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💬 "Stop Whining About Big Government"

Sway - A New York Times Podcast

Photo by Katie Moum / Unsplash

Table of Contents

Host: Kara Swisher
Guest: Mariana Mazzucato, Economist
Category: Biz & Tech | 💬 Opinion

Podcast’s Essential Bites:

[2:22] “We actually have framed the way we think about capitalism in a problematic way, and that’s actually then filtered down to how we govern our public institutions, and also corporate governance. […] [W]e often think of the market as this thing that’s sort of external to say business, and business gets forced into doing things. Which then might be problematic because of market pressures. That’s already the first thing that’s wrong. Markets are actually outcomes. Markets are outcomes of how we decide to structure our businesses, our government institutions, and I think there’s problems in both of those.”

[2:54] “We have a business sector, which is often too short-termist. So just in the last 10 years the S&P 500 companies have spent over $4 trillion just on buying back their shares to boost stock prices. That’s a problem. That’s a lack of reinvestment. And government is also problematically structured, often kind of too little too late. And that’s because at best we think of the role of policy as fixing markets — fixing market failures. So by definition, you almost have to wait for a problem to arise before you can justify any sort of policy.

[15:21] “[T]oday when a civil servant, public servant, makes a mistake they’re on the front page of the newspaper. So we don’t allow what everyone knows needs to be allowed to learn. […] And the whole venture capital community is always bragging about all the risk that they took for every success, six or seven failures. As soon as government fails that’s not allowed. And that’s why if you’re not even seen as a value creator, if the government is there simply to fix market failures, then there’s no real justification for you even to invest within your government institution to create that value. Learning by doing doesn’t just happen if you’re not investing within your own capacity to learn. But if you think of it as a venture capitalist, a public venture capitalist, which I think the U.S. government has played public venture capitalist role, you should also be thinking about how do we make sure we’re not then just subsidizing the failures, but also getting an upside.”

[20:13] “[A]reas like internet, GPS, again, Siri voice activated system, in the energy area nuclear fusion, even though we don’t have it yet, you wouldn’t even have any of the investment without government funding. But also a lot of the green and the solar technology initiated with government funding. […] It’s not that the private sector is not doing anything. It’s that the government comes in first, does the heavy lifting, invests in the most early stage high risk stage, which is exactly the opposite of the storytelling and the narrative. Which is the VC industry or the entrepreneurs in Silicon Valley are the risk takers. Well, actually no, they come in later.”

[35:21] “[T]he steel sector in Germany […] was asking government there for help, as steel is asking in every country, including the U.S., for help. And the conditions set by the German government for the loan that they provided to the steel sector was they had to lower their material content in order to access that public loan, which they then did. They did it by innovating. And they are now one of the greenest most sustainable forms of steel production in the world. Not because they decided to do corporate social responsibility, they had to. They had to in order to get one penny from government. And that’s what we need in some parts of the U.S., where it’s not a digital capital like Silicon Valley, but you have these sectors. That instead of just letting them completely destroy themselves or just get government handouts for nothing, there can be processes of transformation that also lead to investment, innovation, jobs, and training.”

[36:24] “One of the problems is if you just […] try to solve it afterwards you end up just picking up the mess and looking at it simply from a regulation perspective. So the first thing is to say learn that lesson and make sure that as we invest today in all sorts of new areas that there are agreements of how this technology will be used. And that it can’t be used against the very people that helped to finance us.”

[39:39] “[W]ith Facebook they’re called big tech, but they haven’t actually funded the tech. So what they’re actually using is the tech funded by someone else to distribute and to put out information like Facebook does. I mean, forget the bad part, just even the good part of what Facebook is used for. But it’s not clear why we’re classifying them as tech companies and actually not media companies, you could argue. And then they’d have to be regulated like the BBC.”

Rating: 🍎🍎🍎🍎

🎙️ Full Episode: Apple | Spotify
🕰️ 44 min | 🗓️ 03/15/2021
✅ Time saved: 42 min

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