The River God in the 17th Chapter of the Zhuangzi plays the dunce and asks all the necessary questions for the Ocean God to explain to us the implications of his perspectival relativism. By what standard then can we know how to judge between things? he asks. The Ocean's response is worth quoting in full:
Observing (things) by way of Dao, things have no 'worthwhile' or 'worthless'.
Observing them by way of things, each considers itself 'important' while all consider others 'less important'.
Observing them by way of common-convention, 'honorable' and 'contemptible' are not defined by individuals [but communally].
Instead of one standard, the Ocean gives three. And what seems even more remarkable, he does not judge between them; take your pick. But then this is what the view from Dao suggests we do. As Lusthaus tells us, “Zhuangzi does not present Dao as a meta-criterion, but as one criterion among three . . . .” The “Dao-standard” is “standard-less”, and for this reason allows for the other two. But we want the ‘best’ way, the surest way. This, however, is not on offer. The case has been made for a relativism so broad as to disallow any fixed and sure meta-standard, and if we are to be consistent, we cannot now declare this view, the view from Dao, as any more valid than the other two.
But, like the River God, we again ask, how should we then conduct ourselves in the world? Zhuangzi’s answer, I believe, is that life itself would have us choose the one that most enriches our life experience. And this is the view from Dao, the view that embraces the world in such a way as to lead us away from contention and strife, both within and without.
The way of humans generally is to affirm themselves and to reject others. This is because our self-affirmation is a function of the discriminating mind — for something to be right, other things must be wrong. All the world is seen as either/or, not both/and. For this reason, the Confucians declare themselves right and the Mohists wrong, and vice versa. Zhuangzi suggests we view them both as we would the sound of the wind blowing through the forest trees and crevices. Is it a symphony or a cacophony? The view from Dao enjoys the former; the view from self distresses at the latter. Take your pick.
Conventional norms are an extension of individual prejudice. We collectively decide what is acceptable and what is not, and then use this to judge those within the collective and those without. But collectives acquire a life of their own, become “principalities and powers” (to use the biblical term), that can militate against their own subjects. Are the policies of the U.S. government, both foreign and domestic, really in the best interests of its people, or does it in fact have its own interests in mind — its own power and self-preservation?
You can check out Scott's writings on Zhuangzi here.