Do not think of this as a psychological story. Do not ask what personal motivations drive these characters. This is a sociological story, just one anecdote in a country full of ruthless and vengeful selfishness.
What you're seeing in this story is the consequence of the Cultural Revolution (1965 to 1976)...
SNIP
That's just how China is now. And it could take a century or more for the country to return to its traditions and to regain it's moral grounding.
Hi uh
Sorry what?
Cause this happened to both the US (Red Scares 1&2) and the Soviets (Stalin's Great Purges), along with the DDR/GDR (basically all of it). And before you say "no it didn't", yeah sure, not exactly as how it happened in China, but it rhymes along the same lines. Patriotic fervour worked up to dispose of the ruling party's political opponents, which extended beyond and spilled over into the wider society due to said fervour.
In those periods and in the immediate aftermath sure there was a weakening of trust, but putting faith, goodwill, and trusting your fellow human is what constructs a society and maintains it. There is still a baseline level of trust present. Some folks may be more paranoid than others in the wake of it, but in what appears to be the setting of the 2010-2020s, if it's due to mao's purges it's going to be in the people who actually lived during those times, not some kids. Human memory is surprisingly short. The cultural revolution to my knowledge is not fondly remembered, and iirc sometimes evoked to accuse someone of political foolishness or wrong doing.
Besides Radical Idealism (aka Neo-Confucianism. I am assuming this is what you mean by tradition) is still alive and present in wider Chinese society, it's the whole reason it's official party line is Socialism with Chinese characterises, and it's currently evolution of Xi Jinping Thought.
I'm not going to touch on the famine stuff because there's a legitimate historical debate to be had if it was considered a acceptable consequence of rapid re-industrialization or if it was a series of misfortune and errors, or if it was planned as you said.
Also what the fuck do you mean by moral grounding?