Nice piece in today’s Financial Times (paywall, so I’m reproducing it below). Interesting fact: The “Yes” campaign in Scotland gets 80% of it’s funding (£3.5 mn) from just one lucky lottery winner.
June 13, 2014 7:03 pm
The whims of the super-rich can turn politics into a lottery
By Gideon Rachman
Courting the rich is both necessary and dangerous for politicians
So this is what the future of the United Kingdom comes down to? Harry Potter versus EuroMillions. On September 18, Scotland will vote on independence. The news that JK Rowling, author of the Harry Potter oeuvre, has decided to give £1m to the Better Together campaign is a welcome boost to the pro-union campaign. Until now, it has struggled to match the financial firepower of the pro-independence campaign, which has benefited from £3.5m donated by Chris and Colin Weir, a couple who won £161m playing the EuroMillions lottery in 2011. All told, the Weirs account for about 80 per cent of the funding received by the Yes campaign.
The idea that the UK’s survival might hinge on the political preferences of two lottery winners is unsettling. And the Scottish referendum is not an isolated example. Across the world, from the US to Asia, elections and political campaigns are shaped by massive donations by rich individuals.
The financial flows behind these political whims can be complicated. On a recent stay at the Marina Bay Sands hotel and casino in Singapore, which is owned by Sheldon Adelson, it struck me that I was watching Chinese gamblers enrich an octogenarian American billionaire, who would in turn use the money to fund Republican political candidates who support Israel. Most parts of the world seemed to be affected, one way or another, by the spinning fruit machines of Singapore.
Mr Adelson’s political donations have so far been lavish but not particularly effective. According to The Washington Post, he spent more than $90m backing losing candidates in the last US presidential election. This time round, he intends to place his bets more carefully and, according to an aide quoted in the Post, is looking for a Republican candidate “who has convictions but is not totally crazy” – a more difficult task than it sounds, given the state of the party.
Other billionaires have been more fortunate with their political spending. Although the precise amount of money that the Ambani family directed towards the campaign of Narendra Modi, India’s prime minister, is not known, it is widely accepted that Mr Modi and his Bharatiya Janata party massively outspent the Congress party in the recent general election. The industrialist Ambani brothers were generous funders of the BJP and have, in turn, done well out of the stock market boom that followed Mr Modi’s victory.
Courting the rich is both necessary and dangerous for politicians. Tony Blair and the Labour party had to return £1m to Bernie Ecclestone after suggestions were made that the Formula One boss had influenced government policy on cigarette advertising. The financial relationship between Nicolas Sarkozy and Liliane Bettencourt, an elderly heiress, provoked a criminal investigation – although the former French president was eventually cleared of wrongdoing.
While money undoubtedly helps campaigns it is no guarantee. Cantor is only the latest victim of the curse of Sheldon Adelson
It is rare to find people who have a completely consistent attitude to billionaire-funded politics. George Soros, the financier, is a hate figure for the American right but a hero to liberals because of the causes he chooses to support. The Koch brothers, conservative industrialists, evoke similar reactions – but in reverse.
Once they calm down, all sides might agree that it would be better to have political systems not so much at the mercy of the whims of individual billionaires (or, in the case of Scotland, mere multimillionaires). But this is easier said than done. In an age of front organisations and fragmented media, capping campaign contributions or spending is far from straightforward. In the US, the government attempted to place legal limits on the amount an individual could give to a single campaign. But that could not prevent multiple contributions to various political organisations, with similar goals – such as the political action committees that then rallied behind individual candidates. The Supreme Court has ruled that political spending is a form of free speech – making caps on individual contributions illegal, and rendering it all but impossible to rein in free-speaking and free-spending billionaires.
The British used to congratulate themselves on controlling election campaign spending, banning television advertising by political parties. But, in the age of social media, that measure looks increasingly beside the point.
Plutocratic funding of politics probably cannot be stopped. So it might be some comfort to reflect that – although money undoubtedly helps campaigns – it is no assurance of success. If Mr Adelson’s billions really could buy the US presidency, Newt Gingrich would be sitting in the Oval Office. The curse of Sheldon has now struck Eric Cantor, the outgoing leader of the Republicans in the House of Representatives, and an Adelson favourite, who has just lost his congressional seat in a Republican primary to a much-worse funded, insurgent candidate.
Similarly, while help from Harry Potter will undoubtedly be hugely welcome to the No campaign in Scotland, the polls suggest that Better Together was still well ahead before the wizard struck, and despite the EuroMillions that have been poured into the Yes campaign. Maybe voters actually have minds of their own? That would certainly make the future of the UK seem like less of a lottery.