By Magnus Ohman
What country has the most expensive election campaigns in the world? At a first glance the answer may be obvious; in the recent US elections over 2 billion dollars were spent, and combined with the other elections held at that time, the total spending is estimated to over 6 billion.
However, two factors must be taken into account when looking at such figures. The first is that the US has a very large population. There are of course many more people in China, but there are no competitive elections in that country. India is also bigger, but the Indian President is elected indirectly by Parliament, while the President appoints the State Governors, meaning that the direct elections with the largest electorate are for the Lower House of Parliament.
The second factor is the size of the US economy. While exact estimates vary, the nominal Gross Domestic Product (GDP) of the US is twice that of any other country, and since the second country is China, the second largest democracy, Japan, has a GDP that is around a third of that in the US. To give two illustrative examples; US military spending is higher than the GDP of Switzerland while American annual spending on peanuts is higher than the GDP of Fiji.
Since there is so much money in the US, we should expect election campaigns to cost a lot of money. A comparison often made by Commissioner Ellen Weintraub of the US Federal Election Commission is that Americans spend more money on celebrating Halloween than they do on the Presidential election campaigns (which always take place shortly after Halloween).
So, when comparing the costs of election campaigns we must take these factors into account (note that all figures mentioned here must be interpreted with care, since exact spending figures are difficult to ascertain). If we start with the first, a comparison between the US 2012 spending with the estimated amounts spent for the multiple elections in Brazil in 2010, we find that the figures are fairly similar ($18 per potential voter in Brazil versus $25 in the US).
However, another estimate on spending on the Brazilian Presidential elections alone would put the cost at $15 dollars per eligible voter for these elections alone, significantly higher than the $8 dollars spent in the US Presidential race. The Japanese political competitors also spend a lot of money on their campaigns, although admittedly less than their US counterparts.
Regarding campaign spending in relation to the size of the economy, it is useful to compare the total spending with the size of the GDP, showing how large the campaign spending is in comparison with the economy as a whole. Again a comparison with Brazil is telling; while the US 2012 Presidential campaign spending amounted to around 0.013% of the GDP, the level was almost six times higher in Brazil in 2010 (0.08%). While the Indian Parliamentary elections in 2009 cost less per voter than those in 2012 did in the US, the impact on the economy was much larger in India (an estimated 0.08% compared to 0.03% in the US).
The same goes for Ukraine, where the official spending reports for the 2012 Parliamentary elections amount to 0.125% of the country’s GDP – more than four times that in the US. Official figures from the local government elections in Moldova are only slightly lower than those from Ukraine.
These comparisons show that while the spending on the 2012 US elections were very high in an international comparison, they are not as spectacularly high as they may seem at first glance. Admittedly, many older democracies in Europe spend much less; the cost per voter in the US Congressional campaigns were almost ten times those in the most recent UK general election campaign, while the spending in relation to GDP was more than 20 times higher in the US.
In the 2007 French Presidential elections, spending was less than one eighth of that in the US. However, other countries (especially outside of the older democracies) spend more than US politicians when we take into account the size of the electorate and especially the size of the country’s economy.
Two points should be made here; unfortunately we can only make comparisons with countries from which information is available. I have a strong suspicion that the 2010 election campaign in Nigeria was among the most expensive in history when taken into account the size of the electorate and the economy. Unfortunately, there is no reliable data on campaign spending in Nigeria (the political parties ignore the reporting requirements that exist with impunity).
The next is the future of campaign spending in the US. A number of individual races indicated strongly that spending the most money does not necessarily guarantee victory, and there was a strong sense of campaign fatigue among the electorate. This could be factors in favour of reduced spending in future elections. On the other hand, negative advertising seems to remain effective, and this could force candidates in future elections to continue increasing spending; not to get their own message out but to damage the chances of their opponents. This is a very worrying development in US election campaigning.
A final note; US politics works somewhat differently than in other countries, not least because of the limited role that political parties play in organising political activities. Taking political party work into account and using spending data mainly from the 1990s, Karl-Heinz Nassmacher placed the US in the group of “intermediate spenders”, rather than in the group of “excessive spenders”, which included Austria, Israel, Italy, Japan and Mexico).
Dr Ohman is the International Foundation for Electoral System's Senior Political Finance Advisor.