Hayek was bad enough – with his belief that markets would solve any problem. But the complexity theorists seem to have driven the last nail into Free Will’s coffin.
My generation believed three things which kept its sanity -
1. Governments had effective machinery and tools at its disposal to deal with most problems
2. Political parties reflected public feelings and had some influence over governments formed from its leading members
3. Enough fuss and pressure from society – whether media, public opinion, voluntary organisations or trade unions – would get results
We no longer believe any of these things – indeed anyone who offers such judgements is seen as old-fashioned if not eccentric…..
A combination of globalisation, privatisation and neoliberalism has sucked the lifeblood not only from governments but from political parties – leaving social movements to perform as a colourful, pantomime distraction.
Fortunately, however, there are still a few voices left – bravely articulating detailed messages which point to a better way. People like Yanis Varoufakis and George Monbiot and, for those prepared to do some really serious reading, authors such as Mariana Mazzucato - with her latest “Mission Economy – a moonshot guide to changing capitalism” to which the great blog Crooked Timber is devoting a discussion series from which I’ve taken an extract -
starts from the view that at present both capitalism and governments are
dysfunctional. In Chapter 2 she identifies the four sources of the problems of
capitalism as (1) the short-termism of the financial sector (including the
deeply problematic issue that, given the role of financial institutions, its
profits are privatized but its losses are socialized, as we saw in the 2008
financial crisis); (2) the financialization of business; (3) climate emergency
and (4) slow or absent governments.
In Chapter 3, Mazzucato points at New Public Management theory as the culprit for the widespread myth that failures of the public sector are more serious than failures of the private sector, which has been used to justify the massive increase in privatizations and outsourcing. And this, Mazzucato argues, has led to a reduction of the capabilities in the public sector, which in turn makes it harder to change weak or bad policies. The main problem with the government right now is not its size, but rather that its capacities, skills and expertise have been diminished, which has also demoralized public servants.
we need instead, is ‘Moonshot thinking’, which entails that governments should
have an ambition that is so inspiring and concrete, that it motivates all to
contribute to reaching that goal; this is what Mazzucato calls ‘a public
purpose’ – the most essential thing a government should have, and which will motivate
its partnership with business. Innovation and commercial success will happen
along the way.
4 describes the Apollo program in the 1960s as an example of what governments
can accomplish if they have a clear mission that all are contributing to. At
that time, the mission was “bring a man to the moon and safely back to earth” –
in the historical context of the Cold War (not an unimportant detail, perhaps!).
The Apollo program was driven by
mission-oriented innovation, full with great risks and many failures from which
lessons were learnt. At the early stages, poor communication within NASA
seemed its weakest point; apparently this problem was addressed so successfully
that the dynamic communications set-up within NASA was later copied by
businesses. There were many other problems with the Apollo program, and
Mazzucato argues that solutions were found by organizations and people willing
to experiment, rather than picking supposedly good solutions in advance.
Talented and hardworking people, risk taking and adapting, are key aspects of a
5 explains how mission-oriented thinking looks like by applying it to several
missions for our times: the Sustainable Development Goals, the American and
European Green New Deals, accessible health, and narrowing the digital divide.
In all of these missions, the aim is to catalyze collaboration between many
different sectors, and to change our view of the government as regulating and
correcting markets and being a lender of last resort to being the creator and
shaper of markets, and an investor of first resort willing to take the high
risks that are needed for long-term thinking, and who aims to crowd in private
funding and collaborations.
Chapter 6 sketches how the political economy of this capitalism-with-a-public-purpose would look like. Mazzucato writes that there are 7 pillars that a political economy that can guide a mission-oriented approach should have:
(1) a new approach to value;
(2) markets as being co-created and shaped by the government;
(3) organizations that have the capabilities to co-create for the public purpose, including taking risks, experimenting and learning;
(4) an approach to finance that does not start by asking what the budget is, but by “what needs to be done” and as a derivative question asks how to pay for it;
(5) fighting inequality not only be redistribution but first of all by predistribution;
(6) reimagine the relation between government and businesses as a partnership around a common goal; and
new forms of participation, debate, discussion and consensus-building.
And Bill Mitchell is a leftist Australian economist whose Reclaiming the State – a progressive vision of sovereignty in a post neo-liberal world (2017) I’m trying to find the time to at least skim.