Trust in the federal government has hit a 66-year low of 31%. That doubt quietly delays investment and hiring—an estimated $135 billion a year in lost output the market hasn't priced yet.
Americans' trust in the federal government has fallen to 31%, the lowest Gallup has recorded in 66 years, down from 75% in 1958. Trust in Congress sits at 17%. This is not only a political story. When businesses doubt that contracts will be enforced, rules will hold, and courts will function, they delay factories, hiring, and expansion. The uncertainty index that tracks this averaged above 300 in 2022–24, three times its pre-2016 norm near 100. We estimate the resulting drag at about $135 billion a year, roughly 0.5% of the economy.
The market underprices this because 2024 looked fine—strong jobs, solid profits. But the cost arrives as a slow drip of postponed decisions, not a single crash, so it hides in plain sight.
Blackstone (BX) and KKR (KKR) need confident long-term commitments to deploy capital; hesitation freezes their deals. Charles Schwab (SCHW) depends on investors willing to take risk. Caterpillar (CAT) sells the machines firms only buy when they trust the future. JPMorgan Chase (JPM) lends across the whole economy, so any broad pullback in activity lands on its loan book.
Why this matters. Americans' faith in government, courts, and media has fallen to record lows, and that doubt quietly seeps into business decisions—delayed factories, postponed hiring, slower investment. Lenders face borrowers who put off plans, operators face hesitant customers, and investors face a confidence discount that markets have not yet fully priced. The cost shows up not as a crash but as a steady drip of lost output, year after year.
Blindside · US Macro Risk
When Americans Stop Trusting, Growth Slows
Record-low faith in government, courts, and media quietly drags down spending and investment
Imminent
49
Blindside index
What drives it — drag to test
each slider starts at our cited estimate — drag to see the range
Yearly output lost to trust-driven uncertainty (% of economy)0.6%
Sourced — research shows each big jump in policy uncertainty cuts output 0.2–0.3%; today's level is three times the old normal.
How long the drag lasts (sustained vs one-off)75%
Sourced — trust has fallen five-plus years; one-off scares fade in 1–2 years, but deep trust declines tend to stick.
Extra cost if a 2026 election or court crisis hits+10%
Our judgment — no precedent for a full legitimacy crisis in a $27 trillion economy; Turkey's 2016 turmoil cost roughly 5–8% of output.
Time to impact
1–2 yearsImminent
now3 yrs7+ yrs
When the financial hit begins to land, on our read.
How to read this. Drag any slider to test your own number — the chart and index update live. The likelihood and the locked facts stay put.
Yearly lost economic output from low trust
$151.8bn0.56% of sector
Dark line = most likely · faint lines = low–high (8 in 10 outcomes land between) · shaded band = what outside analysts expect
Our estimate lands within what outside analysts expect ✓
Chance this is a permanent shift, not a blip
61%
Average of five independent reads (range 50–70%):
The track record68%
Research consistently ties higher policy uncertainty to weaker investment; today's readings beat every non-crisis average on record.
How it works70%
Firms delay spending when property rights, contracts, or rules feel unsure; trust in courts and government feeds that decision.
The skeptic's case50%
The economy showed strong jobs and profits in 2024 despite low trust; markets have shrugged off political turmoil before.
What other countries show60%
Italy, Turkey, and early-cycle Brazil saw lasting risk premiums and capital flight after multi-year trust declines, even before formal crises.
What the market shows58%
US default insurance has widened, foreign Treasury holdings have shrunk as a share, and the dollar's premium is narrowing.
Fixed — the sliders change the size of the hit, not the odds it's permanent.
Why this matters
Americans' faith in government, courts, and media has fallen to record lows, and that doubt quietly seeps into business decisions—delayed factories, postponed hiring, slower investment. Lenders face borrowers who put off plans, operators face hesitant customers, and investors face a confidence discount that markets have not yet fully priced. The cost shows up not as a crash but as a steady drip of lost output, year after year.
Trust in the federal government fell to 31% in 2024—the lowest Gallup has ever recorded, down from 75% in 1958.
Gallup — Confidence in Institutions Poll (July 2024)
17%
Only 17% of Americans trusted Congress in 2024; trust in the Supreme Court sat at 40%, down 10 points in five years.
Gallup — Confidence in Institutions, Annual Series (2024)
900+
The Baker-Bloom-Davis Economic Policy Uncertainty Index topped 900 at peak 2020 stress and averaged above 300 in 2022–24, versus a pre-2016 norm near 100.
Baker, Bloom, Davis — Measuring Economic Policy Uncertainty (PolicyUncertainty.com, 2024)
−0.3%
Federal Reserve economists estimate the 2018–19 trade-policy uncertainty spike cut US growth by about 0.3 percentage points.
Federal Reserve Board — The Effects of Trade Policy Uncertainty on U.S. Investment (IFDP Notes, 2020)
29th → 36th
The US slipped on the World Bank's rule-of-law measure from the 29th global percentile in 2020 to the 36th in 2023—an unusually long decline.
World Bank — Worldwide Governance Indicators (2024)
5.1%
Small business optimism hit a 50-year low in early 2024 despite very low unemployment, partly blamed on uncertainty over contracts, rules, and the rule of law.
NFIB Small Business Optimism Index (February 2024)
Attention is falling while the impact compounds. the blind spot is widening, not closing.
Our estimate puts the yearly output lost to trust-driven uncertainty at roughly $135 billion (midpoint, range $70–$220 billion), about 0.5% of the US economy—in line with research showing each major uncertainty episode shaves 0.2–0.3% off output. Trust in the federal government sits at a 66-year low of 31%, and the uncertainty index averaged above 300 in 2022–24 against a pre-2016 norm near 100. The gap between gloomy sentiment and strong recent performance is not proof the drag is fake—it is a sign the market has not yet priced the building cost.
