View / How California’s AI safety proposal could pose more risks

Which is worse: the unintended consequences of technology — or the unintended consequences of regulation?

That’s the question raised in California’s new AI safety legislation, which is coming up for a vote this week. The bill, which mandates reporting, is a more modest step than the more punitive safety measure Gov. Gavin Newsom vetoed last year. But AI companies oppose it anyway as the first step down an onerous slippery slope. The White House, I’m told, sees it as another reason to push through a federal block on state AI regulation.

And with the housing crisis in the news, the companies are drawing a particular analogy. OpenAI warned lawmakers they could be creating the “CEQA of AI innovation.” Signed into law by then-Gov. Ronald Reagan in 1970, CEQA seemed like a simple requirement to ensure development doesn’t harm the environment. Instead, it hobbled the state’s ability to do much of anything without long, drawn-out legal battles often paid for by taxpayers.

Housing is one of the reasons anyone in tech will tell you that the industry is thriving in California largely in spite of regulations, not because of them. Now the state is trying to dig out of that hole. There’s a game of chicken happening. How far can lawmakers go before the state’s biggest source of tax revenue begins to flee? Legislators should realize that a simple law meant to avert potential catastrophic risks seems like an existential risk to those who oppose it.