Latin America Magazine.

Towards a Latin American Iron Law of Oligarchy?

05-01-2013 by Fransje Molenaar

» Columns

One of my favorite scholars is Robert Michels, who – as a member of the German
Socialist Party in the early 20th century – came up with the famous ´iron law of oligarchy´. This basically means that every party will eventually end up being governed by a small group of close-minded party elites (this led Michels to switch his allegiance to the Italian fascists. Must have been a logical step at the time…) Imagine my surprise when Michels turned up in 21st century Costa Rica as one of the reasons for the Electoral Court’s involvement in the regulation of political parties! Leaving aside the fact that I hate that every work on Latin American politics starts with references to European political scientists (seriously guys, Duverger and Sartori are enjoying their pensions, come up with your own theories!), this seemed a bit like Michels upside-down. Given that we know from early 20th century European writing that parties are intrinsically bad, we should try to cure them – or something along those lines.

This “parties as a necessary evil that must be tamed” is something that I came across during my research in Mexico as well. For those of you interested, my report on political finance regulation has just been published here  (alas, the reason for this blog). It is very long and technical, so I thought I’d provide you with a summary. What are the highlights of Mexican finance regulation? I don’t know where to start; the Electoral Court’s accountants have perfected the strategies to identify each and every expense that parties make in their election campaigns. For example, they regularly check the candidates´ Facebook pages and Twitter accounts to identify campaign events. With this information they can: 1) check whether parties have reported finances of all events, and 2) check whether candidates correctly reported all their travel expenses (no way in hell did you get from Chiapas to Sonora in one day by bus. Spill it, who paid for your helicopter?!?). Be careful what you share online!

Next to digital monitoring, the government’s accountants also visit campaign events to check for themselves what expenses they come across. They have devised formal guidelines for this, which helps them estimate the number of people attending, the costs of stage/lighting/sound-systems, and they take muestras (samples) of all the campaign materials that are handed out so as to prove that costs were made in the distribution of t-shirts and flags as well. Highlight was probably the brooms with the PRI’s logo – how very emancipated (but hey, what can you expect from a president who is commonly suspected of having killed his wife in order to marry a more mediagenetic one). I went on a monitoring mission with the accountants once and imagined myself to be in some sort of detective movie. We were creeping around the campaign event, taking photos of busses and writing down their license plates, so that the finance reports could later be checked for these expenses. Lot of fun actually!

If you want to see President Enrique Peña Nieto try to explain how his wife died, see 2:12 of the following interview

So, is my report merely full of praise? Unfortunately not. It seems to me that the Mexicans have regulated everything that can be regulated and that they are now faced by the limits of the system. This means that they can trace every electronic financial transaction (no bank and fiscal secrets for the government’s accountants) but what to do with cash transfers…. In a country with a substantial informal economy, that is a serious limitation to political finance control. Also, the law has regulated everything to do with formal party income and expenses, but is rather quiet on matters such as vote buying and the influence of drug money in politics. Why not make these topics the prime center of attention? Isn’t this what really messes up politics? Lastly, the auditing unit is a very professional and well-organized institution among … chaos. Hardly any regulation of local political finance, hardly any pro-active cooperation of the other institutions involved in finance more generally; it is a lonely fight.

But perhaps most difficultly: can you really force political parties to change their behavior? It seems to me that this type of monitoring institutions gets engaged in a cat-and-mouse game with political parties that are unwilling to change their behavior and that start to apply white-collar-crime-like practices. The party officials that I interview can recite all the European political corruption scandals by heart. Although to me it is not clear why you would refer to a German corruption scandal of the early 90s to justify your own behavior, they use to prove that parties are corrupt in itself – and we should hence allow them to be so? Rather depressing really, that all these European references seem to be doing nothing more than absolve the parties from any responsibility over their own functioning and behavior. Latin America is a unique region with unique institutions. I say: let´s put the focus back where it belongs – within!