What A.I. regulation might look like
The fireworks that usually pop when technology executives testify before Congress were noticeably absent from yesterday’s Senate hearing on artificial intelligence. Instead, lawmakers questioned Sam Altman, the C.E.O. of OpenAI, for three hours in what appeared to be a genuine effort to understand the growing importance, and the dangers, of artificial intelligence.
The central question in the discussion was how Washington should regulate A.I. — and, perhaps surprisingly, Altman and lawmakers from both parties agreed on more than they disagreed. (Another unexpected nugget: Altman says he has no equity in the sensationally growing A.I. firm, stunning Senator John Kennedy, Republican of Louisiana.)
The biggest surprise: consensus on creating a new A.I. agency. Altman proposed creating a new government body that issues licenses for developing large-scale A.I. models, safety regulations and tests that A.I. models must pass before being released to the public.
Even some Republicans, who usually eschew expanding the federal government, appeared on board. Senator Lindsey Graham of South Carolina likened A.I. to a nuclear reactor that needs an operating license and regular testing. When Christina Montgomery, IBM’s chief privacy and trust officer and another witness, suggested that a new agency wasn’t needed, Graham pushed back: “I don’t understand how you could say that we don’t need an agency to deal with the most transformative technology, maybe ever,” he said.
Witnesses and lawmakers said other limits were needed. Altman and Montgomery said that users should have the option to exclude their data from being used to train A.I. services. Meanwhile, Senator Marsha Blackburn, Republican of Tennessee, raised concerns about who owns the computer-generated material that A.I. models create after having been trained on copyrighted data.
And Montgomery added that consumers should be made aware every time they’re engaging with a chatbot. “No person anywhere should be tricked into interacting with an A.I. system,” she said.
Lawmakers were eager to avoid repeating past mistakes, including what they said was a failure to rein in tech giants like Facebook. “Congress failed to meet the moment on social media,” said Senator Richard Blumenthal, Democrat of Connecticut and the chairman of the Senate panel that hosted the hearing.
But skeptics worry that Washington may again miss important nuances in crafting new regulations. Sarah Myers West of the AI Now Institute, a policy research center, told The Times that Altman’s proposals didn’t address how the tech was used in policing — or put any speed limits on how fast Silicon Valley developed new products.
The latter may be a tough sell for some lawmakers: Senator Chris Coons, Democrat of Delaware, said that China was working on products that “reinforce the core values of the Chinese Communist Party and the Chinese system,” and suggested that American industry should serve as a counterweight to that.
It’s unclear whether Altman’s collaborative approach will spare the A.I. industry from a Washington clampdown. Consider that some cryptocurrency executives have also called on Congress and regulatory agencies to create and clarify rules for their companies, only to see the S.E.C. take a hard-line approach.
The work in Congress continues. A less-prominent hearing in the Senate yesterday weighed how government agencies should use A.I., while a House Judiciary subcommittee will hold a hearing today on A.I. and copyright law.
HERE’S WHAT’S HAPPENING
BlackRock will require employees to go to the office four days a week. The investment management giant’s new policy, up from three days a week, comes as many Wall Street firms push to return to prepandemic working patterns. But the hybrid model still appears to be going strong as offices remain half-empty.
U.S. prosecutors accuse a former Apple worker of stealing trade secrets. An indictment accused Weibao Wang of taking thousands of documents — including those related to the tech giant’s work on autonomous vehicles — while also working for the U.S.-based subsidiary of a rival headquartered in China. It’s one of the first prosecutions by a task force focused on protecting critical U.S. technologies.
Florida’s government is set to court Wall Street firms. Lawmakers yesterday presented a bill to Gov. Ron DeSantis that allows the Florida State Board of Administration, which he helps oversee, to move an additional $18 billion in state pension money into alternative investments like hedge funds and private equity. That may raise the question of whether DeSantis could receive campaign contributions from financial executives.
E.U. member states approve the world’s most expansive crypto regulations to date. The rules will require companies involved in issuing, trading or managing crypto assets in the 27-nation bloc to obtain a license as early as 2024. From 2026, the names of senders and beneficiaries must be disclosed in crypto transactions. The move may put pressure on other countries, including the United States, to adopt similar rules to regulate the industry.
Progress on the debt ceiling? Doubts persist.
Markets looked volatile this morning as warnings over the debt ceiling impasse in Washington weigh on investors.
To practically nobody’s surprise, negotiators failed to clinch a deal yesterday. Speaker Kevin McCarthy suggested that an agreement could still be reached “by the end of the week,” but Senator Chuck Schumer, the majority leader, said bipartisan support would be needed. Even so, both sides agreed that a U.S. default was out of the question.
Businesses are increasingly worried. More than 140 leaders of big companies, including Goldman Sachs and Pfizer, wrote an open letter to Congress warning of the “disastrous consequences” of a default.
Meanwhile, some Senate Democrats are questioning whether McCarthy can unite his caucus to get a deal done. They’re worried that House Republicans won’t bend on their demand for significant spending cuts to address the country’s $31.4 trillion in debt.
The debt ceiling standoff is a far bigger threat to the economy than the debt, argues Stephanie Kelton, an economics professor at Stony Brook University. The debate over the debt limit, she told DealBook, is “scarier” than it has been in the past, though she’s still hopeful an agreement will be reached.
The U.S. debt is fundamentally not a problem, Kelton argues. That contention is rooted in her embrace of Modern Monetary Theory, which essentially argues that a government’s debts aren’t a concern if it can print its own currency. In other words, the United States should spend big on social programs, because it can easily pay off its own debts and never go broke. (The idea has been hotly contested.)
It is a message that has won the support of progressive lawmakers like Senator Bernie Sanders, independent of Vermont, and Representative Alexandria Ocasio-Cortez, Democrat of New York. That may make an adherence to M.M.T. a political factor in the debt ceiling fight: Lawmakers like Ocasio-Cortez warned President Biden not to agree to Republican demands to cut government spending and that doing so could risk a backlash from his left flank.
“We asked Epstein for advice. The simplest way seemed to be to transfer funds from one account in my name to another, by way of his office.”
— Noam Chomsky, the M.I.T. professor. When asked by The Wall Street Journal about why he received roughly $270,000 from an account linked to Jeffrey Epstein, Chomsky said the money was part of an effort to rearrange his finances and didn’t involve “one penny” from the convicted sex offender.
Elon Musk doubles down on speaking his mind
Elon Musk sat down yesterday for a lengthy interview with CNBC after Tesla’s annual shareholder meeting, ostensibly to discuss the business of electric cars.
Instead the billionaire insisted on often contentious opinions about a wide range of topics — and refused to back down.
Musk defended his tweets, even if they cost him money. In recent days, the tech mogul has taken criticism for likening George Soros to Magneto, the sometime “X-Men” villain, and for weighing in on whether the man accused of being behind a mass shooting at a Dallas-area mall supported Nazi ideology.
“I’ll say what I want, and if the consequence of that is losing money, so be it,” Musk said.
That approach could make life difficult for Twitter’s incoming chief. Linda Yaccarino was hired to help restore the social network’s embattled ad business after it was hit by both a slump in digital advertising and advertisers’ wariness of layoffs and content moderation changes wrought by Musk.
Other highlights from the interview:
The billionaire again derided remote work, calling it “morally wrong” and accusing higher-paid knowledge workers — the “laptop classes,” in his words — of pushing for it while frontline workers must still show up in person.
Musk said Twitter’s finances were grim from Day 1, asserting that the company had just $1 billion in the bank when he took it over last fall and was burning $3 billion a year.
Tesla faces a difficult next 12 months, with challenges including high interest rates and consumers reducing spending. But he praised the company’s forthcoming Cybertruck.
Musk also shared his concern that the Fed would move too slowly on cutting interest rates; questioned whether there was some fraud in the 2020 election, though conceded it hadn’t been stolen; and said he was no longer friends with the Google co-founder Larry Page because of disagreements about the dangers of artificial intelligence.
The Times has launched a new iOS app for audio journalism that features our podcasts, stories from our journalists, columnists and critics on business, politics, tech and more. Now available for Times news subscribers, the app can be downloaded here.
THE SPEED READ
The F.T.C. sued to block Amgen’s $27.8 billion takeover of Horizon Therapeutics, in its latest effort to clamp down on deal making. (NYT)
Jamie Dimon of JPMorgan Chase said it was “unlikely” that his bank would buy another struggling lender, after acquiring First Republic. (CNBC)
UBS expects to shoulder as much as $4 billion in legal liabilities from its fire sale takeover of Credit Suisse, but could see around a $35 billion accounting gain from the deal. (Bloomberg)
President Biden vetoed legislation that would have reinstated tariffs on solar panels from Chinese companies in Southeast Asia that had been imported into the United States in violation of trade rules. (NYT)
“The I.R.S. is building its own online tax filing system. Tax-prep companies aren’t happy.” (NPR)
Best of the rest
Counting the cost of pandemic dogs — starting with the goldendoodle’s monthly $250 wash, blow-dry and nail trim. (WSJ)
The N.B.A.’s San Antonio Spurs won the rights to the No. 1 selection in next month’s draft, widely presumed to be Victor Wembanyama, a 19-year-old French star. (NYT)
Michael Lewis talks about his forthcoming book, a profile of Sam Bankman-Fried, and how he felt when the fallen crypto mogul was arrested. (NYT)
We’d like your feedback! Please email thoughts and suggestions to [email protected].
Source: Read Full Article