Trust will be key to the recovery from the COVID-19 pandemic and recession. Yet over the past ten years, people’s trust in governments, public and private institutions, and one another has declined across many of the advanced economies. As is typical in periods of deep uncertainty, the price of gold has skyrocketed in recent months.
Today’s rock-bottom confidence should come as no surprise. The current crisis is not only globe-spanning and unprecedented in many ways, but also highly ambiguous. While the public-health emergency has escalated and triggered a collapse in the real economy, financial markets have boomed. As with the 2008 global financial crisis, the COVID-19 pandemic has decisively weakened public confidence in expertise. Conspiracy theories and political rhetoric rejecting science have proliferated. But if the public does not trust the recommendations of scientists and financial experts, the crisis will be prolonged.
Trust can prevail, but only if we start working toward a new economic and institutional paradigm. And that means addressing head-on the public’s growing skepticism toward most major institutions – from central banks and international financial organizations to the World Health Organization and academia – not to mention Big Tech. These doubts are no longer concentrated just among populists and people on the margins of society. In the United States, 30 percent believe that the SARS-CoV-2 virus was created in a laboratory, and 35 percent say they would refuse a COVID-19 vaccine.