China’s ‘Social Credit’ System
China’s ‘social Credit’ system fueled by artificial intelligence, and IoT is being enforced, creating a credit score based society. A moral ranking system has been developed by China for years to monitor the behavior of its enormous population – and rank them according to their “social credit.”
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In 2015, a government document announced that the “social credit system” was “an important component of the socialist market economy system and social governance system” and aimed to reinforce the idea that “keeping trust is glorious and breaking trust is disgraceful.”
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The South China Morning Post reports that China’s economic planning team, the National Development and Reform Commission (NDRC), the People’s Bank of China, and the Chinese court system determine the rankings.
This artificial intelligence-based system can be used for both individuals and businesses. According to Wired, the private sector, including the burgeoning tech world in China, has its own non-governmental scoring system. According to the think tank Merics, Sesame Credit, owned by Jack Ma’s Ant Group, uses its own unofficial score system for its employees, such as studying their shopping habits.
CNBC reported that millions of Americans had participated in the program in recent years, and that it would be fully operational and integrated by 2020.
The system is currently piecemeal and voluntary, though eventually it will be unified across the nation and each person will be given their own unique code to measure their credit score in real-time, according to Wired.
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Poor driving and debt will lower your social ranking
It is unclear how the algorithm determines infractions, but examples include bad driving, smoking in non-smoking zones, buying too many video games, and posting false information online regarding terrorism or airport security.
You can also be punished if you spend too much time playing video games, spend too much money on frivolous purchases, or engage in social media behavior.
Travel bans and slow internet are among the penalties
Currently, China has started penalizing people by limiting their travel, including banning them from flying.
The National Public Credit Information Centre reported that authorities banned people from purchasing flights 17.5 million times by the end of 2018.
The government can also restrict access to luxury options – many people are barred from getting business-class train tickets or from staying in the best hotels.
Eventually, bad passengers will be punished specifically. Some potential misdeeds include not purchasing a ticket, loitering at boarding gates, or smoking in non-smoking areas.
In 2017, author Rachel Botsman published part of her book on tech security on Wired. According to Botsman, the government will throttle internet speeds for violating the law, though the exact mechanics are still unclear.
A credit system monitors whether people pay their bills on time, much like financial credit trackers – but also ascribes a moral component.
The best jobs and schools might also be out of reach – 17 people refused to serve in the military in 2017 were barred from enrolling in higher education, applying for high school, or continuing their studies.
In July 2018, a Chinese university declined to accept an incoming student whose father had a poor social credit score due to his inability to repay a loan.
Another tactic is naming and shaming. Businesses are encouraged to consult the blacklist before hiring or contracting with people on it in a 2016 government notice.
After being added to the list, people will be notified by the courts and can appeal the decision within 10 days of receiving the notification.
Li Xiaolin, a lawyer who was deemed “untrustworthy” after failing to comply with a court order in 2015, was placed on the list and was unable to purchase plane tickets home while on a work trip, Human Rights Watch reported. Also, he couldn’t apply for a credit card.
‘Bad’ citizens are punished, but the system also rewards ‘good’ citizens
A good score can speed up travel applications to Europe, Botsman said. A woman who had a good credit score told the BBC in 2015 that she didn’t have to pay a cash deposit to book a hotel in Beijing. Also, the outlet reported that Baihe, China’s largest dating site now owned by Jiayuan, is boosting the profiles of good citizens.
With good social credit, citizens can also get discounts on energy bills, rent things without a deposit, and get better interest rates at banks. In 2018, Foreign Policy featured a story about the city council of Rongcheng, in Eastern China, which rolled out a social credit system for its citizens.
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The system has been likened to dystopian science fiction
China’s social credit system possesses a moral element, which is one of the reasons many have compared it to some form of dystopian governance, such as in George Orwell’s “1984”, where the state heavily controls every aspect of a citizen’s life.
The system has been dubbed “chilling” by Human Rights Watch and “an out of control futuristic vision of Big Brother,” but some citizens say that it is already making them better people.
The 32-year-old entrepreneur who only gave his name as Chen told Foreign Policy in 2018 that “I feel people’s behavior has improved in the past six months. For example, when we drive, we stop at crosswalks. If you don’t, you will lose your points. At first, we just worried about losing points, but now we got used to it.”.