[Reading the World through Han Feizi] A Wealthy Nation Built on Trust

Shang Yang’s Performance

There was a man named Shang Yang. Along with Han Feizi, he stands as a symbolic figure of Legalism, and he may even be called the father of Qin, the unified empire. He was originally from the state of Wey, but when he failed to secure a position either in his homeland or in the other state of Wei, where he had also sought opportunity, he headed west. There he was recognized by Duke Xiao of Qin, who was searching widely for talent, and rose to become chief minister. Through sweeping reforms, he achieved national wealth and military strength, and through rule of law he laid the foundation for Qin’s eventual unification of all under heaven.

Before implementing his reforms, Shang Yang had a concern. He was about to enforce new reform measures and laws, but he was not sure whether the people at large would trust them and follow them. So he devised a clever plan. He erected a long wooden pole, 3 zhang in length—about 9 meters—at the south gate, and announced that anyone who moved it to the north gate would receive 10 taels of gold. At first, no one believed him. So he raised the reward to 50 taels. Then, with nothing to lose, some madcap stepped forward and moved it. Shang Yang immediately summoned the man and paid him the promised large sum. After this incident, no one dared violate the government’s laws and decrees, and the state grew greatly in wealth and power.

This is the famous historical anecdote known as “winning trust by moving a pole” (移木之信), also called “winning trust by relocating a pole” (徙木之信). It was something Shang Yang did before fully launching his reforms. He first made it unmistakably clear that state commands contained no falsehood, and only then revised the laws and pushed ahead with his program for national wealth and military strength. In fact, however, this was a performance that Wu Qi had carried out before Shang Yang.

Why did both men stage such a performance? Because they believed trust was important. They saw trust as a prerequisite for reform, and because they were reformers, they could not help but place great importance on it. They wanted to change things—to repair the framework, or even to smash it and reconstruct the state on an entirely new basis—and they understood that trust was an essential element in any such reform.

Trust, the Absolute Condition for Reform

No policy can satisfy every member of society. New policies and laws inevitably create people who must bear losses and suffer pain. And the more forceful the drive for national wealth, military strength, and reform, the darker that shadow becomes. The gap in benefits and burdens is bound to widen. Even building a single reservoir immediately divides people into those who benefit greatly, those who benefit somewhat, and those whose land is submerged, who weep tears of blood and must abandon the place where they lived. In a complex and deeply interwoven society, the more drastic the reform, the wider these disparities become, and the more inevitable it is that some people will be deeply dissatisfied. In a situation without trust, can reform even be attempted? And even if it is begun, can it succeed?

When reform is carried out, there will always be people who must suffer and incur losses. But if those people believe: it may be hard for me now, but I too will benefit eventually; the state will compensate me for what I have lost; though this is painful, if the reform creates a strong and livable country, then in the future I—or my children—will reap the rewards, then the story changes.

If, in ordinary times, there had been no falsehood in the state’s commands, if political leaders had not gone back on their word, if policies had not been changed capriciously like the “morning three, evening four” parable, then the people would have had trust, and the situation would be different. In that case, a strong reform drive for national wealth and military strength could win the support of the majority of the people. But if rulers have often broken their promises, changed policies frequently without any consistent standard, and pursued private interest rather than the public good, then trust never forms. In such a case, reform often founders before it even begins. No one is willing to bear the pain, and people resist because they do not trust the government. Put bluntly, reform without trust is impossible.

To speak more broadly, there are said to be three conditions for reform, or three problems of reform: the problem of trust, which has already been mentioned repeatedly; the problem of social buffers; and the problem of the stages of policymaking. First, trust must exist. Next, there must be buffering mechanisms. Society must be able to care for those who are knocked down by reform. Put simply, this is what we might call a social safety net.

In Korea, this safety net is weak. That is why reform is especially difficult—not only because Korea is a low-trust society, but also because of the weakness of these social buffers. And for reform to succeed, it is said that the stages of policymaking should be as simple and short as possible. This can be seen as an advantage of authoritarian societies and a disadvantage of democratic ones. But Korea is a country that has undergone substantial democratization, and one in which the middle class and the top 10 percent wield disproportionately strong influence. Under such conditions, simplifying policymaking is extremely difficult. One way or another, Korea is a country where reform is bound to be hard.

In Korean society today, there are growing calls to complete various reforms. People say labor reform, public sector reform, and pension reform are needed. The labor market must be made more flexible. The seniority-based wage structure must be changed. Excess bloat in the oversized public sector must be trimmed. Civil servant, military, and private school pensions must be integrated into the National Pension system. And, taking the birthrate into account, the pension system itself needs restructuring. But at present, all of these reforms are extremely difficult. The previous administration made clumsy attempts, met strong resistance, and effectively ran aground. The current administration has not even been able to begin.

Yet these are tasks that must be done—for future generations, for industrial competitiveness, and for the fair distribution of social resources and the establishment of a healthy incentive structure. Even so, I do not think we should limit ourselves to simply talking about the necessity of reform. It is not enough to flood the discussion with tautological claims that reform is necessary, therefore reform must be done. We must ask: has trust truly been built in Korean society? And are social buffers sufficient? If trust is lacking, how can it be strengthened in the short and long term? To the extent that trust is lacking, how should the public be persuaded? These are the questions we need to ask and wrestle with. Above all, I believe we must also devise concrete ways to strengthen the weak social safety net. Politicians need to think seriously about this.

Trust, a Condition for National Prosperity

Finally, I would like to point out that Han Feizi did not discuss trust only in relation to reform. He also spoke of trust as a condition for national prosperity. He believed that when trust is established, exchange becomes more active, and as a result even a country small in size can become economically powerful. Among the Legalists, one notices striking economic insights. It is true that Han Feizi has often been compared with Machiavelli of The Prince, but in fact I think he has even more in common with Adam Smith.

He believed that his own country, Han, needed trust not only to complete reform but also to become wealthy. Should not our own Korean society now build great trust for the sake of the economy as well? There is nothing shameful about not producing a single drop of oil. What should shame us is the absence of the social resource called trust. Let us now move toward a high-trust society. Let us create a Republic of Korea rich in the resource of trust. Han Feizi said, “Small trust leads to great trust” (小信成 大信立). I hope these words can become our motto for the time being.

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Original title: [한비자로 세상읽기]신뢰(信賴)자원의 부국(富國)으로

Author: Geon-sun Im

Date: 2020-01-21

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=column&pn=10&idx=22309