China's Social Credit System is Not what You Think
Google Translation of this original piece by Ed Sander.
Recently it was again that far. After a broadcast of Tegenlicht, which could be quite a bit marked, the discussion about China's social credit system flared up again. Especially opponents of the 'sleep law' that a few weeks later in a referendum could vote for, it used as an example of 'such a society', and therefore the drag law, which we really do not want in the Netherlands.
All this is accompanied by a number of persistent misunderstandings that have been circulating for four years on the internet and in the media in general. I want to try again in this article to get rid of these misunderstandings. I also want to make an effort to cultivate more understanding for the situation in China. When assessing China's credit systems - spoiler: there are several! - we make a big mistake by looking at it through western glasses and from the context of our society. But China is not the Netherlands ...
Please note: in this article I try not to criticize or defend the social credit system. I am only trying to remove the stubborn misunderstandings and make the necessary nuances.
Misunderstanding 1: There is one credit system
The biggest misunderstanding is that there is one system. This also leads to different conclusions that are not correct in practice. Simply put, there are two groups of systems. To emphasize the difference, I personally prefer to refer to a commercial credit system and social management system .
Commercial credit system: Due in part to the lack of a good creditworthiness system as we know it in the form of a BKR and thus credit to consumers, the Chinese government has given approval to a number of private companies for the development of their own creditworthiness systems. The best known of these is Sesame Credit from Ant Financial, a sister company of Alibaba. To calculate a credit score, Sesame Credit primarily uses transaction data on various Ant Financial and Alibaba platforms, such as Tmall, Taobao and Alipay. With a high score, a consumer gets access to certain services, such as test drives with cars, not having to pay a deposit in hotels, etc. Because financial capacity is an important aspect when looking for a partner, Sesame Credit is also integrated into various dating sites, so that users can see the scores of their potential partner. Also read the extensive article about Sesame Credit that I wrote several years ago for more details.
Social management system: The Chinese government wants to introduce a system in 2020 to assess and manage the social behavior of the citizens. With good behavior one is rewarded and penalized for bad behavior. The question is whether the term is technically feasible in view of the large amounts of data and complexity of linking different databases. Even within the social management system there is currently no single system, but there are experiments in 40 different regions with different local systems. Central there are, however, various 'black lists', for example of persons who have been sentenced to pay fines but who do not pay, or tourists who seriously misbehave during flights or abroad. Such persons can then be limited in their liberties. For example, misbehaving tourists can not go on holiday abroad for a number of years. People who do not pay fines imposed by the court can not use first-class train or luxury hotels; after all, if you can pay that you can also simply pay your fines. I also wrote an article about this system in the past.
An important difference between the two categories is that the social management system rewards and punishes, the Sesame Credit system rewards only at high scores. A system like this mainly shows how powerful you are, while the social management system tries to steer government officials and bodies, businesses and the citizen into moral and ethical behavior.
This video of Extra Credits from 2015, which is regularly referred to, is one of the culprits for the confusion and is full of factual inaccuracies and wild assumptions. Many people will watch the video, but will not read the comments under the video, in which the creator admits that there is a lot of discussion about the operation of the system and he actually is not sure how it works. The assumption in the beginning of the video that arch-rivals Alibaba and Tencent would have set up a credit system together would have had to ring alarm bells for everyone with a little knowledge of the Chinese internet market ...
Misunderstanding 2: Alibaba shares its data with the government for the credit system
As indicated, there is therefore not one system and the two categories are not (yet) connected to each other. Chinese internet companies are obliged to supply data to the government if they ask for it, but there is no evidence that Alibaba shares all its data on a large scale. It is possible that the government requests the transactions of specific persons (suspicious of terrorism, activism etc.) from Alibaba, or that the buyers or sellers of a certain article are requested. Consider, for example, counterfeit goods found on the market place Taobao. But as far as is known, automatic sharing of large amounts of data is not known.
Although the government is therefore not likely to extract large amounts of data from Alibaba's platforms on a structural basis (and Alibaba also denies this rumor), it is true that Sesame Credit uses the black lists with people who do not pay their legal fines. The government provides this data to Ant Financial, which thereby reduces the Sesame Credit scores.
It is also the intention that various government bodies mutually share data with each other. Bad behavior in one sector can then lead to punishment in various other sectors. Do you not pay your court-ordered compensation? Then you are not allowed to travel first class. That may sound strange to us because it can concern two non-related issues, but in China, where the government plays the role of 'parent' culturally, it is comparable to our own upbringing: do you not eat your vegetables properly? Then no television tonight!
Incidentally, it is true that the government can not set up a national social management system on its own and that it requires the specialist assistance of experts. These experts must be sought among the large internet companies, some of which have already set up similar credit systems like Sesame Credit. In 2015, Ant Financial indicated in a press release that it wanted to help build a national social management system and Baidu was also called in to help the technical implementation by the government.
Misunderstanding 3: The social credit system is a point system
Alibaba's Sesame Credit is a points system where a certain score is achieved and a user even gets suggestions to improve that score, eg by buying more on Alibaba platforms or by filling in the personal profile better. But contrary to the persistent reports that every citizen in China gets a score from the government, the social management system is not a system that is based on scores and getting bonus and penalty points.
Most current local experiments with social management systems consist of blacklists rather than scoring systems. There is also experimenting with 'naming and shaming' in which people who misbehave in a modern technological way are nailed to the pillory. There is an experiment where you get to hear a special transition tone and message when you call someone who refuses to pay his fines.There is also an experiment in which pedestrians who regularly walk through red light are identified by face recognition and appear on a publication board with name and name or have to collect a number of likes on their social media for a report of their offense.Incidentally, there has been a testing system in China for years, where restaurants in some regions are obliged to prominently display the result of a hygiene test in their case. A good result is accompanied by a green happy emoticon, a moderate result with a neutral yellow emoticon and a bad result with a sad red emoticon.
According to Foreign Policy , in Rongcheng, in the province of Shandong, experiments are currently being conducted with a point system. For the time being it is no more than that: one of more than 40 local experiments, with no indication that it will be rolled out to the national system of 2020. On the contrary, there is in China in the city of Suining, in the province of Jiangsu in the beginning of this decade Even a test was done with a method whereby the citizen was assigned an actual score, penalty points for violations and bonus points for the behavior of a model citizen.On the basis of the score, citizens were classified in category A, B, C and D, with A-citizens having the most privileges and, for example, becoming members of the Communist Party.However, this experiment was halted after criticism from citizens and state media about the subjectivity of the system. The central bank also did not renew the formal authorization of Sesame Credit to act as a leading creditworthiness system in 2017, partly because the system collected a lot of data and there was a 'conflict of interest' because of the link to purchases from Alibaba.
In summary, there is currently no central point system and it is unlikely that it will happen due to the technical complexity and previous negative experiences. The conviction that the social management system gives every citizen a code is probably due to confusion with Sesame Credit and the fact that an ID number, no score, will be used for natural and legal persons to link data from different sources.
Misunderstanding 4: China's credit system is like the episode Nosedive in Black Mirror
In Black Mirror's episode Nosedive, people judge each other by giving points. The average score of a citizen is therefore adjusted on the spot and the service provided by the government and companies that the citizen can use changes according to the score. People with a low score automatically have a stigma and the whole system is strongly influenced by personal emotions. If someone has stepped out of bed with the wrong leg, you can better stay away from him or her, so it is proposed in the relevant episode.
As you will understand now, the social management system does not work in this way. Sesame Credit may seem more like a Nosedive due to the point system, but Sesame Credit is basically based on buying behavior and does not differ so much from certain loyalty programs that offer customers privileges. You are not actually penalized in Sesame Credit but are rewarded (mainly based on purchases from Alibaba). Just like you can board earlier and be allowed to sit in the business lounge with enough frequent flyer points.
It is true that Alibaba once let it slip that having friends with a high score can also be positive for yourself. Let that be the reason why the protagonist in Nosedive , Lacie Pound, does so much effort to visit a wedding. But even simply comparing Sesame Credit with Black Mirror is too short a turn.
And okay, I honestly admit that I sometimes let myself be tempted into that comparison. At the request of a client I had also included a small reference to Nosedive in a presentation on digital innovation in China. Something that I regret afterwards because I myself have also contributed to the maintenance of the misunderstandings.
But some go much further in the equation. What is shocking is the NOS report in which it is not only stated that every citizen gets a score and in which the comparison with Nosedive is revived, but which is also full of other untruths such as that you would get penalty points if you were the dumpling seller or fellow passengers does not treat the bus properly. That is more than making a direct comparison with Black Mirror, which is the presentation of fiction as a fact and makes me suspect that the media sometimes rather present a juicy story than telling the reader the truth.
Instead of comparing the Chinese social management system with Nosedive , we'd better ask ourselves if that whole Black Mirror episode is not based on the social pressure to 'like' everyone and everything on Facebook, because otherwise people do not like us either. more 'like'.
Misunderstanding 5: This must be terrible for the Chinese citizen
Probably only people who have lived in China for a longer period of time or have good friends or family members understand that a large part of the population actually welcomes the social management system. In recent decades, the economy of China has grown enormously and society has changed a lot. From a central planning economy with little financial incentive for entrepreneurship, China is now a place where there are many more liberties to start your own business. At the same time, China is in what some call a 'moral vacuum'. There is no strong ethical framework for what is good and bad.
You may see plenty of people in Buddhist, Taoist and Confucian temples, but that is often very opportunistic behavior; raising three incense sticks and making a wish. Ask the average Chinese what the teachings of the Buddha exactly means and there will be - just like in other Asian countries - few who can tell you that. Applying a religion or philosophy does not mean that you follow the corresponding moral framework. In China you see the biggest thugs in the business world often wearing Buddhist bracelets.
Everyone wants to get a share of the exploding economy. And in the absence of a moral framework that does not always happen in an equally honest way. In the years that I lived in China, there was a scandal about food safety almost every week, with manufacturers knowingly selling life-threatening products. The melamine scandal from 2008 is probably the best-known example. But there are also several examples of schools that have promised valuable diplomas and run off with the money, brides for lonely single farmers who take their savings with them, people who sell a certain product but then deliver something of a much lesser quality. Employers who do not pay their staff, doctors who prescribe unnecessary medical treatments, web shops with counterfeit goods and fake reviews and 'Black PR' agencies that spread harmful rumors (see China Talk 1 ). All in all, a large part of Chinese society unfortunately hangs from lies and deceit.And almost everyone in society regularly suffers from this.
In practice, this means that a Chinese will, in principle, distrust foreigners. The willingness to donate to charities and volunteer work, for example, is also very low, even if one can easily afford it. People simply do not have the confidence that their money or help ends up well. Within the network of guanxi , friends, family and acquaintances and their friends, family and acquaintances one is still willing to trust another, but if there is no one who can guarantee a stranger, the threshold for doing business will be high . This is also one of the reasons that online reviews of products, travel destinations, restaurants, etc. are so important in China. By definition, we assume poor quality until the contrary is proven.
A good example of the total paranoia that prevails in China was when my Chinese brother-in-law got a daughter. We bought a buggy for him and his wife and although the reputable brand that they wanted to have was for sale on Chinese platforms, and still on platforms like JD.com and Tmall that have fewer problems with counterfeit goods than for example Alibaba's Taobao, both my wife and her brother insisted that we buy this buggy in the Netherlands. That we eventually had to pay 60 euro shipping extra and my brother-in-law might have to pay import duties it was acceptable to them to minimize the - in my opinion very small - risk of delivery of counterfeit products. The run on Dutch milk powder also originates in the same paranoia; Although the same Dutch products are just for sale in China, they prefer to be taken off the shelf at a Dutch chemist.And not entirely unjustified; there were regular reports in China about local tampering with imported foreign milk powder.
In itself, the current situation in China is not so different from the periods full of scam and malicious things that Europe and America (think of the Wild West) have also gone through. In a society where people do not trust each other by definition, where regulations are often only seen as a suggestion and enforcement of those rules leaves something to be desired and where the possibility of equality in the judiciary is often limited (especially if you government would like to sue) is a social management system by a large part of the population not seen as a threat but as a solution. It will help them to determine who is and is not reliable. I am also convinced that the main objective of the government in implementing the social management system is to improve Chinese society, which is confirmed by the overview below from a recent Mercator Institute report setting out the objectives of the social management system are summarized.
Despite all misunderstandings, the media has obviously understood one thing: the system will also be used to keep citizens in line. The government is given even more power to control the behavior of the citizen and to shape the citizen into her ideal image. Citizens are blacklisted after a court ruling, but the fact that the state and the legal system are not separate gives the government the exclusive right to define what is good and bad. And for certain well-meaning people who also try to improve Chinese society, this can sometimes turn out wrong, with or without a points system.
Want to know more about Sesame Credit and China's social management system? These are the most reliable sources for me:
Jeremy Daum's article on the actual meaning of the social credit system.
Rogier Creemers in the VPRO podcast Futureshock .
Simina Mistreanu's nuanced article, Life Inside China's Social Credit Laboratory , in Foreign Policy .
Samantha Hoffman 's analysis of the Leninist origin of social management.
Zheping Huang's excellent explanation of Sesame Credit.
Not everything Wired has published about the credit systems is worth it, but Mara Hvistendahl's article is highly recommended.
A report from the Mercator Institute for China Studies on the current status of local and central social management systems.