Mexico’s Ruling Party Wants to Rip Up Rules on Campaign Cash

Mexico’s ruling party is seeking a constitutional overhaul to eliminate all public funding to political parties months before presidential elections, a move that could benefit the party in power more than any other.

The PRI party presented the bill Monday in the lower house to have private contributions replace public resources, saying the measure would save the government 6.8 billion pesos ($373 million) ahead of 2018 elections. Currently, Mexico strictly limits private donations and has granted hefty public funding to parties since the 1990s in order to even the playing field after the PRI ruled the country uninterrupted for seven decades.

Then, two earthquakes this month took more than 400 lives in Mexico and political parties responding to public outcry began swearing off government funding to help pay for rebuilding efforts. While it would be beneficial to gradually reduce the enormous amount of taxpayer pesos that flow to political groups, analysts warn the PRI’s measure is probably more self serving and would give the party an edge in the upcoming elections.

The second quake in less than a month struck Mexico Sept. 19. Eric Martin reports on “Bloomberg Daybreak: Americas.”

(Source: Bloomberg)

“This crisis is an opportunity for the PRI,” said Carlos Bravo, a political scientist at Mexico City’s Center for Economic Research and Teaching. “The party in power could have more advantages.”

Cutting off all public funding would cause parties to resort to any means necessary to collect cash, and would benefit the ruling PRI because it holds more governorships from which to siphon off state funds for its campaigns, Bravo said. The bill would also eliminate positions of dozens of lawmakers chosen through a system of proportional representation, which would hand the PRI a majority in the lower house it doesn’t currently have, he said.

Luis Carlos Ugalde, a former top electoral official who runs Integralia Consultores, put it simply in an interview on El Financiero Bloomberg TV: “The proposal to take all public money away from political parties is crazy, it’s irresponsible, it’s demagogic.”

The PRI wouldn’t comment on analysts’ reaction to its bill.

Drug Money Risk

Already, anecdotal evidence suggests “unregistered” private contributions dominate most elections, according to a study Ugalde published in 2012. Privatizing all campaign…

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