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You’ve probably heard politicians mention the influence of money in politics, but how does it actually?

Does Money = Victory?

A recent study conducted in 2020 found that there is a strong correlation between campaign spending and election performance, thus illustrating how candidate spending indeed significantly impacts the decisions of voters. 

In perspective of how money can take precedence…

During the 1993 UMNO party election between Anwar Ibrahim and Tun Ghafar for the Deputy President post, it was alleged that “RM200-300 million” had been spent by one faction. In 1995, one candidate allegedly spent RM6 million to secure the post of division chairman. Following this, Tun Dr Mahathir, the then President of UMNO in 1996, banned campaigning for party posts. 

In the context of elections

According to Rafizi Ramli, the former MP of Pandan, the costs of campaigning as a member of parliament may start at a minimum of RM250,000. The basics include:

  • T-Shirts
  • Flags
  • Advertisements
  • Field workers’ salary 

Other costs may include gifts, advisors, poll monitors, survey institutes, travel expenses, remuneration for attending meetings, and more.

When Candidates want to double down

Aside from the bare minimum costs, candidates can go beyond by spending on;

Advertising

  • Political advertising, such as street banners, is a powerful way to reach and influence voters. 
  • Unlike previous campaigns, social media technology has allowed candidates to reach target voter groups with little physical effort.

Communication cost

  • Unlike advertising, communication is two-way and requires more physical effort. 
  • Strategies may include holding press conferences, rallies, and events

Market research

  • Research allows a greater understanding of the behaviour, needs, and wants of key voter groups. 
  • It informs strategic decisions on communication and advertising to educate, persuade, and reinforce existing views.

When cash is king:

Given the strong correlation between campaign spending and election performance, politicians may resort to the wealthy elites to fund their campaigns. 

When Politicians rely on wealthy individuals or corporations to fund their campaigns, patronage may occur, where political parties provide business favours in exchange for funding. The favour could include access to contracts, speedy government approvals, etc When candidates win elections, their donors expect that they are to be compensated. This may result in policy capture, where public policy decisions are repeatedly oriented away from the public interest and towards a specific interest, thereby worsening democratic principles..

If we were to talk about 1MDB…

1MDB was initially established by former Prime Minister Dato Seri Najib Razak in 2009 under the pretence of promoting Malaysia’s economic development and improving people’s well-being through global partnerships and foreign direct investment. 1MDB instead became a massive political financing source for the 13th general election campaign. The Malaysian Anti-Corruption Commission also revealed that RM 212 million of 1MDB funds had been transferred to his political party, UMNO.  Among the sources of these funds were from foreign nations, such as a donation from the King of Saudi Arabia of $800 Million. 

Money provided from a foreign nation allows them to influence the decisions made by those elected. This raises the question: why are their wants prioritised over the rakyat?

The Limits: As they exist now

  • According to the Election Offences Act 1954, candidates for a parliamentary seat are permitted election expenses up to RM200,000 each, while the maximum amount allowed for a candidate contesting a state seat is RM100,000.
  • However, as we’ve established, electoral campaigns are costly and politicians are tempted to spend far more than the spending limits allow to achieve victory.

The law, contradicts as former MP, Rafizi Ramli puts it, an “ open secret” that a parliamentary seat campaign at minimum could cost RM250,000 . When money takes precedence in our elections, it may undermine our democratic processes. It begs a reflection on what we want our politics to be. Do we want our leaders to be elected on the merit of their policy proposals and principles, or based on the wealth they’ve accumulated?

Money and Politics going forward

Though money is a necessary expense in elections, if unregulated, could get out of hand. As established, it may create problems of money based factionalism, policy capture and patronage. Going forwards, how our politics is conducted largely depends on what you think is important. Do you think it should be policy based or who has the largest pockets?

But one thing is certain, if money indeed takes precedence, politicians who have little resources may be forced to find funding from nefarious sources, and the cycle of money politics continues.

References

Azmi, K. S. A., & Zainudin, R. (2020). Money in politics: a recipe for corruption in Malaysia. Journal of Financial Crime, 28(2), 593-606.

Falguera, E., Jones, S., & Ohman, M. (2014). Funding of Political Parties and Election Campaigns: A Handbook on Political Finance. International IDEA.

Schuster, S. S. (2020). Does Campaign Spending Affect Election Outcomes? New Evidence from Transaction-Level Disbursement Data. The Journal of Politics, 82(4), 1502-1515. doi:10.1086/708646

OECD (2017). Preventing Policy Capture: Integrity in Public Decision Making. OECD Public Governance Reviews. doi:10.1787/9789264065239-en

Vaswani, K. (2018, May 11). Corruption, money and Malaysia’s election. BBC News

Office of Public Affairs (2021, August 5). Over $1 Billion in Misappropriated 1MDB Funds Now Repatriated to Malaysia. The United States Department of Justice.

Yeoh, T. (2019, July 13). Following the money: Political financing in Malaysia. Asia Research Institute

Saravanamuttu, J. & Mohamad, M. (2020). The Monetisation of Consent and its Limits: Explaining Political Dominance and Decline in Malaysia. Journal of Contemporary Asia, vol. 50, https://doi.org/10.1080/00472336.2019.1569710

The Electoral Commission. (n.d.). Election campaign spending. The Electoral Commission.

The University of Auckland (n.d.). Political Market Research. The University of Auckland.

Detrow, S. (2018, March 20). What Did Cambridge Analytica Do During The 2016 Election? National Public Radio. 

Ivy, JA. & Puyok, A. (2021). Political patronage In election: Impacts of the coalition change in Malaysian federal government on Sarawak’s politics. 8th International Conference On Public Policy And Social Science (ICoPS).


Researchers : Jia Rou, Lua Yun Xin (Kelly)

Reviewers: Muhammad Bahari, Jie Yee Ku, Faith Tan

Editors : Chanel Ng, Siva Nagappan, Kartika Zayad, Wan Nabil Ikram

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