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Chapter 5: Breaking into the Cartel

Table of ContenTS
Introduction
Chapter 1 – Making The Best of The System We Have
Chapter 2 – The Current Dynamic is ‘Progressive Versus Conservative’
Chapter 3 – Our Current Party Structures Are Ineffective
CHAPTER 4 – INDEPENDENTS CAN’T FORM EXECUTIVE GOVERNMENT
CHAPTER 5 – BREAKING INTO THE CARTEL
CHAPTER 6 – PATHWAYS TO SOMETHING NEW
CHAPTER 7 – A POTENT POLITICAL FORCE NEEDS PEOPLE
CHAPTER 8 – PRODUCING LEADERS
CHAPTER 9 – KEEPING IT SIMPLE
CHAPTER 10 – DRAFT ORGANISATIONAL MODEL
CHAPTER 11 – PEOPLE
APPENDIX 1 – HISTORICAL COMMENTARY ON THE TWO-PARTY SYSTEM
APPENDIX 2 – AUSTRALIAN COMMENTARY

In the 1990s, English political scientists Richard Katz and Peter Mair published a paper called The Emergence of the Cartel Party.[1] The idea is that the major political parties in countries such as the UK and Australia have, in essence, evolved into a cartel. The parties have created a system of securing state funding for themselves, which accounts for a substantial portion of their funding. According to Katz and Mair’s theory, the major parties have become integrated into the state. The term, ‘cartel’, is commonly attributed to economic cartels, groups of businesspeople who collude in order to dominate a supposedly ‘free’ market.

In the context of political parties, it is the idea of major political parties coordinating with each other to ensure they remain dominant, and that no new groups can come to power. Specifically, these parties use state money and other resources to maintain their positions. It creates a ‘barrier to entry’ to any other organisation. Democracy has a fixed menu of options for government.

A major issue for 21st-century progressives is that ‘our party’ in the cartel, the ALP, is archaic and opaque. The situation would work best for progressives if the main party receiving all the money was open, modern, and transparent. It would give us broader public support, a larger pool of potential leaders and a better chance of winning and performing in government. To better understand this theory, it is useful to look at how political parties have evolved. Katz and Mair identify four distinct ‘eras’ of evolution within political parties, particularly in Western European and English society.

Regime Censitaire (Cadre Party)

This era mainly existed when not many people could vote. Votes were generally restricted to male landowners. The people who made up the politically relevant elements of civil society, and the people who occupied positions of power were interlinked, and often knew each other.

The opposing groups, like the Whigs and the Tories, were comprised of informal social networks and factions. They may have been centred around leaders or ideas but were not formal organisations.

The Mass Party

The mass party started to evolve when all males got the vote in the mid-19th century. As more people gained the ability to vote, political parties became more organised and more formal. The mass party model had organised membership, formal structures and meetings. The classic example of this is the rise of the global labour movement in the 19th century—the disenfranchised elements of society fought for a voice and to be represented within the power of the state.

These parties were explicitly claiming to represent the interests of single segments of society, rather than trying to appeal to everyone. Mass parties acted as agents for the interests of their own groups. The parties themselves were the forums in which that social group could articulate their desires and interests. The rise of this model was also involved with the rise of universal suffrage—all males and then all adults getting the vote changed elections from ‘vehicles by which the voters gave consent to be governed by those elected’ to ‘devices by which the government was held accountable to the people’.[2] Much more recently, Professor Anika Gauja notes:

Although many are increasingly questioning the ‘golden age’ of the mass party and now regard it as a historical episode, it still carries significant weight as a normative model of how political parties should be organised.[3]

The Catch-All Party

The catch-all party model is credited to Otto Kirchheimer, a German political scientist. In his 1966 text, The Transformation of West European Party Systems, Kirchheimer argued the then-modern political party looked for votes wherever it could find them, instead of focusing on any single social group. He believed the party had evolved into being a broker between the state and the public.

This party model recruits members wherever they are found, and does so based on policy agreement, rather than social identity. This method is more aggressive than the defensive nature of the mass party and focuses on a wider audience. Parties under this model are more like brokers between the state and civil society. Katz and Mair describe this as a ‘Janus-like existence’.[4] The parties are simultaneously aggregating and presenting the public’s demands to the bureaucracy of the state, while also acting as agents of the state and defending policies to the public.

The idea that parties act as brokers is particularly appropriate to the pluralist conception of democracy … In this view, democracy lies primarily in the bargaining and accommodation of [independent] … interests.[5]

The position of parties as brokers between civil society and the state suggests that the parties themselves may have interests that are distinct from those … on either side of the relationship.[6]

The catch-all party reduces the amount of power that members hold over leaders, giving more to the overall electorate.

The Cartel Party Model

We see the emergence of a new type of party, the cartel party, characterized by the interpenetration of party and state, and also by a pattern of inter-party collusion … [7]

Katz and Mair argue that across the late 20th century, dominant Western political parties have evolved into something resembling economic cartels—groups which collude with each other to maintain their positions of dominance within the political system. The main way in which the parties maintain the cartel is through state funding based on previous election performance. This produces the large amount of funding needed for the next election, provides organisational stability, and reduces the need for other sources of funding.

Characteristics of the cartel party include:

  1. contained party competition: ‘the parties still compete, but they do so in the knowledge that they share with their competitors a mutual interest in collective organisational survival’[8]
  2. primary funding is public money: parties must receive a certain percentage of the vote (first preference) to be eligible
  3. capital-intensive party work and campaigning
  4. party channels of communication include privileged access to state broadcasters
  5. politics as a performance of party leaders in the mass media
  6. politics as a profession.

In the 2019 federal election, the ALP received a total of $24,684,039 in public funding through the electoral system; the Liberal Party received a total of $27,569,610.[9] The current rate of funding per eligible vote provided in state and federal elections is approximately $3. This rate and other payments to the parties have slowly increased over time.[10] In order for a candidate, party, or other group to be eligible for election funding from the Australian Electoral Commission (AEC), they must have received at least 4% of first-preference votes in the latest federal election or by-election. This system was introduced by the Hawke Government, passed by Parliament in 1983 and first applied in the 1984 federal election.

The two parties are also able to cooperate to change electoral laws and the regulations of the AEC to create barriers to entry. This has happened in mid-2021, with a new law suddenly tripling the minimum number of members required to register a party to 1500 and significantly strengthening naming rules to the clear benefit of existing parties. There was little debate; neither major party put much effort into either justifying the new rules or engaging with the many objections that were raised.

Katz and Mair also argue that the cartel model has changed our understanding of democracy:

… the essence of democracy lies in the ability of voters to choose from a fixed menu of political parties. Parties are groups of leaders who compete for the opportunity to occupy government offices and to take responsibility at the next election for government performance.[11]

Citizens prefer to invest their interests in places other than political parties, looking for outlets ‘where they are more likely to be in full agreement with a narrower range of concerns, and where they feel they can make a difference’.[12]

[1] Katz, Richard S., & Peter Mair. 1995. “Changing Models of Party Organization and Party Democracy: The Emergence of the Cartel Party”. Party Politics 1 (1): 5-28.

[2] Katz and Mair, “Changing Models of Party Organisation and Party Democracy: The Emergence of the Cartel Party”, p. 11.

[3] Gauja, Anika. 2017. “Party Reform: Where are Australia’s Political Parties Headed in the Future?”, in Papers on Parliament 67, Parliamentary Library, 19-41, p. 20. https://www.aph.gov.au/About_Parliament/Senate/Powers_practice_n_procedures/pops/Papers_on_Parliament_67/Party_Reform.

[4] Katz, Richard S., & Peter Mair. 1995. “Changing Models of Party Organization and Party Democracy: The Emergence of the Cartel Party”. Party Politics 1 (1): 5-28, p. 13.

[5] Katz and Mair, “Changing Models of Party Organisation and Party Democracy: The Emergence of the Cartel Party”, p. 14.

[6] Katz and Mair, “Changing Models of Party Organisation and Party Democracy: The Emergence of the Cartel Party”, p. 14.

[7] Katz and Mair, “Changing Models of Party Organisation and Party Democracy: The Emergence of the Cartel Party”, p. 17.

[8] Katz and Mair, “Changing Models of Party Organisation and Party Democracy: The Emergence of the Cartel Party”, p. 19-20.

[9] Australian Electoral Commission. “2019 federal election: election funding payments finalised”. 2019. Australian Electoral Commission. https://www.aec.gov.au/media/media-releases/2019/12-12.htm#polPart

[10] Australian Electoral Commission, “2019 federal election: election funding payments finalised”.

[11] Katz, Richard S., & Peter Mair. 1995. “Changing Models of Party Organization and Party Democracy: The Emergence of the Cartel Party”. Party Politics 1 (1): 5-28, p. 21.

[12] Katz and Mair, “Changing Models of Party Organisation and Party Democracy: The Emergence of the Cartel Party”, p. 15.