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The state transformed: The crisis has turbocharged China’s intrusive state capitalism

China's outbreak has been brought under control thanks to an Orwellian system, from personal QR codes to a flourishing of new apps that facilitate lives lived in locked apartments.

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Shanghai is about 800km down the Yangtze river from the city of Wuhan, where the coronavirus outbreak began in November 2019. Yet where New York City, halfway across the world, currently has more than 13,000 reported cases, China’s economic capital has fewer than 400. The country’s one-party state, aided by its state-capitalist private sector, has brought the outbreak under control thanks to an Orwellian system of high-tech monitoring mediated by big data and deep learning. This has become a subject of horrified fascination in the West – witness the widely circulated video of a drone following an elderly lady in Hubei this February, telling her to wear a mask and go home. 

China’s leaders have also compelled every citizen to obtain a QR code, an individual health identifier, using existing mega-apps such as Alipay or WeChat. Having done so, individuals do not need to give any further information to the app in order for the code to detect their health conditions; the geo-tracking system on their phones knows it. Apps allow citizens to see where people infected with coronavirus are in real time; a biopolitical upgrade to the existing social credit system.

The crisis has seen a flourishing of new apps that facilitate lives lived in locked apartments. The Chinese government and private sector have for a while been trying to expand the use of digital healthcare apps to reduce visits to doctors, especially in poor and rural areas. But these efforts had met with resistance from patients, who still preferred to consult doctors face-to-face. Recently, however, as healthcare professionals have been swamped with the workload of the coronavirus outbreak, apps such as Alibaba’s “AliHealth” or Ping An Insurance’s “Ping An Good Doctor” have gained widespread acceptance as a sensible alternative for times of strained capacity. It is not hard to imagine a future in which the new applications provide a cheap and effective alternative to physical hospital visits. 

Online learning, often mediated by deep learning apps, has also been widely adopted to allow students to study during the quarantine. Squirrel AI, for example, a form of software used in Shanghai public schools during the shutdown, learns from each pupil’s mistakes and customises the problems it sets to match their needs. 

Chinese people have been receiving deliveries of groceries by unmanned drones sent by the website Jingdong; they have aggregated data about hospitals, factories and medical supplies on Wuhan2020, an open-source website; and they have sold each other fresh fruit and vegetables by livestreams on Pinduoduo. These powerful new players in healthcare, education and platform capitalism have been turbocharged by the crisis, and some may define the shape of the next decade of the Chinese internet. 

Horrified Western reactions miss two things about Beijing’s response to the coronavirus crisis. First, this intrusive technological eco-system is largely accepted by China’s collectivist society as the price of making life more convenient and, during the current crisis, reducing fatalities. 

Second, aspects of it might yet be adopted by Western governments. The phone-based monitoring at the heart of the Chinese system of surveillance could just as easily be created by WhatsApp, for example. So is China becoming more closed and repressive? Or is Chinese state capitalism using the crisis to pull ahead of the West in technological innovations? It might be doing both at the same time. 

Read the rest of the "The state transformed" series here

Jacob Dreyer is a commissioning editor at Palgrave Macmillan in Shanghai

This article appears in the 25 March 2020 issue of the New Statesman, The crisis chancellor