In the age of polarisation and populism, finding politicians who can remain true to their ideological leanings has become a rather elusive science.
Of course, as human beings politicians are entitled to update their views due to changes in sociopolitical circumstances.
The problem is that unlike the rest of us politicians translate their ideological views into official policy that has profound consequences for the rest of society. The Brexit brigade is one example of politicians who managed to get their ideology to translate into a referendum that has created unprecedented chaos in Britain. Conveniently, politicians who are not in government enjoy more latitude to champion ideas that are great in theory but hard to put in practice. Once such politicians have made their way to power on these "radical" views, reality intervenes and backtracking is inevitable.
Vladimir Lenin is an example. As a hardcore communist, state control of the economy and everything else was central to his political ideology. And yet, in 1922 — less than four years after the end of the world war that had a significant adverse economic effect across the globe and five years removed from the Russian Revolution, Lenin surprised his own party by advocating the promotion of profit-making in parts of the economy. In his "commanding heights" defence, Lenin indicated that as long as the communist party retained control of those heights – the sectors that were central to employment, production and consumption – there was nothing wrong with the profit-driven private sector controlling the residual sectors.
This theory has influenced generations of governments with socialist tendencies across the world that have had to deal with the effects of globalisation and capitalism. Nationalising the commanding heights of the economy and privatising the rest would seem to be the natural consequence of Lenin’s views as articulated in 1922. But each country’s commanding heights evolve over time, and what should be under government control in the Lenin model also has to evolve.
Historically, SA economy’s commanding heights were centred on its natural endowments. These days, however, the mining industry is in decline and now makes news mainly for the number of jobs it sheds. The shift in the concentration of economic activity away from such an industry means any party that advocates nationalisation needs to identify the new commanding heights and explain why it is in the public interest to nationalise such sectors. Additionally, the classical definition of nationalisation – simply approximating ownership with control – may need to be expanded. For example, the Reserve Bank’s ownership lies in the hands of private shareholders and yet its control vests solely in the state.
It is important because even the advocates of nationalisation appreciate that whatever gets nationalised should fulfil a broader social mandate, which incorporates the generation of economic profits. Common sense dictates that after nationalisation society is only better off if nationalised assets remain profitable and viable. And given the private sector’s predilection for efficiencies and profitability, there is a case to be made for the type of nationalisation that results in state ownership with a private sector approach to business efficiencies. Telkom is the closest example of this option.
In the EFF’s motion to nationalise the Bank, the point that seems to have been lost is that the effect and consequence of ownership and control are more important than the form of such ownership. As the Bank’s control model directs all substantive economic benefits to the state, it is difficult to see how the change in ownership structure will lend legitimacy to the nationalisation agenda.
• Sithole (@coruscakhaya) is a chartered accountant, academic and activist.
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