The truth about China’s social credit scores

Speaker 1 ABC Listen. Podcasts, radio, news, music, and more.

Speaker 3 What happens when medicine is sold like a makeover?

Speaker 4 Their marketing is very good.

Speaker 3 Clinics with five-star reviews selling miracle cures. I left that place thinking I found myself a solution.
But it's your body that pays the price.

Speaker 5 I had one cheek higher than the other, one cheek further out from my nose.

Speaker 3 Before and after, a new series on how medical hype spreads online, who profits and who pays. Search for background briefing on the ABC Listen app or wherever you get your podcasts.

Speaker 2 This podcast was produced on the lands of the Wabakal and Gadigal people.

Speaker 2 China has reportedly got more than 700 million CCTV cameras these days.

Speaker 6 Across the country, cameras and spyware are watching.

Speaker 2 That's one camera for every two citizens.

Speaker 6 China has long been a surveillance state. Now Big Brother meets big data.

Speaker 2 For the last decade or so, Western media has been talking about how the Chinese government is pioneering technology which allows them to keep tabs on their entire population.

Speaker 6 What you do, say and even think is being monitored and marked against you.

Speaker 2 Back in 2018, we were being told that they were on the verge of being able to assign everyone in China a social credit score, which could radically affect the lives of people with a low rating.

Speaker 6 Sounds dramatic, but it's the party line. Pilot programs for a national social credit system are already underway.

Speaker 6 By 2020, the official outline boasts, it will allow the trustworthy to roam freely under heaven, while making it hard for the discredited to take a single step.

Speaker 2 This system has been discussed widely in Western media and politics for more than a decade now.

Speaker 8 So in China, for for example. God, this is going to happen here, I think, too.
Although maybe people will fight it. If a traffic camera catches you jaywalking in China, the digital ID system has you.

Speaker 2 Jordan Peterson, the Canadian psychologist seen as some kind of super genius oracle in the podcast Bro universe, is terrified of this system.

Speaker 8 It will convict you of jaywalking and take money out of your bank account with no intermediating judiciary at all and show a picture of you to to the people in the neighborhood so they know that you have jaywalked and reduce your social credit score.

Speaker 2 Here in Australia, the Chinese social credit system has been described as the inevitable end point of the government's online safety code.

Speaker 4 If you want to know what Australia's future looks like in its current trajectory, go and have a look at Chenzhin in China.

Speaker 4 Cameras everywhere, facial recognition, a digital currency and a social credit system.

Speaker 2 The whole thing sounds very scary.

Speaker 8 If your social credit score falls below a certain level, you can't buy drinks from a vending machine, you can't play video games, you can't go on a train, you can't get out of your 15-minute city.

Speaker 8 All that's already in place in China.

Speaker 2 But is it though? I've been hearing about the social credit system for a long time, not just in the news media, but in fictional series like Black Mirror.

Speaker 2 And yet if you ask people who actually live in China, It's a very different story.

Speaker 4 I was asking people who live there, right? And apparently it's not true. it's bullshit.
There's no social credit score.

Speaker 2 Every time a Western government tries to increase its control over the internet, we hear that this is the beginning of a slippery slope that leads to jaywalkers being prevented from using vending machines.

Speaker 2 And now I'm being told this dystopian AI-powered surveillance system doesn't exist and in fact was never going to?

Speaker 2 So what is actually going on here and how does this social credit system actually work?

Speaker 2 I'm Matt Bevan and this is if you're listening.

Speaker 2 I am delighted to announce that two of my children have now reached the age where I can tell them back in my day stories and they can mostly understand them.

Speaker 2 I didn't say that they enjoy them, but they do understand them.

Speaker 2 So recently I was telling one of them that when I was a kid, we couldn't just stream whatever movie we wanted. We either had to buy it from a shop, rent it, or tape it off the TV.

Speaker 2 Now, I neglected to mention the little period between Blockbuster Video and Netflix when most people my age just stole all their movies from the internet.

Speaker 9 Nearly 3 million Australians use file sharing networks.

Speaker 2 Governments and studios worked hard to stop people pirating things off the internet by promoting legislation blocking sites like Mega Upload and The Pirate Bay.

Speaker 2 But the piracy websites did have their supporters.

Speaker 4 Pirate parties have sprung up to try and promote the rights of internet freedom.

Speaker 2 The first pirate party was in Sweden and it was founded by Rick Falkwing.

Speaker 2 His perspective was that if movie studios couldn't stop people stealing their stuff, that's their problem, not the government's.

Speaker 4 If you're running a business, then it's your responsibility to find a business model within the current constraints of society that allows you to make money.

Speaker 4 You don't get to dismantle civil liberties.

Speaker 2 Folk Winger was all about internet freedom and wanted people to be able to exist relatively anonymously online, which is why in 2015 he wrote an article on his website about a disturbing new policy being pursued in China.

Speaker 2 His article described a loyalty program created by the Chinese retail giant Alibaba, which gave people what the company called a sesame credit score based on what they were buying.

Speaker 2 This sesame credit score was not a secret. Alibaba was actually doing its best to promote it to as many Chinese people as possible.

Speaker 10 Alibaba launched a campaign called National Credit Day to promote sesame credit and also public awareness about the importance of good personal credit.

Speaker 2 He said the credit score was meant to encourage people to buy more socially acceptable things.

Speaker 2 To quote Folkfinger, if you're buying things that the regime appreciates, like dishwashers and baby supplies, your credit score increases.

Speaker 2 If you're buying video games, your score takes a negative hit. Now, why would maintaining a high score be important?

Speaker 2 Well, here's a bit of Chinese state media to explain.

Speaker 10 With a good score, consumers can rent a car without a security deposit or enjoy simplified visa application procedures to some countries.

Speaker 2 Those countries were Luxembourg and Singapore, two countries with which Alibaba had come to a commercial arrangement.

Speaker 10 Sesame Credit is adding more partners by the day.

Speaker 2 Alibaba is not a state-owned corporation, but they were one of eight companies that briefly participated in a trial to help the Chinese government develop a financial credit system, which was ultimately rejected.

Speaker 2 As part of this, they were given access to information from the Chinese central bank about whether users had failed to pay back any loans in the past, Which is exactly the same kind of system that Western countries call a credit score or a credit report.

Speaker 2 You know, this one.

Speaker 11 You need to think about the implications on your credit report if you if things get out of hand because it's not just a matter of getting a mortgage.

Speaker 11 Right now credit reports are increasingly being used in job screening for instance.

Speaker 2 So Alibaba uses people's credit history and purchase patterns to assess whether they should get certain benefits.

Speaker 2 A company spokesperson told tech publication quartz that it doesn't take into account what you buy, just how much you spend.

Speaker 2 In other words, no matter how many video games you have in your cart, as long as you can afford them, it's not going to affect your score.

Speaker 2 Now, would you say that there's anything sinister about this system? It's not mandatory, you can opt in or opt out. At worst, it sounds to me like a slightly more invasive frequent flyer program.

Speaker 2 None of the stuff that Rick Fokfinger said about Alibaba's program was new or different to what had been reported elsewhere, but he did go one step further than anyone else.

Speaker 2 He wrote that the Chinese government has already announced that it, or something very like it, will become mandatory from 2020.

Speaker 2 The Chinese government, he says, has also announced that while there are benefits today for obedient people, it intends to add various sanctions for people who don't behave, like limited internet connectivity.

Speaker 2 Such people will also be barred from serving in certain high status and influential positions, like government official, reporter, CEO, statistician, and similar.

Speaker 2 I'm not entirely sure why statistician is in that group, but never mind.

Speaker 2 He then linked to an English language translation of a Chinese government document titled Planning Outline for the Construction of a Social Credit System.

Speaker 2 That does sound a little bit more sinister.

Speaker 2 Folkfinger's article was picked up by the American Civil Liberties Union, the ACLU, ACLU, and spread right across Western media.

Speaker 12 And now China's government is testing a new social credit score system which would rank its citizens based on their online behavior, just the latest in this ever-expanding surveillance state.

Speaker 4 It's a way of compiling information all the way down to the individual levels that can be rolled up into a score that really talks about how well aligned you are with the agenda of the leaders.

Speaker 2 The following year, the Netflix series Black Mirror released an episode called Nosedive, set in a world where everyone was given a social rating out of five.

Speaker 14 You've seen the guest list.

Speaker 2 They are all like 4-5 or above.

Speaker 14 They are going to freak out a 2-6, and I am not taking that kind of damage. Plus, I haven't dipped under a 4-7 in like six months.

Speaker 2 Nosedive was written before the Chinese social credit story hit the news, but it became synonymous with it.

Speaker 15 Is this Black Mirror nightmare becoming a reality in China?

Speaker 4 So that wasn't China copying Black Mirror. That was Black Mirror copying China.

Speaker 16 There was an episode about this on Black Mirror.

Speaker 2 So, China is apparently doing that Black Mirror episode, but for real. Or at least that's what Rick Falfinger is saying, based on his interpretation of this official document.

Speaker 2 But what did the original document actually say?

Speaker 2 Well, it's very long and very boring, as all Chinese government documents inevitably are. But it definitely doesn't say anything about Alibaba or Sesame credit scores.

Speaker 2 In fact, it didn't mention scores at all. The document was vague and sweeping, talking about promoting trustworthiness in social, financial, and legal domains through reward and punishment.

Speaker 2 There's also some debate about the translation of the document.

Speaker 2 For instance, the Chinese characters translated into the word credit could also be translated into the word trustworthiness or credibility. So what was this document really, and why was it written?

Speaker 2 Well the easiest way to explain the problem the document was trying to solve is by looking at something that happened in 2008 which was a really big year for China.

Speaker 7 Beijing is getting ready for the home run to the Olympic Games.

Speaker 7 With 100 days to go officials say preparations are on track and today the Chinese capital offered a small taste of what's to come in August.

Speaker 2 But away from the Olympic excitement, a crisis was brewing.

Speaker 15 Sanlu is said to have first learned its milk powder was causing health problems in children last December, possibly even earlier.

Speaker 15 It waited six months before testing the formula in June when it discovered melamine.

Speaker 2 Across the country, thousands of babies were being hospitalized with kidney stones and kidney failure.

Speaker 15 The infants have all been fed milk powder contaminated with the industrial chemical melamine.

Speaker 2 Per capita milk consumption in China had tripled in just eight years, and dairy farmers were struggling to keep up.

Speaker 2 Many of them diluted their milk with water so they could sell more of it and added protein powder to cheat quality control checks.

Speaker 2 When some of the milk distribution companies caught on, farmers found that the toxic chemical melamine used to make plastic and glue worked just as well as the protein powder, but was undetectable.

Speaker 2 Meanwhile, milk that had gone off was also added to the national supply.

Speaker 15 Milk was seldom turned away. Even if it smelt rotten, farmers say they were told to put it into a special vat where it would be mixed with good milk and turned into baby formula.

Speaker 2 San Lu, the company with the largest quantity of melamine going into their products, found out about the problem in June of 2008.

Speaker 15 But San Lu directors took another two months to report the contamination to local city officials and to their joint venture partner, New Zealand Dairy Cooperative Fonterra.

Speaker 2 They finally reported it. But what happened then?

Speaker 15 Chinese officials did nothing while Fonterra waited until the 14th of August to mention the issue to New Zealand Embassy officials in Beijing casually at an Olympic cocktail party.

Speaker 2 Oh yeah, the Olympics had started just a few days earlier and nobody wanted to cause any fuss.

Speaker 15 Finally, the New Zealand Prime Minister learned of the situation in early September and ordered her officials to tell China's central government.

Speaker 15 Only then did the issue become become public and poisonous milk powder was recalled.

Speaker 2 The consequences were horrific.

Speaker 5 Up to eight babies died from kidney failure and around 300,000 became ill. The Chinese government and producers were criticised.

Speaker 10 I think a lot of quality problems happen in China.

Speaker 2 The Chinese government investigated.

Speaker 17 It seems that some people already knew about this problem for some time, but did not share the information.

Speaker 15 The country's melamine milk scandal has revealed safety loopholes in almost every link of the dairy supply chain.

Speaker 2 There were lots of prosecutions and two perpetrators were executed.

Speaker 15 China's premier has visited sick children and condemned his country's dairy industry as chaotic.

Speaker 2 Now, here in the West, we obviously have corporate scandals too, but the scale of this scandal in terms of the number of people involved.

Speaker 2 It's hard to imagine something like this happening in a highly developed country.

Speaker 2 And that's in part because developed countries have robust institutions and systems designed to prevent this kind of thing. And most of that comes down to paperwork.

Speaker 12 We have records about you, about every individual in Australia.

Speaker 13 Your social security card, important as a bank book.

Speaker 2 Government data makes it much more difficult for people to get away with these things. There are serious long-term consequences for getting caught doing something dodgy.

Speaker 2 But it's taken decades for developed countries to build up all this infrastructure. China, at the time, had almost none of it.
Now you might be asking, how can that be possible?

Speaker 2 Well, it's important to remember that like very recently, China was a very different place.

Speaker 17 There are 800 million peasants in China, four-fifths of the country's population, one-fifth of the world's.

Speaker 17 Government permission is needed to emigrate to the towns and it's government policy to keep the people out of them.

Speaker 2 In the early 1980s the vast majority of Chinese people lived in small rural villages where everyone knew everyone and knew who could and could not be trusted.

Speaker 2 But over the last 45 years China has transitioned from a nation of 80% peasants to a nation of 65% city slickers.

Speaker 2 The villages now have a million people in them and it's impossible to keep track of everyone based on reputation alone.

Speaker 2 While China introduced a national identity card in the 1980s, by the time of the 2008 Olympics, hundreds of millions of Chinese people still didn't have bank accounts or credit reports.

Speaker 2 They did not file tax returns and they did not collect social security pensions. Many worked in jobs that typically require some sort of certification, but did not have one.

Speaker 2 And even even if those documents did exist, they certainly weren't centralised in any useful way.

Speaker 2 The system was a mess and ripe for exploitation by frauds, scammers and other untrustworthy types.

Speaker 16 I think it will and must change because now all Chinese consumers have totally lost faith in the country's quality supervision.

Speaker 16 If they want to get back people's confidence, the relevant laws, punishment and compensation must be improved.

Speaker 2 That's where this document Rick Fogfinger wrote about comes in.

Speaker 2 When the 2014 planning outline for the construction of a social credit system document talked about trustworthiness, this is what it meant.

Speaker 2 Its primary purpose wasn't to figure out who is speaking ill of the dear leader, but to help people figure out who is tipping industrial chemicals into baby formula.

Speaker 2 The government decided that it was going to address all of these issues with one system, the social credit system.

Speaker 2 They laid out plans to assess people's financial credit, introduce social credit codes like social security numbers or tax file numbers, and create public databases to look up whether a business you were dealing with was dodgy.

Speaker 2 The thing is, though, the Chinese central government isn't directly controlling every facet of Chinese society, and it never has.

Speaker 18 There's an old dictum from Chinese history about the emperor is far away and the mountains are high.

Speaker 2 Local governments and agencies are generally able to interpret Beijing's desires as they see fit.

Speaker 2 When Beijing said they wanted a trustworthiness system, thousands of officials set about trying to figure out what that should look like.

Speaker 2 The way some of them implemented these systems is kind of quaint, but in a very authoritarian way. Tyrannic cute, perhaps? Kitschtopian?

Speaker 2 In the city of Rongcheng, a small group of people were employed to walk around town with notepads jotting down people's good and bad deeds.

Speaker 2 Each month, month a committee turns those notes into positive or negative points for people on a register.

Speaker 2 In 2019 that system was shut down after the central government told them that people could not be punished for doing bad deeds, only actual crimes.

Speaker 2 These days the social credit system is mostly a tool to keep track of basic financial and legal information, but that doesn't mean it can't be abused.

Speaker 2 One aspect of the system that can be particularly unpleasant is its blacklists. Investigative journalist Louis Hu found that out the hard way.

Speaker 6 In 2015, Wu lost a defamation case after he accused an official of extortion. He was made to publish an apology and pay a fine.
But when the court demanded an additional fee, Hu refused.

Speaker 2 Blacklists are usually reserved for businesses, but individuals who've been sued or have poisoned milk with industrial chemicals and even journalists like who

Speaker 2 can also end up on them too.

Speaker 6 In 2017, he found himself suddenly locked out of society. Under a pilot social credit scheme, he'd been blacklisted as dishonest.

Speaker 2 Being on a blacklist restricts your ability to do basic things like buying train tickets or which school you can send your children to.

Speaker 6 His poor social credit rating has shut down his travel options and confined him to effective house arrest in Chongqing.

Speaker 2 Now, someone who isn't paying court-mandated fees would be considered dishonest in any country, but...

Speaker 6 He believes his blacklisting is political, but he has no way of challenging it.

Speaker 2 The question is, though, is this an indication that the social credit system is inherently bad?

Speaker 2 Or is it an indication that in an authoritarian country like China, the state abuses otherwise innocuous institutions to punish dissent?

Speaker 2 Ten years after the publication of Rick Falkfing's article, the original text is now gone.

Speaker 2 It's been replaced by an article by a different author which says, people often wrongly portray China's social credit score system as some omnipotent AI apparatus automatically scoring citizens on their every behavior.

Speaker 2 There is still no sign of any national social credit scoring system in China. Nobody is getting their vending machine access cut off because they did a bit of light jaywalking.
Or at least, not yet.

Speaker 2 Reporting on stuff happening in China is notoriously difficult. It's a very big country with an enormous population and a very secretive government.

Speaker 2 Also, Western journalists struggle to get visas, and the ones that do get in can't just wander around the country finding out what's really going on there.

Speaker 2 China's secretive government definitely does oppress people. Those who voice dissent are routinely jailed without justification, and social media usage is heavily policed.

Speaker 2 But that doesn't mean that every single one of their policies is purely designed for oppressive purposes.

Speaker 2 When you read a blog post by a self-described pirate about a fantastical, futuristic, black mirror-esque, dystopian, AI-powered surveillance system,

Speaker 2 it is worth checking out whether or not it really exists.

Speaker 2 This episode of If You're Listening was written by producer Adair Shepard and me, Matt Bevan. Supervising producer is Cara Jensen-McKinnon.

Speaker 4 Next,

Speaker 2 I mean, we're kind of sitting here waiting for the results of this.

Speaker 19 Both the U.S.

Speaker 19 Senate and House of Representatives have approved legislation to compel the Justice Department to release all unclassified documents related to the investigation into the late convicted sex offender, Jeffrey Epstein.

Speaker 2 So, dunno, but unless all hell suddenly breaks loose, we'll take a look at a different disgraced deceased businessman, Christopher Scace.

Speaker 2 Mark Humphreys has a new podcast series about the man who spent the 90s on the run, not only from Australian authorities, but bounty hunters. It's a great story, and it's next on if you're listening.

Speaker 2 Maybe. I'll see you Tuesday.