Milton Friedman, a Nobel laureate, came up with one of the dumbest quotes of all time: “if the government were to take over the Sahara Desert, there would be a shortage of sand in five years.” (He was actually adapting an old joke about communism.)
But the attitude prevails and still inflicts damage. Here’s why.
The neoclassical model of our economy does not fit reality. Yet, since the days of Thatcher and Reagan in the 1980’s, we have pretended that it does. This logic leads to a simplistic formula: to grow the market, you shrink the government.
We’ve seen what happens: The consequences of these policies hit home in 2007. Now we have unprecedented income and wealth inequalities that are destabilizing our democracies.
What’s the alternative?
Over two decades working in regional economies gives me a different perspective, I think we should be seeing our “market economy” embedded in a “civic economy”.
The infographic below explains.
The challenge in building more prosperous economies comes down to developing complex collaborations on the boundary of our civic and market economies.
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