Can We Build a Common Good Economy? (with Mariana Mazzucato)

Hey, pitchfork listeners. One of the joys of co-hosting this podcast is that I get to ask Nick questions from time to time that put him on the spot. Is that not one of your joys, Nick? It is absolutely not one of my joys. But he loves it so much. Despite what he just said there, we're going to give you the opportunity to play Goldie by asking Nick questions yourself. That's right. And we will read every submission. We will not answer every question. Well, I answer the most interesting and spicy ones. And because it's a really fun way to connect with listeners and just find out what's on people's minds. And if you want to put me on the spot, you can feel free to ask me a question too. To submit, just comment on this week's episode on YouTube or Spotify with the hashtag #AskPitchFork and we'll also put a link in the show notes. Thanks for listening and thanks for making us listen to you. The rising inequality and growing political instability that we see today are the direct result of decades of bad economic theory. The last five decades of trickle-down economics haven't worked, but what's the alternative? Middle-out economics is the answer because the middle class is the source of growth, not its consequence. That's right. This is "PitchFork Economics" with Nick Hanauer, a podcast about how to build the economy from the middle out. Welcome to the show. Goldie, today we get to talk to our old friend economist, Mariana Mazicado, who has a new book out called "The Common Good Economy, How to Make Capitalism Work for Us All." Mariana's been on the podcast before. She's written a ton of really interesting books, but this one in particular I think is super well timed and argues that we've kind of gotten how we think about the difference in markets and states backwards, that markets are this sort of state of nature. It's an act of God. The market capitalism emerged fully formed from Zeus's head. Yes, exactly. It's this thing that this object that exists out there, that obeys natural laws. It's like physics. Yes. Then all you government bureaucrats come in and mess everything up. There you go. You no longer have to take econ 101. I just explained it all for you. You said it so well, and she argues that that's exactly backwards, that markets are always human constructs. They're shaped by laws, institutions, public investment, etc, etc. And that the only way to get on top of our problems, and of course this is completely aligned with market humanism, is by organizing the economy to solve the problems you want to solve and try to limit its ability to create the problems that you want to avoid. As opposed to just fixing all those pesky market failures, exactly. By the way, or probably due to government interference in the first act, if you believe what you're taught in school, so a game of whack-a-mole that we usually play. There is definitely a better way. So anyway, Mariana is a brilliant woman and a really fun person to talk to, so I think we should just get right into the podcast. Let's talk to Mariana. So Mariana Matsugata, a professor at University College London, where I direct the Institute for Innovation and Public Purpose. I'm Italian, grew up in America, I've been living in the UK for 30 years and I'm an arsenal support and we won the league. There you go. And I wrote a book called Common Good Economy. And we're going to win again. So we can all go home now. So your book starts from a pretty fundamental critique of economics. So instead of building an economy around the common good, we sort of wait for markets to fail and then try to clean up the mess afterwards. As a starting point, what's wrong with the market failure way of thinking? Sure. So first of all, I mean, the reason I wrote this book is I've actually been going on and on about this whole thing, about needing to move from market fixing, to market shaping, and I'll promise I will answer your question, but I've also worked with lots of governments to do it. And I've realized that the thing they get wrong is what happens along the way, the relationship. So the reason I wrote this book is that sort of to backtrack just on the market failure point, which again, I've been making that point in other books too, is that markets are actually outcomes. So many people will say the market versus the state, which already gets it wrong. So you can say business versus state actors, but the market is an outcome of how you govern business, right? Or businesses just wed to maximizing shareholder value, or is there something different like stakeholder value, or government organizations just filling the gap by fixing market failures. In other words, doing what the private sector isn't doing versus really setting a direction. If they're governed that way, which I think is a bogus way, and if their interrelationship is problematic, in other words, it's a parasitic ecosystem, instead of a symbiotic ecosystem, when driven by mutualism and reciprocity, then you will get a very different type of market outcome. So that first point, which also builds on Polany's work, who really saw markets as outcomes actually of a lot of state involvement, Carl Polany, who wrote in 1944, one of the best books ever, the great transformation. So as soon as you see markets that out as outcomes, the question is no longer market versus state, but how do you actually design state structures, how do you design business governance, their interrelationship also with other actors, including civil society institutions, but also labor unions, and so on, to actually achieve the economic goals that we have. So in mission economy two books ago, the penultimate book was a rant against McKinsey and Deloitte and KPMG. It was called The Big Con. Can you remember if you guys talked to me about that? I'll come back on to talk to you about that. But in mission economy, I've talked about how do you actually design a mission-oriented economy? This truly goal oriented where the design of the policy, whether it's industrial strategy, or the tools like procurement, or really outcomes-oriented design to actually achieve solutions, like when we went to the moon, we got camera phones, home insulation, baby diaper software. But again, when I then worked on this, with many governments globally, because the institute I run at UCL is also about action, I realized that unless you also really take care on the interrelationship, so capital-labor relations, public private, public citizenry, and actually designed the good result, that goal, the mission, into the contracts along the way, then the whole thing falls apart. And if you look at political philosophy, and I promise to be quite in a minute, if you can ask me a second question, but political philosophy from Aristotle onwards, when they talked about the common good, it was exactly what I'm sort of getting at. There was the telos, the goal, in the police, the community, not the police, but the police, so the relationships in the community of different actors, and they looked at both of them at the same time, fast forward communitarian philosophers still talk about that. So Michael Sundell's whole critique of John Rawls theory of justice is based on the fact you can't have a theory of justice if we don't value each other. But in economics, where even the public good, which sounds good, there's two word one is good, is just correcting for a market failure, I say it's impossible to actually achieve good result, because you're always just filling the gap, correcting things after the fact. Yeah, you know, we live in a world where we have somehow decided that the only value worth optimizing around is returns to shareholders. And human welfare doesn't figure in worker welfare doesn't figure in. These are all externalities that we have to account for somehow rather than they're all things Nick that the market magically delivers as long as we maximize shareholders. But actually the reason I wrote the book is also to call out those who are bullshitting around, sorry, am I left this far? Yes. Okay, so those who do talk about something else besides shareholder values. So this beautiful word stakeholder value, yeah, I think is often kind of stakeholder value washing, or people talk about public interest, or even the word common good, there's a lot of common good washing. So you're absolutely right, most companies still are wed too, you know, just maximizing shares, quarterly returns, which results in like seven trillion dollars having been spent on share buybacks just to boost stock prices, stock options, executive pay in the last decade. However, those companies who say, oh, wait, that's wrong, including Larry Fink who sends out that great letter once a year to his investors and says, oh, Miyaku, let's, you know, have purpose oriented companies, that hasn't happened. And so the point is those companies, yeah, the whole business roundtable charade about exactly stakeholder capital. So this book is meant to call them out. It's literally, if I had to say who it's for, it's both for the government. So I think are a bit clueless when they try to do this stuff, but it's especially to call out the business communities, those are actually not even to call them out, to be honest, to help those who are genuine and to call out those who aren't, like, stop just talking about the good, whether it's stakeholder value or purpose oriented companies, as though you're just going to give a bit of pieces at the end to workers or work with communities, or a bit of philanthropy here and there. How do you create value from the start in a predestributive way, not redistributive after the fact giving some pieces and crumbs here and there? And that requires a radical orientation, not only of the company, but of the relationships. The book really is, I think Nick, you've also written about this with with Eric now about the ecosystem view that you know these are ecosystems. So instead of just obsessing about a business or even a government actor, how do we get the ecosystem to be functional, not dysfunctional, and I say symbiotic, not parasitic. And biologists who are much more rigorous, it's not surprising than economists, most people are more rigorous than economists. When they use the word ecosystem, they have mathematical models that will differentiate a predator prey parasitic model, you know, ecosystem versus a symbiotic one. And the book tries to bring into economics, what does a symbiotic ecosystem look like? Right. I think we're deeply sympathetic to your views. You know, I think that the more you peel back this, the layers of the onion as you know, you realize how profoundly backwards our economic arrangements really are and how we somehow backed ourselves into this institutional framework that generates the wrong kind of outcomes for everyone except a few thousand people at the very top, right? But by design, not by coincidence. How do we design it? It's designed that way. And I think that the really important point you're making is that a lot of the interventions that people talk about today are best take the hard edges off some of these pathologies, rather than fundamentally redesigning the system to produce the outcomes that a majority of citizens would agree makes sense. And I mean, the books divide into three. So the first part is the theory where I really go after kind of standard theory, both of public goods, which are just correcting from market failures, but also the common. So Eleanor Ostrom's really important work on the comments that in the end, as important as it is and was, is correcting for the opposite, the government failure, right? So I say the common good can't be about corrections. It's an objective where the how matters as much as the what. And I kind of do a theoretical treatise on that. But then I build this compass, which has five elements. And the second part of the book breaks down those elements and actually looks at around the world's seeds of the common good so we can scale it. Because otherwise, people just get depressed. They're like, okay, this is all shit. What's going to happen? It's just, you know, let's give up. And let's do the common good outside of the economy, which I also criticise some economists and philosophers, including Sandel. It's not so much a bad criticism. I'm just like, okay, he's talking about how do we bring care outside of the market. I'm like, no, how do you redesign the market to deliver the good? Don't bring it outside or Robert Reich, you know, who also critiqued, obviously, how the market works. And then he talks about how we have to bring these good things in ways that aren't at the center of market economics. And again, I'm like, well, then you're leaving them off the hook. So after kind of going through all these good examples, and I'll go through the five elements in a minute, the third part is the places. How do we learn in places where we build community, where we build respect, where we show that we value other actors, whether it's global south and global north actors at the table around a redesigned Bretton Wood system, but also local actors. So many people, definitely in the US, but also all over the world, who have ended up voting for what we might call kind of populist governments, ultimately, it's because they're really pissed off rightly so of how they've been left behind and even some kind of progressive politics that talks at them and doesn't work with them, doesn't kind of exude any sort of dignity and value of the communities that they're speaking to. So how do we build, you know, use centers, community centers, public spaces, where we learn to work together, talk to each other and value each other again. And that idea of kind of reinventing the welfare state also to new places where we also meet is that third section. But the five elements really are just about how do we hold anyone to account that talks about the common good around five principles? What is the direction that you're actually trying to steer the economy in? Because as long as it's really vague, even climate change is like really vague, right? As soon as you bring that idea of more of a mission and real clarity and purpose, not only is it easier to achieve it, but you can also contest the mission because you all of a sudden open yourself up to debate, is that the right direction? So the second element is co-creation and participatory democracy. How do we actually design these goals together, which doesn't mean bottom up chaos, but it does mean that government itself needs to learn to listen, have real empathy, not sympathy. So the art of listening and working with actors, so an example would be in Camden, my part of London, where we worked on an adult social care program where the carers in the system, who also knew why the system was failing, helped to design an outcomes mission oriented adult social care system. We're doing something similar in Brazil right now in the Amazon, where the indigenous communities are fed up with just being kind of told, oh, this is going to be good for you. The Amazon fund, right? Like, well, like we know in the forest, we've been here 500 years, we know about water, more than you do, about biodiversity, permaculture, we should be at the center of the design of that instrument. So common good has to be actually common in terms of who's at the table to design. Third is sharing knowledge. Fourth is sharing rewards. And fifth is transparency and accountability. And that sharing knowledge, you know, in an era where we talk about AI and open innovation, collective intelligence, all these beautiful words, well, it ain't true. I mean, we are privatizing knowledge. Even during COVID, right? The goal was not the vaccine. The goal shortly was global vaccination. And yet, you know, most of the big pharma companies refuse to share any of the knowledge on how to produce the vaccine with other countries, only AstraZeneca, because it was forced by Oxford University taxpayer funded researchers, they said we will collaborate as long as we have this kind of social contract, this conditionality that we're going to share the knowledge, we're going to keep costs and prices low. It's just a model, one of the many examples I look at on how to produce and innovate through collaborations differently. Reward sharing, this is based on all this stuff I've written about, and even in the entrepreneurial state, one of my first books, where Silicon Valley, perfect example of, you know, socialization of risk, privatization of rewards, what have we learned? How can we do that differently? I don't care how much tech companies talk about good as long as the rewards that are absolutely an outcome of massive collective investments, including AI, the early speech recognition, LLM models were all publicly financed in the early early days, and then, to say nothing of the collective wisdom of the entire world that has been monetized by these people for free. Exactly, every time you click on, exactly, exactly. But there's lots of really interesting, and this is a point I make in that second section of the book, really good examples around the world where people are trying to, to change that, but these are just like little things that aren't, aren't scaling, right? It just remains a cute little case study, but the system is not operating that way. And that fifth point, transparency and accountability, unless we know who's doing what, who's earning what and why, the common goods impossible. And that's why, by the way, wrote the big con with consulting companies, because they are everywhere, no one voted for them. Companies haven't been investing in their own brain. We've kind of deloitified our civil service, and that's a first element of lack of transparency, who's running the show. So I want to play econ 101 devil's advocate here. This is all well and good, everything you're talking about. But that's just all that government interfering in the natural efficiency of the market. Aren't you just going to end up hurting the people you're trying to help? I mean, what is it that econ 101 has wrong about how markets and governments work together? Well, what's extraordinary is econ 101, especially the micro, that's where the actions at, right? That's like the underlying theory of value in any theory, whether it's Marxist, economics or neoclassical economics has to have a theory of value. That theory of value in the econ 101 is nested in the production function, which has evolved. There's all sorts of interesting stuff on technological change and so on, since the whole kind of from solo to Romer and the modern also evolutionary economics. But the production function doesn't actually look at government as a value creator. So that's the first problem, right? Like, if we take this view that actually values created collectively and government isn't there to fix markets, to regulate, to administer, but also to invest, to have a direction to help us get to the moon and back, you know, government actually produced, they created value working with 400,000 people in the private sector, economics, standard economics can't describe that because what it describes is value created in the private sector in the firm in particular. And again, it's progressed in the last 50 years or is interesting, you know, neoclassical models of learning and so on. So we shouldn't have the straw man. But anyway, values created in the private sector, it's created through individuals maximizing their, their other utility function, if it's a consumer, their, you know, profit function, if it's a firm, their work versus leisure decision, if it's a worker. And then we aggregate all these, you know, a maximization curves, that's why calculus is used, right? You know, calculus and not what I use in my PhD was more math from biology, so replicator dynamics and other interesting mathematics. So the reason calculus is used by neoclassical economics is you're maximizing your profits or minimizing your costs. So you need to find those points of max and min and everyone's doing that in the economy. You aggregate those curves, which ultimately become supply and demand curves, that point to the equilibrium. No one is doing that in the real economy. Of course not. No, I'm just, I mean, my question was on the bullshit economics. So let me, let me at least do the bullshit thing. I mean, otherwise one of you, one of you is asking me one question. That one's telling me, I mean, I'm sorry. That's what the problem in your class economics is that ultimately you derive these functions, you get the equilibrium prices and aunties and then oh no. We don't have enough clean water. Oh no, we don't even have a defense system. We can't fight the war because this stuff ain't gonna produce that. Oh shit, we got to get the government to come in and fill the gap. So the first thing, I mean, the main thing, which Nick is absolutely right. First of all, this is completely like no one does that. It's bonkers. Who was it? Wait a second. There was that guy. I want to say blinder. No, blind? Oh my God. Binder, binder. Why does he blinder? Anyway. Oh, it's descriptive. Okay. Anyway, before entering the administration, he had begun a study, which from what I understand, he never finished. And so even from a neoclassical perspective, he found through the work they did that there are no firms that actually maximize their profits. Why? Because they don't know their costs. They're basically, you know, just fudging it. So again, fast forward today, evolutionary economics has done great work on this, behaviorly economics has done great work, everyone's just kind of satisfying, not maximizing, but even under their own theory, forget the critiques, right? People aren't maximizing the rules of thumbs, routines, and so on. Even if that theory was right, which it's not, because people don't operate that way. And again, read all the behavioral economic stuff on why that is. It doesn't then produce the goods that, you know, economies actually need, right? Yeah. So then the idea is the government has to step in and fill the gap. So if that's what government did, which the theory is telling us it should do, forget that the theory is wrong because of all these assumptions in human behavior, then we wouldn't have had Silicon Valley because Silicon Valley did not just fill the gap. You had DARPA, you had SBIR, you had NSF, you had INCUTEL, you know, the CIA's big venture capital fund. This whole story is what I told in the entrepreneurial state back in 2013. So the first thing is historically also, not just theoretically, it's just wrong. You would literally not have had GPS, touchscreen, Siri, the internet because government didn't just fill the gap. It actually had goals, right? Yeah. We needed the satellites to communicate the internet with the solution, the Navy needed to know where the hell the ships were, GPS was the solution. So this idea of a mission oriented kind of state is not so much a normative point because a lot of these missions are crap, right? There were time. I don't want more war. I want these missions to be on kind of societal goals and climb and a bite of diversity and so on. The point is if with war, which government's always wake up with war, it's not surprising that with COVID, they use wartime tools like the Defense Production for Kierman Act, if with war and military industrial complex goals, government got us some of the most radical technological change we've ever had, including the internet. And as I mentioned, the early, early AI stuff also traces its back to that. Then we better have a theory to understand at least what does that mean for understanding the role of the state and the economy when it's not just sitting back and waiting for things to screw up and coming in with a bunch of bandages, which we know doesn't work. And my point is not that we should have these military industrial complex war, mongering states. But if they can do it for war, it's a choice, it's a choice not to do it for issues of inequality, issues, you know, all the stuff we care about, right? And so and then the question is, because I already kind of said that in my previous books, the question in this book is, well, what does that look like on economic theory to have a goal oriented economy where public, private, and other actors, I mainly focus on public and private are actually working together from the start in the design of procurement of water rights, of property rights, of bailouts, of subsidies, of tax incentives, where the goal is nested in. Again, as they did with the moon landing, where the first thing that Ernest Brackett don't ask me why I remember his name, I remember nothing I did yesterday, he was ahead of procurement for NASA. The first thing he said had to be done was to redesign procurement so that it changed from just being cost plus to outcomes oriented and a good deal with the private sector. They put into all the contracts, no excess profits. They knew that if they went to the moon, they needed to work well in not an extractive parasitic way with the private sector. So it was not only goal oriented, trying to get solutions to, you know, what would the astronauts eat, what would they wear, how would they communicate back with mission control room, but also that the contract be kind of a fair contract and not a gambling one, which is what we have today in space. Interesting. What do your fellow economists think about all this? Aren't you one of my fellow economists? Oh, no, no, don't insult Nick by calling him an economist. I think it depends. I mean, it's really funny because sometimes people say who are your biggest enemies and I'm like, well, it ain't just the extreme right, it's those who are very comfortable talking about progressive stuff with the standard theory. Like I'm kind of the biggest threat to them, right? Because it's nice to think you can use an existing model and just make it a bit politically correct. Let's add a bit of, you know, gender stuff here and racism there and environmental stuff as opposed to restructuring the theory itself. I debated Jason Furman a couple of days ago, so I know what you mean. Interesting. No, but even like, and I don't mean this at all dismissively because I actually really admire Danny Roderick's work and we talk a lot. We've written a paper together on this whole issue of conditionalities. And I think we in a very healthy way disagree. He really does believe that it's about market failures and it's about the tools through which you then correct those failures, whereas I just, I just think that whole edifice has to be. Eric, and I, Eric Bynacher and I call this market failureism. Yeah. And, you know, they genuinely believe it works, yeah. No, I know. But I guess our argument is that if every single interesting bit of your field, everything you want to talk about is a failure, that is a sign that your theory has failed. The theoretical framework you're using may be inadequate to the task. But also talking about, I mean, I am so honored and grateful that I got my PhD at the graduate faculty of the new school, which is actually, by the way, where I'm launching the US edition of the book, the UK edition came out in June and globally it's coming out in different language, but in the US I'm launching it on my alma mater, where I got my PhD, the graduate faculty at the new school. And I was there. It's a bit changed now. There was all the top people in the different theories of economics, right? We had the top Marxist economists like Unwarshake and Ross Thompson. We had top nearly cardians like Pietan Joagat and Janie and John Eatwell. There was, you know, people like David Gordon, who came more from the UMass Amherst view of things. And the point is that we were presented these different theories of value and how the economy worked as alternatives and the new classical perspective. It wasn't like just history of economic thought, which is how it's usually presented. And most economics departments is like, this is the real theory, it's the neoclassical economics. Oh, and here's, let's go back in time and, you know, through a nice history of economic thought book here, what Cain said and what Adam Smith said and Mark said. We were actually presented different ways of viewing, again, Schumpeterian economics and so on. And I personally, and a lot of my fellow PhD students ended up being able to kind of form our own brains, and I also went to the Santa Fe Institute for part of my PhD where I learned immensely in terms of the methodology. You know, again, that's where the non-Newtonian physics mathematics is useful, which I always warned the young people who say we need to rethink economics. There's too much math. I'm like, no, don't say that. It sounds like you don't know math. Make sure you say it's the wrong math. Of course, we need more qualitative studies, and I believe in that. But what happened in economics and Phil Moralski talks about this, he said it was a very unscientific process. Like, they wanted to prove that the market system and pray to optimality and so on was like the best of all systems, and then they said, which kind of mathematics will help us prove that? Well, of course, we need to use a body of mathematics that looks at equilibria, at unique equilibria. And we need a bunch of assumptions, which are consistent with our desire to do that. Exactly. So it's very unscientific. The scientific process is like, oh, wait, a volcano, let me try to understand why that's happening and look at all the different tools in my toolbox. Not, I want to prove that theory of volcano. So let me backtrack and use the right hammer and screwdriver. And anyway, well, the most important thing is you don't want the government to interfere with that volcano. But see, I don't think that's the world that we're still in. I think that's like the old world is like saying, okay, your class of economics just doesn't want the state, and it's the kind of the Reaganite fact, right thing. I think that's not the world we live in, even the right, at least the, you know, more sane conservatives still want the state to be involved. But it's in a very limited capacity, which doesn't mean size. You end up with big states in countries where the state doesn't work. Because I have to pick up the mess. So they have to pay for all this crappy stuff because they haven't fixed the system in the first place. It costs more to imprison a teenager than to invest in their wellbeing and their education. It actually costs you more. Or that increases, you become a bigger just in terms of, you know, debt and so on state if you don't solve the problems from the beginning. We hear this a lot from economists in which they're kind of defending how much orthodox economics has changed over the past four decades. And nobody really believes what's in that econ 101 textbook. That's just a simplification for beginners. And if you go on and you study, you get a much more nuanced education and no doubt. The reason why we pick on that book is because that's the only economics class most people get. So regardless of what the top economists believe now or what they'll talk about with each other, the policymakers, the politicians and policymakers, they're not economists. Their world view was changed by this unrealistic and rigid set of theories and metaphors that they were taught as undergrads. And they continue, if you read Matthew's book in 1990, that's basically right or left. You know, you're just making the decision how much that trade-off you're willing to make. You know, you accept there's a trade-off. On the left, you're willing to sacrifice some growth for different outcomes, and on the right, you're not. In the real world, in policy making, that's the world we live in today. And we don't see how you fix that without fixing the way economics is taught at the undergraduate level. Absolutely. And, you know, it's interesting because people think that Schumpader's whole thing was innovation, which actually it wasn't Marx had already said everything that Schumpader said in innovation. Schumpader's real thing was on competition. And what he said was, you can't talk about reality like oligopoly and monopoly. If in order to talk about that, you have to introduce imperfect competition. He said, you know, what defines capitalism versus feudalism is innovation. And you couldn't even justify innovation if you had a perfectly competitive market because of all the different conditions, which mancus 101 book talks about that defines perfect competition, ease of entry, perfect information. So in order to introduce innovation, which is the key to capitalist economies, one of the keys besides the dysfunctionality bits, so, you know, comparative feudalism, 500 years of inertia, you have to talk about imperfect competition, should tell you that your theory of competition is wrong. So just to challenge you a bit on what you said, I totally agree with everything you said, but even what those smart economists say, which is, oh, but this is just, you know, we don't actually believe the world works this way. We'll then hold on a second. Then how can you have a theory where in order to talk about reality, which yes, you believe in, thank you very much, like oligopolys and monopolies, you have the measure is how distant it is from this wrong theory of competition. Similarly, Keynes, Keynes said the same thing. He said, hold on a second, you can't talk about unemployment as an imperfection and an otherwise perfectly stable fully employed economy when actually unemployment, and again, Marx had already said this, the reserve army of labor is a permanent feature of the system. So whether you talk about innovation on unemployment, you should have a theory where at the core of your theory, you can discuss that without talking about the imperfect, right, like economy that then produces that thing, which is actually, oh, is there. And so I think what we should push back on is not so much, oh, it's all these stupid policy makers that just don't know what they're doing, and they've somehow believed the economics textbooks is economics textbooks are actually fundamentally wrong because in order to talk about the reality, which real world people know about, you have to go far away from that core theory. So it's as Nick said before, it means the theory is wrong. So Mariano, if we made you goddess for a day, I'd like that. What would you do? What policy interventions would you suggest? So the first thing, which I really believe in, and that's why I've set up this whole institute, as opposed to just doing my thing, just much easier, just to write a book and go talk about it, set up an institute where we train students in this very new way, and so on is because I believe in we have to invest in the capacity of governments to think differently, it kind of comes back to your point, right? So we need to retrain not just everyone and students and rewrite the textbooks. That's great, but we need also to invest within. So in source, the talent, in source, the capabilities, and what does a flexible agile bureaucracy, a creative bureaucracy look like? That's what we look at. And the institute, how does it work in an outcomes oriented way, making sure that the relationship with the private sector is the right one. That first point is training. We have outsourced government capacity for the last 60 years. It is impossible. Let me tell you to govern AI for good or anything for good if you don't have the knowledge in house. And which doesn't mean you have to do it all by yourself. You should always be working with others, but you don't even know how to work with others if you're just outsourcing it all. So I do think that's one of the biggest elephants in the room. And of course, the private sector complains about that all the time, but they use it more just as a criticism. Government officials, they don't know anything. Well, guess why? We've stopped investing in their brains, right? I mean, NBA programs are totally different from NPA programs. Anyway, that's the first thing. Second is this common good book that I've just written is because I actually believe we have to re-believe in that common good. We have been told by so many people, you know, empathy is for whims. I remember it was Musk or Trump that said that or that, you know, there's all this climate skepticism. There's enough people out there that still have in their hearts the belief that we can do good. And enough people out there that know and are listening to the science, they might not be scientists, but they're not skeptical of the science. They're they're, you know, in whatever way listening and reading, if we can make sure that those people forget those who think it's all gone to hell or don't believe or don't want us to believe in the good, I don't think we have a framing. So I think that second bit is let's start testing our ability to work differently with what I call sandboxes. So it's not just theory. I've worked on this big school meals program now in Brazil, Sweden, and Scotland. If we want to make sure that every child in a country has access to healthy, tasty, and sustainable lunch, let's test our ability not just to preach about how economics is wrong, but to design a different type of both economic theory and practice, which allows different actors to work together to solve that problem because it's not impossible to solve. Some problems are really hard, that's not a hard one, but that again requires a very different relationship between public and private. So that second point I'd say is let's start practicing through concrete sandboxes, whether it's cleaning up our rivers, that's a project I'm working on in Mexico, whether it's providing school lunch that's healthy, tasty, sustainable to every child in a country, test our ability to work differently. And third, I think this thing about calling out the kind of public interest, common good, public good, green washing thing that we talked about initially. Let's get the companies that at least are talking the talk and not walking the talk to really ask what does it mean to govern your organization from the beginning and how it works with others differently, and to start bringing those actors. I'm thinking of people like Paul Paulman when he was the head of Unilever or the guy who was running Danone before he was sacked, right? There have been some leaders of big companies, I'm not saying they were perfect, but who definitely seemed very willing to work in a different way both internally and with others. And we need a coalition of those business leaders and to say, okay, let's not just make this a dinner table talk and then you go back to the company and do things as it was before because everyone loves to talk about purpose emissions. Let's test what it means on the corporate side for really running that company differently without always just having to talk about Scandinavia, right? I mean, let's test it in the US with, you know, take 20 companies at large, medium and small and ask what it means to have the common good at the center of how those companies create value from the beginning instead of just giving people some crumbs at the end. That's awesome. One final question. Why do you do this work? Well, because I actually really believe in it. That's why I'm exhausted. And I really believe in something I think you said or we both said that, you know, we've designed this system wrongly. So I actually have a very optimistic that we can change it because it's agency. Like, we have designed this. It hasn't come down from God. There are no like market forces. Like, oh, dear, we are being forced to do something. We've the bond market, right? Like, these are all outcomes of decisions we've made. And I think unpicking. And that's why I believe in concrete action, those decisions testing them on the sandboxes that answer to your question is I really, really believe we can make radical change. But it doesn't happen by just talking about revolution. You have to get your hands dirty along the way with some projects. And that's why sometimes get criticized. Like, oh, but you just believe in reform. I'm like, yeah, no shit, sure. Like, how do you think we're going to learn how to do things differently? You know, it's interesting, Nick. I weirdly, one of my big takeaways from this was Mariana's optimism that I mean, the way that she emphasized that a lot of these problems are solvable. Yeah, for sure they are. Yeah, there are solutions to these problems. We can solve climate change. We can solve the radical inequality that is evolved over the past several decades. We all the things we talk about on this pod and a lot of people talk about the affordable housing crisis, the affordable healthcare crisis, all these things are entirely solvable just like we solve the problem. How do you send a man to the moon and bring him back alive? And we did it in less than a decade. All of these things are tractable. You just have to want to do it. And I think, you know, the starting point is recognizing that the objective function of the economy shouldn't be just making a few people richer. Right. But let's be clear where that comes from. I think foundationally to Mariana's argument here is this disagreement with Orthodox economics, the starting point being that markets are made not discovered. It's not like markets always existed in this pure form. And we just can then we mess them up a little bit. Markets are created through institutions and laws and regulations and norms, government investment, not just the the choices of buyers and sellers in a perfect competition. Whereas as economics has taught today, we're told that, you know, there's the market. And then there's the government. And that invisible hand does serve the common good. And, you know, it was a great insight from Adam Smith. That in fact, often your pursuit of, you know, you're a self-interest does result in serving the common good. You know, the butcher, the baker, the, I was going to say Candlestick Maker, but that's not what it was. Anyway, that's from a, that's from a different camera. Yeah. So, you know, there is a truth to that that the things we're doing, you know, most of us. I mean, if, if what you're doing is just arbitraising bond prices somewhere, that's not all that you're not really adding much. But if you are a butcher or a baker or a brewer, you are doing something you're providing goods and services that people want to prove our lives and so forth, and you're not doing that out of pure empathy. You're doing it for a number of reasons, some of which is your own self-interest. Some of it is your, your own interest. Like, I like baking bread. I'm good at this. I enjoy this. I enjoy it when people enjoy the bread that I bake. And also, I make a living off of it, right? So, there is a truth to that. And what we've done over the past 50 years is said, that truth, that's the whole truth. And nothing but the truth and there's nothing else. And once you accept that markets are actually the social technologies that we create, you can accept the fact that we can choose to make, create them a little differently. So that they serve different needs. And that is, that shouldn't be, but is a fundamental disagreement with Orthodox economics. Yes, it is. But if you want to read more from Ariana in her own words, we will provide a link in the show notes to her new book, "The Common Good Economy, How to Make Capitalism Work for Us All." Pitchwork Economics is produced by Civic Ventures. If you like the show, make sure to follow, rate, and review us wherever you get your podcasts. Find us on other platforms like Twitter, Facebook, Instagram, and Threads at Pitchwork Economics. Nix on Twitter and Facebook as well, at Nick Hanhauer. For more content from us, you can subscribe to our weekly newsletter, The Pitch, over on Substack. And for links to everything we just mentioned, plus transcripts and more, visit our website, PitchworkEconomics.com. As always, from our team at Civic Ventures, thanks for listening. See you next week.