Wrong values? No money: On China’s new “social credit system”

Today China is on the digital forefront. It has the most Internet users in the world and here new technology is being tested. The country, however, also has a sad record when it comes to controlling the digital habits of its citizenry, and what is happening in China risks spreading to the rest of the world. Johan Lagerkvist, Professor of Chinese language and culture, writes about the new “social credit system”—with the wrong opinions you may not be able to use your credit card.

July 8 2015 Text: Johan Lagerkvist Translation from Swedish: Neil Betteridge

On March 9, 2000, former president Bill Clinton gave a speech at Johns Hopkins University in which he praised a new trade agreement, which advocated granting China permanent normal trade relations status. He also said: “We know how much the Internet has changed America, and we are already an open society. Imagine how much it could change China. Now, there’s no question China has been trying to crack down on the Internet—good luck. That’s sort of like trying to nail Jello to the wall.” The year before, in 1999, in an exchange with fellow GOP presidential candidate Gary Bauer in Arizona, George Bush said: “Imagine if the Internet took hold in China. Imagine how freedom would spread.”

Today, China has more internet users than any other country, with the CNNIC—the Chinese internet statistics authority—setting the number of users at no less than 649 million (February 2015). This makes the country a market for all the large IT and computer companies, one that they bend over backwards not to fall foul of or criticise. It is there that they test out all their latest smartphones and accompanying apps before releasing them onto the secondary markets of the West. Internet has indeed taken hold in China, but in contrast to what the US presidents prophesied fifteen years ago, freedom of expression has been quashed and self and state censorship has tightened markedly. According to the latest report from Reporters Without Borders, under General Secretary Xi Jinping’s rule China has dropped down the global table of speech freedoms to 176th place, just ahead of Syria, Turkmenistan, North Korea and Eritrea.

The growing state control of online corporate and private activity can be summed up along the following timeline:
* 1994: internet technology becomes commercially viable when China decides to open itself up to a global internet.

* 1994–1999: initially a period of remarkable liberty as state control is occupied with the old-fashioned censorship of major media channels such as TV and magazines, since the number of internet users is still relatively low. At the end of the decade, new private media companies start to appear that, in the absence of laws restricting the spread of information online, create portals with their own news flows—beyond the reach of the communist party and state authorities. However, the government grows concerned at the free journalistic activities that private companies are pursing online and at the myriad internet cafés that are starting to spring up like mushrooms around the country. With the communist information monopoly and self-justification under threat by these alternative channels, the government applies the thumbscrews.

* 1999–2004: chat rooms and blogs continue to turn into virtual public spaces for a diversity of opinions and freer debate on social issues, politics and economics. The authorities impose new laws, rules and codes of conduct for the internet companies.

* 2004–09: media development on the Chinese internet suffers a wave of setbacks. People are mobilised via blogs and text messaging to rallies, such as the nationalist demonstration against Japan in 2005 or protests against employers that refuse to pay salaries and corrupt party secretaries that sell off commonly owned farmland. At the end of the decade, the authorities take renewed action against text-message mobilisation and anonymous blogging, and announce the launch of new account set-up systems that require users to register with their full name and other personal details.

* 2009–14: new and even swifter communication via social media channels and microblogs—Weibo in Chinese—pose a new threat to the one-party state’s stability policy.

* 2014–2015: an important document is published by the State Council, the Chinese government, describing the one-party state’s plans for a new national social credit system that will have profound consequences for all internet use by creating greater powers relating to the systematic, far-reaching control of people’s behaviour and perlocutionary acts on the internet made possible by the coordination of vast amounts of data between the authorities and computer companies (big data). It has just started to be rolled out in some of the larger provinces, like Jiangsu and Shandong, and has triggered a flurry of activity, not least amongst the software companies as they frantically struggle to snap up a share of the market that this monumental control system is creating. The programme, which is scheduled to be up and running by 2020, is a highly ambitious one that can only be described in terms of a digital panopticon set up to monitor individuals, companies and state bureaucracy in order to tackle dishonesty in Chinese society and foster trust. It is also marketed as good for conducting secure online commerce and thus promoting economic growth. But it is not just a matter of preventing fraud and generally improving national morale; everything that is reported about individual citizens, what they have done or said both on and offline, will be linked to their personal ID cards. People’s behaviour, purchases, statements and comments—all information deemed valuable by the authoritieswill be stored in personal files.

Unlike corresponding systems of credit control in democratic countries, the coordination of vast volumes of data is not just a question of the economy but also one of social control. China’s social credit system will, according to documents from the Chinese government and university researchers, also register opinions and even attempt to grade people’s characters. It also contains elements of “opinion hygiene” and character-building. The Chinese researchers make it clear in their reports that Western credit systems cannot be superimposed onto China. It is claimed that while advantageous components of foreign systems are to be applied, a national system “adapted to the Chinese context must be developed.” That the country’s enormous public administration is not spared the gaze of the panopticon is, of course, about ridding bureaucracy of corruption. What is most telling, and confirms that the system has been constructed by a dictatorship, is that the communist party, with all its political power, is the only social institution and political body to be exempted from the scrutiny, control and accountability that the social credit system will entail.

How is it then possible to implement such an extensive control system? What might the ulterior motives be? What do the critics say?

One could claim that the “character registration” part of the social credit system is a response to the widespread feeling amongst the Chinese people that society is suffering a moral crisis marked by indifference and dishonesty between people and a lack of trust in what is no longer a society of citizens but a market society of consumers. This sentiment is also manifested in the anger that normal Chinese people feel at the corruption that infests the entire state apparatus. Since having recently implemented a vigorous national anti-corruption campaign within public administration and the communist party, General Secretary Xi Jinping has boosted his popularity and legitimacy with the common people. The moral cleansing that China’s supreme leader is engaged with in the state apparatus can be seem as a reflection of the moral shake-up that society, companies and citizens also need if a mood of trust, community and goodwill is to return to what is now a highly competitive market society. Many people would agree that such a shake-up is needed, and if any visible result is to be achieved, the state must make it happen; partly because extremely few Chinese seem to be aware of the consequences that the implementation of the social credit system will have on personal integrity and the storage and use of personal data. My own guess, however, is that most people, even if they did know more about it, would just shrug and continue shopping online and downloading new apps that track online usage and purchasing patterns. Even well-educated Chinese of my acquaintance here have said of the new social credit system, “It’s the future. After all, we want to evolve. The vast majority of people are all pulling together on this.” Regrettably a lack of interest and passivity towards issues of digital integrity is not unique to China, but part of an insidious global trend.