Careful not to stifle innovation, Newsom hesitates on major tech bills

Careful not to stifle innovation, Newsom hesitates on major tech bills
SAN FRANCISCO —

As someone who has spent years observing and analyzing political leaders, I must say that Governor Gavin Newsom stands out as a unique figure in the tech-centric landscape of California. His upbringing in a community buzzing with technology and innovation has undeniably shaped his vision for the future, making him a congenial yet imaginative leader.

At one of the most significant artificial intelligence gatherings globally, Governor Gavin Newsom was present as two influential figures in the industry expressed contrasting opinions about a crucial bill on his table aimed at shielding California residents from AI technologies.

In a later interview during the Salesforce conference in San Francisco in mid-September, Newsom expressed that he seized opportunities similar to this one. He observed carefully, thinking to himself, “Here’s my chance. Should I take it, or should I pass?” Then came the internal debate: ‘Yes, definitely,’ ‘No, absolutely not,’ and so on.

The scene provided a glimpse into Governor Newsom’s considerations regarding the regulation of the tech sector, encompassing a surge of AI companies, as well as the entities attempting to sway him during the bill-signing period at the state Capitol. However, the Democratic governor rejected the AI bill a week following the conference, further fueling accusations that he aligns too frequently with Meta, Google, and other influential figures in an industry he has long admired and maintained friendly ties with throughout his career.

During his tenure as a supervisor in San Francisco and later as its mayor, Newsom gained an up-close perspective on the tech explosion of the ’90s and cultivated both political and personal relationships with influential figures in California’s tech industry, which significantly contributes to the state’s economy. Notable attendees at his 2008 wedding in Montana were Larry Page and Sergey Brin, co-founders of Google, Gordon Moore, a co-founder of Intel, and other high-profile business leaders.

At heart, I’m an entrepreneur too, and my frustration with a local regulation – specifically, the need to install a mop sink in my carpeted wine store – sparked a surprising interest in the workings of government within me.

As governor, Newsom expressed a goal to maintain California’s leadership in technology innovation while also ensuring safety measures, especially regarding artificial intelligence, to protect society from potential risks.

In simpler terms, Lorena Gonzalez, head of the California Labor Federation, stated that this individual prefers to take a leading role and believes that regulations, even intelligent ones, hinder his ambition to move quickly. His preferred term is ‘innovation.’

Gonzalez is the voice for unions in California who worry about AI taking human jobs. Additionally, there’s a sense of mistrust towards tech giants based in Silicon Valley, as they make substantial profits from content generated by others.

During a conversation with Salesforce CEO Marc Benioff, who is also the godfather of his eldest child, Newsom elaborated on his personal approach to leading technology, sharing his views with an audience of conference attendees.

At Salesforce’s conference, Dreamforce, Newsom expressed, “I aim to keep our leadership position and continue driving innovation. Simultaneously, there’s a strong sense of duty to tackle some pressing concerns we all share, which can be quite challenging when balancing progress with responsibility.

As a movie enthusiast, I can’t help but notice the divided sentiment surrounding artificial intelligence (AI). Last year, data from the Pew Research Center revealed that over half of Americans expressed more concern than excitement about integrating AI into their everyday lives.

Siding with Big Tech

In response to a lack of swift action from the federal administration on AI regulation, California lawmakers took it upon themselves this year to strengthen their oversight of artificial intelligence technology.

But there’s a divide about the best way to move forward.

According to Senate Bill 1047, Senator Scott Wiener (D-San Francisco) proposed one of the initial comprehensive regulations aimed at preventing this industry’s technology from being exploited for launching cyber-attacks against crucial infrastructures.

Supporters such as Elon Musk and the Center for AI Safety argue that the law is crucial to avert devastating accidents. These tech innovators have voiced concerns about the risk of artificial intelligence outsmarting humans, potentially leading to a loss of control over the technology if proper regulation isn’t implemented by the government.

As a dedicated follower, I can share that my favorite tech giants like Meta (the powerhouse behind Facebook, Instagram, WhatsApp, among others) expressed their disagreement towards a certain proposal. In fact, these global titans, including Meta, collectively invested close to $800,000 to influence the Legislature, governor’s office, and state agencies on SB 1047 and several other policies between January and June’s end.

OpenAI’s creators and top Democrats in Congress, such as Representative Nancy Pelosi from San Francisco, have voiced worries that the proposed legislation may hinder technological advancement within California.

A few days prior to his veto, Newsom stated that the bill generated a “self-contained climate” or “unique appeal,” not just in California, but also elsewhere.

Governor Newsom stated, “This is a bill that doesn’t often reach your desk. The outcome usually hinges on the last person you spoke with and their ability to persuade. It’s a contentious issue that has split many people.

In his veto note, Newsom expressed that the proposed law, though it stemmed from good intentions, might lead the general public to have an unrealistic feeling of safety regarding the fast-evolving technology in question.

SB 1047 fails to consider if an AI system is used in hazardous settings, makes crucial decisions, or handles confidential information, according to Newsom’s veto message. Instead of imposing strict regulations on fundamental functions, the bill does so even for systems that are just large-scale. I don’t think this is the most effective way to ensure public safety from potential dangers associated with technology.

On Sunday, Newsom may have been preparing for potential backlash over his veto, as he simultaneously revealed that his team has recruited experts in the field to develop safeguards for AI deployment in California. The primary focus will be on assessing its abilities and potential risks. Newsom pledged to collaborate with state legislators on this matter during the upcoming legislative session.

Teri Olle, the director of Economic Security California Action and a co-sponsor of SB 1047, expressed disappointment that Governor Newsom’s veto missed out on a chance to establish sensible limits in the progression of AI technology development.

Olle’s statement expressed that the bill’s collapse underscores the persistent strength and sway of the wealthy tech industry, which strives to preserve the current regulatory landscape and enormous profit rates. In his words, “The great majority of Californians, along with American voters, expect their representatives to focus on ensuring AI safety, rather than relying on companies to prioritize safety independently.

A significant number of SAG-AFTRA leaders and members, among them President Fran Drescher, penned a letter asking Newsom to approve SB 1047. On Sunday, SAG-AFTRA announced its commitment to striving for a safer and more ethically sound AI environment as part of its ongoing efforts.

Though the benefits of artificial intelligence have yet to fully materialize, its potential risks are already being felt, a union representative stated in a release. To prevent disastrous consequences that may arise from unregulated technology, it’s crucial to establish safety measures for AI as soon as possible, such as regulations focusing on accountability and transparency.

This year, Newsom and Democratic legislators faced criticism after they decided not to proceed with a proposal that aimed to make tech giants like Google and Meta financially responsible for sharing news outlet content on their platforms.

Instead, lawmakers reached a contentious agreement between Google and newspaper publishers, which will see the company and the state contributing $250 million over five years towards AI research and local journalism initiatives. This funding represents only a small portion of what they would have had to pay out under the original bill.

The deal split the newspaper industry. Publishers supported the agreement, while labor unions representing journalists opposed the plan and were not involved in the negotiations. Newsom was a party in the deal and agreed to provide taxpayer dollars to support the journalism initiatives.

In my opinion, the lack of union involvement during negotiations left me feeling that Governor Newsom has a strong affinity for technology – a sentiment I openly expressed in public.

She mentioned that it would be beneficial to have someone as influential as Newsom examine the idea of how technology advancements can simultaneously support workers, boost their power, and not contradict further technological changes.

Gonzalez finds himself at loggerheads with the influential Teamsters union, as well as the governor, regarding proposals for legislating self-driving truck regulations.

Last year, Governor Newsom rejected a proposal backed by the Teamsters, which aimed to mandate a human operator in any vehicle exceeding 10,000 pounds. This year, the union attempted to reintroduce the bill, but it faced the same outcome. In his statement released over the weekend, Newsom explained that he suggested various amendments to the bill, but these were not considered.

The governor stated that California should harmonize its robust labor protections with its leading role in technological advancement. He disagrees with the idea that achieving one goal necessitates compromising the other, as California’s achievements debunk such a misleading dichotomy.

In a statement following the veto announcement, the Teamsters expressed that most Californians stand against autonomous vehicles without regulations or accountability operating on our highways.

The union stated that a regulatory system that overlooks current realities does not serve the residents of California – the multitude seeking quality middle-class jobs and secure neighborhoods, the very people our state administration is obligated to assist. Instead, such a system primarily advantages a select few billionaires within the tech sector.

The state released draft regulations last month that could allow for testing of driverless trucks on state highways.

Tech firms and their high-profile CEOs, many of whom are billionaires, have been significant contributors to Newsom’s election efforts.

Over a dozen tech leaders and financiers donated over $100,000 individually to his anti-recall effort. Notable figures like Eric Schmidt (former Google CEO), Reed Hastings (Netflix co-founder), Andy Fang and Stanley Tang (DoorDash co-founders), Marissa Mayer (former Yahoo CEO), Jeffrey Lawson (former Twilio CEO), and Ron Conway (Silicon Valley investor) were among those who contributed, along with others.

A long-standing interest

During a meeting in August, the governor referred back to his 2013 publication titled “Citizenville: Reimagining Government through Digital Communities,” as a demonstration of his perspective on utilizing technology.

As a movie reviewer diving into this captivating read, I found myself transported back to my days as a city mayor. The narrative opens with a recollection of a momentous visit from the esteemed President of Estonia, Toomas Hendrik Ilves. Eager to share our vibrant technological advancements, I was particularly eager to discuss our innovative parking meter solutions, such as the convenient option of paying via cellphones.

The president remained unaffected, as Estonia had long been accustomed to handling such matters. This included paying for parking fines, property taxes, and various other government charges. They even offered free Wi-Fi services.

In simpler terms, Newson uses the term “wake-up call” to highlight that San Francisco was not leading in technology as previously thought, instead it was falling behind. He further emphasizes in his book that the slow response from government in adopting new technologies is a significant issue.

As an ardent cinephile, I’m excited to share that under Governor Newsom’s leadership, our state has crafted comprehensive guidelines for public institutions to judiciously employ AI, even hosting a summit on the subject alongside esteemed academic institutions like Stanford University and UC Berkeley. To top it off, we’ve made significant strides by signing agreements to integrate innovative technologies within our very own government, ensuring a more technologically advanced future for us all!

Dee Dee Myers, head of the Governor’s Office of Business and Economic Development, characterized the governor as having a genial, inventive nature.

In a place brimming with technology and its accompanying enthusiasm, Myers noted, he was raised. He emphasized that this environment fostered a mindset where one could not only imagine but also bring to life ideas that previously didn’t exist. Myers is convinced that we can tap into this collective energy and innovative thinking to tackle challenges and enhance the living standards of people, be it through stricter regulation for his mop sink or artificial intelligence designed to optimize resource management.

Tussles with the industry

Todd O’Boyle, who holds a senior position in technology policy at the Chamber of Progress (a tech industry association), expressed that Governor Newsom is not perceived as overly connected or aligned with the technology community.

As someone following the tech industry, I’ve often pondered about instances where I wish things could have turned out differently. However, it’s clear that technology plays a significant role in California’s state landscape. Governor of California is well-aware that many of his voters are employed in this sector. A thriving tech industry not only benefits the California economy and budget but also contributes significantly to funding California’s social safety net.

The governor’s aides also reject the suggestion that he’s too slow to regulate.

Myers stated that it’s crucial for us to implement intelligent regulations and ensure a fair regulatory process which considers various perspectives. He added that it wouldn’t be accurate to suggest that California hasn’t regulated effectively, as this is not the state’s reputation.

Newsom’s office pointed to legislation he endorsed to protect children from social media.

This year, the governor put his signature on a law that aims to curb the capacity of businesses to deliver “addictive content” within apps for minors. Additionally, this legislation seeks to reduce the number of notifications reaching children’s devices during school hours and late at night.

The Chamber of Progress, comprising tech giants such as Facebook’s parent company (Meta), Instagram’s owner (Meta), TikTok’s owner (ByteDance), Amazon, Google, and Apple, voiced opposition to Senate Bill 976. Similarly, NetChoice, a national technology trade group, also expressed their disapproval of the bill.

He’s had other tussles with the industry.

Through a legal challenge based on infringements of the First Amendment, NetChoice initiated a court action to halt a law signed by Governor Newsom in 2022. This legislation aimed to compel businesses providing online services to implement privacy safeguards for minors. The governor, being a father of four, was displeased with this lawsuit and openly voiced his annoyance towards tech industry leaders for attempting to thwart the law’s implementation.

Governor Newsom’s alliance with Elon Musk, head of Tesla, founder of SpaceX, and executive chair of X, has become strained due to Musk’s ideological shift towards conservatism and his threats to relocate his businesses to other states because he disagrees with California’s policies.

When Elon Musk shared a modified video on Twitter, making it seem like Vice President Kamala Harris had referred to herself as a “diversity hire,” Governor Gavin Newsom expressed his intention to outlaw the manipulation of voices within advertisements.

At Dreamforce, I found myself sharing the spotlight with Benioff, and in the same event, Governor Newsom put his signature on a series of bills aimed at eliminating manipulated content from our screens.

The governor stated, “On all accounts, it was completely unjust – there was evil intention underlying these manipulated videos that influenced elections.” Then, he reached for his pen.

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