Integrity faces a critical moment of peril

Prediction markets are creating a digital Wild West, where well-placed opportunists can win big by betting on real-world events — from the capture of Nicolás Maduro to a surprise Super Bowl cameo. What may strike everyday people as blatant insider trading is defended as legal based on the letter of the law. Why it matters: The spectacle of people profiting off privileged knowledge is accelerating a broader erosion of trust in a society where confidence and good faith were already in retreat. The big picture: Across markets, media, sports, and politics, the incentives increasingly reward those who push ethical boundaries — and penalize those who don't. 🤖 Reality has become easier to manufacture. AI advancements are training people to doubt the authenticity of what they read, watch and listen to online. Any person can now share coherent, well-constructed views that don't reflect their true ideas or beliefs — or that they barely understand themselves. Large majorities of students now use generative AI for schoolwork, leaving educators to wrestle with how much of it facilitates learning versus helps cut corners. 🏀 Fair competition is increasingly in doubt. Gambling and perverse incentives now make sports fans question the integrity of the games they're watching. The NBA is battling a crisis of confidence as bad teams embrace increasingly brazen tactics to improve their draft odds. Last week, the 18–38 Utah Jazz benched their best players in the fourth quarter of a game they had been winning — and lost. The MLB and NBA have been rocked by betting scandals in which players are accused of rigging their play in order to make money off specific performance-based bets. 🏛️ Politics has de-valued shame. The last decade has shown that major players have little incentive to own up to bad behavior or exercise restraint when there's a chance to exploit power. President Trump's defiance in the face of the 2016 Access Hollywood tape created a playbook for politicians to survive scandal by digging in and not giving an inch. The Trump family and its associates have taken advantage of opportunities to profit from power in his second term, raking in billions from crypto ventures. Hunter Biden also faced scrutiny for overseas business ventures tied to his family name — and was ultimately pardoned of gun and tax offenses in President Biden's final weeks in office. Across the country, states are dispensing with the idea of fairness in drawing congressional maps that benefit the party in power. Democrats blame Republicans' Trump-ordered redistricting in Texas last year for kicking off the gerrymandering arms race. The big picture: These trends converge with polling that shows many Americans — especially Gen Z — already feel like the deck is stacked against them. Just 13% of respondents polled in the most recent Harvard Youth Poll said the country is headed in the right direction, while 43% said they're struggling or barely getting by. A whopping 39% said political violence is acceptable in certain circumstances. The bottom line: As more Americans feel locked out of opportunity, the temptation grows to game the system — and to justify doing whatever it takes to get ahead.