The entrepreneur who does not risks his own possessions is not an entrepreneur

THE CATO – One of the most repeated phenomena in recent history is the discovery of things that are already invented, such as the “new man”, “the new journalism” or “the entrepreneurial state”.

The recently published book The Myth of the Entrepreneurial State, co-authored by Deirdre McCloskey and Alberto Mingardi, reveals the fallacy of the discovery of the entrepreneurial state by Italian-American economist Mariana Mazzucato.

The successful author is an advisor to the United Nations, to the president of the OECD, to governments such as the Scottish and Italian, to the European Commission, to NASA; she has received all the awards; she has four honorary degrees, and a resume that makes the morning star pale.

And yet, in her most famous book, Mazzucato discovers, again, the squaring of the circle. That is why the work of Mingardi and McCloskey is so important, as they remember how outdated this idea of ​​a State is that, acting as an entrepreneur, benefits everyone and is efficient.

However, the occurrence that rulers should be successful industrialists dates back to the inspiring aristocrat of utopian socialism, Claude-Henri de Rouvroy, Comte de Saint-Simon. In his Catechism of Industrialists (1823-24), Saint-Simon argued that the industrialists were the ones who should take the reins of the country since they are the most interested in maintaining tranquility, in the public economy, in limiting arbitrariness, and they are the most efficient administrators.

What seemed intolerable to him is that an essentially industrial nation is run by those who are not productive. It is not Mazzucato’s proposal, it is the opposite, but it is from this seed that the fashion of the entrepreneurial state arises.

In the mid-nineteenth century, after the teacher died, Saint-Simonians like Michel Chevalier defended the free market and the company as a means to increase the power of the State. A rich country that pays high taxes will allow the strengthening of the State.

In this way, the government will be able to undertake, as an entrepreneur, large infrastructures. Not surprisingly, it was Chevalier who, in 1860, signed, together with Richard Cobden, the free trade agreement between France and England.

Chevalier participated in the creation of the Suez Canal and the Panama Canal, and had the idea of ​​building the trans-Mediterranean railway. He was a worthy disciple of his teacher, Saint-Simon, who had already raised the union of the Atlantic and Pacific oceans, through a canal.

As Mingardi and McCloskey recall, it is from John Maynard Keynes that, after two world wars and a global economic depression, the need for the State to stimulate demand and gain prominence in the market is called into question.

But if we agree with Mazzucato and his many followers, and concede that investors, as Thaler explains, act dominated by biases; if we accept that society is childish and immature; If it is true that people do not see beyond our noses and we need to depend on someone to help us, why do we have to believe that government ministers are not going to act dominated by biases, they are not going to be childish and immature and go to look long term?

Above all, if we analyze the political decisions of our own Government, not in this year 2020, but for several decades, it cannot be said that they are the best leaders to guide anyone. What is observed is, rather, blind loyalty to the party over the interest of the voters, pathological short-termism, extreme superficiality and a lot of empty gesture.

This reflection comes to the case after reading María Vega who, in yesterday’s article by her, in line with the ideas of Mariana Mazzucato, pointed out the lack of experience of the Spanish political class in the business world. Marcos de Quinto and a few others could be excluded. Indeed, the entrepreneurial role of the State is not without its dangers, because it cannot occur.

An entrepreneur, by definition, as Nassim Taleb always remembers, is someone who risks his skin, loses his money, gambles what is his. The bad results of business experiments by the state are not paid by the cause of the mess, neither in money, nor in votes. There is always a culprit outside the government’s management that allows these holes to be covered. Mazzucato doesn’t risk her money as Enel’s advisor either: the gurus know how to get out unscathed.

But Mariana Mazzucato is not the exception, she is the most successful orthodox economist, and more so in these times. As McCloskey and Mingardi recalled, after catastrophes we must expect a growth in the role of the State.

Fear, economic weakness, and in the case of the pandemic, the unexpected and information confusion, are all factors that make anyone’s knees tremble and follow the one who tells us that he will save us.

And there is Pedro Sánchez, who in all the media claims the victory of having brought the vaccine, an arrival that makes us all happy, but which is the work of the European Union.

If the president of Spain were Espinete, the European Union would have distributed it in our country as well. Another falsehood spread by social networks is that it is free: European Union funds are provided by citizens of the European Union.

As we remember Carlos Rodríguez Braun, Luis Daniel Ávila and I are all at the Treasury, darling, a book that will be released on January 20, the government propaganda machine deceives us into believing that we pay little and for our own good.

Of course, the arrival of the vaccine is very good news and I am optimistic. I think that little by little we will recover our pulse and that the sun always comes out after the storm. What we find when we regain consciousness, that is something else. Happy New Year to everyone.

This article was originally published in El Español (Spain) on December 29, 2020.

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