More on Trust, Wealth, and Cities

I've been avoiding updating this BA blog because I knew I had to write more about the topic I brought up last week, Trust in a society at large. This is a Big Issue, and like all big issues, it's hard to write about because there are no easy answers. So this post will be long, rambling, and probably boring. My apologies. But I like to dabble in such issues, because they're really, really important. When we ask ourselves what kind of world we want to live in, I think one of the things that should come up near the top is just this -- a world in which we can trust everyone. When you can trust people, you just don't have to worry about as much. A world without trust is a tense world, a world where you have to second-guess and third-guess everything.

And I'm not sure, but it seems to me a world without trust probably devolves into a world where power and violence become more and more important. And that does not sound like a nice world to me.

So, to start, I want to get back to what I need to last week's post. I do need to correct something, or at least elaborate. In particular, I said, or at least strongly implied, that it's more likely in a rich society that you're able to trust people than in a poor society. My thought there was that in a poor society, people are just more desperate, and so are less likely to be constrained by ethical concerns.

That's probably true to some extent, but it absolutely must be said that in a lot of poor societies, people are very, very ethical, and there are tons of people in rich societies like the US who are not very ethical at all, who will rip you off at the first opportunity. So clearly wealth is not some kind of direct determinant of ethical behavior.

One thing I mentioned last week that makes a big difference at least in larger-scale transactions is good contract law. If there's no good contract law, you can't call on the legal system to help resolve a private dispute. And if you can't get your private disputes resolved in a reasonable manner, then you're going to be much more wary about your your financial dealings. This tends to inhibit business and economic vitality in general. I think it probably also has a trickle down effect to people's personal behavior. If people see businesses and rich people and people in official positions screwing everyone over, then the screwing of others is going to seem more permissible generally. On the other hand, if screwing others over gets you in trouble, then it seems like a worse idea. And the legal system is the public mechanism for the prevention of screwing-over. So, a bad legal system, corrupt and/or inefficient, can make screwing-over more popular, leading to an over-all decrease in Trust.

There are no doubt many exceptions, but it's probably safe to say that rich countries are more likely to have effective contract law than poor countries. So that's one thing rich countries have going for them.

I'm not sure about the legal system in Argentina. A proxy that is sometimes used is the corruption index published by Transparency International. In a way this is an estimate of Trust in business dealings, and it attempts to include contract law and official and political corruption, among other things. And guess what? Argentina comes pretty far down the list, 105 out of 179. It is way behind Mexico, Brazil, Peru, India, and China (all tied at 72 -- the list is admittedly very approximate).

As an aside, the US comes in at number 20, behind most of the other rich-rich countries. I think this is largely because of the power of lobbyists to affect policy and the power of money to affect elections. I think this list is interesting enough to mention the top 10 "most transparent" countries:

1. Denmark
2. Finland
3. New Zealand
4. Singapore
5. Sweden
6. Iceland
7. Netherlands
7. Switzerland
9. Canada
9. Norway

These are all pretty rich countries, but another thing that jumps out on this list is that all of these are relatively small countries. Canada is the biggest country on this list with 33 million people, and most of them are much smaller. This leads to another factor that has to affect Trust -- population, and more specifically anonymity.

I think most people would agree that it probably becomes harder to maintain public Trust when anonymity increases. No big surprise here -- in a small town, everyone knows you, and so you're much less likely to screw people over. It's going to get back to you. In a big city, you'll never see these people again, and on a strictly practical level you're a lot less likely to suffer repercussions if you behave unethically.

But of course, in Singapore and Copenhagen and Toronto and New York and Buenos Aires for that matter people do behave ethically most of the time, even with complete strangers they will never see again. I think I'd go as far as to say that maintaining Trust in big cities, having people behave ethically despite the anonymity of the megalopolises, is one of the great achievements of humankind. People behave in a trustworthy fashion not because it benefits them on a practical level, but because they just feel that this is the way they should behave. This is what holds society together, right?

So, OK, what about Buenos Aires? I think Trust probably is a little harder to come by in BA than in NY and in a lot of countries. Especially on an impersonal level -- like you're more likely to get screwed on a business deal, you're more likely to have a corrupt official try to get a bribe from you, you're more likely to have some 'inspector' of your business try to shake you down. But on an inter-personal level, I don't know. I think people here are mostly great -- highly civilized, highly trust-worthy. There is a big lower class that I don't know much about, and those people I can't be sure of at all. But in the educated classes, on a personal level things seem good.

And of course crime is probably a bit higher here than it is in the US, at least petty street crime. (Sorry I don't have the energy to look it up right now!) I hear of lots of people who've been robbed here, and I hardly know anyone in the states who's been mugged lately. Of course this crime level is party, maybe largely a matter of the current economic hardships of the country. But also the culture of machismo has got to make crime more attractive. After all, Machismo is all about Force and Power, and robbing someone is nothing if not an exercise of Force, of physical power (although that power may mostly reside in a gun or knife).

Think about it -- where is Machismo lowest? Probably East Asia, right? Where do they have super-low crime rates? East Asia. Hmmm, I'll have to think about this.

But don't worry, I'll try to get back to more interesting topics and posting pictures.