The world’s governments and peoples must decide how to address the increasing surveillance and data collection — and the resulting loss of privacy — that digital formats provide. In recent years, much of this attention has focused on the rapidly building surveillance and data aggregation in China in terms of the emerging social credit systems, which received strongly pessimistic coverage from the Western press in the past two years. At issue is the Chinese government’s plan to “comprehensively move social credit system construction forward” by 2020.
According to the systems’ founding document, the optimistic scheme should establish “the idea of a sincerity culture and carrying forward sincerity and traditional virtues.” So why is there such a strong difference between the optimistic Chinese and pessimistic Western perceptions of social credit systems?
Many reasons contribute to this chasm between the Chinese and Western perceptions. First, the outcry may relate to the erroneous idea that this information is consolidated into a single file on individuals, combining financial data, purchasing patterns, travel records and facial recognition. Second, the Western perceptions are influenced both by suspicions of the Chinese government and by a Western failure to come to grips with their own domestic electronic collection. Finally, and uniquely, the social credit network mimics some elements and repairs other consequences of the 1966-76 Cultural Revolution in China.
The Chinese government is proposing a social credit network as a desirable way to measure and enhance “trust” nationwide and to build a culture of “sincerity” in a society still suffering from the shattered trust of the Cultural Revolution. The policy states: “It will forge a public opinion environment where keeping trust is glorious. It will strengthen sincerity in government affairs, commercial sincerity, social sincerity and the construction of judicial credibility.”
There is no single social credit system in China. There is a wide spectrum of pilot systems, some commercial and some run by local governments that measure different elements related to social trust. Eventually, however, the National Development and Reform Commission, a powerful central body, will have vast amounts of data available. Striving to minimize the flaws of existing systems, “The government is responsible for formulating and implementing development plans, completing regulations and standards, fostering and supervising credit service markets. Focus on giving rein to the role of market mechanisms, coordinate and optimize resource allocation, encourage and muster social forces, broaden participation, move forward together, shape joint forces for social credit system construction.”
Specifically, the credit system wants to limit commercial swindles, sales of counterfeit products, tax evasion and fraudulent financial claims. Not only is there no overall system yet to monitor this fraud by commercial entities on citizens — or by citizens on other citizens — but also Chinese authorities are not creating a single social credit score that will determine every aspect of every citizen’s life.
Although the West has sleep walked into the massive collection of data and loss of privacy, the Chinese electronic systems have leapt nearly fully formed into view.
Of the pilot systems, most Chinese citizens — 80% of respondents — approve of both the commercial and the government-run systems. In one commercial program, now ended, the government allowed private companies to pilot systems and algorithms for social credit scores, including two widely covered projects: one by a partner of the social-network giant Tencent and developer of the messaging app WeChat, and another, by Sesame Credit, is run by the Ant Financial Services Group (AFSG), an affiliate company of Alibaba. These private systems appear to have ended in 2017.
Although the commercial pilot social credit programs have ended, commercial entities feature first and foremost in the systems of Chinese social credit. Commercial entities retain their good standing if they pay taxes on time and lose good standing for substandard or unsanitary products — a sore point for people across China due to frequent scams and food safety scandals. Chinese citizens see social credit systems as a reliable source of information on the trustworthiness of commercial entities, social organizations and individual service providers to such an extent that 76% of people queried responded that a general lack of trust in Chinese society is a problem.
Respondents see social credit as a helpful means of punishing polluters, reducing substandard products and otherwise disciplining negligent commercial entities in an era of rapid commercialization, economic growth and residual distrust.
Signs of Abuse
In addition to monitoring the trustworthiness of commercial entities, the social credit network is meant to provide individual citizens with credit records. The more durable social credit pilots have been primarily piloted by local governments. In these local government schemes — there are approximately 43 cities running pilot programs — negative criminal infractions lead to deductions from the overall individual credit score. The government asserts that social credit systems are also a positive way to bring in those people left out of traditional credit systems, including low-income and rural households.
The negative and positive also extends to the overall systems, where the negative impacts of social distrust inculcated by the Cultural Revolution and adverse side effects of rapid economic expansion are intended to be balanced by the positive aspects of social credit systems that discourage scams and reward good citizenship.
These programs to monitor commercial entities and citizens — both civil servants and private citizens — are being developed simultaneously with video surveillance systems and rapidly developing facial recognition software. China is now rivaling the West and Japan in implementing a pervasive system of algorithmic surveillance as well as becoming a major distributor of surveillance equipment. While there are justifiable concerns that these closed-circuit television (CCTV) cameras combined with facial recognition networks can be used for nefarious purposes in China and elsewhere, so far government-reported instances include boarding subways in Shanghai, catching shooters in the West, waking up drowsy workers in Japan, checking bus driver fitness in the UAE and finding elders with dementia in Singapore.
Again, it is vital to watch for signs of abuse from both governments and commercial entities in this rapidly expanding technology. Reported cases of abuse include Uighur Muslims in Western China, where victims relate stories of being tracked by cell phones, facial recognition software attached to either CCTV or drones, and DNA testing. According to official Chinese press, “The field of big data in cloud computing is slowly blossoming.” The surveillance of specific political or ethnic groups was designed, as the Western press quotes, to “apply the ideas of military cyber systems to civilian public security.” These cases — especially those targeting political opposition in Ecuador, Rwanda and Zimbabwe — are troubling at best.
With a 2020 goal to get systems in place — although the goal seems to be less a deadline and more the end of a planning period — the social credit network appears to be an ecosystem made up of various stratagems that are all run in different ways by cities, government ministries, online payment providers, neighborhoods, libraries and businesses, according to Chinese researchers who are designing the national scheme. Although many of these subsystems may be interconnected by a network of information, it will not be a unified platform where one can type in one’s ID and get a single score that will determine a citizen’s life.
This caricature of a unified system that doles out unique scores to 1.4 billion people — with around 46,000 born and some 19,000 dying each day — would come with nearly insurmountable technical and political obstacles. Politically, the Chinese government is not only trying to build trust for and within commercial entities and individual citizens, but also runs a terrible risk if it loses this same trust from those same commercial entities and citizens, as it has during the Cultural Revolution.
Western perceptions of Chinese social credit systems are pessimistic. This negative perception has at least two major parts. The first part is the horror of seeing a complex electronic network implemented over a few years with its resultant loss of privacy and inevitable errors. Although the developing social credit systems are similar to the systems in the West, these Western systems emerged bit by bit and are rarely considered as a whole. The second part of negative perception is the fear that the Chinese government is not to be trusted with such data, especially given the history of that government with similar data during eras like the Cultural Revolution.
Westerners are often appalled by the Chinese social credit systems for many reasons, not the least of which is seeing the systems that have slowly accumulated in the West appear fully formed in China. Westerners have become accustomed to losing privacy in small bits — by private commercial entities like Amazon, Google and Experian — and have eagerly participated in rating other private entities based on their experiences, such as doctors, realtors and restaurants. With Uber and Lyft, riders rate the drivers, and the drivers rate the riders.
Entire podcasts exist just to rate movies, books and television series. Facebook automatically identifies people in photographs with facial recognition software and chooses advertisements based on account content. These rating systems that developed over decades become truly shocking when Westerners see it developed in a single leap, much as it is in China.
Governments in the West increasingly monitor their citizens with the resultant loss of privacy. The US National Security Agency (NSA) monitors phone calls, emails and locations, then uses that information to try to identify potential wrongdoers. The UK intelligence agency, GHCQ, with collaboration from the NSA, has been collecting millions of webcam images from guiltless Yahoo users. GCHQ files between 2008-12 state that a surveillance program, Optic Nerve, collected still images of Yahoo webcam chats in bulk and saved them to agency databases, regardless of whether individual users were an intelligence target or not. The collected data was used to experiment with facial recognition, to monitor existing targets and discover fresh ones.
The electronic systems in the West, and the loss of privacy, reached a tipping point over a decade ago. Richard James Thomas, who served as the UK information commissioner from 2002-09, says more and more personal data is being collected and stored, both by Western governments and commercial entities. He feared back in 2006 that “we are in fact waking up to a surveillance society that is already all around us.”
Moreover, Western electronic surveillance has a few known flaws. On the one hand, there is always the potential for false positives with algorithms. For instance, think of irrelevant advertisements popping up online based on some algorithm misinterpreting one’s interests. In another instance, false information is almost impossible to remove from FICO scores based on similar names or some other error.
On the other hand, the databases are being stretched. Alec Jeffreys, a pioneer of DNA profiling, said fingerprint, DNA and facial recognition databases originally created from criminal arrests or investigations are now running biometric network searches against massive state driver’s license data bases that are primarily made up of law-abiding Americans. The UK’s David Murakami Wood, from the Surveillance Studies Network, says that “The surveillance society has come about almost without us realizing.” Although the West has sleep walked into the massive collection of data and loss of privacy, the Chinese electronic systems have leapt nearly fully formed into view.
Suspicions of the Chinese government
So, although the technologies and methodologies of electronic surveillance are similar in the West and in China, one big difference is that the Chinese government is viewed suspiciously. For instance, there is an outcry that China issues national ID cards at age 16; however, the German national ID card is also issued at 16. There is outrage at the Chinese use of facial recognition software, similar to the systems set up by the FBI and used extensively in Singapore. There is unhappiness concerning the Chinese government’s reading emails, texts and social media, which is done throughout the West, especially in the context of terrorism or to aid law enforcement or for visas, or even “inadvertently.”
Complaints highlight the Chinese use of credit scores, like the US FICO score, and CCTV, which is used intensively in the UK. Especially ironic is the emphasis on China’s viewing of shopping habits, which are so notoriously scrutinized in the US that shops knew women were pregnant based on what they purchased before their families did.
One basis of these concerns seems to be Western commentators’ worries that this information will allow the Chinese government to target citizens’ behavior and political beliefs. Of course targeting Western citizens’ beliefs is rampant in the West in an age where the disclosure of Cambridge Analytica’s massive voter data scoop — a database that combines government voter rolls with social media data such as lists of people who liked certain Facebook posts, commercial data from grocery chains and religious leanings based on church membership rolls — caused popular distress and government hearings.
Google street views can determine whether voters on that street are conservative or liberal based on the number of parked pickup trucks or Toyota Priuses. Moreover, most US states allow campaigns to obtain voter lists, including every registered voter, along with their name, addresses, party registration, voting frequency history, employer and job title.
The social credit systems, a major policy initiative, is clearly identified with Xi Jinping. While he is powerful and the pilots are popular, the social credit network is secure.
Clearly, most Westerners give their governments the benefit of the doubt that this data will only be collected under specific constraints and for trustworthy purposes. The same benefit of the doubt is not conferred on the Chinese authorities. While the Chinese government may be seeking to develop domestic trust with the collection of data, internationally the trust seems to be waning rather than waxing. Some Western suspicions are likely based on the former Chinese dangan and hukou systems that kept public records and encouraged neighbors and co-workers to check on each other.
These systems played an important role in the Cultural Revolution, and fears are that an electronic version is being created in an era of massive urbanization, where people have left their home villages to work in the cities and live side by side with people they do not know well.
Chinese citizens, however, do give their government the benefit of the doubt both that this data will be used responsibly and that the social credit system will help alleviate the massive lack of trust in Chinese society. Much of this lack of trust stems not only from the rapid industrialization and modernization, but also from the long-lasting and unprocessed effects of the Cultural Revolution. It is not a coincidence that both China’s first leader to grow up during the Cultural Revolution and the renewed assertion that local officials implement a “mass line” — that is, go among the people, talk to everyone and collect and distinguish correct and incorrect ideas — are occurring simultaneously with the creation of social credit systems. The social credit systems mimic some elements and repairs other consequences of China’s Cultural Revolution.
The Cultural Revolution’s massive discord saw citizens turn on citizens and destroy social trust, which is the main area that the social credit systems try to repair. An important study shows that the Cultural Revolution, in which more than a million have lost their lives, affected everyone in society. It affected not only citizens who were mistreated during the revolution, but also those who witnessed the untrustworthy behavior of their neighbors and friends even when these behaviors were not directed at them. Another study also shows the continuing loss of social trust as a result of the culture of spying and snitching that the Chinese Communist Party fostered among the population. It is this loss of social trust that the social credit systems attempt to address.
Children of the Revolution
The Cultural Revolution was a formative time for Chinese President Xi Jinping and for his generation. The president’s father, once a high-ranking official, was purged in the early days of the Cultural Revolution, and Xi Jinping — thus considered a “princeling” — was among millions of urban youth sent to rural areas to be reeducated by farmers and laborers. Some of President Xi’s critics argue that his experiences during the Cultural Revolution support his authoritarian approach; that is, instead of turning against the party, government or leader, he revered strict order and abhorred challenges to hierarchy.
As the Cultural Revolution cooled, one of Xi Jinping’s friends saw him choose to become “redder than red” — red symbolizing the Communist Party’s ideology — to survive. If any of these observations are true, they certainly lend credence to a reliance on a government-run social credit network.
Xi Jinping, the leader creating and implementing the social credit score, took the trauma of the Cultural Revolution to move back into and up through the ranks of the Chinese government and party, but never throwing off its impact. In 1975, the 22-year-old Xi Jinping attended the esteemed Tsinghua University to study chemical engineering. By the time Xi graduated in 1979, he worked as secretary to the then-secretary general of the Central Military Commission, Geng Biao, until 1982. Twenty years later, Xi Jinping came last in the rankings of alternate members of the 15th Central Committee of the Communist Party in 1997.
Working his way up the party ranks, Xi served in several provinces, ending with a brief but prestigious stint in Shanghai, to be unexpectedly promoted in 2007 directly to the Standing Committee of the Politburo — China’s most elite political body. His appointment just months later, in March 2008, as vice president signaled his rise to president and party general secretary in 2012.
Xi Jinping is a powerful leader, but it is an error to assume that the party is a monolithic structure or that the success of policies like the social credit systems do not matter or that popular support for social credit networks do not matter. Xi’s strength is clear: Not only was his political ideology written into the Chinese Constitution, but also a constitutional amendment was passed on March 11, 2018, after his first five-year term, that removed the country’s 10-year presidential term limits.
In addition to his strength, however, Xi Jinping has many enemies and a formidable political opposition. Since Xi’s removal of the two-term limit, murmurs of discontent have risen among academics, businesspeople and former officials despite censorship and the security police. So far, that discontent has not visibly extended to the creation of the social credit network.
So, while the party holds a monopoly on power, the party leadership is not a monolith. The current leadership and its programs not only reflect the trauma of the Cultural Revolution, but also must survive the political mechanisms. The political mechanisms center on two main political coalitions within the party that are often in tension with each other and promote different policy agendas. These coalitions have become dangerously antagonistic. The success and popularity of the social credit systems may be hostage to these political tensions.
21st-Century Mao Zedong
On one side is the elitist coalition, now led by Xi Jinping. Its supporters come from the families of the old-guard revolutionaries who held top posts upon the founding of the People’s Republic of China in 1949. Those revolutionaries mostly lived and worked together, coalescing into a tight social group, until the Cultural Revolution dispersed them. Officials with a direct lineage to those founders, who claim to be the republic’s rightful heirs, have experienced a resurgence under Xi Jinping. The elitist coalition wants the party and the state to have more control in markets and corporations, and have an expansionist and nationalist position in international trade and politics. They are the primary advocates of the social credit systems.
On the other side is the populist coalition headed first by the previous president, Hu Jintao, and now by China’s premier, Li Keqiang. They drew their power base in part from the Communist Youth League, a gateway for young Chinese to achieve party membership that is often identified with populist positions. Populist coalition supporters are often without significant pre-1949 revolutionary credentials or family lineage. The populist coalition policies are more pro-market, perhaps because they consolidated power in the new socialist market economy and take a more subtle approach to international politics. They tend to represent the more disadvantaged groups in the rapidly modernizing society. The Communist Youth League has been attacked vigorously by Xi Jinping and his faction within the elitist coalition. The populist coalition’s stance on the social credit systems is less clear.
The Xi Jinping faction — mainly Xi’s subordinates when he served in the provinces and Shanghai, his home province of Shaanxi and graduates of Xi’s alma mater Tsinghua University — initially targeted another faction within the elitist coalition, and then the populist coalition, with his anti-corruption campaign. It directed the campaign against the former president Jiang Zemin’s business faction within the elitist coalition, destroying families and wealth and networks of many powerful people. The faction simultaneously consolidated power by filling top regional posts and the top leadership positions in most of China’s 31 major administrative districts.
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The Xi faction within the elitist coalition is strong, but his base is small, at around 40,000 people, and he certainly has his domestic detractors. His admirers, reflecting back in part to the Cultural Revolution, like to call Xi Jinping “the Mao Zedong of the 21st Century.” The opposition, however, is not hesitant in calling for Xi to moderate his policies.
The social credit systems, a major policy initiative, is clearly identified with Xi Jinping. While he is powerful and the pilots are popular, the social credit network is secure. However, if the citizens find the social credit systems to be unduly burdensome or too reminiscent of the negative aspects of the Cultural Revolution, there are plenty of powerful people in China — both within the elitist coalition and in the rival populist coalition — willing to find Xi Jinping responsible and weaken him.
While the Western fears of an all-pervasive, socially stifling social credit system are not impossible, Chinese domestic politics do provide something of a counterweight. Chinese citizens want to take the best from a social credit network: rebuild the trust destroyed by the Cultural Revolution and prevent the food scandals and general scams.
The development of Chinese social credit systems does provide an important opportunity for all countries using electronic surveillance to make important judgments regarding the boundaries of this new massive era of data collection. It is not very realistic to ask China to take the lead on this, especially given the wider Western experience, but China certainly should be part of emerging global standards on what is an acceptable loss of privacy by both governments and commercial entities.
The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.
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