Party Funding – the Root of all Evil?

Moldovan political parties have presented their half year financial reports to the Central Electoral Commission. There is tremendous variation among the leading parties in terms of their wealth and donor base. According to the data, unsurprisingly, the ruling Democratic party is the wealthiest, having raised over 15.8 million MLD ($790,000) in the first half of 2016 alone.  The bulk of donations came from party members – 13 million MDL ($660,000), other donors – 1.8 million MLD, and only 749632 MDL from membership fees. With 990 donors, the democrats have the largest donor pool and, surprisingly, neither Plahotniuc nor any other prominent party leaders are among the donors, at least not officially. The biggest donor is businessman and former head of Internal Security and Anti-Corruption (sic!) unit of the Interior Ministry, Vladimir Maiduc, who donated 500,000 MDL ($25,000), which is more than 8 years worth of average monthly salaries. Yet, more importantly, Democrats spend a whopping 12 million MDL ($600,000) on a single service contract with the famous American consultancy Podesta Group. One of its founders, John Podesta, is now the Chairman of the 2016 Hillary Clinton presidential campaign. Thus, Plahotniuc is making an investment into future access to the White House, betting that Clinton would win.

Here is how the other parties are doing. PSRM has the second largest war-chest and, in true socialist fashion, all 21 donors donated 5000 MDL each. Statistically it is highly unlikely for such a coincidence to occur without a prior agreement on a fixed donation from a certain group of people. In this context, the impressive amount collected from membership fees also becomes questionable. Similarly, Out Party (PN) led by Renato Usatii did a suspiciously good job in collecting membership fees, particularly as the party had just one donor (lawyer Igor Pohilă) casually donating 400,000 MDL – which amounts to 80 average monthly salaries in Moldova. As a result PN has by far the largest average donation size. Communists are a far cry from their glory days, but fare relatively well, all things considered.  Liberal Democrats are in a tailspin in terms of funding, just as they are in terms of opinion polls. Liberals have rather modest revenues, despite being in power, yet party leader Mihai Ghimpu seems to be doing very well as he alone donated about 200,000 MLD to the party. Leanca’a party finds itself at the bottom of the list with just ten donors and a little over $2500 of total income. This may have served as extra motivation for the party to renounce their role as opposition and join the ruling coalition. Finally, the two newest parties on the block, understandably, do not have much to show for. Yet, if PAS can be excused as it only started collecting donations from the public after the CEC reporting deadline, PDA’s lack of any funding is somewhat suspicious.

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Curiously, Democrats are going to get about 7 million MDL from the state budget as a result of the law passed last year, which introduces public funding for political parties. Yet, the Podesta contract alone is almost twice as expensive as the amount the party is going to receive from the taxpayer. It makes you wonder, does the party really need public funding? Furthermore, are the goals of public funding for political parties (less dependence on private donations) going to be achieved? Well, less wealthy parties are clearly going to benefit. Ironically, as public funding is based on local and parliamentary elections, the almost defunct PLDM will get the lion’s share – 8 million MDL, PSRM – 7 million, PD – 7 million, PCRM – 5 million and PL – 4. Here is a comprehensive report by Promo-Lex on ‘Strategies, practices and tools for financing political parties in Moldova.’

To add insult to injury, no major political party, other than Maia Sandu’s Action and Solidarity Party, even has a call for donations with appropriate bank account information on the website. This is very telling, isn’t it!? Either parties feel uncomfortable asking for donations from citizens, many of whom live in abject poverty, especially in light of the incredibly low public trust in political parties or, more likely, parties feel content with their current process of funding, whereby just one or a handful of donors keeps the party running. Hence, if Moldovans want parties to be more independent and responsive to the voters’ needs, we should  donate, no matter how little, to any party we trust with our money. Otherwise, parties we do not trust will keep on deciding where our hard earned money should go or, even worse, keep stealing shamelessly from the public leaving the voters with nothing but false hope.

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PS: On August 4, Action and Solidarity Party published their income and spending for the month of July, which is when they started collecting donations and membership fees. This kind of transparency is unprecedented for Moldova.

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