Internet eyed as path to clean politics

The problem is convincing individuals to donate online

by Kazuaki Nagata

The Nishimatsu Construction Co. fundraising scandal is shaking up the political landscape, with some lawmakers calling for removing businesses from the fundraising picture in favor of individual donations.

The Internet has the potential to play a key role in this plan.

Proponents of Internet fundraising point to Barack Obama’s presidential campaign as a successful example. Obama reportedly collected about $640 million, most from individual donations via the Internet.

But Japan’s political culture is different, and there’s a long way to go before online fundraising takes root, politicians said.

“It’s unfortunate but the custom of donating money through the Internet is almost nonexistent in Japan,” said Hiroshige Seko, a Liberal Democratic Party member of the House of Councilors.

Seko said online donations are a rarity, not just for politicians but also for charities and other nonprofit organizations.

Seko said he encountered several obstacles to online fundraising after he tried the method himself upon entering the Upper House.

At the time, he recalled, the United States was allowing presidential candidates to raise donations through the Internet, and Sen. John McCain of Arizona had raised a substantial amount of funds during the Republican primary.

“I was inspired by that and thought I should do it in Japan,” Seko said.

But after several months of campaigning, all he had to show for his effort was a measly ¥30,000. This in a country where waging a national election easily costs tens of millions of yen.

Seko said he was using an electronic payment system provided by a U.S. credit card company that was hard for his server to manage. In addition, he was burdened by foreign-exchange problems because the transactions involved conversions to U.S. dollars.

“It was just complicated,” Seko said.

Eight years later, the topic of Internet fundraising is again at the fore thanks to Obama’s wildly successful Net campaign and Tokyo prosecutors’ oddly timed investigation into fundraising links between politicians and businesses, such as Nishimatsu.

The fundraising probe forced Ichiro Ozawa to step down as president the Democratic Party of Japan by upping public pressure on him to explain the matter although he is reluctant to speak about the ongoing investigation, in which his chief secretary, Takanori Okubo, has been indicted for allegedly receiving illegal donations from Nishimatsu.

Other lawmakers have also been inspired to try their hand at online fundraising.

Last October, Mineyuki Fukuda, an LDP member of the House of Representatives, began using an online payment system called White Supporters to raise funds.

The system allows individuals to join lawmakers’ support groups by paying a monthly membership fee by credit card.

“Obama’s case was covered so much by the media, so if I followed suit I thought it would work out pretty well,” said Fukuda.

But Fukuda said that only a few people have donated to him online. He sees a need to popularize the act of donating online because the custom is not deeply rooted in Japan.

“I think it has just started,” said Katsuhiko Tochinai, a spokesman for m-up Co., which runs White Supporters.

Despite Obama’s success with the Internet, Tochinai said it was never likely that things would go as smoothly in Japan.

Nevertheless, lawmakers have little choice but to rely on individual donations from now on.

The DPJ is looking to abolish corporate donations in three years and to increase individual donations to recover from the Ozawa scandal.

It is unlikely, however, that the LDP, which depends on corporate donations more than any other party, will agree to a complete ban on them.

Politicians generally agree that an increase in individual donations will be necessary in the future.

Some lawmakers, including Seko, claim the credit card firms aren’t being cooperative about helping politicians, which is hampering the spread of online donating.

He said the companies are more concerned about whether donations can be handled as credit and what to do if contributors ask for a refund.

A representative for JCB Co. acknowledged that those were concerns in the past but said the issues have been cleared up by the Ministry of Economy, Trade and Industry.

Acting DPJ President Naoto Kan, a proponent of online donations, said it appears that credit card companies want to distance themselves from certain politicians.

The JCB spokesman said the company has no such concern and that it is unlikely that the public would make such a connection anyway.

Legislators say that one way to make online donations more popular is to make them fully tax deductible — up to a certain amount.

But Fukuda said tax deductions alone won’t be enough.

“Along with the tax deduction, the awareness of the custom needs to be campaigned,” Fukuda said.