The crisis of confidence

Colombia faces and faces a sum of unresolved crises, which have led it to a great crossroads, which is where we are, without a good way out in the immediate future. Undoubtedly the worst of all of them, because it aggravates the others, economic, social and environmental, among others, is the crisis of confidenceBecause when this is lost, governance is put at risk and when it is complicated, the legitimacy of the institutions falters.

We have reached this point because of procrastination by successive governments because, as Miguel Abadía Méndez said, “old problems are not solved and new ones let them grow old”, presuming and taking for granted that the stability of democracy and the institutions that sustain it will remain unscathed, despite laziness and inaction. When the reality is that the problems that are not solved get worse and become chronic. They forget that the great Austrian scholar Hans Kelsen was able to distinguish very well between the legitimacy of origin and the legitimacy of the exercise of power, which is endorsed on a daily basis with acts of government. It is also clear that the exercise of citizenship does not end with voting!

And how important is trust for the economic and social development of a country. Among the ravages of loss of confidence are the loss of reputation and investor confidence, which drive away and drive investment and investors away and lead to failure. This led the Nobel laureate in economics Joseph Stiglitz to affirm that “investment in trust is no less important than investment in human capital and machinery.” Ensuring, then, its preservation and conservation turn out to be a matter of the greatest relevance.

Therefore, it is very worrying that the deterioration The social situation of the country as a result of the pandemic crisis has impacted and in what way the perception that citizens have of the Government, taking the very institutions it serves out of the street. This is how, according to the most recent OECD report, Colombia alongside Chile, and this is no coincidence, is part of the group of countries in which citizens most doubt and question their governments. In Colombia, particularly, confidence in the government fell between 2007 and 2020 from 51% to 37%.

And this skepticism towards the Government extends to companies, the media and even NGOs. Moreover, according to the UNIANDES Democracy Observatory found that the level of satisfaction with the functioning of democracy, in 2020, reached the lowest level in decades (18%). It also concludes that public trust in all institutions, including the most reputable in the past, is on the floor.

According to the results of the virtual survey in which 33 thousand people participated recently by the Edelman Trust Barometer of the global communications agency Edelman with more than 20 years in Latin America, the distrust of citizens towards their institutions was consolidated this year . According to the same survey, Colombia is the fourth country that distrusts its government the most out of 27 evaluated. This is extremely worrying.

The former co-director of the Banco de la República and Rector of the Universidad del Norte Adolfo Meisel, warned, well in advance, with the pandemic crisis and its devastating effects, especially among the most vulnerable “the loss of status that millions of people will suffer it can lead to growing resentment. ” Said and done. In the second half of 2019, before the advent of the COVID-19 pandemic, the first outbreaks of discontent and discontent appeared, overlapped and postponed by it.

And, although the biggest catalyst for the protest has to do with demands, especially from young people, for employment, access to health and education, for a guaranteed basic income for the most vulnerable, among other demands, through it the neoliberal economic model is being challenged and questioned, incapable of responding to their repressed wishes. Stiglitz, referring to the social mobilizations in Chile and Colombia in 2019, said that “the surprise was that the unrest took so long to manifest.”

The Professor of the School of Economics of the National University Diego Guevara draws attention to this, noting that “it is time, then, to break the illusion of a successful macroeconomic world before the pandemic, since to continue with the speeches of austerity , macroeconomic stability and fiscal discipline will only perpetuate a scenario that has been favorable for a very small portion of Colombians. We must bet on an important change in which a strong and active fiscal policy is maintained, oriented towards monetary policy with the same purpose: job creation, better distribution and price stability.”. As Keynes said, “a good crisis should not be missed”. This crisis is the opportunity to rethink the economic model.

A study carried out by the Econometrics research center, based on the thesis that the psychologist and mathematician Daniel Kahneman received the Nobel Prize in Economics on the economic theory of behavior, concluded that “it is easier to change the status quo in times of crisis than in normal times. In crisis, those affected are willing to make changes that would be unthinkable under normal conditions, when they prefer to stay in their ‘comfort zone’ “

Sustainable growth and sustainability of growth, also inclusive, must be the paradigm of the New normality, which should be channeled towards the so-called progressive capitalism that Stiglitz has been proposing as an alternative to the failed Washington Consensus.

Cota, November 22, 2021

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The crisis of confidence