Inside China’s Vast New Experiment in Social Ranking

Curated on Posted on by Stefaan Verhulst

Mara Hvistendahl at Wired: “…During the past 30 years, by contrast, China has grown to become the world’s second largest economy without much of a functioning credit system at all. The People’s Bank of China, the country’s central banking regulator, maintains records on millions of consumers, but they often contain little or no information. Until recently, it was difficult to get a credit card with any bank other than your own. Consumers mainly used cash….

In 2013, Ant Financial executives retreated to the mountains outside Hangzhou to discuss creating a slew of new products; one of them was Zhima Credit. The executives realized that they could use the data-collecting powers of Alipay to calculate a credit score based on an individual’s activities. “It was a very natural process,” says You Xi, a Chinese business reporter who detailed this pivotal meeting in a recent book, Ant Financial. “If you have payment data, you can assess the credit of a person.” And so the tech company began the process of creating a score that would be “credit for everything in your life,” as You explains it.

Ant Financial wasn’t the only entity keen on using data to measure people’s worth. Coincidentally or not, in 2014 the Chinese government announced it was developing what it called a system of “social credit.” In 2014, the State Council, China’s governing cabinet, publicly called for the establishment of a nationwide tracking system to rate the reputations of individuals, businesses, and even government officials. The aim is for every Chinese citizen to be trailed by a file compiling data from public and private sources by 2020, and for those files to be searchable by fingerprints and other biometric characteristics. The State Council calls it a “credit system that covers the whole society.”…

In 2015 Ant Financial was one of eight tech companies granted approval from the People’s Bank of China to develop their own private credit scoring platforms. Zhima Credit appeared in the Alipay app shortly after that. The service tracks your behavior on the app to arrive at a score between 350 and 950, and offers perks and rewards to those with good scores. Zhima Credit’s algorithm considers not only whether you repay your bills but also what you buy, what degrees you hold, and the scores of your friends. Like Fair and Isaac decades earlier, Ant Financial executives talked publicly about how a data-driven approach would open up the financial system to people who had been locked out, like students and rural Chinese. For the more than 200 million Alipay users who have opted in to Zhima Credit, the sell is clear: Your data will magically open doors for you….

Often, data brokers are flat-out wrong. The data broker Acxiom, which provides some information about what it collects on a site called AboutTheData.com, has me pegged as a single woman with a high school education and a “likely Las Vegas gambler,” when in fact I’m married, have a master’s degree, and have never even bought a lottery ticket. But it is impossible to challenge these assessments, since we’re never told that they exist. I know more about Zhima Credit’s algorithm than I do about how US data brokers rate me. This is, as Pasquale points out in his book The Black Box Society, essentially a “one-way mirror.”…(More)”.

The nation state goes virtual

Curated on Posted on by Stefaan Verhulst

Tom Symons at Nesta’s Predictions for 2018: “As the world changes, people expect their governments and public services to do so too. When it’s easy to play computer games with someone on the other side of the world, or set up a company bank account in five minutes, there is an expectation that paying taxes, applying for services or voting should be too…..

To add to this, large political upheavals such as Brexit and the election of Donald Trump have left some people feeling alienated from their national identity. Since the the UK voted to leave the EU, demand for Irish passports has increased by 50 per cent, a sign that people feel dissatisfied by the constraints of geographically determined citizenship when they can no longer relate to their national identity.

In response, some governments see these changes as an opportunity to reconceptualise what we mean by a nation state.

The e-Residency offer

The primary actor in this disruption is Estonia, which leads the world in digital government. In 2015 they introduced an e-Residency, allowing anyone anywhere in the world to receive a government-issued digital identity. The e-Residency gives people access to digital public services and the ability to register and run online businesses from the country, in exactly the same way as someone born in Estonia. As of November 2017, over 27,000 people have applied to be Estonian e-Residents, and they have established over 4,200 companies. Estonia aims to have ten million virtual residents by 2025….

While Estonia is a sovereign nation using technology to redefine itself, there are movements taking advantage of decentralising technologies in a bid to do away with the nation state altogether. Bitnation is a blockchain-based technology which enables people to create and join virtual nations. This allows people to agree their own social contracts between one another, using smart contract technology, removing the need for governments as an administrator or mediator. Since it began in 2014, it has been offering traditional government services, such as notaries, dispute resolution, marriages and voting systems, without the need for a middleman.

As of November 2017, there are over 10,000 Bitnation citizens. …

As citizens, we may be able to educate our children in Finland, access healthcare from South Korea and run our businesses in New Zealand, all without having to leave the comfort of our homes. Governments may see this as means of financial sustainability in the longer term, generating income by selling such services to a global population instead of centralised taxation systems levied on a geographic population.

Such a model has been described as ‘nation-as-a-service’, and could mean countries offering different tiers of citizenship, with taxes based on the number of services used, or tier of citizenship chosen. This could also mean multiple citizenships, including of city-states, as well as nations….

This is the moment for governments to start taking the full implications of the digital age seriously. From electronic IDs and data management through to seamless access to services, citizens will only demand better digital services. Countries such as Azerbaijan, are already developing their own versions of the e-Residency. Large internet platforms such as Amazon are gearing up to replace entire government functions. If governments don’t grasp the nettle, they may find themselves left behind by technology and other countries which won’t wait around for them….(More)”.

The Engineers and the Political System

Curated on Posted on by Stefaan Verhulst

Aaron Timms at the Los Angeles Review of Books: “Engineers enjoy a prestige in China that connects them to political power far more directly than in the United States. ….America, by contrast, has historically been governed by lawyers. That remains true today: there are 218 lawyers in Congress and 208 former businesspeople, according to the Congressional Research Service, but only eight engineers. (Science is even more severely underrepresented, with just three members in the House.) It’s unlikely that that balance will tilt meaningfully in favor of STEM-ers in the near term. But in another sense, the growing cultural capital of the engineers will inevitably translate to political power, whatever its form.

The engineering profession today is broad, much broader than it was in 1921 when Thorstein Veblen published The Engineers and the Price System, his classic pamphlet on industrial sabotage and government by technocrats. Engineering has outgrown the four traditional branches (chemical, civil, electrical, mechanical) to include all the professions in which the laws of mathematics and science are applied to real-world problems…..In a way that was never the case for previous generations, engineering today is politics, and politics engineering. Power is coming for the engineers, but are the engineers ready for power?

…tech smarts do not port easily to politics. However violently Silicon Valley pushes the story that it’s here to fix things for all of us, building an algorithm and coming up with intelligent ways to improve society are not the same thing. The triumph of the engineers is that they’ve managed to convince so many people otherwise.

This victory is more than simply economic or mechanical; engineering has also come to permeate the language of politics itself. Zuckerberg’s doe-eyed both-sidesism is the latest expression of the idea, nourished through the Clinton years and the height of the evidence-based policy movement, that facts offer the surest solution to knotty political problems. This is, we already know, a temple built on sand, ignoring as it does the intractably political nature of politics; hence the failure of “figures” and “facts” and “evidence” to do anything to shift positions on gun reform or voter fraud. But it’s a temple with enduring bipartisan appeal, and the engineers have come along at the right moment to give it a fresh lick of paint. If thinking like an engineer is the new way to do business, engineerialism, in politics, is the new centrism — rule by experts remarketed for the innovation age. It might be generations before a Veblenian technocrat calls the White House home, but no presidency can match the power engineers already have — a power to define progress, a power without check….(More)”.

The Illusion of Freedom in the Digital Age

Curated on Posted on by Stefaan Verhulst

Mark Leonard at Project Syndicate: “Over the last few weeks, media around the world have been saturated with stories about how technology is destroying politics. In autocracies like China, the fear is of ultra-empowered Big Brother states, like that in George Orwell’s 1984. In democracies like the United States, the concern is that tech companies will continue to exacerbate political and social polarization by facilitating the spread of disinformation and creating ideological “filter bubbles,” leading to something resembling Aldous Huxley’s Brave New World….

Big tech companies, worth more than some countries’ GDP, seek to maximize profits, not social welfare. Yet, at a time when attention is supplanting money as the most valuable commodity, the impact of their decisions is far-reaching. James Williams, a Google engineer turned academic, argues that the digital age has unleashed fierce competition for our attention, and few have benefited more than Trump, who is for the Internet what Ronald Reagan was for television….

In the digital age, the biggest danger is not that technology will put free and autocratic societies increasingly at odds with one another. It is that the worst fears of both Orwell and Huxley will become manifest in both types of system, creating a different kind of dystopia. With many of their deepest desires being met, citizens will have the illusion of freedom and empowerment. In reality, their lives, the information they consume, and the choices they make will be determined by algorithms and platforms controlled by unaccountable corporate or government elites….(More)”.

Smart city initiatives in Africa

Curated on Posted on by Stefaan Verhulst

Eyerusalem Siba and Mariama Sow at Brookings: “…African countries are presently in the early stages of their urbanization process. Though Africa was the least urbanized region in the world in 2015—only 40 percent of sub-Saharan Africa’s population lived in cities—it is now the second-fastest urbanizing region in the world (behind Asia). Population experts predict that by 2020, Africa will be on top. Given this rapid growth, now is the time for African policymakers to incorporate smart cities into their urbanization strategies….

Rwanda is one of the pioneers of smart city engineering in Africa. Modernizing Kigali is part of a wider effort by the Rwanda government to increase and simplify access to public services. The Irembo platform launched by the government, seeks to create e-government services to allow citizens to complete public processes online, such as registering for driving exams and requesting birth certificates.

In addition, the country is active in involving the private sector in its goal towards creating smart cities. In mid-May, the Rwandan government launched a partnership with Nokia and SRG in order to deploy smart city technology to “improve the lifestyle and social sustainability of [Rwandan] citizens.” The project involves investment in network connectivity and sensor deployment to improve public safety, waste management, utility management, and health care, among other functions.

Rwanda’s smart city rollout has not been perfect, though, proving that smart city development can hit some snags: For example, in 2016, the city started rolling out buses with free Wi-Fi and cashless payment service, but the buses have had connectivity issues related to the Korea-built technology’s inability to adapt to local conditions.

In addition, there has been criticism around the lack of inclusivity of certain smart cities projects. Kigali’s Smart Neighborhood project, Vision City, creates a tech-enabled neighborhood with solar powered street lamps and free Wi-Fi in the town square. Critics, though, state that the project ignored the socioeconomic realities of a city where 80 percent of its population lives in slums with monthly earnings below $240 (Vision City Homes cost $160,000). (Rwandan planners have responded stating that affordable housing will be built in the later phases of the project.)

POLICY RECOMMENDATIONS

As seen in the case of Rwanda, smart cities—while creating opportunities for innovation and better livelihoods—face challenges during and after their development. City planners and policymakers must keep the big picture in mind when promoting smart cities, emphasizing well-implemented infrastructure and citizen needs. Technology for technology’s sake will not create solutions to some of Africa’s cities biggest challenges, including high-cost, low-quality, and inaccessible services. Indeed, in a 2015 issue paper, UN-Habitat urges city planners to avoid viewing smart cities as the final product. In particular, UN-Habitat calls for smart cities to minimize transport needs, reduce service delivery costs, and maximize land use. These moves, among others, will ensure that the city reduces congestion, creates spaces dedicated to recreational uses, enhances service delivery, and, thus, improves its citizen’s quality of life…(More)”.

Does protest really work in cosy democracies?

Curated on Posted on by Stefaan Verhulst

Steve Crawshaw at LSE Impact Blog: “…If it is possible for peaceful crowds to force the collapse of the Berlin Wall or to unseat a Mubarak, how easy it should it be for protesters to persuade a democratically elected leader to retreat from “mere” bad policy? In truth, not easy at all. Two million marched in the UK against the Iraq War in 2003 – and it made not a blind bit of difference with Tony Blair’s determination to proceed with a war that the UN Secretary-General described as illegal. Blair was re-elected, two years later.

After the inauguration of Donald Trump in January 2017, millions took part in the series of Women’s Marches in the United States and around the world. It seemed – it was – a powerful defining moment. And yet, at least in the short-term, those remarkable protests were water off the presidential duck’s back. His response was mockery. In some respects, Trump could afford to mock. A man who has received 63 million votes is in a stronger position than the unelected leader who has to threaten or use violence to stay in power.

And yet.

One thing that protest in an authoritarian and a democratic context have in common is that the impact of protest – including delayed impact – remains uncertain, both for those who protest and those who are protested against.

Vaclav Havel argued that it was worth “living in truth” – speaking truth to power – even without any certainty of outcome. “Those that say individuals are not capable of changing anything are only looking for excuses.” In that context, what is perhaps most unacceptable is to mock those who take risks, and seek change. Lord Charles Powell, former adviser to Margaret Thatcher, for example explained to the umbrella protesters in Hong Kong in 2013 that they were foolish and naive. They should, he told them, learn to live with the “small black cloud” of anti-democratic pressures from Beijing. The protesters failed to heed Powell’s complacent message. In the words of Joshua Wong, on his way back to jail earlier in 2017: “You can lock up our bodies, but not our minds.”

Scepticism and failure are linked, as the Egyptian activist Asmaa Mahfouz made clear in a powerful video which helped trigger the uprising in 2011. The 26-year-old declared: ‘”Whoever says it is not worth it because there will only be a handful or people, I want to tell him, “You are the reason for this.” Sitting at home and just watching us on the news or Facebook leads to our humiliation.’ The video went viral. Millions went out. The rest was history.

Even in a democracy, that same it-can’t-be-done logic sucks us in more often, perhaps, than we realize….(More)”.

China harnesses big data to buttress the power of the state

Curated on Posted on by Stefaan Verhulst

James Kynge in the Financial Times: “…Over the period of “reform and opening” since the late 1970s, China has generally sought to “bide its time and hide its strength”. But no longer. At the congress, Xi Jinping, the president, presented “socialism with Chinese characteristics” as a “a new choice” for developing nations to follow. But what lends heft to this globalist intent are technological advances that are already invigorating the Chinese economy and may also help to address some of the historic failings of the country’s polity.

The data revolution is fusing with China’s party-state to create a potential “techno-tatorship”; a hybrid strain in which rigid political control can coexist with ample free-market flexibility….

First of all, he said, the big ecommerce companies, such as Alibaba, Tencent and JD.com, are obliged to share their data with central authorities such as the People’s Bank of China (PBoC), the central bank. Then the PBoC shares the data with about 50 state-owned banks, creating a database that covers about 400m people, detailing their payment history, creditworthiness and even networks of social contacts, the official said.

“We have already seen that the number of bad debts being built up by households has come down sharply since we launched this system,” said the official. “People really care about their credit scores because those with bad scores have reduced access to financial services.”…
To be sure, data-centric approaches to governance can have shortcomings. The data can be ignored or manipulated by humans, or privileged institutions can lobby for special treatment using old fashioned political leverage. But some Chinese see a big opportunity. Economists Wang Binbin and Li Xiaoyan argue in a paper that the marriage of big data and central planning creates a potent new hybrid….(More)”.

Growing government innovation labs: an insider’s guide

Curated on Posted on by Stefaan Verhulst

Report by UNDP and Futurgov: “Effective and inspirational labs exist in many highly developed countries. In Western Europe, MindLab (Denmark) and The Behavioural Insights Team (UK) push their governments to re-imagine public services. In Asia, the Innovation Bureau in Seoul, South Korea, co-designs better services with citizens.

However, this guide is aimed towards those working in the development context. The authors believe their collective experience of running labs in Eurasia, Asia and the Middle East is directly transferrable to other regions who face similar challenges, for example, moving from poverty to inequality, or from a recent history of democratisation towards more open government.

This report does not offer a “how-to” of innovation techniques — there are plenty of guides out there. Instead, we give the real story of how government innovation labs develop in regions like ours: organic and people-driven, often operating under the radar until safe to emerge. We share a truthful  examination of the twists and turns of seeding, starting up and scaling labs, covering the challenges we faced and our failures, as much as our successes. …(More)”.

Information Governance in Japan: Towards a Comparative Paradigm

Curated on Posted on by Stefaan Verhulst

Book by Kenji E. Kushida; Yuko Kasuya and Eiji Kawabata: “The history of human civilization has been about managing information, from hunting and gathering through contemporary times. In modern societies, information flows are central to how individuals and societies interact with governments, economies, and other countries. Despite this centrality of information, information governance—how information flows are managed—has not been a central concern of scholarship. We argue that it should be, especially now that digitization has dramatically altered the amount of information generated, how it can be transmitted, and how it can be used.

This book examines various aspects of information governance in Japan, utilizing comparative and historical perspectives. The aim is threefold: 1) to explore Japan’s society, politics, and economy through a critical but hitherto under-examined vantage that we believe cuts to the core of what modern societies are built with—information; 2) articulate a set of components which can be used to analyze other countries from the vantage of information governance; and 3) provide frameworks of reference to analyze each component.

This book is the product of a multidisciplinary, multinational collaboration between scholars based in the US and Japan. Each are experts in their own fields (economics, political science, information science, law, library science), and were brought together in two workshops to develop, explore, and analyze the conception and various of facets of information governance. This book is frontier research by proposing and taking this conception of information governance as a framework of analysis.

The introduction sets up the analysis by providing background and a framework for understanding the conception of information governance. Part I focuses on the management of government-held information. Part II examines information central to economic activity. Part III explores information flows crucial to politics and social life….(More)”.

The Death of Public Knowledge? How Free Markets Destroy the General Intellect

Curated on Posted on by Stefaan Verhulst

Book edited by Aeron Davis: “...argues for the value and importance of shared, publicly accessible knowledge, and suggests that the erosion of its most visible forms, including public service broadcasting, education, and the network of public libraries, has worrying outcomes for democracy.

With contributions from both activists and academics, this collection of short, sharp essays focuses on different aspects of public knowledge, from libraries and education to news media and public policy. Together, the contributors record the stresses and strains placed upon public knowledge by funding cuts and austerity, the new digital economy, quantification and target-setting, neoliberal politics, and inequality. These pressures, the authors contend, not only hinder democracies, but also undermine markets, economies, and social institutions and spaces everywhere.

Covering areas of international public concern, these polemical, accessible texts include reflections on the fate of schools and education, the takeover of public institutions by private interests, and the corruption of news and information in the financial sector. They cover the compromised Greek media during recent EU negotiations, the role played by media and political elites in the Irish property bubble, the compromising of government policy by corporate interests in the United States and Korea, and the squeeze on public service media in the United Kingdom, New Zealand, and the United States.

Individually and collectively, these pieces spell out the importance of maintaining public, shared knowledge in all its forms, and offer a rallying cry for doing so, asserting the need for strong public, financial, and regulatory support….(More)”