Today’s China is tomorrow’s America…

That’s the controversial claim I (Chris) made in these pages back in August 2018.

I was talking about the digital surveillance state the Chinese government is creating.

It’s a mix of a Social Credit System that awards scores and doles out punishments based on how compliant you are with government rules… hundreds of millions of CCTV cameras armed with facial recognition… and even machines that can ID you by how you walk.

My point was simple…

China may be the world’s foremost mass-digital-surveillance “lab,” but the U.S. and other Western democracies aren’t far behind.

I’ve shown you how U.S. cops were using face-recognition dragnets… how U.S. airports are using your face as your boarding pass… and how hundreds of millions of Americans volunteer to be monitored and tracked online in return for free social media and search tools.

But as I’ll show you today, if you think those are scary invasions of privacy… you ain’t seen nothing yet.

First, if you’re just joining us, welcome aboard…

The Daily Cut is the premium e-letter we created for all paid-up Legacy Research readers.

It’s where you’ll find the latest moneymaking and wealth-protection ideas from Teeka Tiwari, Jeff Brown, Bill Bonner, Doug Casey, Dan Denning, Jason Bodner, Nick Giambruno, and Dave Forest.

We also pay close attention to the downhill slide of civil liberties around the world.

After all, if you don’t live in a free society… there’s not much point in being wealthy.

And the ramping-up of mass surveillance since the coronavirus pandemic made front-page news has, frankly, startled us.

The pandemic is the perfect test case for invasive surveillance measures…

People are scared of getting sick. So they’re willing to put up with governments suspending civil liberties.

In Taiwan, for instance, the feds are rolling out smartphone-based “geofences” to force infected people to self-isolate.

If you leave your home address with your smartphone… or you turn off your smartphone… the cops will be calling you or knocking on your door 15 minutes later.

Israel is using spooks in its Shin Bet internal security service to track down potential coronavirus patients through telecom data.

One police force in Britain is using drones to monitor public areas and shaming residents who go out for walks.

Meanwhile, in Italy, Germany, and Austria, telecom companies are sharing their customers’ location data with health authorities. Governments in these countries are checking whether folks are staying at home.

And as we showed you here, state, local, and federal government officials in the U.S. are tracing your location via the GPS (satellite geolocation) in your phone.

These are just the measures in place today…

The next step could be the “digital health passport” system the Chinese government has rolled out.

It’s built into an app on your smartphone. And it’s based on whether you have a clean bill of health.

To get a better handle on how it works… and what it’s like to live in this kind of system… we reached out to two contacts in China.

They teach in a school in Ningbo. It’s a city in Zhejiang province, south of Shanghai. They live on campus. And as they reported, they have to show their health passports to authorities every day.

To protect their identities, we’ll call them Mr. and Mrs. “X.” We’ll also blur any personally identifying information.

Q&A With Mr. & Mrs. “X”

Daily Cut (DC): Can you tell me about this digital passport you use over there in China?

Mr. X: It’s basically a type of barcode called a QR code…

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Mr. X’s green Ningbo Health Code (blurred to protect Mr. X’s identity)

Mr. X (cont.): It’s all done through Alipay. When you come into the country, you have to sign up for the app. You give them your passport number. And they link it to your national ID that way.

[Alipay is the largest online payment platform in the world. More than 1 billion people use it globally to send, receive, and spend money.]

We’re teachers. We’re living at our school. Every day, we have to report to the authorities in the school and send them a screenshot of that green QR code.

That health code stays green as long as we don’t have any symptoms of coronavirus. If we have symptoms, we’re supposed to report them, and it turns yellow. If those symptoms get worse, we report that again, and it goes red.

But by the stage it goes yellow, I think what happens is they come and quarantine you. Then they keep a close eye on how things progress. If you get worse, the code will go red. Then they take you to a hospital or a facility, I imagine.

DC: Do they rely on you to self-report the symptoms?

Mrs. X: Yes, they do. It’s like a city pass. If you want to go out in the city, you have to have your green card with you. And if you go into any shop or restaurant or public building, they will want to check it.

When you show your pass, they check your temperature. If they find you have a fever – 37.3 degrees Celsius [99.1 Fahrenheit] is the threshold – they report you. That turns the color of the QR code on your app to yellow.

Mr. X: At the start of each day, we have to send a screenshot to authorities in the school. If we don’t send them that screenshot every single day, they want to know why that is. And they’ll come around and knock on our door. And we need to send a screenshot to get out into the city on the weekend.

DC: One thing we’re curious about is how this app-based health passport dovetails with Alipay, which is kind of like a state version of PayPal. Is that right?

Mrs. X: It’s like PayPal on speed. Alipay is connected to your bank account.

It’s really a way of monitoring your spending… Not just your buying habits, but also where you socialize, where you visit, those sorts of things.

If you go into the Alipay app, there’s a menu. You have options for takeout restaurants, hotels, movies… So you can buy all your cinema tickets… you can top up your phone… you have your railcards… there’s a health part… And then there’s the city service… and that’s where you find the green card.

DC: That’s where you access your green QR code, is it? Inside Alipay?

Mr. X: That’s where we access pretty much everything.

When we go to the shops, we pay for everything through Alipay. When we get a DiDi – that’s the Chinese version of Uber ­– we flash our Alipay app. And the driver scans a QR code it generates on our phone. That’s different from the health codes. It’s another kind of QR code, directly linked to your bank account.

That’s the system that’s up and running already. It’s almost like a cashless society in a way. The health passport is the new layer on top of this existing system.

Until tomorrow,

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Chris Lowe
April 16, 2020
Dublin, Ireland

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