Can crowdfunding change the political system?

business-ideaTo many American political observers—hell, to many international observers, for that matter—2010 was an ominous year.

Crisis surged, revealing disturbing trends ranging from the environment to the economy to civil liberties. On April 20, the Deepwater Horizon caught fire and exploded in the Gulf of Mexico. The burning hulk would seep toxic crude into the sensitive waters of the Gulf for three months—an ecological catastrophe of unprecedented scale.

Or there were the austerity measures discussed at the Toronto G20. Here, huddled around a table for three days, Obama, Medvedev, Harper, and the leaders of 17 other powers discussed the emerging policies that would collectively punish global societies, perhaps closing them entirely as a result. As if a taste of things to come, Canadian authorities, meanwhile, locked Toronto down, suffocating residents under a police state unseen since the October Crisis of 1970. Toronto had become Kanesetake, First Nations would say.

It was the dawn of the 21st century’s second decade. But as pockmarked as the year was, its most portentous event, analysts said, happened three weeks after New Year’s.

On Jan. 21, a fractured Supreme Court overruled two earlier precedents concerning the political role of corporations, those that prevented them bankrolling political campaigns. Veiled in a cloak of democracy, this hammerstroke at the heart of democracy itself enshrined the “personhood” of corporations, free speech and all, entitling them to spend as they wished. First Amendment rights were extended as an umbrella protection for these suddenly superhuman, monolithic, enormously empowered people.

Bodies of wealthy, invested individuals had become, with a capital “I,” collectively Individual themselves. It was as though a great beast had taken its first breath.

Perhaps presciently, some pointed to the watershed legal decision as the moment representative democracy terminally unravelled in the United States, or the peak of its decline at best. Suddenly flooded with unaccountable corporate dollars, the system, in turn, had become equally unaccountable to its people—something many had been warning all along.

No doubt, the ruling came with some steep competition for the title “Worst Thing of 2010.” But to many, it seemed in a category of its own, a summary attack on the most essential, yet most fragile tenets of Western democracy—or any democracy. Namely that it’s one vote per person, that the system as elected is ultimately accountable to only those people, and that the legal chicanery putting multi-billion dollar corporations on their level, to put it charitably, is absurd. Or worse.

For all the rhetorical dancing used to even argue for the political personhood of corporations, the actual reality that makes it so unacceptable often gets glossed over. The defence contractors, technology conglomerates, and financial interests who comprise the modern-day corporation have the power of the latter-day state. In some cases, that power—to say nothing of the jaw-dropping wealth boasted by some of these giants—eclipses that of entire economies. Certain corporations—think Academi, formerly Blackwater—are better-armed than militaries. By giving them carte blanche to underwrite due process, that process may become so extensively damaged that, in another three or four elections—if that—ours may be a post-democratic system in which the ruling elite elect their own.

It’s all symptomatic, activists say, of the West’s decline—a phenomenon with many faces. Whatever that face may be, observers have diagnosed in America a cancer so insidious, so deeply embedded in the marrow of the nation that—short a worst-case scenario—it’s there for the long haul. Revolution or collapse, whatever comes first.

Caught up in it, the American people have been stirring. Occupy rallies have shut down city cores. Consumers, recognizing a dying system when they see one, have been steadily bailing on the bailed out. As we reported in January, a good quarter of U.S. households have taken to alternative banking methods, everything from pawn shops to payday loans. Crowdfunding itself—the fact that it even exists—may be the best evidence of this.

The question is: can it play a role in restoring democratic power where it belongs?

Such thinking has been readily dismissed as conspiracy theory—think of the South Park episodes deriding activists for blaming literally everything on corporations—but the underlying principle remains unchallenged: in America, indeed the West as a whole, society’s largesse over the last hundred or so years has played a skewed, unbalanced role in deciding who leads it. “Money has changed politics,” remarked Tom Serres in an interview with Mashable, one of the minds behind fundraising platform Rally. “You need to have cash to finance any operation, and a political campaign is no different. You have to spend money to get messages out.”

“Ninety-five percent of candidates,” he suggested, “win because they raise the most money.”

The defining characteristic of crowdfunding, underlining its value as the last lifeboat to leave the Titanic, is its individualized, personal scale. Lenders and borrowers deal with each other directly. Conspicuously absent is the monolithic middle-man of the modern financial institution, the result being an air of authenticity that hearkens back to bartering. But politically, it also presents a means of leveling the playing field for politicians, causes, and organizations whose bottom line may not be conducive to the meddling of corporate interests. For consumers, that middle man is the bank; for political interests, since 2010, it’s the modern-day corporation—an academic difference at best.

Look at it in practice. If, for example, you’re part of a grassroots organization with the toppling of the Super PAC regime in your crosshairs, relying on that system for funding would be hypocritical at best. Crowdfunding, supporters say, may be that system’s counterbalance.

Essentially, though, the use of crowdfunding by the 21st century political set isn’t an example of bold, revolutionary new thinking—arguably, politicos are its pioneers. Politicians have used crowdfunding in one form or another since politicians have had any kind of fundraising strategy. Whenever a campaigner appears on your doorstep, cap in hand, that’s crowdfunding. Whenever you pass a canvasser holding a clipboard on the street, that’s crowdfunding, too. Telethons, still a regular tool of public broadcasting and others who rely on donor dollars, fundamentally use crowdfunding whenever one is broadcast.

Using older tools of media and the outreach available through their use, politicians have made an art form out of raising money, going bigger and broader in scale with each phase of technological evolution. With the form of crowdfunding made available by social media—its 21st-century iteration—one thing sets it apart from its progenitors: with its modern-day applications, crowdfunding can rival the political SuperPAC juggernaut in numbers alone.

Its other value, in political terms, merges dollar signs with less tangible indicators of success.

“Crowdfunding is not a new idea,” states a white paper available at Simplyraise.com. “Startups, venture capitalists, political campaigns and artists, just to name a few, have long used crowdfunding to…raise money to support their businesses or projects. More and more, charitable organizations are using this proven strategy to build creative, flexible and cost-effective fundraising campaigns that not only leverage existing networks, but create new ones.”

In political terms, the math, when democracy is done right, is supposed to go something like this: one vote per person, and the same goes for collected donations. The difference between a campaigner ringing up potential voters with a fundraising pitch and a corporation doing the same is that people, for the most part, have nowhere near the resources available to their newborn counterparts in the corporate world. The billions upon billions available to politicians taking the SuperPAC route tips that math away from the public interest. Worse, it does so in the name of a handful of lobby interests, not the millions of votes upon which democracy is meant to pivot. That, essentially, is the ice at the modern system’s core.

Expanding on the social remedy to this crisis that crowdfunding provides, the white paper goes on. “Besides the obvious benefit of increased fundraising potential,” it reads, “crowdfunding also offers a creative and engaging approach to raising awareness of your mission and, ultimately, growing your brand.”

“Think about it like this. It’s what we like to call the Rule of 10,” it reads. “First, imagine your organization has a donor list of 100 people. Now imagine your organization builds a crowdfunding campaign, and 10 of your supporters participate. Those 10 people create personal fundraising pages and then broadcast these pages to their social networks on a site like Facebook.”

The knock-on result, it suggests, is that the ripple-effect outreach brings a message, political, humanitarian, or otherwise, to roughly 10 times your initial donor base. In an emerging reality where democracy is influenced by a select and very powerful few, fundraising working in tandem with outreach—a basic strategy in both of Barack Obama’s successful presidential campaigns—is a way to resist the forces working against the public at every turn.

Critically, it’s a strategy that, as it does for business ventures, works from the bottom up. Meanwhile, ours is a political culture in which the levers of power tend to be pulled at the top. From down here, tools like crowdfunding, for an engaged populace, may indeed return power to the people—the human ones, not the corporate.

But what’s required first is the political will to do so, not simply the tools. Still, at least we know that much is there.

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