Friday, November 6, 2015

The latest social experiment in China - social and moral credit scores!

I have blogged earlier that the bigger concern from China is that its social and political liberalization may not keep pace with its economic liberalization, thereby constraining those channels which have to drive its next stage of growth. 

In fact, as this New Yorker article points out, the Chinese government seems to be going in the reverse direction. The country is apparently planning a social credit system (SCS) by 2020, which seeks to capture the social, moral, and financial history of its citizens, and "encourage keeping trust and punish breaking trust",
It aims to compile a comprehensive national database out of citizens’ fiscal, government, and possibly personal information. First publicized, last year, in a planning document published by the State Council, S.C.S. was billed as “an important component part of the Socialist market-economy system,” underwriting a “harmonious Socialist society.” Its intended goals are “establishing the idea of a sincerity culture, and carrying forward sincerity and traditional virtues,” and its primary objectives are to raise “the honest mentality and credit levels of the entire society” as well as “the over-all competitiveness of the country,” and “stimulating the development of society and the progress of civilization.”
And the manner in which the government proposes to do this, while reflective of its "crossing the river by feeling the stones" approach, is appalling its invasion of privacy and quest for social engineering, 
The Chinese government... maintains a Web site that allows any citizen to check what serve as proxies for other people’s credit ratings, including court judgments and other interactions with the state. The site uses data from thirty-seven central government departments and is run with help from Baidu, China’s main search engine, which is privately owned but submits to the rules of the state. Similarly, S.C.S. will likely elicit help from major private enterprises to manage various segments of its operation. Prior to its rollout, now planned for 2020, the government will observe how eight private companies come up with their own “social credit” scores under state-approved pilot projects...

Alibaba, the world’s biggest online shopping platform, creates an incentive for customers to use its own payment service (also part of Alipay) by raising the Sesame Credit scores of those who do. The company makes no secret of its interest in accessing the payment history of its four hundred million users, to make judgments about their creditworthiness and character. “Someone who plays video games for ten hours a day, for example, would be considered an idle person, and someone who frequently buys diapers would be considered as probably a parent, who on balance is more likely to have a sense of responsibility,” Li Yingyun, Sesame’s technology director, told Caixin, a Chinese magazine. In some ways, Tencent’s credit system goes further, tapping into users’ social networks and mining data about their contacts, for example, in order to determine their social-credit score.

The information-harvesting tactics of Alibaba and Tencent play to their advantages and exploit the companies’ unique points of access to their users. For the Chinese government, this is exactly the sort of competitive strategizing that might ultimately prove instructive to the construction of its own omniscient system. Indeed, part of what has kept the Party in command over the decades is its pairing of authoritarian imperative with adaptability—a willingness to evolve its mechanisms of control with the technology of the times. To maintain the regime’s political power, the state has already leveraged the market and, for example, erected the Great Firewall. Engineering the lives of its citizens by way of a comprehensive database seems almost like the logical next step.
It is a testament to India's democratic vibrancy and political maturity that there is such pre-emptive hostility and abhorrence to such ideas, despite the country being technologically and systemically ahead of China in being able to do precisely the same. This is surely one area where China has a lot to learn from its southern neighbor. Score India 1, China 0 on this!

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