No more Christmas in May?
On social media, we have videos of politicians handing out P1,000 bills, not for vote-buying but as ayuda for the unfortunate.
Some comment that votes are supposedly for sale in the May elections at P5,000 each. This is fragmentary data. We do not know what P5,000 is buying. Is it for just one candidate and one office? Or is it for a ‘straight’ ticket? Is it ‘cheap’? Who finances all this activity?
In order to shed light on the matter, we can try to build an economic model or theory that aims to explain or predict the extent of vote-buying.
We start by considering that the value of a ‘bought’ vote can be derived from its potential ‘recovery’ by the winning candidate. We then estimate the ‘market size’ for each office up for grabs, and multiply that by the number of vote-buyers, to get a total of moneys spent on buying votes.
Suppose that X wants to be President in a country with about 60 million registered voters (as reported by Comelec). How many votes might X buy? He may think that to be safe, he needs 10 million such votes.
How much would he pay? Suppose a vote reseller (known as a ‘party lider’) tells X that the going price for a presidential vote is P5,000. X will think that he has to pay P50 billion.
Will he do it? If he thinks that he can steal at least that much over the six-year term of a president (a big ‘if’), he will do it. Of course, he may not have the cash up front, but his ‘business friends’ will likely lend him the money. It is an open secret that politics and business mix like cookies and cream.
But X is not alone; he is likely to face Y who has the same decision problem. Y may also be willing to pay P50 billion.
Suppose that Z, a third candidate, is also ‘in’ on the operation. The astute vote- seller will then think that he can collect from all three, and he tries to get P15,000 for his vote.
I imagine that the multi-party system sets up a better deal for the vote sellers, compared with the old two-party mode of elections. For the country as a whole, we then estimate that P150 billion may well be needed to effect a presidential vote-buying operation.
The P50 billion minimum ‘recovery’ by a successful presidential contender doesn’t have to be in money; it can also be the non-pecuniary benefit from being a head of state or a respected statesman.
The same consideration applies to other candidates, who may be tempted to buy votes to achieve a certain stature in political circles.
Historically, there are instances of candidates who didn’t spend much for their candidacy, and won, and likewise didn’t steal.
Such respectability is allowed under our model of vote-buying since we do not assume that all candidates will buy votes; neither will all voters sell.
Our model also allows for candidates to buy votes, and yet still lose.
To a moralist, such ‘bad luck’ is a case of just desserts. He who attempts to buy an office might find that the office doesn’t suit him, and a loss is not exactly the end of the world.
A similar arithmetic can be had for other elective offices. On rough calculation, I can estimate P100 billion of spending by other candidates. How do I come up with the P100 billion figure?
For the senatorial race, the ‘quoted’ value (again from the liders) is perhaps P500 per vote. This smaller value is not unreasonable; senators are ‘a dime a dozen’ compared with a president.
Perhaps the vote-buyer thinks he needs five million votes. He, thus, might spend P2.5 billion.
How many candidates will buy? Assume ten; these will likely be found among those who are unsure of victory but ‘are close’ to it. We then have P25 billion for the senatorial race.
For congressional seats, the individual vote is perhaps also priced at P500. A ‘buying’ candidate thinks he may need to secure 60,000 votes out of a likely total of 250,000 votes cast (we get this by dividing 60 million by 250 district seats, and then assuming that the ‘safe’ margin is a fraction of total votes); the candidate, therefore, needs P30 million.
That seems cheap for a congressional seat, but never mind. Because it is cheap, at least 500 will buy (there are about 350 seats, including party-list and Bangsamoro seats). We then have a ‘market’ size of P15 billion.
The cost of a simple vote in mayoral races in cities and municipalities should be cheaper than P500, although this also depends on the income level of the local government unit.
However, we consider that votes here are sold on a ‘full ticket basis’ – it includes the vice-mayor, the councilors, and the barangay officials. A rough estimate for such a full-slate price is P2,500.
To be safe, the average vote-buyer in these elections will try to secure something like 10,000 full-slate votes (the average voter count for cities and municipalities is less than 40,000 – based on dividing 60 million into 1,600 cities and municipalities). Each market is then worth P25 million.
If 2,000 candidates are willing to buy votes, then total vote-buying amounts to P50 billion. Is it surprising that the total spent on vote-buying for mayoral elections is bigger than for senatorial or congressional elections?
Provincial races can likewise be calculated. We assume that as with the mayoral races, the vote price is for a full slate of governor, vice-governor, and board members, and the full-slate vote price is P1,000.
The average voter turnout in a province is about 750,000; we then estimate that the ‘safe’ buy is for 125,000 votes, or about 1/6 of total votes. Thus, the average size of the market for bought votes is P125 million.
If 80 candidates are ‘buyers,’ then total money spent on buying provincial elections is P10 billion.
Altogether then, something like P250 billion of vote-buying is ‘predicted’ by the vote-buying model. This does not include spending for legitimate purposes – advertisements, surveys, information drives, sample ballots, election watchers, etc. This also doesn’t include other shady operations – fake surveys, trolls on social media, praise releases in mainstream media, insider cheating (the old dagdag-bawas schemes that supposedly are no longer possible with the advent of computerization), etc.
The calculations above can be very wrong. If people were substantially more honest, the calculated figure of P250 billion is too high; the more likely outcome could be something like P50 billion. Such a low figure would, however, fly against the sense that P50 billion is ‘peanuts’ to the big business leaders who are often asked to contribute to election campaigns.
If the top businessmen were to protect their billionaire statuses, they could collectively easily shell out more than P100 billion for the presidential contest alone (as of the latest, the 15 richest US dollar billionaires in the Philippines have a net worth of over $40billion, or P2 trillion; and P100 billion would amount to about five percent of the total wealth of just these 15).
They will likely also support senatorial and congressional candidates if only because tax laws and exclusive franchises are important pieces of legislation. Thus, big business – including others below the Top 15 – is perhaps good for P200 billion of contributions, though, of course, not all of that will go to buying votes. Some of that, possibly a large part, is also from goodwill and intentions.
There are also sources of campaign financing other than from big business. Here, we can think of self-help.
The candidates themselves are not typically poor. Some have inherited wealth, which shows up in ‘dynastic’ political families. Others may be benefitting from protection money paid by scofflaws.
Collectively, the vote-buying candidates may be able to match what their businessmen friends can give. This is a case of risk-sharing by the two groups. We’re then already at P400 billion.
Again, not all that will go to buying votes. The truth may thus fall in the range of greater than P50 billion, and nearer to the P250 billion suggested by the economic model.
Of course, we ignore legitimate grassroots financing. It is hard to imagine that ordinary people will contribute small amounts that they can afford if the recipient will use those for vote-buying.
Thus far, the theory we have sketched is of limited use for predicting the outcome of the elections. Just because a particular candidate is financially adept does not mean that he will necessarily win.
As the Good Book (Ecclesiastes) says, ‘the race is not to the swift nor the battle to the strong.’ Here, I confess to being a religious economist; I believe the Deity works in mysterious ways.
Is it wishful thinking to imagine that enough voters will ‘double-cross’ the vote- buyers, thereby limiting the effectiveness of vote-buying? Is it wishful thinking to pray that honest candidates get a good boost from the general voting public, including those who would typically be the ‘market’ for vote-buying? There are those who believe that 2022 will be the year of the honest voter.
How would we know if the model is any good? We might say that the test of the pudding is in the eating; we might know if we could get voters to admit that they sold votes (the politicians will likely just make denials). But there is a less onerous test.
Note that we can assume that all this vote-buying is done with cold cash. Nobody wants receipts or electronic evidence. Cash will have to be hoarded prior to the May election, and spent for it, while the vote-seller gets to spend his vote ‘revenue’ soon thereafter.
We should, therefore, expect a ‘hump’ in the data reported by the Central Bank as ‘currency in circulation.’
This hump – likely in the form of P500 and P1,000 bank notes – will be in addition to the Christmas season bump up.
As of the latest, cash in circulation is something like P1.7 trillion. P250 billion is roughly 15 percent of that amount. It is something that cannot be hidden, especially as banks are now more sensitive to the rules on anti-money laundering. It is also something that the Central Bank can readily monitor since it prints and manages the money.
If we do not observe a hump in the cash data, this suggests that the vote-buying model or theory is wrong, and that people don’t buy/sell votes. This would be an occasion to celebrate honesty, particularly as we might also expect that more honest candidates will win!
On the other hand, if we have a hump in the data, this just means that the theory is not proven; it does not mean that the theory is necessarily correct, as there are other factors that can cause an unusual increase in cash in circulation, such as gambling, terrorist financing, or illegal drugs. But we may have more confidence in thinking that vote-buying is going on as usual.
It is somewhat ironic that we would wish the theory to be mistaken, if only because an honest election is a public good. Unfortunately, wishful thinking is just that.
We, thus, have an economic model or theory of vote-buying. We know that economists are at times crazy and prone to making all sorts of assumptions just to make a point. Watching the behavior of cash in circulation would be a nice test of economic theory.
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Author’s email: [email protected]; Twitter: @ORoncesvalles
@ORoncesvalles
