Mariana Mazzucato, economist: “If there is no clear and hopeful project from progressivism, fascism fills that emptiness” | Economy | EUROtoday

In a world shaken by the return of Donald Trump to the White House and its renewed tariff campaign in opposition to media planet, the Italian-American economist Mariana Mazzucato doesn’t lose sight of the important: industrial coverage can’t be decreased to a battle of subsidies, taxes or a struggle of percentages in protection. “What Trump is doing right now is not an industrial strategy, it is its destruction. It is destroying all the advances made by US presidents,” he warns. Since January, the Republican president has unleashed a brand new wave of tariffs that threatens to pull Europe and the remainder of the world to a spiral of reprisals and protectionism, simply when the group block tries to get better its personal industrial imaginative and prescient.

The professor of Economics of Innovation and Public Value, and director of the Institute for Innovation and Public Purpose of the University College of London (UCL), has traveled to Spain to obtain the Emilio Ontiveros Economy Award in its third version, in recognition of its mental contribution to the redefinition of the financial worth, the position of the State and the general public mission as improvement engines. In an interview with El País, Mazzucato, observes with skepticism the trail that Brussels might observe if he chooses to answer Washington with the identical forex. “Europe should not fall into a childish logic of ‘If you hurt me, I hurt you.’ It is a trap that weakens it,” he says. In his opinion, tariffs solely make sense if they’re a part of a sturdy industrial technique and oriented to productive transformation. “[Alexander] Hamilton imposed tariffs to protect nascent industries while building capabilities. Trump imposes tariffs without more. He is sabotizing the same industrial architecture that Biden began to build with the Chips Law to assure the US a sovereignty in its production, something that everyone wants. ”

Europe, insists, must resist the temptation to use the instruments of the nineteenth century to address the challenges of the XXI. Instead of limiting yourself to protect yourself, you must rebuild. “The precedence is to not shut, however to reimagine its industrial system from the basis. And that occurs to go away the continual concern of the deficit behind.”

The fiscal debate has been revived in the continent strongly after the European Commission approved to mobilize up to 800,000 million euros to strengthen the common defense. An unprecedented turn that, although it responds to the direct pressure of NATO for European allies to spend at least 2% of their GDP in defense (and that Trump has recently announced that he wants to increase to 5%) has unleashed an old reflection: the fear of debt. Mazzucato dismantles the classical comparison between a state and a family. “The Government will not be a house with a restricted funds. A State can and may use public funding to spice up its financial system. If funding generates progress, it additionally generates tax revenues that compensate for the preliminary deficit.”

The point, emphasizes, is not how much it is spent, but how it is spent. The key is that public investments are aimed at solving specific problems – security, yes, but also health, weather or education – through effective alliances with the private sector. “What can not proceed to occur is that public cash ends within the fingers of firms that don’t remodel or contribute to the frequent good. That parasitic relationship between the general public and the non-public is shaking our capacity to unravel the nice challenges,” he insists.

In this sense, the German model sets as an example. There, the KFW public bank has conditioned its loans to the steel sector to concrete environmental objectives, such as the reduction of material content in production. “That is a symbiotic relationship: the State helps, but in addition calls for. It is rewarded who invests, not the one who shouts stronger.”

Contrasting with that approach, it indicates the structural lacks of other countries such as Italy or even the United Kingdom, where the public sector lacks the capacity to negotiate conditions or implement long -term strategies. “It’s not nearly giving or spending cash. Europe has to strengthen its public administration. If you do not know find out how to use funds, irrespective of what number of you have got.”

European institutional weakness thus becomes an industrial problem. In the face of powers such as the United States – which, despite its liberal rhetoric, has a national system of articulated and generously financed innovation – or China – which displays a meritocratic public function and mobilizes Billones towards sustainability -, Europe appears fragmented and captive of self -contained fiscal rules. “China will not be good, a lot much less, however it doesn’t have our complexes with the deficit. When they make investments, they make investments significantly. We can reduce in an absurd means, with out fascinated by what to speculate, to meet a synthetic determine of three% of the GDP. That is suicidal.”

In that panorama, Mazzucato stands out for Spain as a positive exception. “It is doing higher than many European international locations. It has maintained a extra fixed funding in well being and within the ecological transition, even after pandemic, and has proven a extra coherent imaginative and prescient. Not all the things is ideal, however there’s a readability of objective that we don’t see in locations like Italy or the United Kingdom,” he says. The warning, however, is the political instability that, in his opinion, opaque advances in economic matters.

The new geopolitical context has made all the seams of the European model jump. Trump’s threats to reduce his military support to NATO, the Russian invasion of Ukraine and the growing risk of a recession induced by the commercial war have forced Brussels to move file. But Mazzucato warns of the danger that this turn towards investment is limited to the military field. “Why cannot we do the identical with public well being, the academic system or the struggle in opposition to local weather change? Investing in these areas will not be charity. It is survival,” he says.

“Not investing in inexperienced transition, in well being or social safety finally ends up costing far more. We noticed it with the pandemic: as a result of that they had no ready methods, the confinements have been longer, the economies sank extra. The identical goes for the local weather. Drought, floods, lack of biodiversity are financial accidents. But if we deal Reflect Mazzucato.

Behind this lack of ambition additionally hides a significant political menace: the rise of populism. In Europe, democracy is eroding from the proper and for Mazzucato there’s a direct connection between the deterioration of dwelling circumstances and the vote to excessive choices. “Macroeconomic data can be good, but when salaries stagnate, jobs are precarious, housing is inaccessible and public services deteriorate, it is normal for people to rebel. And if there is no clear and hopeful project from progressivism, fascism fills that emptiness.”

The economist insists that it isn’t about crossing out the voters of silly. It is about providing a story and a coverage that reply to their actual issues. “We need clarity, not condescension. Solutions cannot be limited to technocracy and data. We must speak with ambition, with shared objectives. That is why I insist so much on an industrial transformative strategy: because it is the way to rebuild democratic legitimacy from the economic field.”