With Creditworthy, Josh Lauer has written a landmark book which will surely prove a must-read for historians, sociologists and economists interested in the history of credit in the United States. First of all, the book offers a long run perspective on a largely overlooked object, that of credit reporting in the United States and its main actor, the credit bureau. Apart from the many important contributions of the book, which we will come back to extensively, Creditworthy’s first major input is hence to provide a clear history of the credit reporting business from the 1840s until today. It weaves with impressive care a very detailed history of this line of trade, mostly from the perspective of credit professionals and professional associations. Lauer tracks the countless mergers, buyouts, changes of name and various organizational upheavals which led to the domination of today’s market by three major bureaus: Equifax, Experian, and TransUnion, all of which already existed in some form by the mid-1890s.

The first clients of mercantile agencies, from the 1840s until the end of the 19th century, were mostly wholesalers, merchants, banks or insurance companies, who would resort to “character” reports in order to check the quality of their potential borrowers (retailers, small companies, etc.) before granting them access to commercial credit. As the author explains, these early reports were justified on the basis that economic position (mostly occupation and revenue) was not a good predictor of debt repayment: nothing guaranteed that a rich borrower with a stable salary would honour his debts, and merchants needed a better tool to evaluate the risk associated with one’s character. From Lewis Tappan’s first Mercantile Agency founded in 1841 to the merger of R. G. Dun’s and Bradstreet’s companies, the two leading commercial credit reporting firms in 1933, Lauer details a complex story of centralization and commodification of information which profoundly modified trade and credit practices, as well as introduced what the author argues to be the first “elaborate system of mass surveillance” [34] in the country. As for consumer credit reporting, it fully developed only during the first two decades of the 20th century: only then did a national infrastructure of retail credit information emerge, which systematically compiled and shared information about American consumers on a large scale; Lauer estimates that, by 1940, credit bureaus detained information on about 70% of adult US citizens [7].

The book is based on extensive and documented research. It is clearly and precisely written, and it draws major conclusions which will be of interest to a wide array of sociologists: it will appeal to those whose work focuses on the history of credit but also, more broadly, to economic sociologists interested in commodification processes, science and technology specialists as well as theorists of the nation-state.

First of all, Lauer offers a remarkable account of the evolution of information and communication technologies as well as its effect on market activities. The lengthy descriptions of techniques of credit reporting not only help to shed light on the black box of reports and the origins of statistical automation; they also vividly expose how certain evolutions affected the organizational practices of credit reporting agencies and their employees as well as the U.S. economy on a broader scale. For instance, the book explores at length how computerization and the introduction of certain statistical models in the 1960s, especially techniques known as discriminant analysis, contributed to client categorizations and different forms of market segmentation. These models of risk prediction looked for significant correlations between personal characteristics (like race, gender or marital status) and economic variables in order to judge the quality of one’s application. As such, reporting agencies came to be accused, in the early 1970s, of discriminatory practices–allegations that credit professionals rejected on the basis that they would not stand as “scapegoats for other social ills” [240]. This tension between models (or underlying algorithms) as being both reflections of structural inequalities, and devices influencing day to day market exchanges with potential self-realizing effects, is still of prime interest today as these technologies have spread far and wide out of the credit world.

Then, this work brings a specific and strong contribution to the history of credit in the United States. As much of the literature on the subject has focused either on the embeddedness of credit relationships and transactions or on the broad cultural and moral evolution they reflect, Lauer convincingly demonstrates how the history of consumer credit, through credit reporting, matters more generally for understanding contemporary digital capitalism. Not only does the book analyse the circulation of ideas and techniques between consumer credit and other risk managing industries such as insurance, banking or home mortgages, credit bureaus and other reporting firms were among the first to gather and market huge quantities of information (what would today be considered as “big” data) on American consumers. Indeed, these agencies did more then write credit reports intended to screen potential borrowers; they produced a wide array of analyses, ranging from tenant or insurance to personnel reports intended for prospective employers, or more general “character reports” available for different creditors such as credit-card issuing companies or, more importantly, the federal administration. This happened long before credit scores became the linchpin of risk assessment, which in turn shows that the interconnection of economic and personal information, at the forefront of modern digital capitalism, has been at the root of the credit economy since the early 20th century. Future research will therefore have to consider that credit agencies were pioneers in compiling and commodifying personal information on such a large scale.

Finally, this work will be of interest both to economic sociologists studying processes of commodification and market regulation, and to scholars interested in the political history of the nation-state. Indeed, the book chronicles the birth of new commodities—first credit information and then personal data—and the attempts to regulate their circulation, from the early lawsuits accusing bureaus of espionage to the congressional hearings which led to the Equal Credit Opportunity Act of 1974. It argues that some federal administrations, among which the FBI and the IRS, frequently resorted to credit bureaus and their reports to collect information on American citizens as early as 1937 [179], hence challenging the primacy of the nation-state in the advent of modern surveillance: according to Lauer, “it was not the welfare or protection of the state that spawned the first mass surveillance systems in the United States; it was the security of capitalism”. From an economic sociology point of view, it also reveals how the Federal Housing Administration (and the Veteran Administration) used this corporate-produced information to screen applications, hence highlighting the underestimated role credit bureaus played in government sponsored loan programs which were the backbone of the mortgage market until the 2008 “subprime” crisis.

Turning to some criticisms, we will first concede that, on an empirical level, our major regret was the lack of first hand data on credit bureaus and their activities, especially in the first two chapters which are entirely devoted to the history of these companies during the second half of the 19th century. One of the most compelling arguments of the book, made mostly through the first two chapters, states that credit reporting firms created a “concept of financial identity”. However, the analysis is mostly based on newspaper articles, professional magazines and manuals, and other scholarly works. Only three credit reports are explicitly quoted throughout the chapters, as examples of these early textual practices: this lack of primary sources is surely due to major privacy issues associated with the sensitive data contained in credit ledgers, yet a more systematic or quantitative treatment of credit reports might have helped the reader obtain a grasp of the author’s intention regarding the notion of “financial identity”. What is precisely the “identity” that these companies stored in their famous ledgers, what information was considered relevant in its production and how can it be separated from other “identities” defining American consumers at the time, for instance in insurance reports, national or municipal census, judicial records or private retailers’ account books? Moreover, reports were not purely financial; they constantly intertwined personal information with economic variables, so how does this “identity” precisely qualify as “financial”? Put differently, what is the theoretical input of this concept as opposed to considering these reports as textual statements judging the “character” of a potential borrower and stored within company books? These were indeed truly innovative business practices which profoundly changed the American economy and affected the lives of economic actors, especially considering the scale at which they were recorded, yet it remains unclear what to make of the concept, especially considering how “identity” has been at the forefront of many contemporary debates in both history and sociology. The author tells a complex story of (partial) disembeddedness of credit evaluation, which complements the work of Poon^{Footnote 1} for the pre-WWII era, but it could have been made more pertinent through a more extensive analysis of reports and the information they contained.

However, our main uneasiness came from the use and description of “surveillance,” a notion very frequently used and preceded by various adjectives (“credit surveillance” but also “disciplinary,” “mass,” “capitalist,” “consumer,” etc.) and yet which seems to lack a precise definition at any point in the book. This raises a number of empirical and theoretical issues which need to be addressed, mainly because they might suggest some ways in which this seminal work may open future research.

On a theoretical level, the notion of “surveillance” classically dwells on the work of Michel Foucault (and on one occasion Antonio Gramsci), yet along the text it mostly seems to fit a narrative in which the massive spread of credit reports and corporate scrutiny produced disciplinary effects as such: “credit surveillance” is often employed as a grammatical subject, producing “self-governance,” continually monitoring consumers, and hence it functions as a rather impersonal force. The reader is often left wondering who, in this “system of surveillance,” is actually making decisions, or if this “disciplinary power of the surveillance apparatus” [24] is chiefly an indirect effect of profit seeking companies which compiled and sold consumer information at a national level. As this history is told mostly from the point of view of credit men and women, it does seem farfetched to infer from these professional magazines or discourses the various ways in which American consumers might have reacted to these changes, or potentially modified their behaviours and opinions towards more “self-government”.

More generally, there seems to be a common trend to routinely apply the notion of governmentality to credit relationships and the obligations they produce, without any clear empirical evidence on the practical interactions between creditors and debtors or the power games they create: this was the overarching argument already set forth by Marron^{Footnote 2}, a book which Lauer extensively quotes. This is not to say that the credit machinery is without effect on economic behaviors, but it remains an open empirical question requiring a precise study of devices and debtors’ potential reactions. How does the collection of personal data actually affect market or intimate choices? Do all consumers rationally understand the behaviours they need to adopt in order to improve their credit information and which strategies are developed to circumvent the rules, be they judicial or statistical? Finally, is it possible to identify which social variables drive reactions to these debt-repayment injunctions? Contemporary literature on lower class credit has begun to look into these questions, notably through the work of Deville in the United Kingdom and Lacan in France^{Footnote 3}, and this research tends to emphasize much more agency on the part of consumers than what this Foucaldian reading of credit obligations seems to suggest. Overall, the empirical elements set forth seem less to describe “surveillance” devices and their effects on consumers than the way the industry justified the legitimacy of the credit reporting business within and outside the profession. Finally, the emphasis on the history of communication technologies in order to describe the evolution of post-war credit reporting and the “computerized surveillance” it produced (in chapters 6 through 8) sometimes edges the argument on a form of technological determinism: the author is aware of this limit, stating that it was “not the work of an invisible technological hand” but a “human decision” [210] that produced this “surveillance apparatus,” yet the various actors are not visible enough throughout the archival material gathered to convincingly escape this criticism.

Consequently, the notion of “surveillance” is never precisely historicized, especially regarding the 19th century: at some point “mass surveillance” seems to be a trait of the late 20th century economy, yet at others it seems that such a system was already there or burgeoning as early as the mid-19th century. The author convincingly argues that “surveillance” is not a new phenomenon [9] yet the book fails to explain how the formalization and later automation of credit evaluation practically affected the type of “surveillance” described. First, the author rightly points out that whether or not African Americans were excluded from the white credit system remains an open empirical question [141], and yet this restriction of reports to the “world of white Americans and European immigrants” seems to challenge the notion of “mass surveillance” almost by definition. This resonates with contemporary debates about fringe creditors, which specifically do not resort to credit scores or reports: the author mentions these creditors [57] but it is unclear about how they fit in the overall “surveillance” narrative.

Second, considering that bureaus were in fact relying on local hearsay or on reports made by local attorneys during the second half of the 19th century, how are these credit reporting practices breaking with informal evaluations already carried out locally by wholesalers throughout the country? More specifically, how did these new instruments recompose the power structure between creditors and debtors at the local level? Could creditors threaten defaulting customers with calling the local bureau and ruining their reputation among other credit merchants, hence leveraging this new information infrastructure? Did resorting to credit reporting effectively produce compliance through, for instance, a diminution of court proceedings for unpaid debt? The author argues that a “crisis of trust” [54] gave rise to modern reporting practices which replaced early 19th century “direct interaction and local opinion,” but several works [among which that of Guinnane 2005] have highly criticized the notion of “trust” as a relevant concept to describe pre-modern economic exchanges: credit relationships were commonly rooted in strict judicial procedures [as Finn 1994 has demonstrated, among others, for a similar period], and the separation between formal and informal credit often proves difficult to characterize^{Footnote 4}. Moreover, the history on credit has established that these relationships have long produced obligations and social control at the local level^{Footnote 5}. It would be interesting to analyse how these evolutions of risk management techniques affected the local debt economy, hence giving more substance to the relatively abstract notion of “credit surveillance”.

Rather than these unclear “disciplinary effects,” the book identifies a much more direct influence of credit reporting on market stratification, which according to us could have been underlined more strongly as a core conclusion of the work. One major effect of credit reporting technologies, especially as soon as they operated through statistical modelling, is to produce risk categories through which consumers can be clustered and ranked. These practices evolved from early moral classifications to a continuous hierarchy spectrum, in the form of contemporary three-digit credit scores. Yet, even today, major credit bureaus such as Experian still offer customer classification services, which include categories such as “American royalty,” “Kids and Cabernet,” or at the opposite end “Urban survivors” and “Tough Times” [274]. As Lauer explains, once these classifications were sold to banks, mail-order businesses or credit-card and insurance companies, and this happened as early as the late 1880s, these categories became the basis of target marketing: in short, higher risks would be offered higher interest rates whereas lower risks would obtain access to better credit terms and specific services such as private sales along with attractive prices [151-152]. Higher income brackets could then easily be appealed to by mainstream lenders, such as department stores or banks offering attractive mortgage rates, whereas those “at the razor’s edge of profitability” later became the target of “subprime” lending services [210]. The early connection made between customer sorting and product or service placement suggests very direct effects of credit reporting on social stratification in the long run. These discriminatory (including in the econometric sense of the word) practices might indeed produce snowballing effects on market exclusion, economic inequalities and future credit evaluation. Rather then evaluating the moral character of potential customers or objectifying risk and repayment capacities on a scientific basis, these rankings lean on social characteristics (such as race, gender, economic position or geographic location) as risk predictors, hence constantly determining the “life-chances”^{Footnote 6} of American citizens, a process whose origins are distinctly exposed in Creditworthy.