Money Talks

In his book, The Enigma of Clarence Thomas, the American political scientist Corey Robin provides a useful summary of conservative thinking on the intersection of money and political speech: "When it comes to political speech, Thomas proposes, men and women speak most forcefully not through the idle chatter of social media or cocktail conservation but through giving up their money as campaign donations. Donors 'speak through the candidate', Thomas writes". This is conventional enough, but Robin excavates the roots of this thinking in Friedrich Hayek's The Road to Serfdom. Specifically, the idea that the market reveals our true preferences through the price mechanism, whereby we "decide what to us is more, and what less, important". This suggests that the more we value something, the more we will pay for it. At the margin - e.g. if you're down to your last dollar - what you spend it on will surely be your priority, a true moral choice. But what if you're rich? To cap campaign donations would be to deny the rich person the ability to make a choice at the margin - i.e. at the limit of their possible expenditure. 

As Robin sardonically notes, "the Hayekian argument would seem to favour limitations on accumulations of wealth. How are the wealthy ever to make a moral choice if they never approach the end of their riches?" But this is obviously not the conclusion for soi-disant classical liberals like Hayek or contemporary conservatives like Thomas. The argument rather is that there should be no limit on the exercise of political speech through the medium of money, as that would be an abridgement of rights under the First Amendment. Along with the acceptance of corporate personhood - that rights nominally intended to be exercised by the individual are also available to corporations - this has led to a contemporary American polity in which the interests of large corporations and billionaires dominate the political discourse. Political speech is only meaningful in public forums, and increasingly they can only be accessed through money. Speech may be free, but in practice political speech is beyond the buying-power of the vast majority of citizens. It is no coincidence that social media has arisen in parallel with this development, offering the appearance of free speech but ensuring that the clamour of the crowd (or the occult working of the algorithm) muffles most of it. 

Before turning attention to the UK, one final observation by Robin: "Liberal critics will claim that Thomas's model is pure influence peddling, money buying access and legislation, the essence of corruption. Thomas counters that corruption happens only if there is a simple quid pro quo, a bribe, which is illegal. Influence and access, by contrast, are what all citizens seek. Influence peddling, in other words, is the essence of citizenship." It's obviously easy to disguise a bribe, so the fine distinction being made here between vice and virtue is not one that can readily survive in the real world. The equation of money and speech muddies the field by suggesting that cash can change hands in a virtuous manner, so the presence of cash or benefits in kind is not in itself evidence of corruption. What matters is the intent: influence versus bribery. Ironically, this means that larger donations are less likely to be considered questionable. Per Hayek, the more you give the more it is an expression of your true beliefs and thus a moral choice. It is easier to give a Senator, who has legislative authority over a Bill that will affect your financial interests, $1 million than it is to give a Sheriff who recently stopped you for speeding $100.

Unlike the US, the UK has recognised the right of corporations to make political donations since the Trade Union Act of 1913 superseded the Osborne Judgement of 1909. The latter had temporarily banned trade unions from funding the Labour Representation Committee (the forerunner of the Labour Party) after a Liberal-supporting member of the Amalgamated Society of Railway Servants had objected to the use of his contributions in this way. The 1913 Act made political funds lawful but also enshrined the right of union members to opt-out. Succeeding legislation has further tightened this and today members must opt-in to the political fund, if there is one. Historically, the trade unions were the largest contributor to Labour but that has steadily declined since the 1990s. Last year, in the run-up to the general election, they accounted for 27% of the cash donations to the party. In contrast, businesses and individuals accounted for 67%, with two individuals (Gary Lubner and David Sainsbury) jointly contributing more than the unions. 

Over the years, political donations by companies to all of the leading UK political parties have declined. This is partly due to the desire of publicly-listed companies to appear non-political in order to keep all of their shareholders happy (and avoid charges of wasting money that could go to dividends), but it also reflects the growth of private donations by rich individuals, many of whom will effectively be recycling company profits by virtue of their own large shareholdings. More broadly it indicates how much wealth has shifted from public corporations to private accumulations: patrimonial capital, in Thomas Piketty's phrase. Companies are these days more likely to make donations in kind, for example by seconding staff to work in politicians' offices, or by offering entertainment and other freebies that can be explained to shareholders as lobbying or public relations. It is the latter that is currently in the news for the simple reason that it has become pervasive. 

The first defence wheeled out by many Labour ministers when questioned on the subject was a variation of "Everybody does it; it's no big deal". This was a useful insight into their own worldview, particularly at a time when they were calling for sacrifices by welfare recipients, but it wasn't exactly smart. Equally unhelpful have been the party supporters who have attempted to dismiss football boxes or concert tickets as trivial during a cost-of-living crisis, or who pointed out that Conservative politicians have a worse record in accepting free hospitality, not to mention corrupt practice, though this is surely more down to the opportunity of 14 years in government rather than any moral peculiarity. The problem is that these manoeuvres imply that ethics might actually be relevant at a certain price-point, which simply leads to a discussion of what that price might be. £100,000 in declared freebies over a year plus a new wardrobe for the wife appears to be way in excess of that notional number to judge from public opinion. By now you might have expected the spin-doctors to have come up with a better line. That they haven't tells us something significant, and it isn't that Keir Starmer is politically tone-deaf or that the Number 10 operation is distracted by infighting.

What the government appears to be telling us is that buying influence is fine and that the only ethical requirement is that it should be publicly declared. The insistence on that public declaration is not a weak excuse but a proud boast. That act transmutes what could look like a bribe into a legitimate expression of political preference by the donor, a point Rachel Reeves made, though she was unintentionally revealing in describing a "scale" ranging from members and supporters (small donations) to "people who have been successful in life" (large donations). She isn't going to state that the degree of influence is proportionate to the amount of money, because that would be crass, but she is prepared to suggest that the largest donors don't have to be supporters, let alone party members. The fact that so many Labour politicians have appeared nonplussed at the idea that they would be swayed by some Taylor Swift tickets, which they only took for the benefit of their kids, is not them playing dumb. They understand that what will sway them are much larger donations, not to mention non-executive directorships and plum consultancy gigs.

The Labour Party's infatuation with American politics used to be largely restricted to the Blairites, but since Obama's first presidency, and the post-2008 counter-revolution it enabled, that infatuation has spread to pretty much all parts of the party other than the left and a few Blue Labour eccentrics. Indeed, the charge of anti-Americanism was a significant sub-text to much of the purge of the left after 2016. This goes beyond the traditional Atlanticism of the Labour right, or the West Wing cosplay of Labour's media outriders at the New Statesman and elsewhere, to a full-on absorption of American political norms, from the jejeune technophilia of the Tony Blair Foundation to a more transactional relationship with the donor class. But while the latter is rooted in its US context in a belief that money is political speech, in the UK it is rooted in a very different history, one in which money is authority. This explains the contrast between the cacophonous US party conventions with their loud protests and Labour's tightly-managed conference where protest is anathematised and dissenters are bundled away.