It’s a matter of trust

It’s always a matter of trust

– Billy Joel

After the Hong Kong protests of 2019, Han Feizi figured time had run out on his carpet-bagging days in the fragrant harbor. Ah well, all good things come to an end. It was a pretty good run and the mainland never stops beckoning. Han Feizi, however, was apprehensive. He lived in Beijing over twenty years ago and left with a sour taste in his mouth.

Of course, Han Feizi knows everything had changed – he has been dragging clients around Beijing for two decades. He has witnessed the throngs of bicycles disappear from city streets, replaced by cars, only to reappear as candy-colored shared versions.

The two subway lines of 2001 have grown into what locals call the “spider web”, covering every last inch of the city. All of Han Feizi’s old haunts have either disappeared or gone hideously upscale.

But still. This is Beijing we’re talking about – where Han Feizi has gotten into his share of street altercations, shoved his way through nonexistent queues, hocked loogies with abandon and raised his voice in government offices.

He has even been party to a bloody brawl with steel rebar and cinder block fragments used as weapons – don’t ask. Han Feizi suddenly felt too old to be doing this again.   

One night, as Han Feizi was hardening himself for Beijing’s rough and tumble, he clicked on an Atlantic article by David Brooks. It was a handwringing piece on the decline of social trust in America. While perhaps overwrought, it was written during the lurid 2020 election season when dumpster fires seemed to be burning all over the country. It was a fine essay but one line made Han Feizi chuckle:

Nations that score high in social trust—like the Netherlands, Sweden, China, and Australia—have rapidly growing or developed economies.

Brooks may be a keen observer of America but he obviously doesn’t know China. It’s fine. The article wasn’t about China. Americans, embroiled in a crisis of confidence, were just wistfully extrapolating from footage of China’s bullet trains and glittering skylines. Han Feizi knew better. These social trust scores are fruity, reflecting different cultural interpretations of both the questions and the answers.

According to an Ipsos survey, China and India scored the highest on interpersonal trust with 56% saying “most people can be trusted” with third place Netherlands lagging at 48% and unscrupulous Japan ranking near the bottom at 21% (below the US at 33%, Russia at 24%, South Korea at 23% and Columbia at 22%).

Han Feizi does remember not trusting any of the aggressive touts at Tokyo’s Roppongi district but they didn’t look Japanese. C’mon Ipsos. China and India? Ahead of Japan? And Sweden, Germany and Switzerland? Really?

In 1995, not long after his star turn with “The End of History and the Last Man”, Francis Fukuyama published “Trust: The Social Virtues and the Creation of Prosperity.” In it, he laid out his theory of social trust, based on liberal principles, which allowed citizens to spontaneously organize for the greater good – namely to build large wealth-generating corporations.

According to Fukuyama, impersonalistic Germans, Japanese and Americans could operate at ultra-high levels of social trust, allowing large corporations to form organically, while familistic peoples like Chinese and Italians need state intervention to form meaningfully large enterprises. Russians, with neither deep familial bonds nor liberal values, degenerate into mafia mayhem in the absence of a strong state.    

If readers think this piece will now devolve into another Francis Fukuyama bashing exercise, they are absolute correct. We cannot let “The End of History” steal all the limelight. Francis Fukuyama has produced other stinkers as well and the long-forgotten “Trust” has aged just as poorly.

Since reform and opening up, the Chinese have said that a generation gap forms every three years. China is changing so rapidly that social habits, mores and expectations turn over every 36 months. It is much more than a commentary on unbridled economic growth.

It marked a society in tumult. In this heady mix, Hang Feizi pushed, hustled, bickered, got hustled, fought, howled and didn’t trust anyone as far as he could throw them.   

And then it all changed. It’s hard to date the change. Covid delayed Hang Feizi’s return to Beijing by two years. But things have definitely changed. China’s intermittent Covid lockdowns lasted three years – the standard length of a generation gap in China. Of course it had to change. The go-go days were spinning of control. A new generation was long overdue.

Hang Feizi is finding this new Beijing disconcerting. What happened to all the smokers? And all the loogie hockers? Everybody automatically queues up in the subway, faces buried in their phones. Three young folks have offered Hang Feizi their subway seats. That was Hang Feizi’s first time getting the senior treatment and it was as humiliating as he had imagined.

Hang Feizi steeled himself for the bureaucratic nightmare of opening bank accounts, getting a local phone number and registering with the public security office, not looking forward to stone-faced functionaries and their dismissive attitudes.

The reality was shocking, as if Han Feizi had entered the Twilight Zone. Bank employees bent over backward to accommodate Han Feizi’s various special circumstances and requests. The public security office was similarly helpful. Han Feizi was on edge for months wondering whether body snatchers had invaded Beijing and turned the population into service-obsessed imposters. He had to test it.

Han Feizi picked an unnecessary quarrel with a DiDi driver expecting the old Beijing blowback. And nothing. Just polite nodding and de-escalation. Han Feizi’s better half chewed out subway security for confiscating an aerosol can.

While still steaming on the train platform, a security manager chased her down and offered to keep the offending item in her office for later collection. Yes, Beijing has been invaded by body snatchers and Han Feizi does not like it one bit. This is Beijing for chrissake, not Tokyo!

Perhaps Brooks and Ipsos know something Han Feizi does not. Street crime has all but disappeared. University students leave their laptops and belongings unguarded in the library. The hairdresser will give you a fruit plate just because. The bristly facade Beijingers previously fortified themselves with to face a treacherous public has melted away into a subdued politeness.

The obsessive attention to service can partially be attributed to 内卷or “involution”, a term used in China to describe diminishing returns for additional effort. As growth slows, competition becomes more intense resulting in over-the-top efforts by businesses to satisfy customers. Retail businesses in China are slaves to reviews on e-commerce apps.

If a bad review has merit, nine times out of ten, the merchant will reach out and offer to make amends. While this certainly has consumer benefits, the flip side is the exhaustive workload service workers are expected to bear. Han Feizi notes the improved service but wonders if it is merely an expression of deflation, reserving judgment until the economy rebounds.

Technological tools like ubiquitous CCTV cameras, facial recognition and real-name phone registration has contributed to both the reality and, just as importantly, the perception of public safety. Everyone knows that everyone knows that they are being watched by CCTV. This has lowered the blood pressure of a once high-strung public.

In the absence of property crime, people are less on guard, less ready to get their backs up and less inclined to bare their fangs. Public shouting matches, a once favorite pastime of Beijingers has sadly disappeared. We note that none of this is a result of a “social credit score” which, so far, exists as small pilot programs and in the fevered imagination of Western media.

After the media publicized instances of citizens’ Kafkaesque experiences navigating bureaucracies for routine services, a campaign was launched to overhaul public-facing government offices. This was a natural extension of the decade-long anti-corruption campaign which eliminated low-level bureaucratic misbehavior.

The 12345 public hotline was expanded and empowered to register complaints, the minimization of which has become a significant KPI for public-facing government agencies.

As Brooks documents the demise of social trust in America, Han Feizi is left scratching his head in China. This new Beijing is freaking him out. It was not supposed to be possible. According to Fukuyama, social trust cannot be engineered:

Today, having abandoned the promise of social engineering, virtually all serious observers understand that liberal political and economic institutions depend on a healthy and dynamic civil society for their vitality.

Civil society, as we all know, are voluntary association such as churches, charities, unions and businesses which are the instruments by which people are socialized into high-trust citizens. These institutions are products of liberal societies and enlightenment values which, according to Fukuyama, have no government substitutes: 

The social capital needed to create this kind of moral community cannot be acquired, as in the case of other forms of human capital, through a rational investment decision.

Of course, the past three decades have not been kind to Francis Fukuyama’s historical takes. Even before China’s recent climb up the social trust league tables, it had already created behemoth private companies like Alibaba, Tencent, Huawei and BYD, which Fukuyama had deemed impossible: 

There is a relationship between high-trust societies with plentiful social capital – Germany, Japan, and the United States-and the ability to create large, private business organizations. The economies of relatively low-trust societies like Taiwan, Hong Kong, France, and Italy, by contrast, have traditionally been populated by family businesses.

In his 2014 tome, “Political Order and Political Decay”, Fukuyama offered up a mea culpa of sorts. As it turns out, civil society is not necessarily the secret sauce without which high trust societies would wither. In fact, Fukuyama has belatedly discovered, civil society can form interest groups, which can ossify the political system, turning America into a vetocracy:

How then, do we reconcile these diametrically opposed narratives – that interest groups are corrupting democracy and harming economic growth, and that they are necessary conditions for a healthy democracy.

How indeed. Han Feizi will leave that question up to Brooks, Fukuyama and their ilk. What Han Feizi is more interested in is this nascent high trust society that Beijing appears to have achieved.

On a recent trip to Hong Kong, Han Feizi had a discombobulating feeling that Hong Kong citizens were rude, dismissive and uncouth. To be sure, in his head, Han Feizi has heavily caveated his observations by the obvious fact that Beijing may not be representative of all of China, that surface niceties disguise deeper pathologies and that some ineffable vitality may have been sacrificed.

This alien high-trust Beijing has also thrown a wrench into Han Feizi’s personal plans. One major reason Han Feizi returned to Beijing is for the next generation. Besides providing a better foundation of China knowledge, Han Feizi believes, with his masochistic parenting philosophy, that young people who have never experienced a developing economy and all its maladies will be too soft for the coming decades.

This is turning out to be a massive fail. Ah well, there are a lot of universities in America.