Building social capital requires trust and participation among individuals

These are the networks and associations that give rise to trust between people.

Robert Putnam, in his book Bowling Alone, has tried to measure the rundown of engagement in voluntary organisations in America over the last third of the 20th Century. Although I have not seen a similar attempt to measure this in Australia, all the anecdotal evidence to me from the churches, the political parties, the Scouts, the local sporting clubs suggest that membership is in decline and in that sense social capital is running down. The Productivity Commission's research paper on social capital reviews the work that has been done in Australia.

Putnam quotes a slogan used by a volunteer Fire Department to publicise its annual fundraising effort: "Come to our breakfast, we'll come to your fire."

Of course we know that the volunteer bushfire brigade will come to our fire whether we come to their breakfast or not. But we also know that if nobody comes to their fundraiser, or if nobody comes to join their brigade, there will not be anyone available to come to our fire.

Engagement in these voluntary groups produces a direct outcome, for the bushfire brigade is a group that can attend to a fire. But it also produces by-products. By-products like friendship, belonging, tolerance and trust - and forms the basis for relationships which can be extended to other worthwhile causes.

Engagement is reciprocated, it sponsors further engagement. And in these groups where people have a common interest, and a name, they build trust and tolerance.

Does it matter if this culture of engagement is running down?

I think it does. I think the public laments the fact that engagement is running down. But we should be careful here. The majority of the public is not so worried about the issue that it makes them want to change their behaviour and reverse the trend of declining participation. If people were really worried they would presumably start flocking back into all those associations now struggling for membership.

But there is a tendency to think fondly of a time when people in a neighbourhood knew each other better and seemed to be closer.

Although television could well be one of the main causes of disengagement it is replete with shows that depict people living together in close neighbourhoods. The Australian TV series Neighbours is one such show. The American series Friends is another. There are not too many television shows about people who sit at home and just watch television shows. Even if people don't actually engage that much with their neighbours, they apparently like watching others who do.

I should mention here that not all social groupings are positive ones. The Mafia is a very close social network; calling itself a society, an honoured society. It generates a high degree of trust among its members. It uses these associations for anti-social activities such as extortion, racketeering and the like.

Some social networks also inspire enormous trust between insiders on the grounds of a common intolerance to outsiders. Paramilitary organisations in Northern Ireland work on this principle. Urban gangs are another example. These organisations develop social capital among themselves which they then direct in a destructive way against others. It is the combination of internal trust and external tolerance that produces positive benefits for the wider society