China is developing a new high-tech system of mass surveillance and coercion aimed suppressing political dissent among its 1.4 billion people, while forcing American and Western businesses to conform to the government’s communist policies if they want to operate there.
The system that critics call an Orwellian national-level control system has been dubbed the Social Credit System (SCS) and was set for launch in the coming year, although recent reports from China now say the rollout could be delayed until 2021.
The massive system has been tested in several major Chinese cities and uses millions of surveillance cameras linked to supercomputers containing massive databases. Face and voice recognition technology then identifies and monitors people with the goal of controlling behaviors that range from dissident political activity to jaywalking, ostensibly as part of a financial credit monitoring system similar to those used in the West.
Vice President Mike Pence called out the program in a recent speech, warning that China’s surveillance state is “growing more expansive and intrusive — often with the help of U.S. technology.”
“By 2020, China’s rulers aim to implement an Orwellian system premised on controlling virtually every facet of human life — the so-called social credit score,” Mr. Pence said. “In the words of that program’s official blueprint, it will ‘allow the trustworthy to roam everywhere under heaven, while making it hard for the discredited to take a single step.’”
Facial recognition tools are widely used now in China bolstered by cameras deployed along streets, on buildings, in train stations, in classrooms and subway lines. With the emergence of next-generation 5G telecommunications technology, the reach of the surveillance networks is only expected to increase.
As part of the stepped-up surveillance, the Chinese government announced this month that all who purchase SIM cards for mobile phones must first produce a facial recognition print.
Pilot projects for the SCS have been under way for the past several years around China.
The system has its kinks. A Western corporate executive leaving China faced a fine after an SCS search claimed she ran a traffic light and failed to pay the fine. A diplomatic source familiar with incident said the executive’s only crime was that her face appeared in a photograph that was part of bus advertisement and was captured by a surveillance camera when the bus ran the light.
A gray market in China has started for people with bad social credit who can boost their scores by buying points online. China’s Alibaba online retailer has listed available social credit from people in rural areas.
One Chinese national in the country who declined to be identified by name said those who fail the social credit system are called “laolai” — roughly translated as serial scoundrel or rascal.
“It is quite an insulting term,” the person said. “In a totalitarian state, everyone is expected or forced to be a small, useful cog of the society. It happened now and then in the human history and it is happening now.”
Another Chinese citizen said social media discussion of the SCS is being heavily censored.
“Basically, as far as I know, the system connects everything and perhaps controls everything,” this person said. “For example, all my bank cards and payment accounts, my WeChat and other social media accounts, the accounts to buy train and air tickets, my phone number, and even my face ID, are connected to my identity card in China.”
The official government website, creditchina.gov.cn, described the social credit system only as “an important part of the socialist market economic system and social governance system.”
Outside China, the international variant is known as the “corporate social credit system” and is already been used by Beijing to coerce foreign businesses that fail to toe China’s political line on issues such as Taiwan, Hong Kong and Tibet.
Paying the price
The official National Public Credit Information Center, reported last year that a total of 23 million people were “discredited” and barred from traveling by air or rail. Another 17.5 million Chinese could not purchase airline tickets, while 5.5 million were barred from buying high-speed train tickets — all due to poor social credit scores.
Among those caught up in the SCS was Chinese actress Michelle Ye Xuan. She was unable to board a flight last March after information about a recent court case popped up on a computer screen at an airport checkpoint. She was found guilty of defaming her boyfriend’s ex-lover and failed to apologize. The ban was lifted after she apologized.
Beijing euphemistically calls the program part of “social management” — a key element of communist ideology to shape and control society.
In reality, critics say, the system is designed to preserve the power of the Communist Party of China, blacklisting and punishing anyone who is spotted by the system engaging in any unapproved activities. It’s marks a high-tech upgrade of traditional measures of control.
In the past, the party relied on a system called “dongan” or personal file — millions of dossiers on citizens filled with personal information ranging from comments made in high school to remarks made to coworkers.
The SCS is expected to take the dongan system to new levels of surveillance by the use of use of advanced technology.
“At its core, the system is a tool to control individuals,’ companies’ and other entities’ behavior to conform with the policies, directions and will of the [Communist Party of China],” said Samantha Hoffman, a China specialist with the Australian Strategic Policy Institute in Canberra. “It combines big-data analytic techniques with pervasive data collection to achieve that purpose.”
The heart of the SCS is the more than 200 million video cameras that line streets and alleys, all networked to vast stores of personal data sifted by increasingly advanced data mining software. China plans to have as many as 626 million cameras deployed by next year.
Low credit scores — whether due to political activity, financial impropriety or even minor offensives like smoking on a train — employment, can result in schooling and travel being blocked or restricted.
Jeremy Daum, a Yale University expert on Chinese law, said the SCS is a surveillance apparatus that seeks to incentivize “trustworthy” and “untrustworthy” behavior. It’s very different from the work of credit reporting agencies in the U.S. and other free-market economies to monitor individual financial activity.
Early pilot programs assigned a score using a point system, although Mr. Daum says it is not clear that the point system will be used in the final nationwide system. The figure of 800 or 900 points has been reported as a baseline for a person’s unblemished social credit — reflecting the Western credit reporting scoring system.
One area already in use is a blacklist for those found guilty under China’s legal system. But Ms. Hoffman notes that in China the law is not the same as in democratic states. It is used by Communist Party to set expectations and communicate intentions.
“By the party’s own definition, the law functions to ensure the party’s political security above everything else,” she said.
Any person who fails to abide by a court judgement gets added to the blacklist and is restricted from buying airplane tickets, train tickets, private school education, entertainment, and other areas. Corporations on the list face limits on access to tightly controlled Chinese industries and also can be required to leap greater regulatory hurdles.
“Like many other parts of China’s surveillance apparatus, it is very frightening,” Mr. Daum said on his blog China Law Translate. “Even as it delivers some safety and security to many Chinese, it is all too clear from watching Xinjiang or other areas of unrest, that these systems can be quickly weaponized for harsh control.”
Apps and spying
Earlier this year, the Communist Youth League offered an app called “Unictown” that gives users a credit score of between 350 and 800. Those with higher scores may receive preferential treatment, such as school tuition discounts or favorable treatment in seeking jobs.
But the app is also being used by China’s leaders to spy on the political leanings and other activities of the users. Those who post anything critical of the party will lose points. Points can be gained from reading speeches by Chinese President Xi Jinping.
The app and the massive amounts of data it collects are used by a government entity called China Youth Credit Management system.
A U.S. congressional commission has studied the system and warns the Beijing government wants to control all speech and writing by deploying the increasingly advanced social management technology.
Communist Party efforts “to control discourse within China’s borders also resulted in its deployment of increasingly advanced social management technology,” concluded the latest annual report of the U.S.-China Economic and Security Review Commission.
The government earlier this year introduced a mobile application called “Study Xi, Strong Country” that requires party and state employees to study daily Mr. Xi’s speeches and other ideological writings.
“The application also enables digital surveillance because it is linked to users’ personal information, and metrics regarding users’ performance can be accessed by government offices, schools, and private companies to sanction employees and students who earn too few points,” the commission report said.
The SCS is also being integrated into China’s system called “smart cities” — wired and internet-linked localities that will further facilitate mass surveillance.
Beyond the borders
China is finding markets abroad for the SCS in the form of exports of surveillance cameras; command and control centers; facial and license plate recognition technologies; data labs; intelligence fusion capabilities and portable rapid deployment systems for use by governments in emergencies.
For example, Turkey’s mobile operator Turkcell in 2018 signed an agreement with China’s military-linked Huawei Technologies for smart city development that will allow authorities in Ankara to better track political dissent, Ms. Hoffman said.
The overseas program was on display again in Beijing’s recent efforts to punish the National Basketball Association after a single NBA executive tweeted support for Hong Kong democracy protesters. A second example was China’s attempt earlier this year to coerce U.S. and European airlines into changing their online description of Taiwan as separate from China on company maps.
The corporate SCS push drew the attention of 25 U.S. senators, who wrote to U.S. Trade Representative Robert Lighthizer on Dec. 2.
The senators warned China will use the control system to coerce U.S. companies into “onshoring” research and development in China. That in turn could force the transfer of American technology and demands for support of Beijing’s policies as the price for market access.
“Once the corporate SCS is fully operational, firms with scores below a certain state-determined threshold will face an interlocking series of sanctions across multiple Chinese government agencies, including restrictions on procurement and business licenses, less favorable interest rates, higher inspection rates, and even potential debarment from the Chinese market,” the lawmakers said.
In September 2019, the Chinese Communist Party threatened to lower social credit scores for American companies unless the companies acknowledged Macau, Hong Kong, and Taiwan as part of China.
“What our country witnessed recently with respect to the NBA over a tweet by one American team’s general manager is not an aberration, but the latest in a litany of attempts by China to deploy its state and economic power to bend American entities to its will,” the senators said. “It seems the SCS is designed, in part, to further and formalize this practice.”
A recent report by the European Chamber of Commerce also warned the corporate SCS could be used to enhance the party’s ability to control the behavior of European businesses in China.
“It is no exaggeration to say that the corporate SCS will be the most comprehensive system created by any government to impose a self-regulating marketplace, nor is it inconceivable that the corporate SCS could mean life or death for individual companies,” the chamber’s president, Joerg Wuttke, said.
Not all experts agree about the threat.
Wired magazine recently published an analysis of the system warning of “science fiction myths” prevalent in the West about it.
“This is a totalitarian regime. That’s the point really,” Mr. Midler says. “The CCP doesn’t need a ‘system’ of any kind. Their officials can do anything they want to any person at any time.”
Mr. Midler added there is some debate on how much control the SCS will have.
“Knowing the Chinese and this debate of ‘rule of law’ vs. ‘rule of man,’ they will never allow any system to take power away from actual communists,” he says.
“Just as officials will take an arbitrary, draconian action and pin it on the law — ‘We have arrested him according to the law’ — they will one day flush people down a hole and say it wasn’t any one official who ruined the man, but that it was their automated system which led to his demise. This sort of capricious behavior is actually more frightening to me.”
China’s social credit system, said Victor H. Mair, professor of Chinese language at the University of Pennsylvania, ” is stripping away individual identity and reducing people to mere ciphers.”