What if government, instead of being viewed as cumbersome while the private sector takes the risks, bears the greatest level of uncertainty and reforms its internal organization to take such risks? Imagine the transformation: from a bureaucratic top-down administration to a goal-oriented stimulator of new ideas from the ground up.

Outsourcing in itself is not a problem as long as governments remain capable, risk-prepared and have foresight; and as long as the underlying ‘partnerships’ with the private sector are truly designed in the public interest. The irony is that so much outsourcing has damaged governments’ abilities to structure contracts. In March 2020, in an echo of

Conventional wisdom continues to portray government as a clunky bureaucratic machine that cannot innovate: at best, its role is to fix, regulate, redistribute; it corrects markets when they go wrong. According to this view, civil servants are not as creative and risk-taking as the entrepreneurs of Silicon Valley, and government should simply level

Why are capital gains taxed less than income from work?

This chapter examines the Apollo programme as an example of an extraordinary feat: government stepping outside the market-fixing role and into the market-shaping one.

The key role of NASA is to define the mission, plan the programme, be clear on the guidelines, set the parameters, and then allow as much innovation as possible to create the product or service required. None of this could have been done without the NASA staff themselves having experience of the underlying science and technology; in fact, it would

The problem is not ‘big government’ or ‘small government’. The problem is the type of government: what it does and how.

The appeal of working for a government agency was that it was not only purpose-driven but also explicitly welcomed risk-taking in the process. Far from being a boring bureaucracy, NASA was the most exciting possible place to be!

Government thus cannot limit itself to reactively fixing markets, but must explicitly co-shape markets to deliver the outcomes society needs. It can and should guide the direction of the economy, serve as an ‘investor of first resort’ and take risks. It can and should shape markets to fulfil a purpose.