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COVID-19 and the Trust Deficit

Summary:
PALO ALTO/MILAN – With the world in the grip of a deadly, disruptive pandemic, it should be obvious that scientific, medical, economic, political, and other varieties of expertise are crucial to addressing the attendant health, economic, and psychological effects. Unfortunately, what should be obvious is not. The problem, as we warned back in 2012, is that we are living in an era of policymaking paralysis. “Government, business, financial, and academic elites are not trusted,” we wrote. “Lack of trust in elites is probably healthy at some level, but numerous polls indicate that it is in rapid decline, which surely increases citizens’ reluctance to delegate authority to navigate an uncertain global economic environment.” Change those last words to “navigate a

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PALO ALTO/MILAN – With the world in the grip of a deadly, disruptive pandemic, it should be obvious that scientific, medical, economic, political, and other varieties of expertise are crucial to addressing the attendant health, economic, and psychological effects. Unfortunately, what should be obvious is not.

The problem, as we warned back in 2012, is that we are living in an era of policymaking paralysis. “Government, business, financial, and academic elites are not trusted,” we wrote. “Lack of trust in elites is probably healthy at some level, but numerous polls indicate that it is in rapid decline, which surely increases citizens’ reluctance to delegate authority to navigate an uncertain global economic environment.” Change those last words to “navigate a highly chaotic public-health and economic shock,” and the statement loses none of its relevance today.

A World of Distrust

Although there are many reasons for the lack of trust, a key element is ordinary citizens’ belief that elites are placing their own interests above broader shared values. Beginning in May 2015, an Economist-YouGov poll has surveyed a panel of 5,000 Americans on issues relating to politics, elections, and trust in institutions. For example, when asked that September, “Do you think the US economic system favors the wealthy or is fair to most Americans?,” 66% of the panelists said the system favors the wealthy, while only 24% said it is fair to most Americans.

Over the next five years, that question was asked numerous times, and the “favors the wealthy” percentage never fell below 60%. In the March 2020 survey, a full 67% of registered voters continued to doubt the system’s fairness. Some 70% think that the US government is run by and for a few big interests, rather than for the benefit of everyone, and about two-thirds believe that many of those running the government are crooked and routinely waste taxpayers’ money.

But the distrust does not stop there. Questions exploring trust in institutions other than government yield similarly dismal results, as shown in Table 1.

COVID-19 and the Trust Deficit

With the exception of the military, the police, and small business, the ratio of strong to very little confidence is less than one across all the institutions measured. In fact, most of the remaining institutions score less than 0.25 on this metric. From organized religion and the medical system to the stock market, organized labor, and the news media, many more Americans distrust major institutions than trust them. With the exception of organized religion, these distrusted institutions do not win the strong confidence of even 10% of the public; and with the exception of the medical system, the scores for “very little confidence” range from 25% to 50% of the public.

The Pull of Polarization

These figures doubtless reflect many factors. But one important trend is that support for a particular institution seems to depend heavily on one’s political-party affiliation. As Table 2 shows, Republicans tend to have a lot of confidence in the military and the police, then some degree of confidence in small business and organized religion. After that, no other institution has the confidence of more than 7%.

COVID-19 and the Trust Deficit

In contrast, Democrats have less confidence in the military (35%) and the police (32%) than Republicans do, and also are relatively less supportive of organized religion and small business, albeit by smaller margins. As might be expected, Democrats tend to be more supportive of public schools, organized labor, news organizations, and universities.

The only areas of agreement concern banks, the stock market, and the criminal-justice system, toward which neither Republicans nor Democrats are particularly supportive. Finally, views toward the medical system show a small degree of partisan difference, but are generally more supportive than those toward banks, the criminal-justice system, and the stock market.

Turning to the negative side of confidence assessments, the biggest partisan divergences (from largest to smallest) show up in views toward newspapers, TV news, organized labor, universities, public schools, and organized religion. And while Republicans are less dismissive of banks and the criminal-justice system than are Democrats, few supporters of either party report a lack of confidence in the military, small business, and the medical system, and both parties’ supporters hold similar views about the stock market.

Some of these differences are understandable, given today’s ideological polarization. With the exception of Fox News, Republicans regard the national media as overly liberal, along with universities and public schools. And organized labor, of course, has historically supported Democrats. Finally, minority groups tend to have differing views than whites when it comes to the police and the criminal-justice system.

All told, the only major institutions about which Americans agree are banks and the stock market: they have a low opinion of both. While some of these differences are understandable, partisan politics in the United States appears to have made it more difficult to build and maintain trust in the system as a whole.

New Divisions on the Old Continent

Similar patterns also show up in the European Union’s member countries. In July 2019, the Hewlett Foundation, the Hoover Institution, and YouGov conducted a “populism survey” in which respondents were asked, “Do you agree or disagree with the following statements pertaining to the people and the elites in your country?” Table 3 shows the results for five countries.

COVID-19 and the Trust Deficit

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Michael Spence
Nobel Prize in economics, Economics professor at Stern School of Business NYU, author of The Next Convergence

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