Not the most appealing-looking of book covers, is it?
And I suppose that it won’t help either if I tell you that I’ve taken about a year to finally finish and review this book.
But you definitely shouldn’t let my poor discipline in reading this put you off starting. Let’s rather back up to the point of my inspiration to read it. Mariana Mazzucato was speaking at a CFA conference in London that I attended in May 2019. Subtitled “Disruption: The New Reality in Investment Management”, Mariana, a passionate Italian-American, now heading the Institute for Innovation and Public Purpose and at the University College London argued that economic theory we’ve all learned is problematic. We need an economy that encourages participation from both government and private sector (and rewards each appropriately, in recognition of their contributions), that is sustainable and that has a mission – a big one at that.
My imagination was captured. Just picture what the world would look like if we really could do that, I dreamed. This book is the foundation of those dreams – what really creates value in society, and what just makes (takes) money from ideas that have already been developed? In the preface, she quotes Oscar Wilde as saying that a cynic is one who knows the price of everything but the value of nothing…“economics is known as the cynical science. But it is exactly for this reason that change in our economic system must be underpinned by bringing value back to the centre of our thinking – we need a revived ability to contest the way the word value is used, keeping alive the debate, and not allowing simple stories to affect whose thinks productive and who is unproductive.”
A detailed history of the development of the economic wold follows, with reference to what is built by wealth creators that adds value and how value is extracted by landlords, portfolio managers and the like. But it isn’t that simple. In order for great innovation and growth to happen, we need collaboration, and government – often painted as boring, bureaucratic and unproductive, has an advantage in that it can afford the risk-taking that is so necessary yet unaffordable by the private sector. She uses an example of the development of the smart phone (reliant on the internet and SIRI – developed by DARPA, GPS developed by the US Navy and touchscreen display by the CIA). And there are many others.
So many questions are posed through the book about how we value things, how we should challenge the status quo and the capitalists who charge inappropriately for life-saving medical interventions and our traditional constrained thinking.
Many of the hopeful ideas and collaborations are not thrashed out fully in the book. However, given that Mazzucato advises on policy in this regard (from Mission-Oriented Research & Innovation in the EU to assisting Alexandria Ocasio-Cortez with the thinking behind The Green New Deal) she can be forgiven for ending where she did, replacing writing and thinking about this stuff with actually helping people implement these strategies. She’s also part of Cyril Ramaphosa’s Economic Advisory Council, tasked with igniting the South African economy.
Her critics will point to all the ways that this could fail – corrupt government, greedy capitalists, unwillingness to pay social taxes in production. However, when growth is desperately needed, and ideas and innovations to rescue us from lockdowns and economic devastation wreaked, I’d rather have an optimist and dreamer on my team than a cynic.
I thoroughly enjoyed reading this book, and will be quoting from it regularly, even if it’s just to my family around the dinner table for now.
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