Governments Must Reclaim Vision and Purpose
Economist Professor Mariana Mazzucato emphasizes that effective governments possess a clear vision, understanding not only what they aim to achieve but also why, and they engage transparently with the public on how to realize these goals. She critiques the superficial focus on economic growth, highlighting that growth is meaningless without a defined purpose. Mazzucato asserts that addressing social challenges and fostering economic development are not mutually exclusive objectives. She advocates for flexible fiscal policies that enable rather than hinder public investment.
If this critique seems directed at the current UK government, it extends beyond that. Mariana Mazzucato, a professor specializing in the economics of innovation and public value at University College London, is a globally recognized economist, government adviser, chair of international commissions, prolific author, and mentor to diverse talents including poets. She notably inspired Keir Starmer’s initial economic vision for the Labour Party, which has since been overshadowed by political turmoil.
Mazzucato’s assessment of the Labour government’s lack of clear direction is sharply critical. Speaking from her north London garden, she states:
“Fine, come in, say the Tories were shit, but once you’ve said it, move on! You’ve got five years, so what’s your plan? What’s the positive narrative? It was always half baked … [now] it’s half assed.”
Despite her dismay at the current state of the Labour government, Mazzucato’s ambitions are global. She envisions a fundamental transformation of economic theory and government practice to address the pervasive issues of inequality and the existential threat posed by climate change. She argues that prevailing economic models have failed and that the world must rediscover the concept of the common good—our collective destiny reliant on the equitable stewardship of Earth’s resources.
Governments as Active Economic Shapers
To achieve this, Mazzucato insists governments must “get back their mojo.” Contrary to the neoliberal view of governments as passive responders to market forces, she portrays them as primary actors shaping markets and economies. Governments should confidently exercise their authority and cease to be intimidated by financial markets.
“If there’s no purpose or direction, then what the hell are we doing? And who sets that purpose? It has to be co-created through real participation, not tokenistic,”she explains.
[We need] an objective-oriented economy, where how we all relate to each other matters as much as what we’re doing.”
Regarding funding, Mazzucato states:
“There’s plenty of money, it’s just not directed towards anything, and government’s part of the problem.”
Her perspective offers hope amid global challenges that often seem insurmountable.
“The reason I’m hopeful is that all of this is possible,”she says.
[You need] a happy narrative [for the common good] that would inspire young people. Like the – it doesn’t have to be space, but really ambitious missions make people dream. They’re all looking up at the sky.”
The Decline and Potential Revival of the Common Good
The notion of the common good largely disappeared from political discourse in the early 1980s during the Reagan-Thatcher era. Citizens were reframed as consumers, with public services recast in business terms focused on efficiency and cost-cutting rather than civic wellbeing. Governments adopted managerial approaches oriented towards serving “customers” rather than caring for citizens.
This shift was intended to introduce private sector discipline and efficiency but instead led to the degradation of the public sphere. Mazzucato has documented the consequences of governments relinquishing their governing role. In her work, she challenges the neoliberal myth that innovation is exclusive to the private sector, demonstrating that public sector initiatives have been crucial to economic success. For example, the internet, foundational to the technology industry, originated as a government project.
In collaboration with Rosie Collington, Mazzucato has also highlighted how governments’ dependence on consultancy firms undermines businesses, infantilizes governance, and distorts economies.
Economic Strategy and Market Reactions
These insights may resonate with Labour’s anticipated leadership, but questions remain about market reactions. Mazzucato comments:
“I don’t know any government in the global north that has ever been penalised by the bond markets through a smart strategic investment strategy. Liz Truss was not penalised for that, she was penalised for having the most idiotic tax policy ever, it had nothing to do with investment.”
Interdisciplinary Perspectives on Economics and Climate
While Mazzucato is an economist, she draws inspiration from diverse fields including biology, Indigenous knowledge, and cultural practices such as carnivals to envision a more creative economy centered on the common good. This broad perspective enables her to challenge conventional economic thinking.
Traditionally, economists have approached climate issues as a balance sheet of environmental credits and debits. Activities like fossil fuel consumption, water overextraction, and deforestation are considered “externalities”—costs not reflected in market prices. Because markets do not assign value to public goods such as clean air and a stable climate, these externalities represent market failures, which are typically addressed through mechanisms like carbon taxes.
This framework aligns with the "tragedy of the commons" concept, where individual actors exploit shared resources without bearing full responsibility, allowing fossil fuel companies to profit while the planet suffers.
Mazzucato critiques this approach as fundamentally flawed. In her latest book, she states:
“In the old economics, doing good is a correction. In an economics of the common good, it is an objective we design and work on together.”
Growth, Capitalism, and the Climate Crisis
Some radical economists advocate abandoning capitalism’s growth imperative, proposing alternatives such as degrowth or steady-state economies that respect planetary limits. However, Mazzucato situates her ideas within a capitalist framework, asserting:
“The problem is not growth, but that we’ve been growing in the wrong way.”
She further contends that if capitalism cannot address the climate crisis, then society faces dire prospects:
“If the climate crisis cannot be solved within capitalist systems, as some , then ‘we should all go to bed and not wake up’,”she says.
Despite differing approaches, there is mutual respect among economists seeking a more equitable society and sustainable economy, united against populist politicians who disregard both goals.
Clarifying the Common Good
Mazzucato distinguishes the common good from the economic concept of public goods, which are non-excludable and non-rivalrous services. She explains:
“Public goods are merely corrections for what the private sector won’t do; the common good, however, is a shared objective.”
She also advocates for “pre-distribution,” ensuring citizens receive a fair share of state investments from the outset, rather than relying solely on redistribution through taxation and benefits.
Human Flourishing and Community as Foundations
Beneath the economic theories and philosophical references, Mazzucato’s ideas are grounded in human flourishing and joy. She passionately discusses self-expression and creativity, lamenting that economists engage too little with poets. Her enthusiasm extends to personal interests such as swimming and football. Following Arsenal’s recent Premier League victory, she observed the communal spirit at the club’s stadium, viewing it as an embodiment of the common good.
Mazzucato highlights community initiatives in Camden, north London, where food banks have transformed into food cooperatives, enabling collective purchasing at lower costs. She notes the positive emotional impact on participants, primarily women, contrasting it with the stigma often associated with food banks.
“Just literally the facial expression that I’ve seen in women – it’s mainly women who use it. There’s a Somalian women’s food cooperative, near here, where they just feel good. Look at people walking into a food bank – they don’t feel good. It just goes to our human soul.”
Community engagement is not only essential to the common good but constitutes it.
“The reason I wrote the book is not just academic, I literally believe people want that [involvement], they feel better about themselves, it’s joyful.”
She argues that only communal interaction can foster such joy. Right-wing governments in the UK and globally have often prioritized austerity and privatization, neglecting or dismantling community amenities and shared spaces, which are central to the common good.
Mazzucato emphasizes the importance of investing in collective infrastructure:
“It’s investing in those collective structures.”
Arsenal FC’s youth football programs in north London exemplify the common good in practice. Mazzucato recalls:
“My kids all used to play [at nearby pitches] there on Friday nights, and I used to almost cry when I’d go there. You just see hundreds of kids and their parents, lots of them from the local estates, and I used to think, imagine if this was normal, imagine if this was everywhere, people had a place to go.”
“It’s not that it would solve crime, but I literally would bet that if you made a kind of Marshall plan investment in soccer pitches, public libraries, public pools, and made it beautiful, you would see health benefits and lower crime and a lower cost to the state. We shouldn’t just do it because it’s good for people – which is the reason to do it – but it also costs you less, ultimately.”
