It is said that centuries ago, before Africans discovered that some were Christians, and others Muslim, long before new worlds were discovered, at a time Mount Kenya was known as Kiri Nyaga , there were said to be knights in the European Union Continent. While it is not clear whether the knights roamed the lands in shiny armour, an anonymous source hints that the knights started a scam that is now perpetuated globally in the later day.
It is said that the knights roamed the breads of Europe, and therefore really did nothing for a living, since they were out roaming. The knights were however needed in times of war, where they protected their community and got alms in return.
However, in times of peace, the community got restless and demanded to be reminded what the knights were protecting them from. The knights then went on a retreat, where they cooked up a story, that they had come across some dragons that needed to be slayed. Tales of the fiery dragons are still told today, mostly to kindergarten kids.
The community, now scared of these fiery dragons, needed protection. For a regular fee, the knights would fend off this dragons, and hence tax and government were born.
While the reliability of my anonymous source is not guaranteed, we still pay tax to date, where the government is supposed to use the taxes to provide services such as roads, negotiate with other tax paying countries for trade treaties and provide stuff such as security.
While it is not known how knights came to be, later day governments are mostly elected, in what is supposed to be a democratic election. The definition of democracy has varied widely from China to Russia to Iran to Kenya and to the United States. Irrespective of the definition of democracy, elections costs lots of money, which politicians have to raise from somewhere.
In the United States, they have elections this year, where, as you may have probably heard, Barack Obama is running for re-election against one Mitt Romney, who happens to wonder why aeroplane windows don’t roll down.
For the 2012 elections, Obama has raised $ 690.1 million (KES 58.8 billion) while Romney has raised $ 633 million so far (KES 53.9 billion). So far, they have spend 615.6 million and and $ 530.7 million respectively. Where does the money come from?
Among Obama’s top contributors is the CEO of Dreamworks animations, the founder of chip maker Qualcomm, the National Air Controllers Political Action Committee and United Autoworkers PAC.
Romney is being backed by a casino billionaire, Oxbow Carbon – an oil and gas company, several hedge fund managers and founders.
There also what are known as Super PACs (Political Action Committees) which fund electoral campaigns without disclosing its donors, or amounts donated.
See, in the US, individual donations to a political party are limited to $ 5,000 from individuals and $ 15,000 from PACs. While corporations may have affiliated PACs, they are limited to only funding their administration and running, but they can only raise funds from employees. However, the US, defending their rights to buy fund democracy, formed Super PACs which accepted funding from all and sundry, including corporations, and of any amount. in 2010, a court ruled that Super PACs can receive any amount of money from any person, without disclosing it, as long as they do not directly contribute to a party. Super PACs therefore spend their enormous funds (more than the $ 600 million that Obama has received) in advertising campaigns and other publicity.
Of course the limits were set up due to the discomfort of too much money being poured into elections, which itself was seen as a threat to democracy. The stakes proved to be higher and the money machine found a legal loophole in SuperPACs.
You may wonder why companies and their CEOs in the US may be passionate about funding elections. As inclined one may think is their love of democracy, the truth of the matter is that it is more about policy. See, businesses, and businessmen, at the end of the day need to make more money do more business. More business will be done if the regime in power has supporting policies and/or is friendly.
It is from the above that industry related PACs come in. The tech industry has been quite good at this, with firms such as Google having active PACs. Google’s PAC is quite active in funding candidates that support Internet neutrality rules and other favourable technology bills. Such bills of course mean that more people use the Internet and Google makes more money by serving Ads to them.
Back to Kenya, it is the high time that businesses began funding political candidates and parties. The money here is not free lunch. Of course the funding is to candidates in the return of favourable policies. Prostitutes will fund a candidate who will promote legalisation of their trade, while an arms supplier will find a candidate that promises to take the country to war.
While you may consider yourself (your business) too small to fund a political party, you can form an industry related PAC, which comes up with favourable policy and back a candidate who promotes the same.
Persons are limited to contributing KES 5 million annually to a political party in Kenya (My lawyer pal @Inde_Fatigable says the legal person applies to both people and corporates). However, as we have learned from our friends across the Atlantic, one can contribute to a SuperPAC which acts on behalf of the party without funding the party.
If you remember Triton -who were in some scandal of importing oil that was never delivered, or something close – the guys were easily left off the hook. Triton happened to have funded both ODM and PNU in the 2008 elections in Kenya. Maybe the elections were too close to call for them, or they decided to pull a fast one by funding both potential government and opposition.
It’s the high time that Kenyan businesses stopped ignoring politics and assuming it has nothing to do with them. The stakes are high, as Phares Kaboro points out here. Remember, favourable policies lead to better business, evidenced by the tripling of Kenya’s GDP starting 2003 after years of little growth.
At the end of the day, politics affect your books. Maybe its time you introduced politics in your books too.