OXFORD – As the world’s financial leaders gather for the International Monetary Fund and World Bank spring meetings, many working people around the world are demanding radical change, because they sense that their voices are not being heard. Those who are supposed to represent them should not ignore this anger and frustration any longer.
According to the 2017 Edelman Trust Barometer, the public’s confidence in the status quo has collapsed worldwide, owing to widely held concerns about globalization, innovation, immigration, the erosion of social values, and corruption. At the same time, the response from elites who regard themselves as the guardians of economic growth has sometimes made matters worse. If they think they can allay public concerns simply by explaining the benefits of the current global economic system and tweaking policies to compensate those left behind, they are in for a rude awakening.
Earlier this month, the IMF, World Bank, and World Trade Organization published a joint report extolling the benefits of trade as a driver of productivity growth, competition, and consumer choice. The report’s argument in favor of free trade is not new, nor is its recommendation that “active labor-market policies” be used to cushion the blow of lost jobs and livelihoods. What is new is that repeating these claims, without also addressing people’s deeper concerns, can now do more harm than good.
Global public opinion has changed dramatically in recent years. A majority of people worldwide – and up to 72% of people in France and Italy – now believe that the system has failed them. Moreover, only 29% of people across 28 countries now trust government leaders, while three-quarters of those surveyed say they trust reformers who would upend the status quo. These findings suggest that those defending free trade have lost credibility with the people they hope to persuade.