German party finance; from the sublime to the ridiculous

Strange things have recently been afoot in the normally sanguine world of German party finance.   Back in October 2014 the Alternative for Germany (AfD), a new(ish) right-wing party, mutated in to a gold selling business so as to claim extra funds from the state (see here). This was quickly followed in December 2014 by ‘Die Partei’, a satirical party with one MEP (see here), deciding that it would take the oddness one step further. It began selling money to help it access public funds to which it otherwise wouldn’t have been entitled (see here for an English language summary of both cases).

By December 2015 the sublime was turning in to the ridiculous. The AfD was once again involved, although this time unwillingly. Despite a year marked by internal strife (see here), the AfD was flying high in the polls. Indeed, for the first time in its history it was registering around the ten per cent mark as it looked to make the most out of not only the Eurocrisis but also Europe’s summer of immigration trauma (see here for more on the AfD’s rise).

The AfD’s successes were clearly too much for some of its opponents. Members of ‘Die Partei’ (yes, them again) and a number of small, left-wing activists launched a campaign on the internet (see here) that had the potential to financially ruin the AfD. Not content with opposing the AfD’s policy package they called on the AfD’s opponents to donate money to the party.   How, one might ask, would donating money to a party potentially cause it problems? Surely the more money a party has, the easier it is for it to carry out its daily affairs? No, not always.

How was the ruse going to work? Anti-AfD Germans were asked to donate small amounts to the AfD – the numbers in play couldn’t get much smaller, in fact, with 10 cents being the amount mentioned. They were asked to do this online, by transferring money via companies such as PayPal or Sofort (simply a German version of PayPal). Every time a payment is made via one of these providers, the receiver (in this case the AfD) has to pay a commission. This varies from provider to provider, but Der Spiegel (Germany’s largest weekly newspaper) reported that the costs tend to be between 0.9 and 1.9 per cent of the value of the transaction (see here). On top of that every transaction comes with a flat fee – again this varies, but it’s generally between 25 and 35 cents.

So, in theory, a 10 cent donation could cost the AfD roughly 30 cents. The AfD would be able to claim back some of this via the system of state subsidies, but not enough to cover the transaction charges. For every Euro that the AfD raises it gets 38 cents from the state – it doesn’t take an expert in arithmetic to work out that that would still leave the party well short of being able to cover the costs that come with these donations.

On the one hand, the AfD reacted in a reasonably relaxed fashion to the threat of death by donations. It claimed, for example, that it had good relationships with the likes of PayPal and Sofort and that the contracts it signed forbad charges from being levied that were greater than the transactions involved. If that’s true, then the AfD is indeed covered and has nothing to worry about. Indeed, a few clever-dick activists trying to bring a party down can often help a party make itself look like it’s the victim of a campaign, and that can go down very well with potential supporters. A case of all attention being good attention, maybe.

On the other hand, if all really is that sanguine then one wonders why the AfD has threatened to take legal action against those pushing the initiative. The background to these concerns is quite complicated, but in essence the AfD is worried about hacking campaigns and data management. Come what may, the party made it clear that if any of these ‘campaigns’ are seen to help the AfD’s opponents undermine its online presence, then the AfD is clear about who it will be holding responsible.

Huffing and puffing to one side, all of this might ultimately be of little real relevance anyway.  By 11 December it was being claimed that the princely sum of Euro 167.23 had been donated in this fashion, hardly the stuff of which financial ruin is made.  But, for a party where money is very tight (see here for more on that), it’s clear that the insurgency is nonetheless an awkward distraction.

The sight of Germans ruthlessly applying rules in absurdum is in and of itself mildly amusing, but these cases also tell us a little more about what we should and shouldn’t expect from party-funding debates. The German party-funding regime is short on neither laws nor judicial attempts to interpret them, but that hasn’t saved it from parties and activists trying  to ‘play the game’. Party funding regimes never stand still as rational actors do their level best to get the most out of them – or indeed to attack their opponents via them if they can.

In and of itself it is unlikely that the AfD will fall apart at the seams on account of these donations, but it does show us that creative souls will use loopholes to further their own interests.  Sometimes in a decidedly comical way, but sometimes in potentially more serious ones.  One good reason to keep an eye on developments in funding regimes (in Germany and beyond) in the years to come.

Dan Hough

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