From moonshots to earthshots
by Mariana
Mazzucato on 5th February 2021 @MazzucatoM
The pandemic has created a huge opportunity to restore mission-driven
governance in the public interest.
Mariana Mazzucato
Covid-19 has exposed the myriad weaknesses of modern capitalism. And in
many countries past cuts to social services and public health have amplified
the damage wrought by the pandemic, while other self-inflicted wounds to the state have
led to inadequate policy co-ordination and implementation. Mass testing and
tracking, production of medical equipment and education during lockdowns have
all suffered as a result.
We should not be afraid of a post-pandemic world that will not be the same
as the status quo ante. We should embrace it and use all
appropriate fora and available opportunities to make it a better world by
advancing the cause of international cooperation.
By contrast, countries and states that have invested in their
public-sector capabilities have performed much better overall. This has been
most striking in the developing world, where Vietnam and the Indian state
of Kerala stand out.
Investor of first resort
Instead of acting as investors of first resort, far too many
governments have become passive lenders of last resort, addressing problems
only after they arise. But as we should have learned during the post-2008 Great
Recession, it costs far more to bail out national economies during a crisis
than it does to maintain a proactive approach to public investment.
Too many governments failed to heed that lesson. Faced with another
society-wide challenge, it is now clear that they have relinquished their
proper role in shaping markets, allowing public institutions to be hollowed out through outsourcing and
other false efficiencies. The retreat of the public sector has given way to the
idea that entrepreneurship and wealth creation are the exclusive preserve of
business—a perspective endorsed even by those who advocate ‘stakeholder value’.
In fact, the more we subscribe to the myth of private-sector superiority,
the worse off we will be in the face of future crises. To ‘build back better’ from
the current one, as the administration of the US president, Joe Biden, and many
other governments have committed to do, will require renewing the public
sector—not just by redesigning policy and expanding the state’s organisational
capabilities but by reviving the narrative of government as a source of value creation.
Capable public sector
As I explain in my new book Mission Economy:
A Moonshot Guide to Changing Capitalism, landing a man on the
moon required both an extremely capable public sector and a purpose-driven
partnership with the private sector. Because we have dismantled these
capabilities, we cannot hope to repeat earlier successes, let alone achieve
ambitious targets such as those outlined in the Sustainable Development Goals
(SDGs) and the Paris climate agreement.
The Apollo programme demonstrated how a clearly defined outcome can drive
organisational change at all levels, through multi-sector public-private
collaboration, mission-oriented procurement contracts and state-driven
innovation and risk taking. Moreover, such ventures tend to create spillovers—software,
camera phones, baby formula—that have far-reaching benefits.
The original moonshot model offers insights and inspiration for pursuing
‘earthshots’ today. For example, to achieve the 17 SDGs, we should transform each
into several clearly defined missions that would lay the groundwork for more
multisectoral, bottom-up innovation. A plastic-free ocean, for
example, will require investment and innovation in areas as different as marine
transport, biotech, chemicals, waste management and design. That is what the
Apollo programme did by sparking innovation in aeronautics, nutrition,
materials science, electronics, software and other areas.
‘No excess profits’
A mission-oriented approach is not about government ‘picking winners’ but
about choosing directions for change—such as a green transition—that require
investment and innovation in many sectors. The full power of policy instruments
should be used to create projects that elicit solutions from many different
willing actors. NASA designed its procurement contracts to focus on goals,
while encouraging bottom-up solutions and including ‘no excess profits’ clauses
and fixed costs, so that going to the moon involved sharing both risks and
rewards. This is an important lesson for many governments that have suffered
higher costs and lower quality from outsourcing.
Earthshots have much in common with moonshots but the two are not
synonymous. Among their similarities, both require bold, visionary leadership from
governments that have been properly equipped to ‘think big and go big’.
Consider the Covid-19 vaccine. The collective spirit and outcome-driven
approach to vaccine research and development last year recalled the Apollo
programme. While technological breakthroughs can provide new tools, they
are not necessarily solutions in themselves.
Earthshots require attention to political, regulatory, and behavioral changes.
Safe and effective vaccines were created and tested in record time
through public-private collaborations,
with public investment proving
absolutely crucial. But a disparity in vaccine acquisition between high-income
and lower-income countries appeared immediately and has only deepened.
When it comes to an earthshot like global vaccination, technological
innovation is only as useful as its real-world application. ‘Vaccine
apartheid’—rather than a People’s Vaccine—would
constitute a moral and economic catastrophe. If
pharmaceutical companies are serious about their stated support for the
principle of stakeholder value, they should be sharing Covid-19 vaccine
patents, data and know-how through the Covid-19 Technology Access Pool,
which remains unused.
Governments, too, must truly embrace the principle of stakeholder value,
which does not apply only to corporate governance.
Public-private collaborations also must be governed in the public interest and
not repeat the failures associated with today’s digital economy, which emerged
in its current form after the state provided the
technological foundation and then neglected to regulate what was built on it.
As a result, a few dominant Big Tech firms have ushered in a new age of
algorithmic value extraction, benefiting the few at the
expense of the many.
Common vision
Technology alone will never solve social and economic problems. In applying
the moonshot principle to complex challenges here on earth, policy-makers must
pay attention to myriad other social, political, technological and behavioural
factors, and capture a common vision across
civil society, business and public institutions.
Thus earthshots must also involve extensive citizen engagement.
Carbon neutrality, for example, must be designed with citizens where they live,
such as social housing. By truly adopting an inclusive stakeholder approach, a
mission can develop into a powerful civic platform and an engine of sustainable
growth, as envisioned in calls for a Green New Deal, Health for All and
plans to bridge the digital divide.
These lessons could not be more relevant to the Biden administration, which
will be able to tap the power of an existing entrepreneurial state comprising
organisations like the Defense Advanced Research Projects Agency and the
National Institutes of Health, which invests up to $40 billion per year in drug innovation.
There is now a huge opportunity to pursue industrial policies beyond
traditional sectoral and technological silos, and to restore mission-driven
governance in the public interest. A modern industrial strategy aimed at a
Green Renaissance, for example, would require all sectors—from artificial
intelligence and transport to agriculture and nutrition—to innovate and pivot
in a new direction. President
John F Kennedy had his moonshot. Biden’s mission is to bring it home.
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