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Culture War Roundup for the week of July 7, 2025

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I disagree. I think the book presents a convincing case that, impossible utopias excepted, a world with no fraud would be worse than a world with some amount of fraud. Some amount of fraud is the price you pay for living in a high-trust society (and all the economic and social benefits that entails); a few iatrogenic deaths is the price you pay for a national healthcare system; a few murders is the price you pay for living in a free society etc.

I think this is backwards. No one pays with fraud or murder to create a higj-trust / free society. A high-trust / free society comes about when the amount of fraud and deaths is so low, they're not worth bothering with to preempt.

No, and the book quite lucidly explains why this counterintuitive assertion is actually true. Fraud is only possible in a society in which most people are assumed to be trustworthy. Montreal Vancouver was for years known as the scam capital of the world, specifically because the number of trusting investors eager to invest in promising new startups made it catnip for scam artists. By contrast, in a society where nobody trusts anyone else, people are famously unwilling to lend out their money, which results in low rates of fraud but also sluggish economic development.

Fraud is only possible in a society in which most people are assumed to be trustworthy

This hasn't been my experience coming from a low-trust society, where everyone quickly learns to keep their hand on their wallet, and grow extra eyes all around their head.

Montreal was for years known as the scam capital of the world, specifically because the number of trusting investors eager to invest in promising new startups made it catnip for scam artists.

Did this happen, by any chance, because there was very little fraud in Montreal in years prior, and people were much less cautious with their money because their priors about trustworthiness were outdated? Did they start being more cautious about fraud specifically after it turned out that the expected cost of preempting fraud is lower than the expected cost of falling victim to it?

The book is not counter-intuitive. It's wrong. At best it's doing the old gimmick of phrasing something true in a deliberately counter-intuitive way, to make it's reader feel smart, but the way you're describing it, it sounds just plain wrong.

This hasn't been my experience coming from a low-trust society, where everyone quickly learns to keep their hand on their wallet, and grow extra eyes all around their head.

And in this society, if a stranger approached you, introduced themselves as an entrepreneur, and offered to let you in on the ground floor of their operation for a small loan of million dollars, would you consider taking them up on the offer? Of course not - you'd assume they were a scam artist trying to rip you off. The only place someone would take them up on the offer is in an environment in which most people are assumed to be trustworthy, which in turn means the only place a scam artist would attempt it is in an environment in which most people are assumed to be trustworthy: in other words, fraud is impossible in a low-trust society.

Did this happen, by any chance, because there was very little fraud in Montreal Vancouver in years prior, and people were much less cautious with their money because their priors about trustworthiness were outdated? Did they start being more cautious about fraud specifically after it turned out that the expected cost of preempting fraud is lower than the expected cost of falling victim to it?

Of course, and the book catalogues many examples of boom-bust cycles of the type you're describing. A high-trust society (or subculture, or community) is founded -> scam artists get wind of this and exploit it for all the alpha it's worth -> after a few successful frauds, people start getting a lot more cautious and risk-averse -> realising that it's no longer a high-trust society, the scam artists depart for greener pastures. None of this even seems counterintuitive to me, it just seems like basic economics.

Of course not - you'd assume they were a scam artist trying to rip you off. The only place someone would take them up on the offer is in an environment in which most people are assumed to be trustworthy, which in turn means the only place a scam artist would attempt it is in an environment in which most people are assumed to be trustworthy: in other words, fraud is impossible in a low-trust society.

This is completely false. It doesn't surprise me, as westerners don't really grok low-trust societies, even the ones that acknowledge their existence (because hilariously there's quite a few who think doing so is racist).

What you're saying is the equivalent of believing that a predator can only successfully hunt if you transfer him it to Quokka Island. Quokka Island will appear to one as an all-you-can-eat buffet, but It's obvious predators survive and thrive quite well in environments where the prey is adapted to it's existence, it's just that they're subject to "you win some, you lose some" dynamics. In the case of scams, all it means is that they have to put more effort into appearances of legitimacy. To someone from a low-trust society, a high-trust one does not appear as "the only place where fraud is possible", it appears as one where the population hasn't bothered to put up the most basic defenses.

None of this even seems counterintuitive to me, it just seems like basic economics.

The part that's counter-intuitive, and perhaps deceptive, is where you/he claims that tolerating fraud is the price for a high-trust society. No amount of tolerance will turn a low-trust society into a high-trust one. What needs to happen is the purging scammers, once that's done, people lower their guard naturally. They don't "tolerate" fraud, it just happens so rarely, it hardly ever enters their thoughts.

In the case of scams, all it means is that they have to put more effort into appearances of legitimacy.

I think we might be talking past each other. I've been using "high-trust society" and "high-trust country" kind of interchangeably, but I think more specificity is called for. What I'm really arguing (and what I take Davies to be arguing) is that fraud can only take place within a high-trust community. That is, a country might be low-trust on the whole, but there might be enclaves within that country in which the members enjoy a presumption of trust with one another (social clubs, religious communities, voluntary organisations etc.). It is within these communities in which fraud and scams will occur in countries which are otherwise low-trust. This, I think, is what you're getting at with "putting more effort into appearances of legitimacy": scam artists must consciously infiltrate these high-trust communities, and this may be more difficult in a low-trust country than in a high-trust one (as the members of a high-trust community within an otherwise low-trust country will be doubly suspicious of outsiders).

I think you and @ArjinFerman are both wrong about the point. The optimal amount of fraud is not zero is about how as you eliminate fraud and increase social trust you increase the incentive to fraud and the marginal cost of reducing fraud rises asymptotically such that the last little bit of fraud isn't worth the squeeze. The point isn't that you tolerate fraud as in not police it, it's that you police it but you don't turn panopticon to go from 10 cases of fraud across the whole population to zero. You tolerate it in that you accept cases won't be zero, not that you don't do every reasonably cost effective thing you can do to reduce it.

he point isn't that you tolerate fraud as in not police it, it's that you police it but you don't turn panopticon to go from 10 cases of fraud across the whole population to zero.

I don't know if this is quite right. It's not that high-trust societies police fraud just as intensely as low-trust ones, but decide not to got the final mile. They actually police fraud much less than low-trust ones, take people at their word and generally assume their good faith. This is kind of the definition of a high-trust society, and it's also been matched by my experience visiting them.

They actually police fraud much less than low-trust ones, take people at their word and generally assume their good faith.

This is an unstable situation, though, unless fraudsters actually are punished a good bit of the time. If they prosper, your high-trust society days are numbered as the chumps figure out they're chumps and stop trusting and/or turn to fraud themselves.

If we're talking about some less-than-Dunbar's number small community, that's pretty easy, if Aaron Stevenson Stoltzfus invents lying in some small naive Amish community, then even if he doesn't get formally punished (which he likely would be, the Amish not actually being naive), word's going to get around and no one is going to trust him. Anything larger and it's a lot more difficult.