I believe a fair chunk of the alienation that concerns you isn’t just a result of competitive economic systems, but also urban planning.
When in a city, you have significantly less personal connection to, and knowledge of, the people around you. This makes it harder not only to judge their intentions, but also to punish them. Thus, you are at increased risk when interacting with them (as I think slavojzyzzek mentioned).
Part of the way to combat this may be to turn cities into collections of ten thousand villages. Build each block of the city as a mixed-use unit, with internal green space and, critically, controlled access beyond the shops at the perimeter. That could be as simple as just making people check in when they enter and refusing anyone not approved by a specific resident. Have the block owned or managed by a sort of cooperative responsible for creating cultural festivals and whatnot to encourage social interaction and a sense of community. Specific police officers could be assigned to each block (as the population is high enough) and get to know the residents.
With increased trust and more limited populations, the residents can get to know their neighbors more on the scale of a small town than a big city, reducing the social distance by one or two orders of magnitude. If you’re Communitarian enough, you can also have police/healthcare/etc units focus on specific high-risk people within the block to prevent situations from spiraling out of control.
This seems like treating a symptom of the real problem, which is needing to know and get along with the people you happen to live near, and is the opposite of “high-trust.”
Low-trust vs high-trust is about how you have to deal with strangers. If tight-knit communities are required to form connections or even so much as not expected to get attacked or ripped off, then that is a failure of civil society and a damage-control motivated return to the tribalism and provincialism that modernity is an effort to solve/depends on already being solved.
And we certainly have at out disposal far greater tools for creating shared context and trust between unrelated strangers than has perhaps ever existed, if there existed the will to use them. (And certainly, if you’re entertaining a scenario where the pursuit of your goals can affect the direction of urban planning, then you’re already imagining the use of a lot of political will!)
I consider that much of what gets called “alienation” is a feature. It would be worth fighting for as a goal rather than fought as a problem, even absent its economic benefits.
I would consider that in high-crime areas, civil society has in fact failed to some degree and that a return to a more structured form of community as a method of preventing it from getting even further off the rails can be considered justified. Preventing and policing crime and misbehavior are both quite challenging tasks on their own.
What I have proposed does not undermine modernity any more than the existence of suburban towns does. (Though, perhaps you wish to abolish suburban towns as well for some reason.) Specifically, it’s also primarily for residential areas. It isn’t as though you can’t just walk right off the block and be back in the rest of the city.
As for political willpower, something not so different from what I have proposed already appears to exist in Singapore. I once thought that cop cameras, while a good idea, weren’t politically tractable, but that situation changed and they began to emerge in various cities. I wouldn’t expect this idea to take off for another 20 years, anyway.
I probably have different values from you, since I believe that human beings are social creatures and function best if they have at least some social context and support network, people that they know they can depend on (which, absent some pretty powerful culture, is not something that can be counted on from strangers).
What are these methods that people lack the political will to use, that are only as difficult as urban planning?

