The Short of It:
The best politics provide organization, not control.
58. Letting Others Be Transformed.
When the government is blindly liberal, the people are rich and noble. When the government is pryingly strict, the people are needy and miserable.
Happiness is ever built up on the back of misery. Misery is ever lurking under happiness. Who knows where this will end?
If one be [themselves] devoid of uprightness, the upright will become crafty, the good will become depraved. Verily, [humankind] have been under delusion for many a day.
Therefore the sage is [themselves] strictly correct, but does not cut and carve other people. [They are] chaste, but [do] not chasten others. [They are] straight, but [do] not straighten others. [They are] enlightened, but [do] not dazzle others.
58. ‘Transformation According to Circumstances.’
58.1 The government that seems the most unwise, Oft goodness to the people best supplies; That which is meddling, touching everything, Will work but ill, and disappointment bring.
Misery! -happiness is to be found by its side! Happiness! -misery lurks beneath it! Who knows what either will come to in the end?
58.2 Shall we then dispense with correction? The (method of) correction shall by a turn become distortion, and the good in it shall by a turn become evil. The delusion of the people (on this point) has indeed subsisted for a long time.
58.3 Therefore the sage is (like) a square which cuts no one (with its angles); (like) a corner which injures no one (with its sharpness). [They are] straightforward, but [allow themselves] no license; [they are] bright, but [do] not dazzle.
58. Adaptation to Change.
58.1 Whose government is unostentatious, quite unostentatious, [their] people will be prosperous, quite prosperous. Whose government is prying, quite prying, [their] people will be needy, quite needy.
58.2 Misery, alas! rests upon happiness. Happiness, alas! underlies misery. But who foresees the catastrophe? It will not be prevented!
58.3 What is ordinary becomes again extraordinary. What is good becomes again unpropitious. This bewilders people, and it happens constantly since times immemorial.
58.4 Therefore the holy [person] is square but not sharp, strict but not obnoxious, upright but not restraining, bright but not dazzling.
The Long of It:
It’s plausible this Chapter is a rewrite of Chapter 57 by some over-zealous scholar (see Hoff). After all, the paradox is the same: heavy handed governments instigate what they’re trying to prevent. The structure is the same: set up, paradox, solution. And the Chinese translator is trying to state the paradox as a truism (something the English translators tried hard to do both here and in 57).
-TB