Friday
Dec272013

Limits of Leadership

We dubbed the challenge of incorporating leadership into the study of political economy Nelson Mandela’s challenge because Mandela powerfully illustrates the role of a visionary, talented and shrewd leader who can critically impact the course of affairs.

But Mandela’s legacy also points to a dilemma of leadership.

Leaders can form and hold together new coalitions and change beliefs in a way that expands the set of political feasible options. But if all of this is embedded in the skills, trustworthiness and networks of the leader, most of their achievements can be reversed or at the very least will slowly wither away when they disappear from the stage.

At some level, his huge leadership success in manufacturing reconciliation and a peaceful transition to democracy in South Africa notwithstanding, Mandela has perhaps not been as successful in building institutions.

This is reflected in part in the troubles of the African National Congress (ANC), which despite its huge mandate from South Africans, has not been able to form an effective government. It has not been able to deal with the huge inequality — and inequality of opportunity — challenge that is central to South Africa’s economy today. And South Africa has failed to play a constructive role in helping peaceful transitions to democratic institutions in neighboring countries, most notably in Zimbabwe, whose kleptocratic autocrat, Robert Mugabe, still receives implicit or explicit support from many ANC leaders.

Rather, the ANC has concentrated power in the hands of a small group of leaders that have mightily benefited from their newfound status. It has been mired in corruption scandals which it has not shown any ability to control or properly investigate. What’s more, it may be in danger of splitting between an “anti-reconciliation” wing, epitomized by Julius Malema, the former head of its Youth League, and a “business-as-usual” wing, entrenched in and benefiting from power.

This all raises the question of whether there are two kinds of leadership to be distinguished and separately modeled. The first is leadership that at some level transcends institutional realities and as such is truly inspiring, but does not entirely transform the institutional dynamics already set in motion. We argued, for example, in a previous post about Venezuela that Hugo Chavez’s leadership was (fortunately!) of this sort, though without making this conceptual distinction.

The second is institutions-building leadership, perhaps more in the mold of George Washington’s leadership in the United States or Seretse Khama’s role in building Botswana’s inclusive institutions which we discussed at length in Why Nations Fail.

So it seems there are many more questions to ponder about leadership.

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