The far right is generally more successful today than at any other point in recent history. The chart below shows the average vote-share of far-right parties in 20 ‘advanced democracies’. In the past 70 years, their share of the vote has dramatically increased. Yet even with this dramatic rise over time, these parties are finding it difficult to pose a serious political threat to mainstream parties and form a government in more than a few isolated countries like Austria, Hungary, and Poland. Since 1950, the far right has received on average 4.13% of votes, and very rarely do they cross 10% of the vote.

Meanwhile, research has shown how important fundraising is to electoral success. In my ongoing work, I argue some of this lack of far-right success can be attributed to their difficulty raising funds relative to other parties. Given this, the public financing of elections arguably serves to disproportionally benefit the far right.

The difficulty of funding a far right party

There are important differences between the average voter of a far right party vis-à-vis the average median voter. For one, far right voters in Europe tend to be more economically disadvantaged. Thus, it is no surprise that far right candidates tend to have a hard time raising money from voters. For example, data from the German Bundestag shows that the far right Alternative for Germany (AfD) was by far the lowest funded party in the 2016 election (of those who got seats in the legislature). This begs an important, and oft overlooked question: where is their money coming from?

I argue that we can attribute a portion of the far right’s recent success, despite their lack of large fundraising, to the popular trend of nationally publicly funded elections.

Generally speaking, studies of far right success in Europe find that their support greatly increases as the economy slows. When this happens, people begin to pay more attention to the arguments of far right platforms, which tend to share these common themes:

(1) the current government system has failed us,

(2) foreigners and other ‘outsider’ groups are to blame,

(3) you need our party to fix things.

Of course, when economic conditions are good, it is hard for this argument to take hold. Thus, these parties see their support take off as the economy worsens and they have a persuasive argument to make to the public. Otherwise, voters will likely pay them little attention. What happens, then, when these parties have a large war chest, and thus the ability to make people pay them attention? The answer: a lot.

Public financing and far right party success

In the case of the AfD, some have warned of the potential danger in ensuring all parties have access to funds from the public purse. Given the unique characteristics of the far right and their difficulty raising contributions elsewhere - as mentioned above, the AfD was by far the least-funded party in 2016 - they are likely to be overly reliant on these public funds. Thus, public funding should serve to disproportionately aid in their success.

Indeed, German government data shows the AfD was the party most reliant on public funding (as a percentage of total party revenues) in 2016. This effect is not unique to Germany, but rather can be seen broadly throughout Europe. Greece, for example, passed a public financing law in 2002. In 2004, the first election after the law’s passage, the Greek far right received votes for the first time, and in the subsequent election, they entered parliament. Importantly, this all occurred prior to the economic crisis in Europe.

How would this money disproportionally help far right parties? Broadly, this relationship can be explained by three mechanisms:

(1) public funding erodes incumbency advantage, and far right parties are rarely incumbents,

(2) it dilutes the influence of special interests, who rarely support far-right parties, and (3) it affords them funds they otherwise would likely not be able to raise from contributors.

Beyond this, there is another, equally important effect. The aforementioned findings tying economic performance to far-right vote-share (see, for example: 1, 2, 3, 4, 5) will likely not hold in the same way in the context of publicly funded elections. Given that far right party platforms become more attractive as economies begin to fail, we can characterize a poor economy as ‘pushing’ voters towards the far right. As these parties are underfunded relative to the competition, they rely heavily on economic downturns to build them an audience. Rather, when they receive public funds, they now have resources to mobilize voters, thus they are now able to ‘pull’ voters towards them regardless of economic conditions. In turn, this should lead to an attenuation of the noted relationship between economic growth and far right vote-share.

The purpose of public funding

The most striking feature of these relationships is that they are wholly counterintuitive to the stated purpose of public funding laws. Public funding is often a policy championed strongly by those on the political left. However, rather than providing a worthwhile benefit for their proponents, public funding likely has the effect of aiding those on the opposite side of the political spectrum.

Second, public funding is often described as a way to ‘restore power to the majority.’ Yet, here too, it seems to have an actual effect that is completely contrary to its intended purpose. Namely, rather than restore power to the majority, these policies are likely to do the opposite: reallocate power to those on the political fringe.

It may of course still be argued that the public funding of elections is the more democratic option, after all, voters have decided that these are the parties that best represent their interests. However, I note that these policies have some secondary effects that should be well considered before being implemented.