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Mariana Mazzucato Thinks We Need More Moonshots
Brief
Mariana Mazzucato joined hosts Jill Wisenthal and Tracy Alloway from Madrid to argue for a rebirth of state capacity through mission-oriented public policy. Drawing on her books The Entrepreneurial State (2013) and The Big Con, she framed the problem as threefold: governments need fiscal and staffing capacity, stable administrative routines that allow learning, and — most critically — dynamic capabilities that enable interministerial coordination, experimentation and partnerships with private actors. She described her recent meetings in Spain (including the prime minister and Economy Minister Carol Squerpo) and a new Public Sector Capability Index co-developed with Bloomberg City Lab as practical work to revive those muscles inside government.
Mazzucato stressed missions rather than sectoral handouts: set a clear public-purpose problem (a moonshot) and crowd in private actors who are willing to collaborate. She used NASA/Apollo as the archetype — changing procurement from cost-plus to outcomes and engaging some 400,000 private-sector contributors — and proposed comparable civic missions such as healthy, tasty, sustainable school meals. She warned against over-reliance on consultants, arguing governments invited consultancies in after decades of downsizing and then outsourced core public functions (citing the UK test-and-trace spending). Consultants create perverse incentives and conflicts of interest unless governments retain in-house expertise to write contracts and embed learning.
On technology, Mazzucato reminded listeners that government financing built much of the AI stack but now a handful of firms have amassed 'trillions' and are hiring away top researchers, concentrating knowledge and creating algorithmic rents. She argued for proactive governance: AI disclosures analogous to climate reporting, public–private conditions (as with the Oxford–AstraZeneca vaccine example), green conditional loans (KfW in Germany), and outcome-based procurement. Hosts and guest agreed on the need to rebuild public-sector capabilities, insource technical talent (cities hiring hackers), and design mission-led programs that preserve democratic oversight while leveraging private innovation.
Why it matters
Mariana Mazzucato (guest) said she met with Spain's prime minister and Economy Minister Carol Squerpo in Madrid and helped launch a Global Council for a Common Good Economy and a Public Sector Capability Index developed with Bloomberg City Lab.
Key details
- Mazzucato (guest) distinguished three elements governments must rebuild: capacity (people and fiscal space), administrative routines (stability and learning), and dynamic capabilities (agility, interministerial coordination); she argued capabilities are the most commonly lacking.
- Mazzucato (guest) advocated mission-oriented policy — 'moonshots' — that pick the willing not winners, using NASA/Apollo as an example (she said NASA mobilized roughly 400,000 private-sector workers) and suggested concrete missions like 'healthy, tasty, sustainable school meals.'
- Mazzucato (guest) sharply criticized 'consultification' (her book The Big Con) and cited the UK test-and-trace example where government paid consultants '£1.5 million a day' (quoted) instead of investing in in-house capability; she also warned of conflicts of interest when consultants advise both regulators and regulated firms.
- On AI, Mazzucato (guest) noted decades of public funding underpinned modern AI but warned that today a few tech firms control 'trillions' and are hiring top public researchers, creating concentrated 'algorithmic rents' and a talent drain from public institutions.
- Mazzucato (guest) recommended policy tools: outcome-based procurement instead of cost-minimizing contracts, conditional public loans (citing Germany's KfW conditional lending to steel) and AI-related disclosures (she's co-running an 'Algorithmic Rents' project with Tim Moriley) to govern ethical and climate-related impacts.