Consultants and the Crisis of Capitalism https://www.project-syndicate.org/commentary/consultants-bring-more-problems-than-benefits-by-mariana-mazzucato-and-rosie-collington-2023-03
Mar 2, 2023 MARIANA MAZZUCATO and ROSIE COLLINGTON
In 2021, the global market for consulting services was estimated to be $700-900 billion. Yet despite the industry’s growing role in economic and political life, its activities are hardly ever viewed as what they are: symptoms of deeper structural problems with contemporary capitalism. The consulting industry may not be wholly responsible for the financialization of the economy, corporate “short-termism,” or the gutting of the public sector, but it certainly thrives on them. Throughout the history of modern capitalism, the Big Con (as we call the industry) has been there to surf each new wave of dysfunction.
In government, big consultancies promoted and profited massively from the push toward privatization, management reform, private financing, outsourcing, digitalization, and austerity. In business, they helped to entrench new models of governance, from the spread of cost accounting and multidivisional corporations in the decades after World War II, to the rise of King Shareholder in setting priorities and allocating resources.
Today, the consulting industry is promising to reverse the very problems it helped create – hence the boom in new contracts to provide “environmental, social, and governance” (ESG) advice. Not surprisingly, this new line of business has come with all kinds of conflicts of interest. McKinsey, for example, has previously advised at least 43 of the 100 biggest polluters...
COVID: When everything is outsourced, government agencies cannot develop the internal skills and knowledge needed to manage new challenges. This should concern all of us. Epidemiologists warn that the next global pandemic is a matter of “when,” not “if.” We urgently need to invest in governments’ and public-health agencies’ ability to detect new outbreaks and contain them before they can spread.
Around the world, governments are waking up to the dangers of an overreliance on consultancies – and of the form of capitalism that they have helped bring about. Reformers are developing innovative new governance models, from in-house public-sector consultancies to policy “labs” and local community-oriented procurement programs.
Transforming our economies in the public interest requires changing how we think and talk about the role of government.