Douse The Wildfires

Public information should be both accurate and interesting. When there is a conflict between the two, many information users prefer an outcome based on truth. Lately, there have been growing scandals which taint media considered traditionally to be of quality.

Some believe that this is a problem only encountered by President Trump or the United States. Far from it, we are not alone! From around the world one learns about misdirections and shortfalls in media accuracy. For example, late last year the German magazine Der Spiegel had to admit that its key investigative reporter, Mr. Class Relotius, had plainly fabricated stories in many of his articles over the past seven years. The individuals he described or allegedly interviewed either did not exist or had not made the attributed statements. Relationships were mischaracterized and the context reported was either falsely described or non-existent. 

As the most important information source for many users, the media must take responsibility for the ethical and honorable delivery of fact-based and reliable messages. The opportunity is there. New information gathering capabilities can be a tool to improve quality.

Continuing poor work will further erode the public information space. For example, one can easily imagine a land without newspapers. Already, their role in the wrapping of fishes has been severely diminished.

The issue is of particularly great importance to the global investment community. Poor information leads to increased uncertainty and risk. In 2013, stock markets lost $130 billion in two minutes after AP posted false news about an explosion in the White House that was said to have injured President Obama. In the same year, the Chinese construction company Zoomlion’s share price tumbled 26.9% on the Hong Kong stock exchange when the state-owned CCTV network published a series of fake stories by a corrupted reporter.

For individual investors, wrong news will hurt their confidence in products or companies which they might use or invest. In consequence, lack of investment may lead to great opportunities missed.

In the long run, people have to learn, absorb, understand and react to surprising political results or sudden economic unrest. Life will continue to present spectacular events like the 2016 U.S. presidential election or Brexit, which can lead to confusing flows of information. Crossnational effects can be triggered by national inaccuracies. In German’s “Spiegelgate”, fake pieces largely focused on U.S. policies and segments of the American population. There were stories about U.S.-Mexican border conflicts with made-up “Mexicans Keep Out” signs, which may have intensified local disagreements.

Media worldwide need to regain public trust. Fact-checking must be improved. Credibility requires more transparency and a greater indication of global linkages. Also, the tasks of gathering and distribution should be viewed with appropriate humility.

It will be difficult for media both old and emerging to maintain and re-build credibility.  When President Trump tweets about an informational heap of bovine waste, he clearly reflects the risk of a decline comparable to that of the typewriter and medical application of leeches. Media need a commitment to honesty, accountability, transparency and personal responsibility, also for its global communication, in order to offer a safe and reliable public information space.

Professor Michael R. Czinkota (czinkotm@georgetown.edu) teaches international marketing and trade at the University of Kent in Canterbury and Georgetown University. His latest book is “In Search For The Soul of International Business”, (businessexpertpress.com) 2019.

Trump fostering a new era of prosperity for US-EU relationship

The walk over burning coals with tariffs rattling has been completed and soothing coolness has returned. EU Commission President Juncker came to Washington with a publicly pronounced low level of expectations. But, as could be expected, when it was all said and (hopefully) done, acerbic argument gave way to collegial progress. The United States will be able to sell more of its products to Europe, and, in exchange, the treat of prohibitive tariffs will be eased.

Some believe that these developments were unexpected – like Manna from heaven. Not so! The Trump Administration had undertaken many steps to indicate that trade was a key concern. Unlike the experience of other administrations, President Trump persisted in his intent to support American business domestically and internationally. The shot across the bow of the ship Europa helped to concentrate the minds of policy makers. Yes, they still have other problems, such as NATO, Household deficits, Brexit, migration, and more. However, with the imposition of significant tariffs, Trump made it clear that trade had to move up on the list of important policies to consider.

After much hesitation, the adjustment steps began to take place. And rightfully so, when one considers that it has been more than 70 years, three generations , since the setting in place of U.S. sponsored world trade mechanisms such as the International Monetary Fund, the World Bank and the General Agreement on Tariffs and Trade. Back then, the principal dimension was the strengthening of European economies in order to improve local standards of living and achieve a meaningful defense against the then Soviet Bloc. In support of these goals, the U.S. willingly accepted its leadership cost to a growing excess.

The world changed, as did its opportunities and threats. But the U.S. negotiation approach stayed the same, support others, don’t worry about the drawbacks to the privileged U.S. firms. Over time, the U.S. started to fall behind – lots of imports, few exports, and still no major support from the government. When Trump took on his campaign, he promised changes in the trade picture, and he even lived up to that goal after he won the election. He started to use an anvil and hammer approach to break through old fashioned restrictions and chains. When other nations complained, he warned them of the sparks that could fly during the hammering in a larger forging process. His watchword was ‘reciprocal’ relations.

Now, it has worked out. With reason on both sides there will be progress and stronger linkages. It is gratifying to see how past barriers can be converted into linkages. Decades ago, for example, the river Spree in Berlin clearly marked the distance and separation between East and West Germany. Today, the very same river offers easy crossing and pulls the two river banks together. Its flow encourages rather than inhibits linkage.

The willingness to acknowledge shortcomings and engage in the collaborative implementation of solutions is a new engine for growth. Trump has coached this right, the EU and Juncker are good co-captains. Let the new game begin!

Professor Czinkota (czinkotm@georgetown.edu) teaches International Business and Trade at Georgetown University and the University of Kent. His forthcoming book in October 2018 is In Search for the Soul of International Business.

This commentary was published first by The Hill; Washington D.C. On July 29, 2018