Australians Lose Trust in Institutions Amid Corruption Scandals

Australians have a woefully inadequate understanding of how their institutions work, Governor-General Sam Mostyn said. According to Shane Wright's recent article, 59% of Australians don't grasp the relationship between interest rates and inflation, while almost half get it wrong or are unsure about the connection between interest rates and economic activity.

This lack of understanding can interact dangerously with a lack of trust in institutions, which is already declining. The Reserve Bank of Australia has an average score of 5.5 out of 10 for trust, indicating a significant problem.

The only reason people might still have faith in institutions is that they've always worked this way or that politicians say to trust them. However, recent events suggest otherwise.