The charge sheet against 40 years of British capitalism is as damning as it is familiar. Most people have experienced stagnant wages and seen no improvement in living standards; a wealthy elite has accumulated more and more while helping to destroy the planet. Business is bedevilled by low investment, short-term management and corporate greed. These failures were enabled by the retreat of the state from guiding and directing the economy from the Thatcher era to today.
The bungled response of the government to the pandemic – from the failure to enforce lockdown early enough to the test and trace debacle – has exposed the depth of the rot. It has also demonstrated the power and importance of the state in a crisis. But therein lies what might seem to be a paradox: just as we have needed a strong, capable government, those in power have been exposed as clueless and incompetent. Free marketers argue that these problems are inherent to the state. But contrasting international experiences reveal otherwise: the correct response to the pandemic is to demand better government, not less.
Mission Economy offers a path to rejuvenate the state and thereby mend capitalism, rather than end it. The case for a new approach is overwhelming and Mariana Mazzucato’s project is ambitious. By focusing on the immense power of governments to shape markets, she argues that capitalism itself can be remade. Mazzucato aims to infuse capitalism with public interest rather than private gain.
In her landmark 2013 book The Entrepreneurial State she invited us to rethink the role that the state could have in the creation of wealth. This was followed by The Value of Everything in 2018, which demolished the widely held belief that a narrow economic elite was the wealth creator. The traditional framework confuses prices with value, meaning social goods are only examined for their costs rather than their social benefits.
Mission Economy takes the argument forward. It is styled as a “how to” guide for policymakers who want to unleash the full potential of the state to solve some of the great challenges of the 21st century. Mazzucato invites us to imagine government that “bears the greatest level of uncertainty and reforms … itself to take risks”. From confronting the climate crisis to improving health and wellbeing, Mission Economy offers a method to tackle the great challenges facing societies globally.
The title is inspired by President John F Kennedy’s mission to send a man to the moon and back: Mission Economy tells the story of Nasa’s Apollo programme and the lessons it teaches us. “To carry out the Apollo mission,” Mazzucato explains, “hundreds of complex problems had to be solved. Some solutions worked, many failed. All came out of a close partnership between government and business: a partnership with a purpose.” The book provides a fascinating account of Nasa in the 1960s that is rich with insight. (The British government’s own “Operation Moonshot”, on the other hand, currently provides a cautionary tale of the importance of defining a mission, and the collaborative leadership required to achieve it: both have been sorely absent.)
But this is not a nostalgic account of a better yesterday. Mazzucato systematically dismantles the arguments used to defend the broken status quo and then offers the pillars of a new approach. It is governments rather than businesses that take the big risks in the development of new technologies. Markets aren’t some kind of celestial creation but a set of rules that can be rewritten. Conceptualising government as a business is destructive rather than useful – and outsourcing often destroys value while corroding the crucial capabilities of the state. Government’s role should be to “tilt the playing field” in a direction that is good for society as a whole.
Mazzucato’s prescription is for governments, in dialogue with citizens, to define the grand challenges of our times and to set missions to solve them in partnership with business. These missions should be bold and inspirational – from solving the climate crisis to curing cancer to eliminating the digital divide. By focusing on the ends rather than the means, policymakers should create the space for creativity, experimentation and collaboration across sectors. All the most interesting and important problems today are collective action problems.
It requires civil servants to act boldly, with confidence in their capacity to create value. It requires more dynamic institutions and the same “whatever it takes” approach to budgeting as found in wartime to solve social problems. A strict focus on the economic benefits is counterproductive. As the Apollo example showed, spillover benefits will come by concentrating on what matters, not some narrow demand for short-term commercialisation.
Mazzucato makes a persuasive case. But can the missions she describes really solve systemic problems such as social care or the climate crisis, where success is less clear-cut than landing a man on the moon? Can missions really work when both the outcomes and the means are politically contested? Mission Economy attempts to take these counterarguments head-on but is not wholly convincing. The correlation between technological challenges – “big science meets big problems” – and systemic ones is imperfect. The importance of political stability in democratic politics is underplayed: JFK was succeeded by his vice-president Lyndon Johnson who was in office until just six months before the successful moon landing.
There are times when Mazzucato sounds rather too like the management consultants she derides as she co-opts their language proposing “mission maps”, “building in-house capabilities” and “indicators and monitoring frameworks”. Mission Economy is at its most compelling when it encourages the reader to look up to the stars not at a PowerPoint presentation.
But there is no perfect form to policymaking, and to focus on the limitations is to miss the broader point. Mission Economy injects the kind of vision, ambition and imagination so desperately missing from government today. It is a shot in the arm for policymakers who have grown weary after a decade of “can’t do” austerity. It is an invitation to think big.
For nearly half a century, progressives around the world have been locked in a miserable cycle of defending the gains of the postwar era while lacking a positive agenda for the 21st century. Meanwhile, it is conservatives who have become the revolutionaries: from tax cuts for the already extremely wealthy, the mass sell-off of public assets, to the unchecked rise of finance, to Britain’s exit from the EU, they have not shied away from their exploitative dreams. In Mission Economy, Mazzucato offers a call to bold, collective action. All those in favour of a better future – of prosperity that is broadly shared, first class public services to be enjoyed by all, and a solution to the climate crisis – should read this book.
• Mission Economy: A Moonshot Guide to Changing Capitalism is published by Allen Lane (RRP £20). To order a copy go to guardianbookshop.com. Delivery charges may apply.