You may not want to believe racist ideas, but that doesn't mean that "noble lies" will work.
Besides, you are missing the obvious third option - that the issue is culture and institutions. The politician in Denmark might also steal if he could get away with it, but he has people checking on him. In other words, there are "mechanisms of enforcing trustworthiness," to use the phrase in my original post. But if there are no such mechanisms, then why should the rate of tax compliance make any difference to the politician's willingness to steal?
People's "honesty" (and I worry you are subsuming too much into this label) isn't just a function of the honesty of people around them. It is a function of the particular incentives they face from (dis)honesty. The inmates are no doubt dishonest to the prison warden all day long, but it doesn't follow that he's dishonest with them.
The problem is that (say) Ukraine has basically never had stable, pro-market culture and institutions, whereas England has had them for centuries. They are not going to catch up overnight, because it takes a long time for webs of trust to form and break, habits to change, norms to be removed, established and reinforced. You just have to be patient and do the best you can.
But checking on a politician is an investment in your community with little personal return to yourself. It requires trust to think it will pay off to you.
Mancur Olson modelled it perfectly in The Logic Of Collective Action. 1000 people put 100 $1 bills or coins into a hat making it $100K and then someone steals $1000 out of it. What is more beneficial for you, to catch the thief and then you personally get your $1 back, or you, too, steal $1000 out of it? Setting morals aside, in the short run the second is better. The first one depends on the vague noti...
I decided to link to this article, because this seems to be all about what Less Wrong is about: http://www.newyorker.com/magazine/2014/11/10/better-time. Out of interest, does anyone know of a good resource for learning more about the training techniques used in elite athletics?