I will present my paper Measurement, Assessment and Reward: The Challenges of Building Institutionalized Social Credit and Rating Systems in China and in the West. I post here a link to the preliminary conference draft for review and comment. It can be accessed HERE. Following below is the abstract and introduction (English and 中文)
More on the conference in later posts. Index of Social Credit Posts.
Measurement, Assessment and Reward: The Challenges of Building Institutionalized Social Credit and Rating Systems in China and in the WestLarry Catá BackerABSTRACT: This short essay has two objectives. The first is to examine the challenges that social credit, ratings or assessment systems pose for effective implementation. To that end, Section II considers first the difficulties of separating the role of social credit as a set of techniques and as a means of advancing ideological principles and objectives. It then considers social credit as a project of informatics. It then examines the control element of social credit systems, and ends with a consideration of social credit as governance. To understand the shaping of law today (and soft law as well) one must understand social credit. The second is to examine some aspects of Western rating and accountability systems to consider resonances with Chinese social credit. To that end Section III considers some of the ways in which Western efforts at social credit institutions have sought to meet these challenges. It considers the context of social credit systems in the West, and its operationalization, principally in the private sphere. It examines the use of asocial credit as a technique of governance and as a means of embedding international standards in domestic behavior.
I. IntroductionYears ago, when the attention of influential thinkers was occupied elsewhere, I noted a curious development in the nature of the forms of governance and its objectives within Western liberal democracies.Surveillance has morphed from an incident of governance to the basis of governance itself. It is both government (apparatus) and governmentality (its self-conception and complicity, the prisoner becomes his own keeper). In this sense, surveillance has become the new regulatory mechanism. And law is becoming its servant. And the state, either as the traditionally conceived apex of political order, or as the repository of large aggregations of power within an international state system, now serves as a (but not the) nexus point for the regulatory power of technique. It is in this sense that we can speak of the “death” of the “state” or the “rise” of a transnational political system, or the “death” of the public/private divide or even the construction of non-public autopoietic systems. (Backer, 2008).These changes, I thought, had the potential to change significantly the relationship of the state to law, and of the character and role of law in the governing of states. Moreover, they appeared to signal a new era of management that would fuse the authority of public and private institutions in new and uncharted ways. There was a sense that the appropriate approach to the management of behavior (by states or private institutions) was increasingly centered on the ability of decision makers to deploy data within algorithms to develop finely tuned systems of reward and punishment to manage appropriate behavior, to hold individuals accountable, and to contribute to social development. That system of discretionary decision making built on data-algorithm-consequence models would have to further the command of law and the public policies of which law was an expression. But it appeared increasingly clear that rule of law was moving toward data driven systems implemented through development of compliance practices of individuals and enterprises, and overseen by administrators exercising constrained decision making authority for the public goodYet an initial consideration might have dismissed this trend as irrelevant to the development of the productive force of law and its system. The phenomenon wasn't law; it had been the object of an abstract and remote elite political philosophy since the 1970s; and it appeared most valuable for the extent to which one could pronounce this area "eccentric" than for any value where it counted--for tangible value for academics concerned about the collective intellectual movements of their field. (cf. Majone 1997). But suddenly all that appeared to change. The trigger was the action by China, which appears to have ascended to the position of principal global driving force in political theory and action, when the Chinese State Council published its 2014 Notice concerning Issuance of the Planning Outline for the Construction of a Social Credit System (2014-2020) (the “State Council 2014 Notice”). This project, a development of ratings and rewards systems, means to unify and integrate systems of monitoring, of transparency and of compliance within the traditional law-administrative regulation construct of state systems, appears to be one of the most innovative and interesting efforts of this decade.Social credit can be understood in two senses. First, Social Credit itself references the specific project of the Chinese state to create a comprehensive legal and regulatory mechanism that they have named "social credit." Second, it refers generally to a new mode of governance that is emerging in both China and the West that recombines law and governance, and the public and private spheres in new and hybrid ways that will likely transform the structures and principles on which legal, governance, and societal regulatory systems are now understood and through which they acquire their legitimacy. In both senses, the structures of social credit are similar. In each case the system seeks to rate or score or assess the object of regulation through a process that requires the acquisition of specific and relevant data, which is then interpreted through the application of an algorithm to produce an assessment or a score or a measure which can be used to assess compliance with underlying objectives. Those scores than serve to guide the application of legal or administrative decisions—they can trigger rewards or suggest punishment (Backer 2017). But the components of the standards themselves can also be used as incentives to conform. The more that the individual or institution conforms to the expectations built into the algorithm the higher the rating score and the greater the likelihood of reward. For example, a rating standard for corporate governance that is based on the creation and operation of a corporate compliance and monitoring system with certain characteristics is itself an incentive for enterprises to adopt such systems if they want to see their ratings scores increase.Social credit and rating systems evidence changes in the way in which the old divisions between government and the private sector are being transformed (Harlow 1980). The forms of governance that were once the province of private enterprises are becoming essential tools of government; the functions of government are being devolved to enterprises and other social organs, and the way that government and enterprise relate to people are transformed in turn (Backer Transnational Legal Order 2017). The triangular relationship between governmentalization (of both public and private institutional actors with managerial power), the mass of the population (which is its object and now its foundation), and the ‘statistics’ (that both define and serve to manage the mass of the population) is the essence of the problem of transparency in the twenty-first century. (Backer 2013). But it also describes the change in the way in which government understands and implements its social and political role (Murray Li, Tania. 2007). At its limit, the enterprise of social credit suggests both the emergence of a new field of law as well as the negation of the privileging of law within economic and political structures. On the one hand, one might be tempted to see in the social credit enterprise a notion of the dissolution of the constitution of law within itself; that is that the structures of legality, and its constitution, will have consumed itself. What will emerge from that self-consumption will be the methods and systems that it had once generated and which had been deployed in the service of the constitutional project—that the success of the constitutional notion will ultimately consume it so that where once there was constitution there will only be mechanics; where once there was principle, there will only be data; and where once there were norms, there will be “statistics.” This is bound up in the more fundamental idea of the end of law and the irrelevance of lawyer except as technician of a new system the lawyer no longer controls. On the other hand, the success of social credit may require and indeed may be dependent on the simultaneous development of a law for the digital and data age. That is, in the digital age, society (however constituted) is even more in need of law's nomos and narrative. That nomos and narrative may vary depending on the societal and political context, but it must nevertheless develop alongside the re-constitution of the principles, customs and manners of governance. To understand social credit, one must understand the evolving structures of the relationships, in law and politics, of the relationships between states, its masses, and the institutions through which it operates.This short essay has two objectives. The first is to examine the challenges that social credit, ratings or assessment systems pose for effective implementation. To that end, Section II considers first the difficulties of separating the role of social credit as a set of techniques and as a means of advancing ideological principles and objectives. It then considers social credit as a project of informatics. It then examines the control element of social credit systems, and ends with a consideration of social credit as governance. To understand the shaping of law today (and soft law as well) one must understand social credit. The second is to examine some aspects of Western rating and accountability systems to consider resonances with Chinese social credit. To that end Section III considers some of the ways in which Western efforts at social credit institutions have sought to meet these challenges. It considers the context of social credit systems in the West, and its operationalization, principally in the private sphere. It examines the use of asocial credit as a technique of governance and as a means of embedding international standards in domestic behavior.
__________ W. Richard and Mary Eshelman Faculty Scholar and Professor of Law and International Affairs, Pennsylvania State University; Board Member, Foundation for Law and International Affairs; Coalition for Peace & Ethics. This Conference Draft was first presented September 23, 2017 the KoGuan Law School, Shanghai Jiao Tong University, for the International Symposium on Rule of Law & Social Credit Systems, Guided by the Shanghai Reform and Development Commission, and the Shanghai Public Credit Information Service Center, and presented by Shanghai Jiao Tong University KoGuan School of Law, East China University of Political Science and Law School of Economic Law, Shanghai Law Academy Research Center for Banking Law Practice, Shanghai Jiao Tong University Research Center for Internet Law Innovation, East China University of Political Science and Law Research Center for Rule of Law, The Intellectual Property Office of Tencent Holdings Limited, and the Foundation for Law and International Affairs