When you hear the words “innovation” and “entrepreneurial”, what do you think of? A technology start-up company backed by a risk-taking venture capitalist? Or politicians and bureaucrats making public investments to build a future that doesn’t yet exist?
Chances are you think of the start-up rather than the politicians. You probably imagine that the private sector is always more dynamic and innovative than the public sector.
As the old song goes, it ain’t necessarily so.
Mariana Mazzucato, in her powerfully-argued book, The Entrepreneurial State, shows that these are just stereotypes. Of course businesses and private enterprise can be innovative and agile, but Mazzucato’s point is that governments have a huge (if often unacknowledged) role in driving and supporting innovation.
Governments support the basic research on which technological innovation is built. Governments make long-term investments and take long-term risks which most entrepreneurs and venture capitalists can’t and won’t. Governments direct funding and coordinate research in strategic areas (think biotechnology and pharmaceuticals or the clean energy revolution). Governments provide support to help businesses commercialise and scale-up products built on technological innovation.
So what about the iPhone?
As amazing as an iPhone is (or any other smartphone for that matter – I don’t want to be accused of running an ad campaign for Apple), Mazzucato also shows that it only exists because governments funded and helped develop every single piece of technology that makes it smart.
Semi-conductors, lithium-ion batteries, GPS, touch-screen technology, wi-fi (thanks CSIRO!), the internet, voice-activation all came about through direct investment or coordination and support by government. It wasn’t the invisible hand of the market that created these. It was the visible hand of the state.
Steve Jobs did an amazing job integrating the technologies into a platform and marketing it to customers, but he didn’t create the technologies. In its crucial early years, Apple also received financing from government through a small-business investment program.
The take-home lesson of this for me is that Christians need to move beyond lazy stereotypes of agile businesses and lumbering governments. Clinging to these stereotypes allows governments off the hook for delivering more active and visionary “mission-oriented public investment” to create new public goods. It allows them to downsize their vision and outsource their activities to bolster private profits instead making the long-term, large-scale strategic decisions and investments in support of the public good.
It was government investment, energy and focus that put humans on the moon. It was government investment, energy and focus that eradicated smallpox.
So let’s move beyond the stereotypes and ask our governments to be more ambitious. Lets ask them to put that same investment, energy and focus into unleashing a new wave of innovation and jobs in clean energy, or researching the new antiobiotics we will need to tackle drug-resistant “super-bugs”, or to tackle the big global challenges of climate change, sustainably feeding a growing global population, and ensuring that all people everywhere can live lives of dignity, opportunity and hope.