Reputation Processes and Social Trust

One theme that appears in the essays in this symposium is that it’s not clear exactly what we can do about declining social trust. Even in my own more optimistic view about just how much social trust we have and take for granted each day, I will admit that I don’t have any silver-bullet ideas for dealing with what I think is a genuine decline in social trust in the political world. As I argued in my first response, I think it can’t hurt to continually remind people about how often we do, in fact, trust and interact beneficially with people who may well have a range of views we find odious. I have a few more thoughts that I’ll get to toward the end of this reply, but even those I do not hold with great confidence.

One major problem is that there is not a powerful and straightforward mechanism for punishing those who violate or reduce social trust. Compare, for example, how trust plays out in markets. Another form of trust we rely on frequently in markets is how many strangers we allow into our homes. We don’t think about it this way when it happens, but it is somewhat odd that we let perfect strangers into our homes to repair our plumbing or to install a new appliance or to protect us against insects and other creatures. Paul Seabright raises this question in his wonderful, and underappreciated, book The Company of Strangers. Seabright argues that many of the institutions of the modern world, especially in the market, have the effect of turning strangers into honorary friends. Put differently, those institutions create ways for us to signal trustworthiness to each other. In the case of the plumber, the use of a uniform, a truck with a company logo, and the various ways firms contact us to expect someone all serve as signals of trust. (My home repair company emails me a picture of the person who is coming out to do the work.) We would be rightfully wary if a company’s repair person showed up unexpectedly, driving an unmarked vehicle, and wearing a t-shirt and jeans and carrying few tools. It’s also why we tend to prefer organized firms over independent actors for such tasks, all else equal.

But more important is what would happen if that company’s repair person behaved inappropriately while doing the work, thereby violating the trust that was otherwise signaled. In the world of the twenty-first century, we have so many ways to convey back to the company that this person behaved poorly, from directly contacting the firm to using social media like Yelp or Angie’s List or others to leave a bad review, to a simple Facebook or Twitter post. One of the often-overlooked advantages of markets is that profit-seeking leads firms to care about their reputations and to respond, and to do so quickly, when that reputation is threatened. (Yes, this can be taken too far, and I will come to the role of “cancel culture” later.) It is not clear that a similar set of incentives and effective process of response exists when it comes to undermining trust in large-scale social and political institutions. Profit-seeking firms also have ways to rebuild trust when they make mistakes or their reputations are wrongly harmed. How many people remember the “Chicago Tylenol Murders” from 1982? How large-scale institutions rebuild or recover is more tricky. In fact, as the events of January 6th suggest, some acts that undermine social trust in large-scale institutions might well lead to social rewards for some participants. These sorts of perverse incentives are particularly concerning.

A related problem is that politics in particular has become an arena of such high stakes that the incentives to win at any cost are greater than ever before. The fiscal and cultural resources and power that come with political victory, especially winning the presidency in a world of executive orders and octogenarian Supreme Court justices, are perceived to be so great that playing by the rules is for suckers. Combine that with the issues about information, social media, and the decline of the elite that Martin Gurri raises, and we see the amplification of extreme voices and positions that has characterized political discourse for the last decade or two. This is about the worst context possible for maintaining social trust or punishing attempts to destroy it. Extremism and win-at-any-cost strategies pay off.

So what, if anything, can we do? I think we need to recognize the ways in which nonpolitical institutions can serve as a substitute for the weak reputation effects in modern American politics. For example, the decision by Twitter to shut down President Trump’s account and the decision by Amazon to enforce their terms of service with Parler are both examples of the ways in which markets and civil society can punish those who attempt to violate large-scale norms and institutions and thereby undermine social trust. Yes, those on the right will say that this is “cancel culture” and that such actions themselves show political bias and undermine social trust. I don’t like the term “cancel culture” because it is too broad and has quickly become an attempt to ward off all kinds of legitimate criticism. However, the idea that some people or actions are beyond the pale and that we should engage in some form of shunning seems to me to be valid. What exactly is “beyond the pale” will always be contested, but actions that undermine trust in the foundational and framework institutions that make other forms of productive social interaction possible would qualify.

Modern American society is polycentric with respect to forms of social power. We need to figure out how to deploy institutional structures outside of politics to serve as countervailing forces when political actors undermine social trust. It will be tricky to find the right balance between punishing those who deserve it and avoiding the excesses that are associated with more dubious acts of “cancel culture.” However, if liberalism (and not just classical liberalism) is to survive the combined forces of social media disinformation, partisan extremism, and a global pandemic, we’re going to have to give it our best shot.

Also from this issue

Lead Essay

  • Kevin Vallier argues that politics should not be war, and that classical liberals should strive to be peacekeepers. He marshals evidence that high levels of social trust lead to many desirable social outcomes, and that social trust in the United States has been on the wane. At the same time, Vallier also laments the decline of classical liberalism as a force in American politics. He proposes that classical liberals can reinvigorate their movement by addressing the problem of trust—a development that will improve the political climate for everyone.

Response Essays

  • Steven Horwitz points out that civil society is of great value regardless of the political beliefs of those within it. Our neighbors—whom we may hate for voting for Trump, or for Biden—are the same people whom we greet and exchange kindnesses with. They are also the same people who provide us goods and services in the market—meaning that the market and civil society both stand in conflict with our harsher political impulses.

  • Martin Gurri places the blame for declining instutional trust squarely on how internet-mediated social interactions have fatally undermined many of our old, elite-run institutions. The problem is structural, he insists, and not the result of partisanship alone. He is doubtful that classical liberalism, however defined, can offer a workable solution.

  • Americans are paradoxically both highly polarized—and not all that ideologically divided, writes Irina Soboleva. Voters are intensely attached to their parties and their leaders, and, she argues, it is these institutions and leaders that have encouraged polarization. Political ignorance has exacerbated this tendency; in response, Soboleva calls for “buffer zones” of relatively nonpolitical life including but also extending beyond the market.