A Canadian Crisis of Consumer Confidence

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Aristotle once wrote that, “Courage is a mean with regard to fear and confidence”; based on recent evidence, it would appear the world is mired in a state of constant cowardice. Fear reigns supreme all across the globe these days, with politicians, consumers and businesses showing little confidence in either themselves or each other. In this country, the big ball of doom started rolling in late November. That’s when our esteemed elected officials in Ottawa decided to throw parliament into turmoil – a threatened vote of non-confidence in an admittedly lamentable government, followed by its threatened replacement by a troika of equally lamentable stooges. A total lack of courage all-round – and the ugliest constitutional mess in over 80 years. And that’s just our pathetic pols. In the business world, it’s even uglier. A survey published in mid-January showed just how far consumer confidence has fallen worldwide. Over 14,000 people in 17 countries were surveyed, and close to half – 49 per cent – thought our economic situation would get worse in the next three months; in Canada, the number jumped to 61 per cent. Then, this week, the Conference Board of Canada released its latest index of business confidence. Bad News Bears, those CBC people: 60 per cent of surveyed firms say general economic conditions in Canada will be worse in six months, with the index (a hocus-pocus measure I won’t bother explaining) falling to its lowest level since the third quarter of 2001, just after 9/11. Admittedly, it’s hard to will yourself faith. Confidence is like a bubble: when times are good, it expands and takes over the room; when times are bad – pop – it’s nowhere to be found. New Yorker financial writer James Surowiecki touched on this notion in a recent column. His focus was on the Bernard Madoff scandal – the New York money manager who swindled some $50 billion from investors – and those who got hoodwinked. But his conclusion, and its wider applicability to our political and business leaders, bears repeating: “This culture of credulity did plenty of damage to the economy, but now it has given way to something even more corrosive; namely, endemic mistrust. Because if there’s one thing worse than too much confidence, it’s not enough.” Or as Dan Rather used to say, ending his nightly newscast: Courage.