It is the cycle marked in red, where emotions mix with arbitrarily selected or randomly received information about facts and may ignite a communicative fire.
Celebrities who have established a high public profile as part of their ‘business model’ can pick up a topic in social media and bring in their own opinion. This further heats up the process which is sometimes drastically labelled “shit storm”.
The legal system’s lines of defence against this overwhelming non-professional "conjectural sphere" are weak. It has traditional instruments such as the prohibition of defamation or, to some extent, injunctions against false allegations. However the legal system does not have the clout to slow down or stop mass phenomena. This is not an expression of weakness, but of the necessary respect for freedom of expression and freedom of the press.
The competitive edge of the professional media without the propensity to engage in social media (“1 o'clock” in the chart inserted above) lies in their ability to systematically gather information and to analyse and communicate it. Whereas the use of their skills underlines their importance for society, the contagion from the modes of operation of social media would undermine it. Giving in to amateurs by ruminating non-professionally produced “news” melts the ice floe on which professional media sit. The unfortunate economic development of the commercial news industry in recent years shows that there is no solid land here, only fragile ice.
In some areas trust is consistently created and reliably maintained
In some sectors of society, experts have developed instruments that enable risks giving rise to distrust to be controlled with a high degree of certainty. Many people do not even think of distrust when they deal with the risks managed by these sectors. Even very distrustful people make use of the possibilities when e.g. they need to consult a dentist and don’t get any doubts about their health insurance’s capability and willingness to cover the expenditure.
Here are a few examples of approaches that give some indications of how the opposite of the distrust that bothers us today can develop:
The most natural and simplest way to create and maintain trust is to be reliable over long periods of time, i.e. not to give rise to distrust. We can experience such successes with all contracts that have been concluded for a long period of time. Examples are rent and employment agreements. Continuous compliance with the terms of an agreement generates solid trust and a feeling of comfort on both sides.
In financial services, there is additional precision in measuring trust: prices are calculated to express exposure to risk. The better the credit standing of a counterparty (= trust), the shorter the lifetime of a default risk, the lower the price will be for taking a risk. Debtors with a history of defaults need to pay a high premium to investors who are prepared to incur the risk of another default.
On the other hand, debtors with a very good standing are able to incur very long term debt. Here is an impressive example: In 1624 the Dutch Lekdijk Bovendams water board issued a perpetual debenture with a coupon of 2.5% to finance the restoration of a lifesaving 33 kilometre long dike from Amerongen to Vreeswijk. The word “perpetual” implies that the initial subscribers’ trust was infinite. They did not require the repayment of the capital and trusted that the interest would always be paid. In fact, the value of the security has been preserved to this day, as the interest continues to flow to the holders of the debentures every year.
The saying "the wallet is the most sensitive organ of the human body" is not correct, yet it leads to important arguments.
When it comes to our savings, most of us are hypersensitive. If we have acted carelessly and made mistakes in this area, we feel ashamed and remain silent.
We are well advised to be cautious about investments. Professional investors have the advantage of being able to express categories such as time, amounts and diversification in numbers and calculate probabilities. The analysis of figures from the past makes it possible to identify default risks and correlations to better determine probabilities for the future. Mathematics reduces the breeding ground for distrust.
Within the scope of the guidelines for a given portfolio (e.g. “energy stocks” or “emerging markets debt”), investment managers are in a position to reduce risks considerably. Rather than taking bets, they can rely on sophisticated procedures to diversify risks while maximising opportunities. The basis for this is the “Modern Portfolio Theory” (MPT) for which Harry Markowitz was awarded the Nobel Prize in 1990.
The methodology applies to both discretionary and automated ("quantitative") asset management.
Sophisticated rule-driven diversification can be compared to the suspension of a car, which gives a reasonably quiet driving experience even on bumpy roads and therefore inspires confidence.
Of course there are also exceptional situations where sophisticated diversification is not sufficient to avoid painful losses. But this does not fundamentally undermine trust. Despite the best suspension, nobody would expect a car to glide smoothly through a scree field.
There are cultural differences from one population to the other with regard to the inclination to pay a trusted company for eliminating (completely or partially) risk factors emanating from human behaviour, but the model of insurance for the elimination of distrust is universal. Incidentally, insurance companies also apply systems based on Modern Portfolio Theory to manage the assets they need to compensate their customers' losses.
Well balanced and well thought out communication with clients and the outside world make an additional contribution to the maintenance of trust.
The institutions cited as examples are not exempt from social distrust; there can be a hiccup from time to time. But normally they have the means to reduce distrust to tolerable levels. Trust is the - refutable - default position.
One common feature of these examples is that the variables that cause trust to develop are limited in number and manageable and can be calculated. These “islands of trust” are exceptions, but important ones. Unfortunately, the methods that have been successful here cannot be used to measure leaps in technical innovation. Their trigger is often a coincidence or the persistence of a single person (or a combination of both). It is almost impossible to predict something like this.
Media professionals back to the driver's seat
In team sports, you win by studying and exploiting the strengths and weaknesses of the opposing team. The strategy to win is based on bypassing the strengths and attacking the weak spots of the other side. Realism counts. Initiative counts.
The current surge of social mistrust is linked to a feeling of collective insecurity. The reality is that industrial societies are at the beginning of fast and powerful technological developments that are accelerating and will not be stopped. While we sense the beginnings, we have no idea where they will take us and how we should cope with them.
The record speed at which pharmacologists have developed vaccines against the Covid pandemic using completely new and scalable methods gives us a flavour of what is possible and is good news for us. But what about genetic engineering, nano technology, Artificial Intelligence, machine learning, quantum computing, compact nuclear fusion reactors and, most worrisome, robotic process automation in factories and offices? The list is long. What are the effects of the upcoming technologies on the life of the individual? What will happen to us if a bot looks over our shoulders and quickly learns what work we do every day and then does 90% of our work at top speed without ever getting tired? Will we still play a relevant role in production and services at all? Will we still have a private sphere?
When you ask professionals about the subject, the usual response is "I hope it will be a long time before that happens".
Very many people today feel like sheep who suspect that an eagle is hovering above them. They sense a vague threat and prefer to focus on other issues.
The scarcity of easily available and understandable information on the implications of the imminent technological changes is a very sensitive weak spot which the amateurs running the social media sphere successfully exploit. From a tactical point of view, they are realistic and they show initiative. However, they have no chance to understand and explain the new realities that are emerging. The generation of fear is not a reassuring explanation.
The professional media are in a strong position to harness existing strengths in this area by putting their decisive resources to the spotlight. There are a great many highly qualified journalists who understand research and development exactly and have frequent high-level exchanges with scientists. At the moment you will find them mainly on specialised websites that you need to know about. In the classic media they are not seen enough, and often their reports appear late. These journalists can explain implications of new technologies in a comprehensible manner. They need to have a much higher profile in the middle of the mainstream.
As new technologies are now recognisably bringing about substantial changes in society and triggering strong emotions, they should move up the media's list of priorities. If very good science journalists are on the first pages, they will trigger valuable social processes of opinion formation. As responsible citizens, we must not capitulate to the new industrial logic, but find a new modus vivendi.
The second burning issue is the necessity for the integrity of the economic and social leadership. This is particularly important in times of change. Here too, the professional media are in a position to lead. In recent years, they have advanced the instrument of investigative journalism with new methods of research and started to make valuable contributions.
Some media have already recognised this and are acting accordingly. The search for integrity in society starts in the same way as empirical science. It is always about the search for facts.
The fact that integrity makes an economy more competitive is recognised. This is why increasingly, the investigative journalists enjoy the backing of legislators who protect "whistle-blowers". In contrast to the social media, the professional media are able to dig deep and find out facts on a large scale, while amateurs from the social media sphere can only conjecture.
Clearly the professional media can reassert their superiority without changing the structure of their business models. They only need to acknowledge the new priorities and position the right journalists prominently. It is a question of their strategic decisions and whether and to what extent and in which areas they use them.
This applies regardless of which media they use to reach their clients.
The social media will continue to be active and part of the professional media will continue to try to sail in their slipstream. But when the power of reasonable opinion-forming has regained dominance, we will get the right dialogues to let trust grow.
The return of the professional media to the throne will not be enough
The technological hockey stick, the lower part of which we can now see,
will be a reality for many years to come, because the new research results and the further lines of development derived from them are most unlikely to end up on the shelf. The food is on the cooker, it will be eaten.
However, many people may feel more comfortable and safer not to follow proposed changes. We may like the change mode at low speed and with manageable implications. But now our societies experience that progress pushes us into a permanent change mode. There is no historical precedent for this.
If an industrial society does not want to fall behind internationally, it has no alternative but to convince its citizens of the personal and collective benefits of change. This is not easy even for vaccines against a viral pandemic. The use of coercion is conceivable, but not a valid option.
Militant refuseniks who believe they will find salvation in rejecting progress and are confident that the storm will pass would cause backwardness. They are a serious threat to society.
The processes of technology driven societal change is in its first phase. It will be stormy. And the impact will be more painful if a large number of people decide to sabotage and rely on nebulous distrust instead of preparing for facts.
Beyond the media
Now the question arises as to where there are other avenues, beyond the professional media, for creating a healthy level of trust.
Culture of trust
Wouldn't it be nice if we could always rely on the honesty of other people? Then we wouldn't have to worry, for example, if we accidentally left a mobile phone on the underground. We would get it back quickly. Actually, there is a striking example at the heart of a highly industrialised society:
The Lost & Found office in Tokyo not only returns lost items with a high degree of reliability. It also gives people a warm feeling of security and solidarity.
Even though almost everyone will find such conditions desirable, we have to understand that they are the result of long cultural developments. Cultures can inspire each other, but this cannot be done simply by creating a spark. So, unfortunately, this approach is not the fix we are looking for.