Socio-political crowdfunding as the latest philosophy of cooperation and solidarity

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Socio-political crowdfunding as the latest philosophy of cooperation and solidarity

Nataliia Khoma

Ihor Vdovychyn

Abstract

Socio-political crowdfunding as a technology of social investment and co-financing is studied. High efficiency of realization of public interest through crowdfunding is proved. The authors explain the emergence of socio-political crowdfunding by the transition from hierarchical to network structures in management. Emphasis is placed on the equality of participants in the socio-political crowdfunding network, the voluntary interactions, the need for trust, self-determination of each participant in the amount of contribution to the common cause. The set of characteristics of socio-political crowdfunding is considered by the authors on the examples of cases of electoral and anti-corruption crowdfunding. Prerequisites for the formation of a stable tradition to co-finance the socially significant projects involve a high level of social capital in society, democratic political and legal culture, presence of public trust and others. Socio-political crowdfunding is positioned as a new philosophy of cooperation and solidarity.

Keywords: co-financing, socio-political crowdfunding, public policy, public networks.

Громадсько-політичний спільнокошт як новітня філософія співпраці та солідарності

Анотація

political social investment crowdfunding

Досліджено громадсько-політичний спільнокошт (краудфандинг) як технологію соціального інвестування та співфінансування. Метою статті є вивчення концептуальних засад і механізмів практичної реалізації громадсько-політичного спільнокошту як одного з різновидів колективного інвестування. Для досягнення мети поставлені завдання: 1) довести, що громадсько - політичний краудфандинг здатен реалізовувати суспільний (публічний) інтерес; 2) виявити особливості громадсько-політичного спільнокошту в системі видів краудфандингу; 3) проаналізувати виборчі кампанії, в ході яких використовувався електоральний краудфандинг; 4) вивчити можливості та переваги антикорупційного краудфандингу. Дослідження опираєт ься на методологію мережевого аналізу. Доведено високу ефективність реалізації інтересів громадськості завдяки краудфандингу. Появу соціально-політичного спільнокошту автори пояснюють переходом від ієрархічних до мережевих структур в процесах управління в сучасних демократичних спільнотах. Акцентується на рівноправності учасників громадсько-політичних краудфандингових мереж, добровільності їх взаємодії, необхідності довіри, самовизначення кожного учасника у визначенні розміру внеску у спільну справу. Автори уважають, що передумовами формування стійкої традиції співфінансування соціально значущих проєктів є наявність високого рівня соціального капіталу в суспільстві, демократичної політико-правової культури, наявність високої довіри в межах громади та под. Автори перебувають на позиціях, що в умовах, коли досягнуті технологічні передумови для реалізації спільнокошту, рівень представленості краудфандингу узалежнений передусім від якості демократії в тій чи іншій країні, розвиненості публічної сфери.

Ключові слова: співфінансування, громадсько-політичний краудфандинг, публічна політика, публічні мережі.

Formulation of the research problem and its significance

In recent decades, an array of various forms of public activism - unpaid activities that are motivated by the interests of the community of citizens - has been developing dynamically. There is a noticeable increase in the number of implemented socially useful projects and the prospect of practical application of numerous initiatives is accelerating, etc. Internet technologies promote such practices, even though in the pre-Internet era one can find many similar cases.

One of the latest forms of political activism is crowdfunding, a technology of collective financing through the attraction of social investments (usually financial resources) from multiple motivated people. It is the tool to secure assets for the implementation of a new project, the public lending (collective investment), which is founded on trust and conviction in the social significance of the plan that needs financial support to be implemented. This is the format of interaction in which the public interest realizes itself. The extent of crowdfunding types today is extremely wide - business, technology, ecology, art, politics, support for socially vulnerable groups and more. Kickstarter, Indiegogo, Go-FundMe, RocketHub, SyndicateRoom and many other platforms enable the realization of thousands of innovative startup projects.

Traditionally, this financing mechanism (or more precisely, co-financing) is associated with nonpolitical startup projects, technological, innovative developments, etc. However, for more than a decade, the upward dynamics of collective financing of politics has been noticeable. To refer to the collective financing of political projects, we consider it appropriate not to use the term “political crowdfunding”, but “socio-political crowdfunding”. This kind of formulation appreciably emphasizes the decisive role of the public in promoting the implementation of socially significant projects of political orientation. Besides, this notion covers not only projects related to the direct struggle for power and its exercise, but also a wide range of public policies, such as anti-corruption, support for migrants, municipal development, and so on.

Co-financing of policy projects is increasingly applied today, as there have been radical changes in the political order - from hierarchies/organizations to network structures. Mechanisms for making political decisions no longer fall within the range of exclusively administrative activities of the authorities. The number and activity of various non-state actors that influence the processes of preparation and decision-making, which are important for the public, are increasing. Network cooperation contributes to the formation of a public sense of belonging to the common cause and responsibility for the decisions made. It is the non-hierarchical socio-political networks formed for the implementation of collective interaction projects that today become a mechanism for involving the population in the process of making socio-political decisions and solving collective problems. We are witnessing that currently the non-governmental sector has reached a high level of communication, which gives it certain advantages (speed, flexibility, etc.) in generating socio-political ideas and their fulfilment as compared to the public sector. These processes determine the scientific interest of political science in studying the potential of socio-political crowdfunding.

Analysis of recent research on the problem

The following scholars - V. Golka, I. Kosulia, O. Marchenko, Yu. Petrushenko, V. Polishchuk and others - suggest research approaches to the analysis of socio-political crowdfunding. It should be noted that the issue of socio-political crowdfunding is relatively new in the Ukrainian political discourse. It has been studied in the last decade and has been intensified by the events of the Revolution of Dignity and subsequent tragic events in the history of Ukraine, which promoted co-financing processes. In Western political science, on the other hand, the topic of political (socio-political) crowdfunding began to be discussed much earlier - since the radical changes in the political order - from hierarchies/organizations to network structures. The processes of forming non-hierarchical socio-political networks in democratic communities accelerated the emergence of crowdfunding and attracted the researchers' attention to finding out its instrumental possibilities.

Research methodology

It is assumed that all types of crowdfunding are networking practices. This explains the choice of a network approach as a methodological basis for the study of sociopolitical crowdfunding. In the authors' estimation, this type of crowdfunding is justified to be positioned as a social network in which collective action determines the end result of a certain idea, initiative, project. In this context, an important theoretical basis is the study of public networks, namely the work of A. Melucci Melucci, A. (1996), Challenging Codes: Collective Action in the Information Age. Cambridge: Cambridge University Press; Melucci, A. (2008), A Strange Kind of Newness: What's “New in New Social Movements?” In: V. Ruggiero, N. Montagna (eds.), Social Movements: A Reader. London: Routledge, рр. 218-225., who defines modern collective action as the result of complex processes of interaction that are mediated by the networks of group identity. M. Castells' network approach Castells, M. (1996), The Rise of the Network Society, The Information Age: Economy, Society and Culture. Oxford: Malden; Castells, M. (1997), The Power of Identity, The Information Age: Economy, Society and Culture. Oxford: Malden; Castells, M. (1998), End of Millennium, The Information Age: Economy, Society and Culture. Oxford: Malden. is also valuable for conceptualizing the latest forms of socio-political activism.

The approaches of the mentioned and other representatives of network analysis allow us to form the authors' understanding of public and political crowdfunding network as such, which is based on: horizontal connections, and thus - equality of participants; trust; voluntary interaction; selfdetermination of the contribution extent to the common cause by the participant of network cooperation; openness of the network structure, which is ready to broaden the circle of participants, etc. Accordingly, the major objective of such networks is communication and socially useful results.

The argumentation of the decisive role of trust in intra-group relations is of great significance for the study of socio-political crowdfunding (P. Sztompka Sztompka, P. (2007), Zaufanie: fundament spoleczenstwa. Krakow: Znak; Sztompka, P. (2007), Worrying About Trust, European Review, Vol. 15 No. 2, рр. 147-152.). We also note the importance for the study of the latest forms of socio-political activism, particularly, crowdfunding, the concept of mass collaboration Cress, U., Heisawn, J., Moskaliuk, J. (Eds.) (2016), Mass collaboration and education. Cham: Springer Inter-national Publishing.. Therefore, relying on this methodological basis, we handled a variety of cases of world politics, which demonstrated the possibilities of applying the tool of co-financing in the field of politics.

Formulation of the purpose and tasks of the article

The purpose of the article is to study the conceptual framework and practical realization of the socio-political crowdfunding as one of the types of public lending, collective investment. The following tasks were set to achieve the purpose:

1) to prove that socio-political crowdfunding is the latest format of interaction in which the public interest is able to be realized; 2) to identify the features of socio -political crowdfunding in the system of types of crowdfunding; 3) to analyse the election campaigns during which electoral crowdfunding was used; 4) to explore the possibilities and benefits of anti-corruption crowdfunding.

Research results

Socio-political processes of the last two decades have manifested the gradual upward dynamics of using the crowdfunding technology. New ways of organizing society, online communities are gaining importance and becoming the core of a new society. It is no coincidence that the 44th President of the United States, Barack Obama, who actively employed crowdfunding to finance his election campaigns, called it a “game changer”.

Socio-political crowdfunding is founded on the lack of material gain, disinterested actions for the sake of the community or the individual. The tool, which originated to finance innovative business projects, turned out to be adaptable to a broad range of socio-political issues.

Crowdfunding platforms began to emerge two decades ago. Both at the start of the application of this technology and today, most of the projects are still commercial, but the share of social initiatives is growing, specifically in the public policy segment. It is the rapid technological progress that enabled dynamic communication in the format of remote interactive engagement. And under the conditions of social distancing through Covid-19, this feature of crowdfunding contributed to its even more active use as a technology of public cooperation It is significant that not only the use of crowdfunding technology as a socially remote technology increased due to the threat of Covid-19 infection. Of social importance is the fact that to minimize the devastating effects of Covid-19 a fundraiser in support of many initiatives is launched. An example is the Covid-19 Relief Fund project on the GoFundMe platform..

A variety of socio-political crowdfunding, which has already clearly demonstrated its potential, is crowdfunding for election campaigns. The experience of Western election campaigns showed that more than 80% of the campaign budget can be raised through public funding. Crowdfunding helps finance the important expenditure items for candidates and political parties, especially when it concerns national elections. Financial support by ordinary citizens is becoming more frequent. Nowadays, pro-democracy candidates resort to crowdfunding not only in order to wage a campaign, but also to protect themselves from accusations of dependence on sponsors, whose interests are likely to be lobbied for in the event of an election victory.

One of the first election campaigns, in the course of which funding was provided through crowdfunding, was held in the United States. Particularly, Howard Dean, who was proposed by the Democratic Party of the United States as a candidate for the presidency, carried out a kind of revolution in the methods of raising funds for the election campaign. In a matter of days, his headquarters raised more than 41 million US dollars. 318,884 people donated an average of 80 US dollars each. It is known that the impetus for such fundraising of Howard Dean's campaign was the reluctance of traditional Democrat sponsors to support the politician's campaign because of his criticism of the war in Iraq, which had begun in 2003 with a view to overthrowing Saddam Hussein's regime by a coalition of Democratic states. Although that campaign was not successful for Howard Dean, the use of crowdfunding technology by his team revealed the realism of obtaining funding from sympathizers, the transition to the so-called “democracy of small sponsors”. Awareness of the effectiveness of appealing to the public for support to organize the election campaign was clearly manifested in the following presidential election campaign in the United States in 2008.

Barack Obama's fundraising campaigns in the 2008 and 2012 elections were focused on small investors; in particular, the mybarackobama.com website was used to collect donations. Notably, almost 750 million US dollars was raised during the 2008 election campaign; at the same time more than 600 million US dollars was received from about 3 million small investors Luo, M. (4 Dec. 2008), Obama Hauls in Record $750 Million for Campaign, The New York Times.. The My.BarackObama.com platform was used for this purpose. It also bears remembering that candidate Hillary Clinton in 2016, as well as a number of other candidates, actively used the Payments startup Stripe Khoma, N. (2015), Technologies of political (socio-political) crowdsourcing and crowdfunding: world experience and steps towards implementation in Ukraine, Torun International Studies, Vol. 1 No 8, p. 56.. Most significantly, both Democrats and Republicans used the same platform.

The start of applying the socio-political crowdfunding in European countries was somewhat slower. Large-scale crowdfunding campaigns, similar to those organized by Barack Obama's team, are not recorded there. However, some cases are indicative of the interest of European politicians in this technology of fundraising, as well as the willingness of the public to financially support the politicians of their countries and socio-political projects.

In 2012, crowdfunding technology was used by the team of Finnish presidential candidate P. Haavisto from the Green Party. Although P. Haavisto did not win this campaign (but m ade it to the second round of an election), his team's experience was one of the first in European countries in terms of crowdfunding during the presidential election. In fact, the Green Party provided meagre resources for its candidate's campaign. Nevertheless, the Haavisto campaign managed to collect over 600,000 euros through micro donations. This amounts to 80% of the total campaign budget Eranti, V., Lindman, J. (2013), Crowdsourcing & Crowdfunding a Presidential Election. Available at: <http://blogs.oii.ox.ac.uk/ipp-conference/sites/ipp/files/documents/IPP2014_Eranti.pdf> [accessed 05 January 2022].. In the first instance, social networks were used to mobilize finances.

Examples of socio-political crowdfunding are:

the Spanish left-wing populist party Podemos. This party was established in early 2014, but a few months later received approximately 1.2 million euros in donations for the election campaign from the Spanish. This amount was collected in about a month. It is obvious that such a reaction of the citizens was the result of the crisis of the government and those parties that were in power at that time;

the Green Party of England and Wales used the Crowdfunder platform to collect donations in the course of the 2015 election campaign. The party was supported by 2,976 people who donated more than 74 thousand pounds. Even though this amount is not substantial, the experience of this political force became a completely new practice in organizing elections to local and regional authorities;

the Scottish National Party applied the crowdfunding method during the 2015 election campaign to the House of Commons of the British Parliament. More than 221 thousand pounds sterling was raised. If in the previous elections (2010) the party won only 6 seats, in 2015 - 56. This result is not least associated with the use of the British platform Crowdfunder.

It should be noted that most political parties, which use crowdfunding to participate in elections or implement certain party projects, point to the fact that co-financing for them is a way to display the transparency of their finances and the ability to unite their sympathizers, to demonstrate how they can achieve a specific goal by collective efforts. We believe that crowdfunding can be used by politicians and political parties as a tool to measure the level of voter support. It is a marker that indicates the compliance of a politician's or party's program with the expectations of a particular community.

Most remarkably, crowdfunding can take not only the format of financial support for a candidate or party to be elected, but also, conversely, help to deprive them of their leadership status. For example, in 2015, British voters raised funds to provide legal support for the expulsion of a member of the House of Commons Alistair Carmichael on account of his unethical behaviour (he leaked information). With the efforts of 10,194 backers, more than 210 thousand pounds sterling was raised, though the politician's guilt was not proven and he retained his status.

It is worth mentioning that not only the election process is a platform for socio-political crowdfunding. For example, the need for change in many states gave impetus to revolutionary crowdfunding. Understanding the importance of preventing and combating corruption led to the emergence of anti-corruption crowdfunding. The growth of migrant flows, especially against the background of the events of 2015 in the EU, which caused the migration crisis, intensified the co -financing of projects to support asylum seekers. Hence, we can talk about socio-political crowdfunding as a system that combines an abundance of types of social crowdfunding.

One of the most socially effective and significant today, in our view, is anti -corruption crowdfunding. Importantly, most of the cases we analysed were not about supporting a specific project on a crowdfunding platform. The cases when non-governmental organizations turn to citizens for financial support through their website are more frequent. An example is the non -governmental international organization Transparency International. In particular, the organization's website has an option “Donate”; besides, audited financial reports are made available for public review. This makes the anticorruption organization free from any accusations of sponsorship.

At the same time, not all initiatives aimed at investigating corruption cases, preventing corruption, forming an anti-corruption culture, etc., receive the expected financial support. This is due either to the low trust in the initiator of the project, who does not have sufficient social capital, or the “weakness” of the project itself or other reasons. As an example, we can mention the initiative of creating an independent anti-corruption Internet portal in the Republic of Bosnia and Herzegovina, which was not implemented through the crowdfunding platform Crowdfunder See: https://www.crowdfunder.co.uk/anti-corruption-portal-in-bosnia-and-herzegovina.. From our standpoint, the worst reason why anti-corruption initiatives do not find financial support from the public may be the high level of corruption pragmatism of the population in a certain state, low political and legal culture of the population, when anti-corruption changes are not viewed as appropriate. However, such a reason becomes apparent when this is in reference to initiating an anti-corruption project on national (rather than international) crowdfunding platforms. Then powerful global platforms can provide a different result for the initiator of the project if it is properly justified.

Our analysis showed that most of the anti-corruption projects implemented through crowdfunding dealt with: organization of various types of events for young people, the purpose of which is to form a culture of anti-corruption, promotion of integrity; increased public awareness of community losses from corruption and ways to combat this destructive practice; anti-corruption investigations; support for investigative journalism. In fact, anti-corruption crowdfunding is the evidence that anti-corruption strategies of new states are constantly kept up to date with new technologies, which are implemented through technological progress.

We will single out migration crowdfunding as a separate type of socio-political crowdfunding, the need for which has been on the rise in recent years. It aims to support, first of all, asylum seekers from the states that were affected by conflicts and wars. In 2015, when the EU countries entered the migration crisis, the need to help this socially vulnerable group became clear. The requirement for alternative ways to aid migrants distinctively emerged against the background of a rather aggressive policy of some national governments of EU member states to combat the admission of migrants.

Examples of migration crowdfunding include:

Google's initiative, launched on September 15, 2015 to raise funds to help refugees from Syria. 5.5 million US dollars was received from the backers alone, and this was attained 48 hours after the start of the campaign. The total donation, including Google's own contribution, reached 14 million US dollars;

film actress S. Hayek, UNICEF Ambassador, launched the crowdfunding initiative “CHIME for the Children of Syria” on the Crowdrise platform. The initiative aims to assist children and families with children affected by the humanitarian crisis in Syria;

the crowdfunding platform Kickstarter, which specializes primarily in raising funds to launch innovative business projects, launched fundraising in October 2015 for refugees from Syria. The project raised more than 1.77 million US dollars with the efforts of about 27.7 thousand backers. Such a project was carried out according to other that customary rules; for example, Kickstarter owners waived their commission payments, transferring them to the needs of refugees. To emphasize the scale of the mentioned support for refugees through Kickstarter, we will note that on average the project of this platform attracts about 18 thousand US dollars;

Chuffed. org platform, which for the last decade has been accumulating funds exclusively for the implementation of social (non-profit) projects, has been raising funds within the project “Fight for Refugees”.

However, not all projects based on crowdfunding technology were successful, and some - even in public opinion, and thus - received scant support. For example, in the autumn of 2015, the sociopolitical movement Refugee Nation launched a campaign to raise 3 billion US dollars with the subsequent creation of an island state for asylum seekers. That campaign was implemented through fundraising on the GoFundMe and Indiegogo platforms. Refugee Nation planned to use the raised funds for measures that, according to the organizers, should stop the global migration crisis by 2020.

Some projects were implemented, but not to the full extent. Namely, in the autumn of 2015, the German online university Kiron University launched a crowdfunding campaign on the StartNext platform to assist refugees in obtaining professional education. It was planned to attract about a thousand refugee students. To provide them with a four-year bachelor's program, it was necessary to raise 1 million 200 thousand euros. But, in five years of fundraising, much less was collected - 537 thousand euros.

Alternatively, examples of using crowdfunding technology for an explicit objective and an accessible budget can be given. K. Vogel, formerly the ship's German captain and now the head of the humanitarian organization SOS Mediterranee, successfully i mplemented a crowdfunding project to support the rescue of refugees on the high seas. The project involved raising funds for the lease and subsequent purchase of a lifeboat to help refugees who tried to cross the Mediterranean. The funds were raised on the Ulule platform. As a result, the project raised 274% of the expected amount (274.7 thousand euros) through the efforts of 3,355 backers. The emergence of such an initiative and such a powerful public reaction to it was due to the tragic deaths in 2015 of a large number of asylum seekers who drowned while trying to reach Europe. Today, the humanitarian organization SOS Mediterranee continues its mission, and fundraising is organized directly through the organization's website.

The analysed cases of using crowdfunding for the implementation of socio-political projects only outline the broad opportunities that exist as a result of the growing application of co-financing.

Conclusions

The research study has lead us to the conclusion about the high practical effectiveness of collective financing in public and political life. The experience of countries where crowdfunding is widely practiced demonstrates that in order to form a stable tradition of co -financing the socially significant projects in a certain society, of particular importance are the high level of social capital in a certain community, rooted norms of democratic political and legal culture, tradition of selfless interaction. Extensive practice of crowdfunding the non-profit socio-political projects in society requires trust, developed internal need of citizens for mutual assistance, conviction in the social significance of certain initiatives, faith in collective energy and so on.

Crowdfunding has the potential to increase the level of citizen involvement in socio-political life. While maintaining the autonomy of each participant and social distance between them, crowdfunding reveals the possibilities of networking in socio-political life. Admittedly, these are quite symbolic manifestations of activity in its traditional sense, which are reduced to a few clicks. At the same time, they clearly signal a motivated desire to engage in the provision of socially useful results in a transparent and operative way, to share one's own resources. The value of the c ommunity, which is united by the intention to collectively finance a socio-political project, is manifested in the fact that the members of such a socio-political network have not separate but common goals and choose cooperative ways of working to achieve them. Thus, a new philosophy of cooperation and solidarity is being formed.

References

1. Castells, M. (1996), The Rise of the Network Society, The Information Age: Economy, Society and Culture. Oxford: Malden.

2. Castells, M. (1997), The Power of Identity, The Information Age: Economy, Society and Culture. Oxford: Malden.

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