I’m often asked, including by students, about how elections in other major democracies are financed. Since Germany just had elections, there was some explanation of this issue in the press. A good summary can be found in this article; here are some excerpts. Note in particular the closing paragraph, in bold:

There is no curb on the size of donations that individuals, companies or groups can make to German parties, or on how often donors can make gifts.

Transparency Germany Chair Alexandra Herzog sees that as a major problem: “In Germany what a person can gift to a party is unrestricted. We are calling for an upper limit of €50,000 per donor, per year, per party.”

In an interview with DW, Herzog cited a recent multi-million euro donation to the far-right Alternative for Germany (AfD) from a former party official from Austria’s far-right Freedom Party (FPÖ). The AfD accepted the payment of almost €2.35 million ($2.43 mio) to fund a large-scale poster campaign for the February 23 election.

While gifts from outside the European Union are limited to €1,000, donations from EU citizens are not capped….

Larger sums do, however, have to be immediately reported to Germany’s parliament. The AfD’s Austrian windfall was disclosed in accordance with regulations, according to the Bundestag Administration. “

…Countries, such as Finland and France do, in contrast, have donation caps. Paris has also banned corporate gifts. Current German party financing rules, Herzog argues, make Germany more susceptible to attempts by foreign states to exert influence….

Parties get revenue from membership fees, too, which are usually linked to a member’s net income. In the case of the Greens, for example, the monthly membership fee is generally 1% of net income.

The CDU charges its 363,000 members between €8 and €50 per month according to their income — while the center-left Social Democratic Party (SPD) membership fee starts at €6 per month and goes up to €300 for net monthly earnings over €6,000.

Political parties in Germany also receive funding from the federal government depending and in accordance with how well they fare in elections. They are eligible for public funding if they manage to snag at least 1% of the vote at the state level or 0.5% of the vote in either the EU or national elections.

In addition, the parties receive 45 cents for every euro they receive in the form of membership fees, contributions from elected representatives and donations (up to €3,300).

However, a party can never get more state funding than it generates through its own revenue in any year. So, state funding cannot make up more than half of its income.

A ceiling on state funding is set each year by the Bundestag…

And unlike in the US, all campaign advertising, from billboards to radio and TV ads, is limited to a few weeks before the election in Germany.