Submitted by Eric Peters, CIO of One River Asset Management

"2005 marked the beginning of the global democratic recession," wrote Cambridge University’s "Global Satisfaction with Democracy 2020" report.

"That year also marked the all-time high point for satisfaction with democracy.” In 2005, just 38.7% of citizens globally were dissatisfied with democracy. “Since then, the proportion of dissatisfied citizens has risen by 18.8% to an all-time 57.5% high."

This leap in dissatisfaction is led by the US, Brazil, Nigeria and Mexico. But America’s surge has been most pronounced. Having spent many post-war decades with fewer than 25% of our citizens reporting dissatisfaction, a 55% majority are now dissatisfied with democracy.

The problem with that is twofold. A healthy democracy requires the vast majority to believe in fair elections. Checks. Balances. Institutions of integrity. Rule of law. Respect by the majority for rights of the minority. If that faith is lost, then each faction quite rationally fights to dominate its opponents at all costs, by any means. That is tribalism.

Which leads to the second problem - America was built by immigrants who left tribalism behind. Working together we’ve shown humanity the great wonders achievable through cooperation, integration, assimilation. Optimism. Idealism.

“For much of its modern history, America has viewed itself as a ‘shining city on a hill’ - a model democracy, and one that can serve as an example unto others that wish to emulate its success,” wrote the report’s authors. “Following the 2008 financial crisis, however, that has begun to change, with Americans’ evaluation of the functioning of their political system continuing to deteriorate year on year.

Rising political polarization, government shutdowns, the widespread use of public office for private gain, a costly war in Iraq, and growing spatial and intergenerational inequality have all weighed against Americans’ view of the ability of their democracy to deliver.”

What will happen when a majority of citizens in the world’s leading democracy, its largest economy, and mightiest military, lose faith in its very foundation?