“In the near future, the world may need to resort to lockdowns again — this time to tackle a climate emergency.” Certainly, Mariana Mazzucato has a taste for striking words. In her latest column for Project Syndicate, Mazzucato argues that
Shifting Arctic ice, raging wildfires in western US states and elsewhere, and methane leaks in the North Sea are all warning signs that we are approaching a tipping point on climate change when protecting the future of civilization will require dramatic interventions.
This is the scenario Mazzucato works with. What are the odds it will come by? When could that happen? What are the events that may trigger it? Mazzucato seems to assume that this is almost inevitable if things “go on” as they did in the past, namely if we continue to have economic growth dependent on fossil fuel. Still, more than a scenario this looks like the background story of the movie “Interstellar”: in that movie, a team of scientists was (treacherously) contriving to send some humans up in space in order to perpetuate humanity. Here we have Mazzucato suggesting governments should work to “limit private-vehicle use, ban consumption of red meat, and impose extreme energy-saving measures, while fossil-fuel companies would have to stop drilling.”
That the private sector can cope with such a challenge is a hypothesis Mazzucato does not even consider. Such a sad scenario cannot possibly be affected by human ingenuity, at least if supported by private shareholders.
Mazzucato’s piece is simply an exercise in “never letting a good crisis go waste”. She maintains that Covid-19 is “itself a consequence of environmental degradation: one recent study dubbed it the disease of the Anthropocene.” Moreover, she says, “climate change will exacerbate the social and economic problems highlighted by the pandemic. These include governments’ diminishing capacity to address public-health crises, the private sector’s limited ability to withstand sustained economic disruption, and pervasive social inequality.”
The key sentence in the article is: “These shortcomings reflect the distorted values underlying our priorities.”
Virtually all problems, in Mazzucato’s worldview, reflect the fact the priorities in the world of production are attuned to people’s demands. In a capitalist system, there are no other “values underlying our priorities” than the perceived necessities of people which become demand for goods and services.
This is the essence of Mazzucato’s view:
Addressing this triple crisis requires reorienting corporate governance, finance, policy, and energy systems toward a green economic transformation. To achieve this, three obstacles must be removed: business that is shareholder-driven instead of stakeholder-driven, finance that is used in inadequate and inappropriate ways, and government that is based on outdated economic thinking and faulty assumptions. Corporate governance must now reflect stakeholders’ needs instead of shareholders’ whims. Building an inclusive, sustainable economy depends on productive cooperation among the public and private sectors and civil society.
This nicely summarizes the evolution of Mazzucato’s views, from her first to her second book. In her first book, she advocates an “entrepreneurial state”. In the second she does call for going beyond capitalism founded upon “shareholder value”. I think this makes sense. If the state is going to fund or sponsor innovative companies, they will nonetheless have to compete in a world of private business seeking positive profits — and that may show either the virtues of government-led capitalism or its weaknesses. So, why not allow both the government and the private sector reject the profit motive, which means the traditional metrics of success and failure too?
Note that in Mazzucato’s piece there are no words of concern for low-income countries, where relatively more “polluting” technologies may be the only ones available, let alone economical, for the time being.
I think this piece is very useful. It perfectly epitomizes an attitude which is spreading in some intellectual quarters: use the Covid19 crisis to make some changes permanent, hoping for a world in which people travel less, trade less, rely more on the government. Those on the other side of the debate should take any available opportunity to emphasize that the quarrel is not between those who want to use government capital to satisfy people’s needs, and those who want to use private capital to satisfy people needs: but between those who want the economy to serve the needs of the people, and those who want the economy to supply those goods and services some rulers believe the people should consume.
READER COMMENTS
Don Boudreaux
Sep 28 2020 at 11:05am
Scary stuff from Mazzucato – but, as you note, it’s increasingly par for the “Progressive” course. These people – along with swelling numbers of intellectuals on the political right – seem simply to want to turn the globe into a prison, or series of prisons, with intellectuals as wardens.
Ike Coffman
Sep 29 2020 at 7:31am
OMG, this is quite possibly the worst description of progressive belief that I have ever seen, made worse because it is coming from someone who is generally respected. Progressives want to turn the globe into a prison? Really? Isn’t there another interpretation?
How about this one: progressives see an entirely predictable global crisis occurring right now in real time, one that is arguably existential, and are trying to propose solutions.
Is it really that hard to try to try to see things from other perspectives? I want to say something about tribal polarization here, but I will leave that for another day.
Garrett
Sep 29 2020 at 8:24am
And the solutions tend to be to restrict freedom.
Anders
Oct 12 2020 at 7:40am
This is baffling – I first ran across Mazzucatos work on the role of government spending for innovation. She actually makes a pretty good case that public research, especially in defence, has played a strong, enabling role – and that mechanisms to orient such efforts strategically and recoup some of the returns makes sense. It mirrors my personal solution to the problem of student debt: government pays tuition, and recoups most of it through dedicated levies on future income – making education financially attainable to all, while spending a fraction of what it currently does.
But here, not only does she base her argument on a worst-case scenario that no climate scientist find anywhere near likely; she also assumes that a radical cut in CO2 emissions at this particular stage would make a difference – a particularly mind-boggling one, as human emissions stand for 5% of Co2 in the athmosphere, and CO2 itself makes up only a fraction of total greenhouse gases – and as we know little about ocean absorption, sun spots, cloud projections, and the like.
While we should treat disastrous climate change the way we treat the threat of nuclear war, as unlikely events that nevertheless because of their effects warrant intervention, advocating such a radical cut to liberty and poverty reduction is a far cry from the progressive yet thoughtful advocacy for a productive role of Government through which I got to know her. Perhaps the worst of it is that such a scenario would, just like with Covid-restrictions, disproportionately affect the poor – almost all of the job cuts affected, in the US, people who make less than 60 k a year.
What worries me the most: if all we have to choose from is alarmism and denial (not of climate change; but of the need to take strong measures), then how on earth are we going to forge a consensus and create a dynamic around measures proposed by the likes of Lomborg and Nordhaus, which clearly show that we can radically reduce emissions at modest short-term costs and with positive long term economic AND environmental benefits? We have ran out of things before – and almost always find solutions that were even better (think of the switch from guano to synthetic fertilisers).
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