Government and trust

Kevin Williamson of National Review Online focuses on the importance of trust.

Trust enables social cooperation in part by lowering what economists call transaction costs. When you want to buy something — whether it’s a bar of soap or the labor of a would-be employee — there are costs beyond the nominal price. You have to look around to see what’s available, compare options, evaluate the sellers and providers, etc. Sometimes, that’s pretty easy: I don’t worry too much about whether the avocados I buy at Whole Foods are going to be poisonous, because I trust Whole Foods to perform due diligence and quality control. The more trust, the lower the transaction costs, and, as a purely commercial matter, that can be significant. …

… The bigger the commitment — and the more difficult it is to disentangle oneself from it — the more trust matters, and the more difficult it is to earn. …

… Progressives who believe that replicating the government policies of Scandinavian societies in the United States will necessarily replicate Scandinavian outcomes ignore the role that prior Scandinavian social conditions have played in shaping those societies, which were not constructed ex nihilo by acts of parliaments. The Scandinavian countries have long been relatively homogeneous — their linguistic barriers tend to socially exclude outsiders and newcomers — with very high levels of trust and other social capital and long, deep traditions of social cooperation and relative egalitarianism. And it’s not just Scandinavia: As I often point out, the most important thing about Switzerland isn’t its localism, direct democracy, or business-friendly tax and regulatory environment — it’s the fact that it is full of Swiss people. Replicating Swedish social-welfare policies in Pennsylvania is unlikely to end up with Philadelphia being a lot like Stockholm.

Mitch Kokai / Senior Political Analyst

Mitch Kokai is senior political analyst for the John Locke Foundation. He joined JLF in December 2005 as director of communications. That followed more than four years as chie...

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