It’s common knowledge that human societies work most effectively and harmoniously where there are high levels of trust – in each other and our institutions. Markets cannot operate without trust. Wall Street is learning this as I discussed in Electronic Bulls, Bears & Pigs. Confidence among retail investors has dropped since the 2010 Flash Crash and 16% of small investors have fled. Hearings in the US Senate June 17, on investor loss of confidence, conflicts of interest, high-frequency trading and maker-taker models saw even insiders calling for reforms.
Today, trust is breaking down in many societies around the world. Populist distrust of governments, elites, corporations, media, finance, academia, science, churches, is evident in protest groups, movements, whistle blowers and public demonstrations. New questions arise in the age-old human conflict between individual rights and those of communities and the public interest. Our fearful quest for certainty leads to dogmas and ideological conflict. In all human history, life has always been dangerous and precarious; our “fight or flight” responses predominated. Yet, humans have always bonded in social groups for survival. Britain’s Margaret Thatcher was wrong when she claimed there was no such thing as society – only individuals.
Charles Darwin actually saw that this human genius for bonding, cooperating and sharing and our evolving altruism were the basis for humanity’s spectacular success. Humans now dominate the Earth, using 40% of its primary production from photosynthesis, causing extinctions of many other species and altering the planet’s biogeochemical cycles and climate. We have built trust over the centuries and learned wider cooperation and sharing, as I documented in Building a Win-Win World (1996). Evidence is in our journey from nomadic tribes to settled agriculture, towns, cities, nations, corporations, to today’s vast web of international treaties, agreements and associations of nations from the OECD, ASEAN to the EU and the UN. Finance became part of our global cultural commons in 1944 with the Bretton Woods agreements. Today transforming finance to conform with Nature’s laws and ethics leads to the Principles of Ethical Biomimicry Finance®.
All our human cooperative achievements required trust and have brought us to our current global transition to the next stage in our evolution, now driven by our globe-girdling technologies, jet travel, satellites, networks of communications, undersea cables, electricity grids, the internet and social media. These technologies enabled by tax-supported infrastructure and research also spawned high-frequency trading and algorithms. These technologies were often developed from limited perspectives, national interest, markets, producing unwanted effects: pollution, etc., and were assessed from broader public interest perspectives by the US Office of Technology Assessment (OTA) from 1974 until its shutdown in 1996. Many of OTA’s predictive 30-year old reports are still relevant: Electronic Bulls and Bears; Energy Efficiency; Decommissioning Nuclear Power Plants; Ocean Thermal Energy Conversion and others deserve republishing.
The good news about today’s widespread loss of trust among so many citizens and investors is their growing awareness of future possibilities, better alternatives – still often suppressed by the prevailing order and incumbent interests. Ubiquitous information, cell phones, the internet are now shifting ever more power to the people. Few corporate or government secrets survive for long.
Our loss of trust in past successes is driving reforms of all our institutions as we awaken to our new situation as a 7-billion plus human family, changing our planet visibly from NASA’s Earth-observing satellites in this new Age of the Anthropocene. As our technologies and innovation accelerate exponentially, so does our expanding human awareness and consciousness. We demand more of ourselves and our institutions. We still trust that civil society, NGOs, social movements, ethical investing, professional and trade unions, students, women and community groups, open-source and other volunteers can lead the way. Even advertising, a $500 billion global industry targeting our amygdalae, is responding, as we see the new genre in the EthicMark® Awards for advertising that uplift the human spirit and our human potentials.
- See more at: http://www.justmeans.com/blogs/restoring-trust-in-markets-and-politics#sthash.w5Z38lJm.dpuf