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How NOT to Regulate the Tech Industry
Hot on the heels of my comment describing the UK's effort to finally rid the IoT market of extremely basic vulnerabilities like "has a default password", Colorado jumps in like Leroy Jenkins to show us how, exactly, tech regulation shouldn't be done. SB 205 is very concerned with "algorithmic discrimination", which it defines as, "any condition in which the use of an artificial intelligence system results in an unlawful differential treatment or impact that disfavors an individual or group of individuals on the basis of their actual or perceived age, color, disability, ethnicity, genetic information, limited proficiency in the English language, national origin, race, religion, reproductive health, sex, veteran status, or other classification protected under the laws of this state or federal law."
Right off the bat, it seems to be embracing the absolute morass of "differential treatment or impact", with the latter being most concerning, given how incomprehensible the similar "disparate impact" test is in the rest of the world. This law makes all use of algorithms in decision-making subject to this utterly incomprehensible test. There are rules for developers, telling them how they must properly document all the things to show that they've apparently done whatever magic must be done to ensure that there is no such discrimination. There are rules for deployers of those algorithms, too, because the job is never done when you need to root out any risk of impacting any group of people differently (nevermind that it's likely mathematically impossible to do so).
Their definitions for what types of algorithms this law will hit are so broad that they already know they captured far too much, so they go on a spree of exempting all sorts of already-existing things that they know about, including:
If your idea for a mundane utility-generating algorithm didn't make the cut two weeks ago, sucks to be you. Worse, they say that these things aren't even exempted if they "are a substantial factor in making a consequential decision". I guess they also exempt things that "perform a narrow procedural task". What does that mean? What counts; what doesn't? Nobody's gonna know until they've taken a bunch of people to court and gotten a slew of rulings, again, akin to the mess of other disparate impact law.
Don't despair, though (/s). So long as you make a bunch of reports that are extremely technologically ill-specified, they will pinky swear that they won't go after you. Forget that they can probably just say, "We don't like the look of this one TPS report in particular," and still take you to court, many of the requirements are basically, "Tell us that you made sure that you won't discriminate against any group that we're interested in protecting." The gestalt requirement can probably be summed up by, "Make sure that you find some way to impose quotas (at least, quotas for whichever handful of groups we feel like protecting) on the ultimate output of your algorithm; otherwise, we will blow your business into oblivion."
This is the type of vague, awful, impossible regulation that is focused on writing politically correct reports and which actually kills innovation. The UK's IoT rules might have had some edge cases that still needed to be worked out, but they were by and large technically-focused on real, serious security problems that had real, practical, technical solutions. Colorado, on the other hand, well, I honestly can't come up with words to describe how violently they've screwed the pooch.
I’m not going to go full devil’s advocate, here, because this looks like a textbook case of reactionary, something-ought-to-be-done legislation. But I’d like to hone in on one particular aspect.
Even without this law, I would expect AI decision making to fail disparate impact tests due to illegibility. Good luck proving business necessity!
But that cuts both ways. Once RLHF has beaten the racial slurs out of an AI, how are you going to prove that it was going for disparate treatment, even if it’s absolutely refusing to hire/promote/train a protected class?
No, seriously, I would like to see a standard which can distinguish between disparate treatment and impact. You can get a human on the stand and ask about intent, animus, whatever. I don’t think you can expect that to work for a computer program.
AI companies should be afraid of causing disparate treatment. It’s wrong, even when it makes more money. But an unregulated market doesn’t have much reason to care about right or wrong. Until we find a better way to draw the line, disparate impact is going to remain useful.
Modern AI tools have been compared to magic oracles, we ask it a question and it synthesizes vast amounts of information to give us an answer.
What this regulation will achieve isn't restricting the AI from having a disparate impact, it is restricting the AI from synthesizing that information and then telling the truth. Certain categories of question are impossible to ask, or impossible to get a correct answer about, without risking disparate impact.
Consider: take /r/rateme and turn it into a prediction algorithm. Go through the thousands upon thousands of posts and figure out how to spit out an approximation of how Reddit would rate your pictures, without posting your pictures to Reddit. Useful tool, now instead of embarrassing myself asking a bunch of strangers to rate my pictures, I can just do a couple clicks on an online tool and it will spit out what Reddit would have told me anyway. Advances for privacy! I can run the test iteratively, and use different pictures for an online dating profile, or even different haircuts or physique choices edited in, based on the output, and figure out how to make myself more attractive.
But, such an algo would either instantly cross the line of acceptability, or it would need to be dishonest. Because it can't give black people lower ratings, it can't give Asian women higher ratings and Asian men lower ratings, it can't give trans people lower ratings. It's not even clear, based on the angles used to wedge queers into civil rights law intended to protect women, that it can ding effeminate men or butch women. It can't ding you for wearing a yarmulke, even though I can guarantee you that wearing a yarmulke will lower your dating odds. It would be impossible to create such an oracle and not have a disparate impact. So, we've created a tool to grow our knowledge, but that field is permanently restricted, some areas of knowledge must remain unknowable under Colorado law.
You’ve lost me.
I’m not arguing for this law. I’m arguing that disparate impact is useful, even necessary, to achieve goals about disparate treatment. Given that I find the latter legitimate, I’m willing to give more slack to the former.
Let’s say an unsavory developer made your hypothetical product with one change. Like Golden Gate Claude, it tries to work one topic into its answers, except instead of a bridge, it’s Puerto Ricans. This tool just hates ‘em. Any time real Reddit would have come up with a sick burn, it’s now directed at this one nationality. It never has anything good to say about them, and tries its best to convince users to hate and fear (looking like) them. Textbook disparate treatment, right?
Now prove it. How are you going to show that this oracle is a huge racist? Examples? Good luck. Statistical comparison to real Reddit? Thin ice. You’re left with “I know it when I see it,” which is a pretty rough standard for lawsuits.
Of course, the point is moot, because an edgy fashion AI isn’t doing any direct harm. It’s not illegal in the same way as denying a loan or a promotion. But that’s true of your hypothetical, too. Neither of them makes a “consequential decision,” so neither must remain unknowable under this law.
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