For example, credit card points are a zero sum game. Credit scores are not. Everyone could be creditworthy, but many are not, and it’s highly beneficial to the entire system to be able to identify which group a person fits into (including for the person who isn’t creditworthy!)
My mind isn't made on credit scores, though I do feel it might be a case similar to insurance - it's not strictly a zero-sum game, but it's also socially harmful to have such a system be 100% efficient. I.e. with insurance, if everyone was correctly pooled into small bucket that near-perfectly reflects their actual risk profile, insurance would stop making sense - those who need it most wouldn't be able to afford it, and those who could afford it need it the least and would be better off putting that money into savings accounts.
There's a lot of areas in the economy where increasing efficiency past some point just makes systems inhumane and exacerbates social problems.
I feel default risk estimation may just be like that - the more reliable you want your credit score, the more invasive you need to be wrt. what information you collect and how you do it; meanwhile, the system becomes less and less tolerant of mistakes and unfortunate circumstances, while also exerting more control over how people live their lives.
Already the US credit score makes people obsessed about credit, and getting credit cards and loans to improve/game their credit scores with their future mortgage in mind. That very much affects people's life choices at scale. I don't think having everyone leading their lives to optimize their credit score is a way to have a healthy society; conversely, maybe letting the lenders eat a little more risk, and the wealthiest (and most responsible with money, and most morally superior) have a little smaller line, actually improves overall well-being.
I agree with your concerns but don't feel like we're at that tipping point to be honest, relative to the value of credit being generally easy to get for the legitimately creditworthy.
> Already the US credit score makes people obsessed about credit, and getting credit cards and loans to improve/game their credit scores with their future mortgage in mind
I've encountered very, very few people doing this to an inappropriate degree (obviously yes you should consistently demonstrate creditworthiness, that's not gaming though). Anecdotally, the people I see doing this are actually seriously not creditworthy. A whole lot of "you bought 3 cars and fucked your score, here's how to dig your way out." But like... the evidence actually shows you can't be trusted with credit!
I don't disagree with any of your big picture concerns about the system and the possible edge cases or distortions of priorities. I just haven't seen evidence those are huge problems relative to the value of the system.
For example, credit card points are a zero sum game. Credit scores are not. Everyone could be creditworthy, but many are not, and it’s highly beneficial to the entire system to be able to identify which group a person fits into (including for the person who isn’t creditworthy!)