Truth, The Gold Of The New Age. The Economic Value Of Knowing Who To Trust

In a society where the value of facts is replaced by digital sensationalism, truth is now a scarce and precious commodity, the new gold of our times.

“Access to reliable information is the fundamental resource that fuels our 21st century economy (…)  no less than previous eras relied on the power of steam or coal for industrial development”.

This is how eleven economists, including Nobel Prize winners Joseph Stiglitz and Daron Acemoglu, set the tone for their report, which summarizes a simple but powerful idea: reliable information is the new engine of global economy.

Independent, public interest media is the fuel needed to keep this engine running. It is no coincidence that this report has a title that turns this premise into a warning: The Economic Imperative of Investing in Public Interest Media.

In times of uncertainty and economic turmoil, central banks keep the world from falling apart by controlling inflation and money printing. In the information market, this role is played by public interest media, the true regulator of truth. 

The analogy is obvious: markets thrive on trust – the trust that investors place in data and news to assess risk, the trust that governments place in the evidence they rely on to define public policy. This trust dies when lies enter into circulation. Misinformation erodes the value of facts, which sustain both markets and democracies.

Public interest media is therefore under threat!

The Attention Business

For years, the media business model revolved around advertising. Companies paid to advertise, and that revenue was channeled into funding journalism.

This was a model that digital platforms such as Google, X and TikTok put and end to. The migration of audiences to these platforms dragged with it advertising investment, once destined solely for newspapers and television, the great carriers of reliable information. These traditional media were the biggest victims, losing a considerable share of their main source of revenue.

Big tech has thus created an unfair market, that appropriates the public good that the media produces (quality information) to attract users, monetizing their attention through advertising and personal data. An algorithm that does not ask for permission. It enters our homes every day without knocking, offering us informative content but also one that is sensationalist, controversial and polarizing, which does not prioritize facts, but that certainly generates many clicks.

In an interview with Agência Lusa, following the launch of this new book “Algoritmocracia” (Algorithmic Democracy) Adolfo Mesquita Nunes, lawyer and politician, states that in the past “we bought a newspaper, watched the news on TV, sought out information. Today, it comes to us every day, even in content that is not informative”.

It is important, however, not to be fatalistic in analyzing the impact of this algorithm. It also brings us benefits: it allows us to access the information at the moment we need it. I have no doubt that it was this algorithm that spontaneously brought me to the words of Adolfo Mesquita Nunes on the day I wrote this article, while scrolling through Instagram.

Disinformation Wears a Suit and Tie

Disinformation does not arise solely from algorithms, it is cultivated in some corridors of power. In authoritarian regimes, such as Russia, it is a declared weapon. However, the lawsuits imposed by Donald Trump against the New York Times and the Wall Street Journal, or the cancellation of television shows in the United States, have taught me that even in consolidated democracies, disinformation can operate under the cover of the law– shielded by the subterfuges of the democratic game itself. 

For the eleven authors of the aforementioned report, the responsibility of governments does not end here. They are guilty of failing to recognize the importance of reliable information. An unusual and contradictory fact, given that they are all pursuing the AI dream, which needs to be built on a strong foundation of independent, serious and verifiable information. 

The Truth Is Not Profitable

What is the incentive to produce reliable information? Investigating, verifying and contextualizing facts requires time, teams and resources. This is a type of work that the market does not value. The social return is high, but the financial return for those who produce it is minimal, since the real profit belongs to the intermediary, the digital platforms, which distribute and monetize the content without creating it.

We all benefit from public interest media, but almost no one pays for it. I am part of the problem: I read news on social media, without paying for subscriptions or seeing adverts on the original websites.

The result is predictable – little incentive to produce reliable information. With it comes the classic economic problem of public goods: underprovision. The damage does not end here. Disinformation amplifies information asymmetries between those with access to trustworthy content and those who, often without knowing it, are left with misleading information. In the extreme, this gap can enable forms of tacit collusion among better informed agents. This is illustrated in the European Commission’s findings on the “Emissions Cartel”, where major car manufacturers coordinated to limit clean-engine technologies. Consumers, misled about real emissions, were left completely in the dark, without the information or the power to make informed choices.

Recognizing the importance of public interest media for society is the first step in tackling misinformation. Intentions are not enough, they must be translated into policies: creating public funds and tax incentives to support independent media, and ensuring that digital platforms remunerate those who produce the information that feeds their algorithms.

The truth does not produce itself. Without investment, the new gold of global economy is at risk of turning into digital dust.