Professor Mariana Mazzucato, a renowned economist at University College London, has issued a powerful call for governments worldwide to reclaim their proactive role in shaping economies and solving societal problems. In her new book, The Common Good Economy: A New Compass, she argues that current economic models have failed, and that a fundamental shift toward purpose-driven governance is essential to tackle inequality and the climate crisis.
Governments Must Set Ambitious Missions
Mazzucato insists that governments need to articulate clear visions and set ambitious, mission-oriented goals. 'If there's no purpose or direction, then what the hell are we doing?' she asks. She criticizes the UK Labour government under Keir Starmer for lacking a positive narrative, saying: '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.'
According to Mazzucato, governments must 'get back their mojo' and stop cringing in the face of bond markets. She argues that they are the supreme actors and shapers of markets, not passive fixers. 'There's plenty of money, it's just not directed towards anything, and government's part of the problem,' she says. The common good economy requires co-creation through real participation, not tokenistic engagement.
Rejecting Neoliberal Myths
Mazzucato's work challenges the neoliberal consensus that only the private sector can innovate. In her 2013 book, The Entrepreneurial State, she demonstrated that public sector investments have been crucial to innovations like the internet. Her 2023 book, The Big Con, co-authored with Rosie Collington, exposed how over-reliance on consultants weakens governments and warps economies.
She dismisses fears that strategic public investment would frighten bond markets. '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.'
Reframing Climate Crisis as a Shared Objective
Mazzucato critiques traditional economic approaches to the climate crisis, which treat environmental harms as 'externalities' to be corrected by market mechanisms like carbon taxes. Instead, she argues that 'doing good is a correction' in old economics, while 'in an economics of the common good, it is an objective we design and work on together.'
Unlike degrowth advocates, she believes capitalism can be reformed. 'The problem is not growth, but that we've been growing in the wrong way.' She warns that if the climate crisis cannot be solved within capitalist systems, 'we should all go to bed and not wake up,' because revolutionary reforms would take too long.
Community and Joy at the Heart of the Common Good
Mazzucato emphasizes that the common good is not merely about public goods—services that are non-excludable and non-rivalrous—but about shared objectives that foster human flourishing and joy. She points to examples like Arsenal FC's community programs and a food cooperative in Camden, north London, where women pool resources to buy food in bulk. '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.'
She advocates for investing in collective structures like soccer pitches, public libraries, and pools. '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.'
Ultimately, Mazzucato's message is one of hope: 'The reason I'm hopeful is that all of this is possible. [You need] a happy narrative [for the common good] that would inspire young people. Like the Artemis going to the moon – it doesn't have to be space, but really ambitious missions make people dream. They're all looking up at the sky.'
