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Jakub Kucharczuk  17 lipca 2019

Authoritarianism on technological steroids? The Chinese Social Credit System

Jakub Kucharczuk  17 lipca 2019
przeczytanie zajmie 10 min

The consequence of introducing the Social Credit System will be a creation of the model citizen and modelling him using incentives. Are you punctual, do you eat well and remember to pay bills? The algorithm will appreciate it, and you will advance in the social hierarchy. Did you cheat on a test, watch TV series at night, do you live in a run-down neighbourhood, or even worse, keep in contact with people of low credit ratings on WeChat? You will soon find yourself becoming a social outcast with limited access to services and practically no chance for a better tomorrow for yourself and your family.

This system has its justification

The diagnosis that justifies the need to create the SCS is accurate. In China, social trust was destroyed during the communist revolution, the cultural revolution being the culmination of this process. For Mao, breaking down the traditional social ties was an aim in and of itself. He did a lot to disturb the social balance that has for centuries been based on traditional family ties (understood not only as blood ties, but a whole network of social relations called guanxi). The plan has not been entirely successful, but China still feels the social consequences of the revolution to this day.

The economy’s extremely rapid development in recent decades has not been accompanied by a similar evolution in legal and cultural norms. The modern Chinese society is therefore characterised by widespread indifference and by consent to fraud. It is also challenging to look for any foundations of civil society.

Chinese banks do not know who they can lend money to, the state has a problem with enforcing court judgments, and citizens will not even look at a passer-by hit by a car, lying on the street, in line with the „keep your head down” principle, prevalent in a communist society. The Party, however, sees the scourge of economic frauds as particularly painful – fake vaccines, crumbling flats, poisoned milk or transport disasters. Suffice to say that last year, when the China Food and Drug Administration announced that the company Changchun Changsheng Biotechnology was falsifying the ingredients of their vaccines, thousands of people in the Shandong province took to the streets in protest. Even the social media censors, usually meticulously precise, allowed the terrified Chinese to share critical comments on the web.

Moreover, local protests against chinese companies (never against the state or the Party) acting to the detriment of society have been by far the most significant cause of social turmoil for several years. And we’re not talking just about peaceful marches, but also demolishing factories. Just like the events in Fengxiang a few years ago, after local media reported that the factory is responsible for lead poisoning in children.

Therefore, the announcements regarding the construction of a system that will restore social trust have been received positively. Especially that it was showcased as a „whip against corrupt officials and dishonest citizens.” A technocratic state erected in recent years on the belief in the power of the Chinese economic miracle cannot tolerate mediocrity lined with corruption.

According to the document published in 2014 by the State Council, the prominent executive body of the People’s Republic of China, the program aims to create a „system that measures and strengthens trust throughout the country and builds a culture of sincerity. This will strengthen the political, social, commercial and judicial credibility.”

You aren’t paying your debts? Then you won’t get a passport

In parallel with the official announcements of the universal system, tests of various prototypes began, in a limited area or with limited functionality. In 2015, eight Chinese giants such as the Alibaba Group or Tencent provided systems where selected citizens could join and benefit from „increased personal appraisal”. This, of course, was done with the blessing of the significant Chinese officials, who announced in their official documents that the few years to follow would be a test period.

How are people evaluated? Of course, no company has publicly disclosed the details of the tools. In the largest of the systems, named  Sesame Credit, it is done by an algorithm. It includes 5 categories: financial liabilities (e.g. timely payment of bills), civil law liabilities, personal data (place of residence, phone number), behaviors and preferences (data on purchases and payment transactions) and interpersonal relationships (evaluated based on relationships and connections in the virtual world – in messengers, forums and dating sites alike).

The system collects data from its users through the apps and services it offers. Ant Financial (creator of Sesame Credit) has nearly 600 million users and is only a part of the Alibaba empire, the most potent Chinese technology company offering virtually all services needed by a Chinese internet user. The data is therefore provided by social networks, payment systems, banks and insurers, and even dating sites – Sesame Credit knows everything about its users who voluntarily agree to data processing, expecting rewards for „good performance”.

Voluntarism is vital because, in theory, this is a private system that has nothing to do with the SCS announced by Chinese authorities. Jack Ma, the creator of Alibaba, repeatedly highlighted that his company does not provide its users’ data to the Chinese government, and the company itself is fully independent (which can only raise a smile on the faces of many experts on Chinese economy). The system uses a carrot, not a stick – it does not apply penalties for low ratings but rewards the high ones. The rewards are quite attractive – whether access to preferential loans, cheaper access to selected hospitals, or no obligation to pay deposits when renting a car or bicycle. All this means that 500 million Chinese citizens, over one-third of citizens, were already registered in the system in 2017.  In other words – it is the vast majority of citizens using the „digital world” (their number is estimated at 770 million).

Sesame Credit has become the most notorious among the eight „private” and over a dozen state-owned prototypes, locally tested by some city authorities. Meanwhile, government agencies have been observing their functioning and implementing auxiliary programs to collect additional data that allow including citizens in the system. Although the universal Social Credit System is to be implemented in 2020 at the earliest, we have already seen the first effects of its „start-up”.

Every few months, agency reprints appear in Western news sites about how several million Chinese citizens could not buy airline tickets or did not receive passports. All this is due to one of the aforementioned auxiliary programs, whose task (at least officially) is to exclude untrustworthy individuals from society: for now only those who stand against the law or do not pay their debts.

The Chinese „Big Brother”

Although the official announcements of the Social Credit System mentioned introducing it in 2020, it seems that China is not ready. Making it widespread is a major issue. Although the Chinese digital society is almost 800 million citizens, the process of including the remaining 500 million citizens in the „digital world” will take many more decades. The face-recognition system, which seems relatively easy to implement in Beijing or Shanghai, will probably never be implemented in the hundreds of Sichuan villages. The same is true of assessments based on interactions in social media. As a result of unprecedented technological advancement, some of the Chinese were included in the technological revolution and digital economy in express mode. However, there is still a significant minority in the country, whom these changes have not affected yet, and perhaps never will.

Therefore, the SCS will not necessarily be announced with a bang during an organised conference. It may turn out that successive overlapping auxiliary programs will be interoperable (it is highly probable that this process is already slowly occurring). The virtual fireworks from Alibaba or Tencent will only be added to the nation-wide system as a lure, obviously without asking for the consent of all those who have accepted the terms by installing one of the hundreds of services offered by these companies.

This does not mean, of course, that the major companies will be nationalised. A well-known model of an agreement on data exchange will be applied – of course, without even a pinch of transparency or data openness, but this doesn’t seem to be a problem for Chinese officials and entrepreneurs alike.

The direct consequence of universal citizen appraisal will be the creation of a model citizen and modelling it with the use of point stimuli. Are you punctual, eat well and remember to pay bills? The algorithm will probably appreciate that, and you will profit and advance in the hierarchy. Did you cheat on a test, do you watch TV series at night, live in a run-down neighbourhood, and even worse, keep in contact with people of low credit ratings in WeChat? You will soon find yourself a social outcast, with limited access to services and practically no chance for a better tomorrow for yourself and your family.

More important, however, is how the system will indirectly affect society, turning behaviour and social relationships upside down, and causing unprecedented social stratification. It is the algorithm (and in practice, those who created it) that will show with whom it is worth to maintain relationships, reward exemplary citizens and push those who do not stick to the imposed pattern. Thus, one’s life goal will not be to start a happy family or achieve professional success, but above all to maintain a high rating, which may have a positive side effect in terms of one’s private or professional success.

The digital „eye of Sauron”

The assurances concerning the need to build public trust are right to an extent, which is confirmed by public enthusiasm for this project (of course, considering that even if this enthusiasm was not there, we would surely never know).

Undoubtedly, however, the system is about more than just building noble social trust. The overriding goal of the Social Credit System is to consolidate the power of the Communist Party of China.

A single-party state ruled by an elite of a few thousand, with an increasingly authoritarian president, little governance control and no tradition of social control, has undergone an incredible transformation, whose main goal was „to remain as it was” – in terms of system and society, of course. The creation of the SCS is therefore only a technological culmination of a path that the CCP has taken and which allowed it to connect the party with economic and social development. In Mao’s time, the Party’s strength involved massive ideological mobilisation based on the leader’s charisma, which, of course, could not remain effective in the long run. Introducing a system that will probably be universal in name only and will not include the party elite is just another step in strengthening the current elite’s position.

Much also indicates that the development of artificial intelligence will only help in this endeavour. Although the debate on the development of AI focuses on disappearing jobs, it is worth remembering that governments and corporations will soon get their hands on unprecedented tools to monitor and control social attitudes. The costs of such control will be negligible compared to, for example, the hukou, i.e. passport control system, which has kept the Chinese society in check in the 20th century.

Until now, the key advantage of liberal democracy over authoritarianism has been the dispersed, and thus much more efficient, information flow. Dictatorships with one single centre of power must always have been lagging behind. Meanwhile, an unexpected result of the industrial revolution 4.0 may be authoritarian governments becoming definitely more effective. This is cautioned by, e.g. Yuval Noah Harari, who writes that centralised systems will be much more efficient than dispersed ones because machine learning works better when the machine has more information to analyse.

This will provide benefits not only to the Chinese Communist Party but also the more or less democratic African countries or even developed Western democracies. Israel is already making efforts to replace expensive and risky intelligence systems in Palestine with algorithms. Why risk one’s life if it only takes the right string of code and some cameras?

Polish version is available here.

Publication (excluding figures and illustrations) is available under Creative Commons Attribution 4.0 InternationalAny use of the work is allowed, provided that the licensing information, about rights holders and about the contest "Public Diplomacy 2019" (below) is mentioned.

The publication co-financed by the Ministry of Foreign Affairs of the Republic of Poland as part of the public project "Public Diplomacy 2019" („Dyplomacja Publiczna 2019”). This publication reflects the views of the author and is not an official stance of the Ministry of Foreign Affairs of the Republic of Poland.