While it is difficult to typecast Gandhi's economic idea into any one particular model, there persists an enduring misconception that Gandhi was a socialist and Nehru's socialism was a legacy of Gandhi's thought. Yes he endorsed the spirit of socialism and in that sense he can be classified as socialist by intent. However he had correctly seen several of the flaws in socialism when it was still very fashionable in that era. I find the quotes below fascinating. Though he does not use modern economics jargon, the essence is exactly the same and the words he uses to express them are fascinating and reflect intellectual honesty.
On Capitalism:
It can be easily demonstrated that destruction of the capitalist must mean destruction in the end of the worker and as no human being is so bad as to be beyond redemption, no human being is so perfect as to warrant his destroying him whom he wrongly considers to be wholly evil. We invite the capitalist to regard himself as trustee for those on whom he depends for the making, the retention, and the increase of his capital. Nor need the worker wait for his conversion. If capital is power, so is work. ... Either is dependent on the other. Immediately the worker realizes his strength, he is in a position to become co-sharer with the capitalist instead of remaining his slave. If he aims at becoming the sole owner, he will most likely be killing the hen that lays golden eggs. Inequalities in intelligence and even opportunity will last till the end of time. A man living on the banks of a river has any day more opportunity of growing crops than one living in the arid desert.
On Socialism and Communism: I look upon an increase of the power of the State with the greatest fear, because although while apparently doing good by minimizing exploitation, it does the greatest harm to mankind by destroying individuality, which lies at the root of all progress. We know of so many cases where men have adopted trusteeship, but none where the State has really lived for the poor. ...
The socialists and communists say, they can do nothing to bring about economic equality today. They will just carry on propaganda in its favor and to that end they believe in generating and accentuating hatred. They say, when they get control over the State, they will enforce equality. Under my plan the State will be there to carry out the will of the people, not to dictate to them or force them to do its will.
It is my firm conviction that if the State suppressed capitalism by violence, it will be caught in the coils of violence itself, and will fail to develop non-violence at any time. The State represents violence in a concentrated and organized form. The individual has a soul, but as the State is a soulless machine, it can never be weaned from violence to which it owes its very existence.
On Trusteeship
He very well identified the need for wealth creators. In the context of Ahmadabad textile strike when someone asked Gandhiji whether it is desirable to close down the mills he opined that we also need people who have the capacity to make money. Some more excerpts:
...That no matter how much money we have earned, we should regard ourselves as trustees, holding this money for the welfare of all our neighbours. If God gives us power and wealth, he gives us the same so that we may use them for the benefit of the mankind and not for our selfish, carnal purpose....
...My theory of trusteeship is no makeshift, certainly no camouflage. I am confident that it will survive all other theories. It has the sanction of philosophy and religion behind it.
I am inviting those people who consider themselves as owners today to act as trustees, i.e., owners, not in their own right, but owners in the right of those whom they have exploited.
Supposing I have come by a fair amount of wealth—either by way of legacy, or by means of trade and industry—I must know that all that wealth does not belong to me; what belongs to me is the right to an honorable livelihood, no better than that enjoyed by millions of others. The rest of my wealth belongs to the community and must be used for the welfare of the community.
The question how many can be real trustees according to this definition is beside the point. If the theory is true, it is immaterial whether many live up to it or only one man lives up to it. The question is of conviction.
It is my conviction that it is possible to acquire riches without consciously doing wrong. For example I may light on a gold mine in my one acre of land. But I accept the proposition that it is better not to desire wealth than to acquire it, and become its trustee. I gave up my own long ago, which should be proof enough of what I would like others to do. But what am I to advise those who are already wealthy or who would not shed the desire for wealth? I can only say to them that they should use their wealth for service.
Several decades later most of the above stands vindicated. Most countries that tried to enforce equality by force have failed. The communist countries in their efforts to make a classless society simply ended up creating another layer of bureaucrats and middleman.
There is a very real difference in the abilities, intent and opportunities that each individual has. This will be reflected in the trajectories each individual follows in their life spans. Some will achieve more, some less. So the endeavor to create equality cannot be forced top down, there needs to be a bottom up approach. Enduring change can only come through some real transformation of hearts.
Narayan Murthy, founder of Infosys, once said he is a socialist at heart and a capitalist by profession. Gandhi wanted the capitalist or the wealth creators to be the trustees of the wealth they create. In that trusteeship remains one of the most relevant of Gandhi's concept, which something which most of us can easily relate.
On Capitalism:
It can be easily demonstrated that destruction of the capitalist must mean destruction in the end of the worker and as no human being is so bad as to be beyond redemption, no human being is so perfect as to warrant his destroying him whom he wrongly considers to be wholly evil. We invite the capitalist to regard himself as trustee for those on whom he depends for the making, the retention, and the increase of his capital. Nor need the worker wait for his conversion. If capital is power, so is work. ... Either is dependent on the other. Immediately the worker realizes his strength, he is in a position to become co-sharer with the capitalist instead of remaining his slave. If he aims at becoming the sole owner, he will most likely be killing the hen that lays golden eggs. Inequalities in intelligence and even opportunity will last till the end of time. A man living on the banks of a river has any day more opportunity of growing crops than one living in the arid desert.
On Socialism and Communism: I look upon an increase of the power of the State with the greatest fear, because although while apparently doing good by minimizing exploitation, it does the greatest harm to mankind by destroying individuality, which lies at the root of all progress. We know of so many cases where men have adopted trusteeship, but none where the State has really lived for the poor. ...
The socialists and communists say, they can do nothing to bring about economic equality today. They will just carry on propaganda in its favor and to that end they believe in generating and accentuating hatred. They say, when they get control over the State, they will enforce equality. Under my plan the State will be there to carry out the will of the people, not to dictate to them or force them to do its will.
It is my firm conviction that if the State suppressed capitalism by violence, it will be caught in the coils of violence itself, and will fail to develop non-violence at any time. The State represents violence in a concentrated and organized form. The individual has a soul, but as the State is a soulless machine, it can never be weaned from violence to which it owes its very existence.
On Trusteeship
He very well identified the need for wealth creators. In the context of Ahmadabad textile strike when someone asked Gandhiji whether it is desirable to close down the mills he opined that we also need people who have the capacity to make money. Some more excerpts:
...That no matter how much money we have earned, we should regard ourselves as trustees, holding this money for the welfare of all our neighbours. If God gives us power and wealth, he gives us the same so that we may use them for the benefit of the mankind and not for our selfish, carnal purpose....
...My theory of trusteeship is no makeshift, certainly no camouflage. I am confident that it will survive all other theories. It has the sanction of philosophy and religion behind it.
I am inviting those people who consider themselves as owners today to act as trustees, i.e., owners, not in their own right, but owners in the right of those whom they have exploited.
Supposing I have come by a fair amount of wealth—either by way of legacy, or by means of trade and industry—I must know that all that wealth does not belong to me; what belongs to me is the right to an honorable livelihood, no better than that enjoyed by millions of others. The rest of my wealth belongs to the community and must be used for the welfare of the community.
The question how many can be real trustees according to this definition is beside the point. If the theory is true, it is immaterial whether many live up to it or only one man lives up to it. The question is of conviction.
It is my conviction that it is possible to acquire riches without consciously doing wrong. For example I may light on a gold mine in my one acre of land. But I accept the proposition that it is better not to desire wealth than to acquire it, and become its trustee. I gave up my own long ago, which should be proof enough of what I would like others to do. But what am I to advise those who are already wealthy or who would not shed the desire for wealth? I can only say to them that they should use their wealth for service.
Several decades later most of the above stands vindicated. Most countries that tried to enforce equality by force have failed. The communist countries in their efforts to make a classless society simply ended up creating another layer of bureaucrats and middleman.
There is a very real difference in the abilities, intent and opportunities that each individual has. This will be reflected in the trajectories each individual follows in their life spans. Some will achieve more, some less. So the endeavor to create equality cannot be forced top down, there needs to be a bottom up approach. Enduring change can only come through some real transformation of hearts.
Narayan Murthy, founder of Infosys, once said he is a socialist at heart and a capitalist by profession. Gandhi wanted the capitalist or the wealth creators to be the trustees of the wealth they create. In that trusteeship remains one of the most relevant of Gandhi's concept, which something which most of us can easily relate.
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