With Donald Trump’s inauguration as the 45th POTUS and the latest ruling from the Supreme Court on Brexit, Michael Wilson looks at the importance of trust and worries about what happens when trust gets diminished.
Truth is the first casualty of war, they say. And although the last nine months haven’t produced any actual armed conflict, at least here in the industrialised west, you can’t fail to have picked up on some of the utterly warlike rhetoric both in Britain and in the United States.
Okay, Theresa May hasn’t needed to wear a bulletproof vest yet, but Donald Trump most certainly has. It’s a fair measure of how overheated the political atmosphere has become. And what a sorry situation that leaves us in.
As we explain in this February’s issue of IFA Magazine, it’s still far too early to say whether The Donald’s policies are going to work, because even his closest associates can’t figure out yet what they are. What we can say, though, is that Trump’s campaigning style has thrown truth quite deliberately out of the window, in favour of a blustering, self-contradictory showbiz barrage in which everyone from Hillary Clinton to the Pope has been vilified, threatened with revenge, and then quietly dropped from the agenda.
Whole news agencies have sprung up to distribute fake news designed for distribution via Twitter. Did you know that Hillary Clinton is in rehab? That the Democrats operated a paedophile ring from a Washington pizzeria? Well, she isn’t and they didn’t. Which didn’t stop somebody from shooting up that pizzeria with an assault rifle.
Truth is fragile
That’s what happens when people lose the certainty that what they’re being told is at least based on truth. We all know that politicians lie, but to industrialise the scale of the deception like this is corrosive, not least because it undermines every assumption that our society makes about democracy. Destroy that, and it becomes impossible for voters to trust politicians; for politicians to trust each other’s sincerity (even if it’s “misguided); and for everyone to take the serious media seriously.
Sooner or later, the lack of trust will extend to financial institutions too. The Brexit referendum didn’t just stop at deliberate distortions – it featured people like Michael Gove actually exhorting us to stop believing the independent financial experts. An injunction which the voters, disenchanted as they were, were only too happy to accept. We had Jeremy Corbyn damning his own party’s pro-Brexit line with deliberately faint praise and a lot of carping as well. All of it helped to undermine our confidence in the sincerity of what we were being told.
We won’t know for some months yet what Theresa May will do with her poisoned chalice. In recent months she’s seemed frozen, indecisive, and believing, against all evidence to the contrary, that her 27 partners would quietly stand aside and let her keep our access to the Single Market.
Until 8th January, that is, when she abruptly told Sky News that there was no prospect of our wanting anything but a hard Brexit. And no future in hoping to keep “any bits” of our membership. “We’re leaving,” she thundered. “We’re coming out.”
That put her immediately at odds with her own Chancellor, Philip Hammond, who has been still trying to save at least the banking passport. And with the CBI, which is desperate for clues as to whether it’s safe for British businesses to build new factories after Brexit. (Answer, at present – probably not.) May’s long awaited speech in late January added to the mantra that out means out, and that Brexit will mean an end to our time as part of the Single Market. We have yet to see what the implications of the Supreme Court’s ruling will be, which set out that Parliament must now be consulted on Brexit.
So far, the City has been doing its best to take this huge farrago in its stride. But fund managers, pension trustees and – yes – financial planning advisers all depend on better than this. Don’t we?