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Notes on the Brazilian Case Bruno Marques Schaefer1

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The Logics of Party Money Distribution: Notes on the Brazilian Case Bruno Marques Schaefer1 Abstract: In the last years, research about elite recruitment, party organization, and electoral financing has been developing in Brazil. However, these studies focus on proportional federal elections, leaving several gaps in studies about competition for other positions. In this paper, I seek to fill this gap by comparing the parties’ strategic behavior regarding the distribution of resources of two extremely important positions for the functioning of the Brazilian political system: governor and federal deputy. My research problem is: how do Brazilian parties allocate financial resources - private and public - in the governor and federal deputy elections? Much has been said that Brazilian parties would be organizationally fragile and without fixed ideologies. Without denying the findings of the literature that make such statements, it is important to emphasize that Brazilian parties have control and coordination mechanisms when it comes to the distribution of money, in electoral and non-electoral periods. National Party Committees (NPC) receive public funds from the Party Fund every month and, at the time of the elections, they are also the destination of corporate and other donor resources. With this power, the NPC’s can choose which candidates within the party will benefit the most. My hypothesis is that Brazilian parties distribute financial resources to the incumbent governor and state legislator candidates in states where the level of electoral competition is low, and the rewards are high (positions for distribution). In order to test this, I analyze data from the 12,288 candidates for governor and federal deputy in the 27 Brazilian states in two elections: 2014 and 2018. The dependent variable is the percentage of resources allocated by candidate in a given election considering the total distributed by the party. I consider as independent variables the following: the number of incumbents in the state, the level of competition in the immediately preceding election, the electoral rewards in the district and the electoral strength of the party in the district. Key Words: Political Finance; Electoral Legislation; Party Organization; Party Resources. Introduction Financial resources are one of the most significant variables for electoral victories in the democratic world (KRAUSE, 2010). The literature about electoral financing has been fruitful in discovering the impact of money on the number of votes (JACOBSON, 1981; SPECK & CERVI, 2016; NETTO & SPECK, 2017; ARRAES et al, 2017; AVIS, 2019); on the candidates who receive more money than others (McMENAMIN, 2010; JUNCKES et al, 2019); as well as possible rewards from funders over donors 1 Ph.D. candidate in the Program in Political Science of the Federal University of Rio Grande do Sul. CAPES Scholarship. Email: [email protected]. (AGGARWAL et al, 2012; DE FIGUEIREDO & RICHTER, 2014; FONSECA, 2017; MANCUSO et al., 2019). The money also serves as an indicator for characterizing the organizational typologies of political parties. Maurice Duverger [1951] (1992), in his classic “The Political Parties”, points out that one of the differences between the cadre and the mass parties is that the first depends primarily on the contributions of their candidates, while the mass parties come to depend on their members’ resources. A broader base of small contributions strengthens party leadership over party candidates. Katz & Mair (1993, 1995, and 2009) frame this phenomenon in a theoretical model that considers three faces of party organizations: party in the public-office (PPO), party in the central-office (PCO) and party on the ground (POG). In Duverger's typology, the mass party is an organization in which the PCO controls the PPO. In this sense, the links between types of donors and political parties could serve as one of the indicators of the type of party organization (KRAUSE et al, 2015). At a systemic level, a country's political finance legislation could even be one of the variables that determine the size of the party system (MENDILLOW, 1992; SCARROW, 2006). In any liberal democracy, money is a necessary asset to electoral victories. For this reason, it is important to study how parties spend the money they receive. In the Brazilian case, significant institutional changes regarding the forms of electoral financing have occurred in recent years (MANCUSO, 2020). Recent corruption scandals, uncovered by the “Car Wash” (Lava-Jato) operation, showed that large companies, especially in the construction sector, had been donating money to candidates from various parties with expectations of future gains (CARAZZA, 2018). One of the reactions to this scandal was the change in the legislation on electoral financing in the country. In 2015, the Brazilian Supreme Court (Supremo Tribunal Federal - STF) ruled that corporate donations would be prohibited on Brazilian elections (KRAUSE & KESTLER, 2017). The impact of the decision was strong because companies were the main donors of Brazilian electoral campaigns. One of the reactions of political actors was to increase the amount of public money available to parties and candidates since that decision. Brazilian parties are yearly funded by public money from the Party Fund (Fundo Partidário -FP), which in 2018 distributed around US$ 172 million. In 2017, the National Congress (Senate and the House of Deputies) approved an Electoral Fund (Fundo Especial de Financiamento de Campanhas – FEFC) available every two years to parties, which in 2018 made available to party organizations US$ 417 million. This money is distributed to parties according to proportional criteria (votes in previous elections) and is available to National Party Committees (Executivas Nacionais – NPC), that choose which candidates will benefit from it. Much research has been done on the origins of electoral and party funding sources and on the impacts of economic power on dynamics of electoral competition and government policies in Brazil (SPECK & CERVI, 2016; NETTO & SPECK, 2017; ARRAES et al, 2017; AVIS, 2019; FONSECA, 2017; MANCUSO et al., 2019; PAZ, 2018; MANCUSO, 2020). However, there is still a gap to be analyzed which concerns the reverse direction. That is to evaluate the dynamics of the distribution of financial resources within party organizations, both in its logics and its effects on the internal political competition of the organization. Hereof, my research problem in this paper is to identify how Brazilian parties allocate these resources. To answer this question, I make a two-dimensional exploratory comparison. First, I make a comparison between two elections/campaigns: 2014 and 2018. In 2014 business donations were allowed while in 2018 they were not. Second, I compare two positions: governor and federal deputy. In Brazil, there are two electoral systems for the election of political positions: proportional open list for the legislative positions of councilor, state deputy and federal deputy, and plurality for the positions of senator, mayor, governor and president. The last three are Executive positions to which there is a second round in case a candidate fails to reach 50% + 1 of the votes. In the last years, several pieces of research about elite recruitment (CODATO et al, 2013; 2014; MARENCO DOS SANTOS & SERNA, 2007), party organization (RIBEIRO, 2010; SCHAEFER, 2018) and electoral financing (BRAGA & BOURDOKAN, 2009) were developed in Brazil. However, these studies focus mainly on proportional elections for federal deputy, which leave several gaps on research about the competition for other positions. In this paper, I seek to fill this gap by comparing the strategic behavior of the parties regarding the distribution of resources to two positions extremely important for the functioning of the Brazilian political system: governor and federal deputy. This paper is organized as follows: in the first part, I review part of the literature that deals with the strategic behavior of political parties regarding the distribution of financial resources in different democracies. In the second part, I briefly describe the Brazilian case. In the third, I indicate the operationalization of the dependent and independent variables and the analysis model. In the fourth, I analyze the results and, finally, I make the final remarks. How do parties allocate resources in democracies? Political parties are central actors in democracies (LAPALOMBARA & WEINER, 1966). Despite the disbelief of these organizations to public opinion, political parties continue to serve as filters for political representation, selecting the political elite that will govern and legislate (SCARROW & WEBB, 2017; WEBB, POGUNTKE & SCARROW, 2017). As I pointed out earlier, parties exercise control over part of the money circulating in elections. The degree of this control and the strategies for allocation and distribution of financial resources, however, depend on several variables, such as the electoral financing legislation ruling the country under analysis, as well as the government system, state format and the type of electoral system. In presidential regimes, for example, the parties, can concentrate their financial efforts on competing for the top office: the presidency (ACUNA et al, 2018); while in parliamentary regimes the more equitable distribution of resources can be instrumental to the party's electoral victory. The format of the State - whether unitary or federalist - is also one of the variables
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