It sounds like the plot line straight off “Nosedive,” an episode from the futuristic dystopian TV show Black Mirror, which depicts a fictional society where citizens are assigned a rating judged by their surrounding peers.
Although unlike the show, the implied threat isn’t the tyranny of the crowd but state power and it’s a definite reality in China.
Beijing announced that it would use data to monitor and rank the behavior of its citizens, rewarding those that score high and punishing those that score low.
Under the system, the elite will gain access to better social privileges and those who rank closer to the bottom will effectively be second-class citizens. By 2020, the scheme is set to become mandatory for all 1.4 billion of China’s citizens.
Beijing claims the system’s intention is to promote a more trustworthy and harmonious society. Nevertheless, critics say the program is just a new tool to control market and political behaviors.
According to the system’s founding document, released by the State Council in 2014, the scheme should “allow the trustworthy to roam everywhere under heaven while making it hard for the discredited to take a single step.”
But at a time when the Chinese Communist Party is aggressively advancing its presence across town hall offices and company boardrooms, this move has sparked fears that it is another step in the tightening of China’s already scant freedoms.
Meanwhile, as a national system is still being designed and realized, local governments have launched their own pilot versions to test out various methods on citizens. In Shanghai—the country’s largest city— not visiting parents often, parking illegally, falsifying personal history when registering for a marriage and illegally selling train tickets are bad behaviors that could lower a person’s credit score.
In Suzhou, in southeast China, the government rates its citizens on a points system that ranges from zero to 200, with all participants starting at 100.
In 2016, police revealed that the top-rated citizen, who donated over one liter of blood and volunteered over 500 hours of work, was on 134 points. Citizens can obtain prizes with their points, such as discounts on public transport or the ability to skip to the front of a line in hospitals.
Suzhou authorities warned that the next step may be to extend the scheme to punish citizens for minor transgressions, such as dodging transport fares, failing to turn up to a restaurant booking and cheating in video games.
The experience of an early citywide experiment might explain why.
In 2010, authorities in Suining, a county in Jiangsu province near Shanghai, launched a pilot project that included criteria such as residents’ education level, online behavior, and compliance with traffic laws.
Locals would earn points for looking after elderly family members or helping the poor and lose them for minor traffic offenses or if they illegally petitioned higher authorities for help.
High scorers were fast-tracked for job promotions and gained access to top schools, while those at the bottom were restricted from some permits and social services.
The scheme was a disaster. Both residents and state media blasted it for its seemingly unfair and arbitrary criteria, with one state-run newspaper comparing the system to the “good citizen” certificates issued by Japan during its wartime occupation of China.
The Suining pilot was canceled but not before teaching the government some lessons about what is palatable to the public.
The reason why the new one has the most successful social credit system so far is that the community has embraced it.
Data Collection
The Chinese government aims at assessing the trustworthiness and compliance of each person. To achieve this, it collects data from all sources by utilizing the regulatory freedom it built: From objects and social networks, public and private institutions and offline and online. Here, data stems both from peoples’ own accounts, as well as their network’s activities. Website operators can mine the traces of data that we leave and derive a full social profile, including e.g. peoples’ location, friends, health records, insurance, private messages, financial situation, gaming duration, smart home statistics, preferred newspapers, shopping history, and dating behavior.
The corporate network of Sesame Credit, led by the Alibaba Group, spans over insurance, loan, historical payment, dating, shopping and mobility data.
Therefore, this system is powered by “data from more than 300 million real-name registered users and 37 million small businesses that buy and sell on Alibaba Group marketplaces”.
Due to Sesame Credit’s close collaboration with the government, it also has access to all public documents, such as official identity and financial records. Further, this also includes all information that the Chinese government is collecting under its data protection regulation, which requires businesses to turn over their data.
For example, the government already has access to the messages of WeChat’s 850 million active users, China’s most popular communication application.
Thus, China can already access monitor most social and object data of its citizens on a continuous basis. Data Structuring
A combination of big data, statistics and behavioral analytics sets the basis of China’s Social Credit System.
Automated algorithms are used to structure the collected data, based on government rules that define good and bad. What remains unclear is whether data is also structured according to its trustworthiness, to eliminate errors through fake news or unreliable sources.
At Sesame Credit , data fragments are further classified into five categories: Credit History: Reflects users’ past payment history and level of debt
- Fulfillment Capacity: Shows users’ ability to fulfill contract obligations
- Personal Characteristics: Examine the extent and accuracy of personal information
- Behavior and Preferences: Reveal users’ online behavior
- Interpersonal Relationships: Reflect the online characteristics of a users’ friends
To date, the specifications of the algorithm that determine the classification, as well as the analytical parameters and indicators remain confidential. Data Distribution
Sesame Credit emphasizes its strict privacy and data protection, ensured through encryption and segregation.
The firm also states that data is only gathered upon knowledge and consent of the user.
According to Ant Financial, users’ scores can currently only be shared with their authorization or by themselves.
Data Visualization
The above-mentioned five categories that Sesame Credit classifies its data into, have different weightings attached to them.
Based on those, an algorithm determines a citizen’s final citizen score, ranked among others.
The scores in the ranking range from 350 (lowest trustworthiness) to 950 (highest trustworthiness). From 600 up, one can gain privileges, while lower scorers will revoke them.
According to current plans, the final score and ranking will be publicly available. Control Factors to Monitor and Evaluate the Behavior of Citizens
As shortly mentioned above, the Social Credit System, as developed by Sesame Credit, is based on certain variables, among these are: payment of invoices, ability to honor stipulated contracts, personal preferences and behavior and interpersonal relationships.
Payment of Invoices
As well as traditional social credit systems (formerly Schufa in Germany, or FICO in the US) the Chinese system will include and evaluate information in function to the ability of each Citizen to punctually meet their financial obligations. In this regard, a person who pays his bills on time can be considered as reliable and solvent. For this reason he/she will receive a higher score.
Ability to Honor the Stipulated Contract
A second factor taken into consideration in this model concerns the ability of each individual to fulfill his/her duties as defined in the stipulated contracts. For example, an individual with a conspicuous level of savings will receive a higher score than a person who is struggling to get to the end of the month.
Personal Preferences and Behavior
Behavior on online purchasing portals such as Alibaba, offline shopping trends paid through Alipay, social interactions on WeChat, Baidu’s online history, mobile phone position as well as many other factors can give an all-encompassing idea of the personality of each citizen. For example, a user who buys diapers is very likely a parent, and it can be inferred that as such he is also a more responsible citizen. On the contrary, a citizen who spends huge sums for online games could be considered more lazy and less productive for society.
Interpersonal Relationships
Finally, the Chinese system will not just analyze the behavior of an individual. Inspired by the saying “God makes them and then mates them”, the score of each individual will also be influenced by the behavior of the people closest to the individual in question. For example, a person who infringes one or more laws of the Chinese Communist Party will also negatively affect the people connected to it.
Implications for Chinese Citizens
Punishments:
From the program, the Chinese SCS will be fully implemented starting in 2020 and will be made mandatory for every citizen. Once implemented, every citizen will be rewarded, or punished, on the basis of their behavior.
Some types of punishments can be: flight ban, exclusion from private schools, slow internet connection, exclusion from high prestige work, exclusion from hotel, registration on a public blacklist.
Flight Ban
Currently, the flight ban for people considered unreliable is already common practice in China.
One example is Liu Hu, who has been banned from buying airline tickets for writing highly critical posts to government officials.
In the future, if a person’s score falls below a certain threshold, this person may be limited in his movements.
When Liu Hu recently tried to book a flight, he was told he was banned from flying because he was on the list of untrustworthy people.
Liu is a journalist who was ordered by a court to apologize for a series of tweets he wrote and was then told his apology was insincere.
“I can’t buy property. My child can’t go to a private school,” he said. “You feel you’re being controlled by the list all the time.”
Exclusion from Private Schools
If the parents of a child score below a certain threshold, their children would be excluded from the best schools in the region.Slow Internet Connection.
Citizens who are considered unreliable may see their internet connection slowed down or even be completely excluded from accessing specific internet sites.
Exclusion from High Prestige Work
The score of the Chinese SCS may be part of a person’s Curriculum Vitae in the future, and therefore provide essential information to potential employers. In this way, people with a low score will most likely be prevented from achieving highly coveted work positions.
Exclusion from Hotels
Similar to the ban on the purchase of flight tickets, exclusion from hotels in also a possibility in China and will be applied following the implementation of the Chinese SCS.
Registration on a Public Blacklist
A blacklist prototype currently exists in China, and all those who will be registered on that list can expect one or more of the previously mentioned punishments.
Rewards:
At the same time, the Chinese SCS will also provide a series of rewards: easy access to finance, easy access to rentals, facilitation of travel, and social status.
Facilitated access to Financing
In the Sesame Credit pilot project, those who achieve a score of 600 can apply for a “just spend” loan up to an amount of 5’000RMB.
Easy Access to Rentals
Citizens with a sufficiently high score can rent vehicles without having to leave a deposit.
Facilitation of Travel
Depending on the score, fewer documents will be required to justify the request for travel visas when traveling abroad.
Social Status
Also important, your personal score could be used as a social symbol on social and couples platforms. For example, the isto Baihe already allows its users to publish their own score. Social credit for businesses
For businesses, the Social Credit System is meant to serve as a market regulation mechanism. The goal is to establish a self-enforcing regulatory regime fueled by big data in which businesses exercise “self-restraint” (企业自我约束).
The basic idea is that with a functional credit system in place, companies will comply with government policies and regulations to avoid having their scores lowered.As currently envisioned, companies with good credit scores will enjoy benefits such as good credit conditions, lower tax rates, and more investment opportunities. Companies with bad credit scores will potentially face unfavorable conditions for new loans, higher tax rates, investment restrictions, and lower chances to participate in publicly funded projects.Government plans also envision real-time monitoring of a business’s activities. In that case, infractions on the part of a business could result in a lowered score almost instantly.
However, whether this will actually happen depends on the future implementation of the system as well as on the availability of technology needed for this kind of monitoring.
The party is using both coercion and cooperation to integrate the scheme into people’s lives and have it bring benefits to them.
“To me, that’s what makes it Orwellian,” says Hoffman of IISS.
The social credit system provides incentives for people to not want to be on a blacklist.
“It’s a preemptive way of shaping the way people think and shaping the way people act,” she says. And to the extent that people believe they can benefit socially and economically from the Communist Party staying in power, the system is working.
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