“The time demands a humanistic vision of the economy,” Jean-Hervé Lorenzi

THE TRIBUNE – The Economic Meetings of Aix-en-Provence 2017 have chosen the theme of prosperity. It is the question of our time, ten years after the financial crisis ?

JEAN-HERVÉ LORENZI – Yes, we think so. We are convinced that the problems of the current societies are not confined only to the question of the return of growth, but require you to cover a wider field that encompasses inclusion, equity, sustainability. The time demands a humanistic vision of the economy, because we are living in a transition that is characterized by technological change, climate, energy, and a rise of inequality. This requires rebuilding our social contract and reform of our institutions to take account of these new requirements.

This reflection draws on the work of Amartya Sen, the Nobel Prize in economics, but also of authors like John Rawls : it is time to invent an economic and social model in the long term, to build new forms of prosperity, in order to reconcile the quality of life and personal development in a social contract humanistic. In short, it is an economic vision, which wants to put people at the centre of the game.

The economists-they too tended to obscure this human factor in their work ?

For classical economics, man is an agent supposed to be rational and subject to behavioral analysis. But few works have highlighted the issue of capacity and the development of the individual, except, perhaps, the Nobel laureate Edmund Phelps in his latest book on The prosperity of mass [Odile Jacob, 2017, editor’s note], where he highlights the concept of good life.

For the vast majority of economists, the dominant institution, one that guarantees the social contract, it’s either the market for the liberals, or the State for the keynesians. Ask the question of prosperity, it is thus put the individual at the centre, look for new answers where the two schools of thought dominant have failed.

Ten years after the financial crisis, can the world know a new cycle of growth ?

I think we have to stay very cautious about this. What one finds, rather, it is a paradigm shift. The company of 2017 has nothing to do with that of 1997, during the last period of global growth strong. The situation that we live ten years after the most severe financial crisis since the 1930s bears other requirements as the only back to what we call growth.

The terms of the problem have changed : in the face of globalisation or of technological progress, we can see that there are winners and losers. And these losers, everywhere in the world, especially the middle classes of advanced countries, revolt in different forms. There is the rise of populism and the social violence or faith-based that we had not known for a long time, such as terrorism.

Without falling in the sermon on the stagnation of secular Robert J. Gordon, doesn’t anyone think that the world will return to growth as strong as that of the 1990s and beginning of 2000. This goes hand in hand with the realization that economic thinking has failed. The financial crisis has demonstrated that liberalism provides an analysis inadequate societies in which we live. And the keynesian solutions put in place following the crisis have not proven their effectiveness. We are living in a period of uncertainty absolute in the future.

In the same way that we have seen the rise of protectionist reflexes and self to reject globalization, negative reactions appear to be against the groups technological giants who want to dominate the world by holding our personal data. The all feeds of a new perception of the inequalities that are widening because the institutions are no longer able to regulate globalization and the power of technology. In ageing societies where the generation gap manifests itself more markedly than in the past, all this invites the economists and the political world to think of new answers.

“If you have a garden and a library, you have everything you need,” said Cicero. It is this, the new forms of prosperity to which we must aspire in a world that is more sober ?

The common point between this quote of Cicero, and we, indeed, it is that we need to focus on the development of the individual, or rather of the individuals who form the society. It is necessary to provide them with a garden and a library, in the sense of helping to train and develop their capabilities throughout their life, and not just from 3 to 16 years, as proposed today by the school. This is the new social responsibility, in a world where it must learn to continuously adapt.

It is not necessary to count on the major economic policies to save us. After ten years of crisis, the monetary and fiscal policies have exhausted their effects and there is not a lot of margin of maneuver using macroeconomic instruments traditional.

In the Face of the next crisis, we are disarmed. The solution is therefore elsewhere : in education and training, to raise the level of human capital, because it is the best way to combat inequalities. We live in a world that is very unequal. And I regret that we have not quite worked out this issue. What are the springs of inequalities ? What is the limit of what, until now, was considered acceptable and now is not ? The question of the universal income is now on the table in all modern societies.

In your book, The future of our freedom*, you engage in a virulent criticism of the Gafa, the tech giants of Silicon Valley, and call even to dismantle Google. They are one of the causes of these inequalities ?

I wanted to raise this debate, which appeared obvious to me : innovation is necessarily good for the progress, growth, and social inclusion ? According to me, the technological revolution is one of the sources of the rise in current inequalities. There is an uptake, a concentration of wealth in a few hands, the United States, the Gafa, whose market capitalization is approaching the GDP of France. This poses a problem because there is also a vision, very arrogant, and domineering, universal, which is dangerous to run if nobody puts a stop. Is it that it will come from the world of politics, customers or antitrust authorities ? No-one can say but yes, to an economist, this technological leadership is a real problem and serious.

In the world to come, the technology will have to be put at the service of the human, and not the reverse, as is currently the case when we “work” for free for Google. Beyond Gafa, the acceleration of progress in the field of artificial intelligence and of the genetic research on the human embryo, the chisel genetic CRISPR-Cas9, all of this raises questions new, ethical and philosophical : are we still humans in this world ?

The response of the economist in the face of these advances, of course, this does not outlaw the innovation. It also brings advances in medicine, how we work, or we move.

The competition should allow to regulate these new monopolies, but this is only a part of the subject. It is necessary also, it is to re-humanize technology. Dismantle Google, it is sending a strong signal in this direction.

Google has just been sentenced to a very heavy fine by the european Commission for abuse of dominant position on its price comparator. This is a strong signal sent to the economy platforms ?

We have reached out to Google, and a few others, we say in the book, with Michael Berrebi, but first Google it, because it is the only one who has created a holding company, Alphabet, for the holding of activities in all areas of our social life. It is the most iconic ; but Facebook, Amazon and a few others raise the same questions. The challenge is to make it clear to the citizens and consumers that they should regain control of their personal data. It is also necessary, in the field of genetics, to prohibit research on the human embryo by an international agreement.

I would like to implement a global agency of genetics and artificial intelligence, built on the same model as the one that fight against the proliferation of nuclear weapons. It is necessary to create institutions to the extent of the new dangers of our time, and fix it before it is too late clear limits not to be exceeded.

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(*) The future of our freedom. Should we dismantle Google… and a few other ?, by Jean-Hervé Lorenzi, with Mickael Berrebi, Editions Eyrolles (June 2017), 256 pages, 17 euros send

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