Mandela sought balance between capitalism and socialism

Nelson Mandela was the pivotal, indispensable architect of one of the greatest political miracles of the 20th century, the abolition of apartheid in South Africa and the establishment of a multiracial democracy, achieved through tough negotiation rather than the catastrophic civil war that many observers had predicted.

Yet the second half of the revolution he sought for South Africa — freedom from poverty, establishment of genuine equality of opportunity and a fair share of national wealth — has yet to be achieved. Poverty was a central theme of Mandela’s famous 1964 speech at the Rivonia trial, in which 10 African National Congress leaders were prosecuted for sabotage, just as poverty was a central theme of the 1955 Freedom Charter, which articulated the ANC’s ambitions for a democratic society.

As Mandela would repeatedly insist over the years, the ANC’s Freedom Charter did not call for a socialist revolution, and Mandela’s views and the ANC’s official position remained distinct from that of the allied South African Communist Party. The charter called for a nationalization of “the mineral wealth beneath the soil, the banks and monopoly industry” as well as for redistribution of land, but this step was to be achieved within the context of a mixed economy, without comprehensive central planning.

In his memoir “Long Walk to Freedom,” Mandela writes that the charter “guaranteed that when freedom came, Africans would have the opportunity to own their own businesses in their own names, to own their own houses and property, in short, to prosper as capitalists and entrepreneurs ... The clause discussing the possible nationalization of the mines, the banks and monopoly industries was an action that needed to be taken if the economy was not to be solely owned and operated by white businessmen.”

He would come to abandon nationalization so as not to deter foreign investment — a move variously praised and denounced as pragmatically modifying the aspirations of the Freedom Charter to fit the demands of the global economy as well as the practical need to reassure whites frightened by the prospect of a black-led government. Instead his government embarked on the Reconstruction and Development Programme, an ambitious social democratic vision that led to some tangible gains in housing and other basic needs but fell far short of the goal of eradicating mass poverty. Subsequent turns in the late 1990s to more overtly neoliberal policies that favored private investors over state-led development under the Growth Employment and Redistribution program were severely criticized for exacerbating rather than narrowing inequalities. Serious deprivation remains a fact of life for many South Africans: Recent data show that from 2011 to 2013, 40 percent of population experienced water shortages at least some of the time, including 11 percent facing frequent or constant shortages.

Despite the disappointing pace of change in post-liberation South Africa, there remains much of value in the Freedom Charter’s vision of economic justice. It is an inspiring vision to which South African progressives may well wish to return. When one reconsiders the 1955 Freedom Charter, it is striking to see that Mandela’s ideas about a practicable just economy bear a strong resemblance to the mature view of John Rawls, the 20th century’s most prominent philosopher of social justice.

Rawls has often been misunderstood as an advocate of a liberal welfare state of the kind realized in the Nordic countries. Under such a view, redistribution of income via taxation and government-run social welfare programs is essential to a just society. While he favored some redistribution, he thought that changes to the “predistribution” of property and ownership were more critical than redistribution of market income. A just, egalitarian society would not be one in which a small minority owns the lion’s share of wealth and then agrees to be taxed at sufficiently high rate to meet the needs of the majority. Instead, it would be a society in which wealth and property itself would be widely distributed across the population.

He called this conception of economic justice a “property-owning democracy” and argued that only property-owning democracy or liberal democratic socialism could fulfill fundamental principles of justice (which he identified as equal basic liberties, fair equality of opportunity and limits on economic inequalities to those that benefit the least well off). Rawls believed that the choice between these systems in real life should depend on historical and cultural factors.

To be sure, “Long Walk to Freedom” suggests that Mandela’s prison reading was more likely to consist of Marx and Engels rather than Rawls. Yet it is striking that the 20th century’s leading theorist and its leading practitioner of social justice converged on roughly the same idea: that of a market society that did not abolish private property but assured that productive wealth would be widely distributed and that the benefits of industry and trade would extend to all.

Recent work by political philosophers and others have returned to that concept in view of both the historic failures of state socialism and the glaring inadequacies of the welfare state, especially in nations such as the U.K. and the United States. This work has made clear that there are many policy options available to help bring the concept of a property-owning democracy into reality. These include but are not limited to the establishment of savings funds for all children (such as the baby bond in the U.K., which gave all British children a state-backed savings account that they would be able to access on reaching adulthood but was abolished by David Cameron’s government in its first days of office), tax incentives and other support for worker-owned and cooperative businesses, support for community-owned firms, matched-savings programs and assistance to first-time homeowners. Given the top-heavy distribution of wealth in countries like the U.S., it is theoretically possible to assure that all households have ownership of a significant bundle of assets through a relatively modest program of wealth redistribution.

The sticking point, now as in early 1990s South Africa, is building sufficient political will to enact a long-term program of wealth redistribution targeting the very top. Mandela was surely right to judge that his 1990s government could not rigidly cling to 1950s strategies. But 20 years of experience with the neoliberal model have swung the pendulum in the other direction, with renewed appreciation among both politicians and the public of the reality and danger of unchecked inequality and of economic systems effectively dominated by the richest 1 percent.

In that context, South Africa, the U.S. the U.K. and other countries would do well to return to Mandela’s and the ANC’s early insights that the central question of social justice concerns control of property and that finding ways to broaden ownership in a fundamental and not merely marginal fashion should be the leading edge of an agenda of economic justice. Mandela stood for the end of economic marginalization and the broad advance of equality of opportunity. After the necessary accommodations needed to find peace, returning to the radical ideas of the younger Mandela can be an important component to finishing the uncompleted work of his remarkable life.

Thad Williamson is an associate professor of leadership studies and philosophy, politics, economics and law at the University of Richmond and a co-editor of "Property-Owning Democracy: Rawls and Beyond."