In 2014, China’s State Council released a road map for a comprehensive “social credit system” which would assign citizens, firms, and organizations a credit score based on multiple economic and social categories.
The data-driven system would help meet market objectives by effectively extending financing options to the country’s large unbanked population, and ideological objectives by addressing rampant corruption, profiteering, and mistrust in the country—or as early documents promised, to “allow the trustworthy to roam everywhere under heaven while making it hard for the discredited to take a single step.”
Criticism of the system, particularly from Western observers, has largely come along two, seemingly contradictory lines: that the project is either too ambitious to succeed or, given the country’s successful clampdowns on dissent, too Orwellian to fail.
Both assessments persist because the current social credit system — due to be fully operational in 2020 — remains a patchwork of existing administrative systems and loosely linked pilot projects from private tech companies and local governments.
The most comprehensive of these local efforts is Shanghai’s “Honest Shanghai” app, which pulls data from nearly 100 government entities. The least comprehensive is likely the city of Jinan’s system for dog owners, which deducts points for infractions like walking without a leash.
It’s unclear how or when these efforts will coalesce, and as Jamie Horsley persuasively argues in Foreign Policy, a single composite score for every citizen still seems a long ways off. What does seem clear is that, given the technological and especially administrative complexity of the endeavor, critics should familiarize themselves with Weber before they go reaching for Foucault.
The system’s shortcomings to date reflect familiar bureaucratic hurdles, namely a reluctance of companies and government agencies to share data, and third-rail concerns from threatened political and business interests.
A Popular Panopticon
For the moment at least, surveys show that the social credit system is actually quite popular within China, as socially advantaged citizens perceive it as a way to reduce consumer fraud and access elite benefits associated with high scores.
Popularity could easily shift, however, especially if the system is unable to navigate sensitive political considerations, protect citizen privacy, or reliably deliver accurate financial assessments.
An early pilot system in a Suining county, north of Shanghai, triggered a public backlash in part because of the inclusion of “political” data points (such as illegally petitioning higher authorities for help). The state-owned China Youth Daily \went so far as to declare that “people should have rated government employees and instead the government has [rated] the people.”
China’s central bank, meanwhile, has been reining in initiatives by tech companies like Alibaba and Tencent to create their own social credit scores due to fears about conflict of interests, consumer privacy protection, and overreach of data collection. Instead, these companies have now become shareholders and active contributors to the government-backed Baihang Credit Scoring company, which only recently launched and is thus far only available in the southern city of Shenzhen.
Developing reliable consumer financial profiles for 1.4 billion people is no easy task. Each of the three major U.S. credit bureaus has over 200 million credit files that, on average, contain 13 past and current credit obligations, resulting in 2.6 billion pieces of data. Each month, more than 1 billion pieces of data are updated. Given that volume, it shouldn’t be surprising that more than one in five Americans have a “potentially material error” in their credit file that makes them look riskier than they are.
Now consider that China is proposing to track not only financial transactions, but eventually driving records, social media activity, charitable donations, and much more. The party-state may soon find that even when surveillance solutions scale, so do data problems.
At this point, it seems highly unlikely that the social credit system — or even a scaled back consumer credit scoring system — will be fully operational by 2020. The ominous media reports of Chinese citizens with “low scores” being barred from travel (or having their children rejected from college) are real, but these penalties reflect credit reporting blacklists that predate the social credit system.
None of the above is meant to suggest that concerns about China’s surveillance state are misplaced. The government really is collecting vast amounts of information on its citizens, and the social credit system and other monitoring initiatives have raised red flags from civil society leaders and foreign businesses. Moreover, a report from the Mercator Institute for China Studies notes that even if the full vision of the system is not realized, the “scope of this project is massive and will transform China’s legal, social, and economic environment significantly.”
But critics should avoid the temptation of technological determinism. As Horsley notes, the Chinese party-state has already developed an array of tools to address public and political security issues without relying on an algorithm. If the social credit experiments succeeds, it will be because it delivers good governance — not omniscient surveillance.
Pete Hunt is a Bangkok-based writer and analyst with Beutler Ink. You can follow him on Twitter @PeteHuntBKK.