Speaker 1: This week's episode of the trip Cast is sponsored by
the Texas Tribune Membership program as we celebrate Amplify Austin. Hello,
and welcome to the Texas Tribune Trip Cast for March fourth,
twenty twenty five. I'm Matthew Watkins, editor in Chief of
the Tribune. My two co hosts, Eleanor Klibanoff and James
Berragon are nursing their oscar parties hangover, aren't able to
make it today, so instead I am joined by Cherry Greenberg,
a former state representative and professor of practice at the
LBJ School of Government at the UT Austin.
Speaker 3: Hello, Sherry, thanks for being.
Speaker 2: Here, my pleasure. Hello.
Speaker 1: So today we are going to be talking about a
subject that you have been studying for several years now,
many years even before it became sort of the buzzword
in the Texas capital and beyond the idea of artificial
intelligence and regulating it at this date level, When the
idea of regulating businesses comes up in the legislature, there's
usually a pretty strong consensus among Republicans to sort of
stay out of the way in the name of growth
and free enterprise. But the conversation this year around regulating
AI is turning out to be a little bit more complex.
You have powerful conservatives such as Senate Business and Commerce
Chairman Charles Schwartner and the Chair of the House Doge Committee,
Giovanni Copriglioni, comparing carrying bills that would impose strong guardrails
and rules for the technology, but they're finding some opposition
from members of their own party. Senator Lewis Cole course
was questioning a bill by Schwartner earlier last week. Tech
impresario Joe Lonsdale has really come out against some of
the legislation, despite being pretty usually aligned with Republicans in
the state. It's a fight that sort of avoids that
partisan brack breakdown. But I think there's some fear kind
of driving both sides. On one hand, you have lawmakers
worried about the dangers of AI on people's privacy, their freedom,
and the possibility that really important decisions might be made
by computers not people. On the other side, you have
folks who are worried about going too far and restricting
AI that would leave Texas behind other states in the
technology and maybe even pulling the United States with them
behind adversaries like China. So Sherry, You, like I said,
have been watching this for a very long time. A
lot of the focus so far earlier on this session
is on a major bill called TREGA, the Texas Responsible
AI Governance Act. Can we start by just having you
explain what's in that bill?
Speaker 2: Sure? And for background, which you really alluded to, is
what I call the promise in peril of AI. Right,
there's great promise with AI with artificial intelligence and healthcare
detecting diseases that we wouldn't be able to, but there's
peril too. So if we can use healthcare and as
an example, big privacy issues, and we also talk about
balancing innovation with rules and policies and regulations that provide transparency,
accountability and guard against invasion and privacy. And so that's
really what we're dealing with here. And with artificial intelligence,
we do find that there are a lot of common
concerns across political parties and sometimes you find alliances that
you wouldn't elsewhere, and you also alluded to that. So
with TREGA, this is a bill that was filed its
House Bill seventeen oh nine by Representative Giovanni Capriconi, and
there was a lot of discussion about this bill over
the interim. He had a very large stakeholder group that
many of us participated in meetings and whatnot, and I
think he knew that this is a bill that would
have a lot of discussion once it was filed. So
TREGA is really a builds based on risk mitigation, and
this is what the EU bill really is based on.
And also other states such as Colorado which we can
look to, and it's mitigating against risk, which is also
what this the Nationaltitude for Standards has really set out
in its framework, which is part of the National Science Foundation.
So TREGA would create obligations for developers and deployers of
any AI system that is a contribution, you know, decisions
relating to employment, finance, healthcare. Texas would also be the
first state to require high risk AI system distributors to
take reasonable care. The bill would ban AI systems that
pose unacceptable risk. Private litigans would have limited right of action.
The law would require generative AI to developers to keep
detailed records of data sets used to It would exempt
many small businesses. So you can see it's very much
a risk based system. It is also a build that
very much focuses on what we call algorithmic discrimination, and
in the bill, that means any condition in which an
artificial intelligence system, when deployed, creates an on lawful discrimination
of a protected classification in violation of the laws of
this state or federal law. And then it further goes
on because you're wondering, what's an artificial intelligence system? Right?
That means the use of machine learning and related technologies
that use data to train statistical models for the purpose
of enabling computer systems to perform tasks normally associated with
human intelligence. And this is really where we get into
the AI, the artificial intelligence realm or perception such as
computer vision, speech, or natural language processing and content generation.
Speaker 1: Okay, so there's a few things that are sort of
key phrases in this bill, one of which you already
mentioned high risk AI systems. What do we mean by
a high risk system in this case.
Speaker 2: So a high risk system in this bill, and again
this bill is really based on risk mitigation. High risk
artificial intelligence system means an artificial intelligence system that is
a substantial factor in a consequential decision. The term, though,
does not include an artificial system. If the artificial intelligence
system is intended to detect decision making patterns or deviation
from prior decision making patterns, and is not intended to
replace or influence a previously completed human assessment without sufficient
human review. So the following technologies unless the technologies, when deployed,
make or a substantial factor in making a consequential decision.
And a malware anti virus calculation, cybersecurity database is data storage, firewall,
internal domain. The list goes on and on.
Speaker 3: So those are things that are not included in the building.
Speaker 1: But what we're really talking about here are basically using
AI using computers to make kind of important, impactful decisions
about customers or people in this state.
Speaker 2: That's exactly right, okay, And.
Speaker 1: I think the other interesting thing is the idea of
using reasonable care. Right, this this idea that if essentially
it's up to the developers, the people you know, like
open ai or or you know, Twitters developing some some
AI systems and things like that, or even the distributors
or the employer, the deployers, the people who are you know,
utilizing an AI system to evaluate, you know, whatever it
is they might do, make decisions about healthcare, health insurance
and things like that. What it's basically saying is that
they need to take steps that are done reasonably to
protect people from that kind of discrimination in the system.
Speaker 3: Is that right?
Speaker 2: That is exactly right? And there is a kind of
I guess provision you would say for piloting, you know,
with a sandbox where there can be some innovation taking place.
Speaker 1: Okay, okay, very good. And so I mean what's interesting here.
This is the bill that's gotten a lot of attention.
It'll be interesting to see whether it advances in its
current form, and we can talk about that a little
bit more. But what's really struck me about this is
there was a lot of conversation, you know, when when
chat GPT was really out there, a lot of conversation
about the dangers of AI. A lot of those felt
like sort of conversations around existential dangers for humanity.
Speaker 3: Right, are the right going to take over?
Speaker 2: Yes, sentient and they're not cynient.
Speaker 1: Exactly exactly, And that's not really what this is protecting about.
This is more about privacy concerns. Are AI you know,
basically things without a conscience is going to be making
you know, life or death or you know, major financial
decisions for the lives of people in Texas.
Speaker 3: Is that is that right?
Speaker 2: Yes, this is not about whether AI is, as we say, sentient, right,
It is about looking at those areas that people are
most concerned about when they talk about AI, protecting their privacy,
having transparency, having accountability, knowing when you know AI is
being used. The bill, you know, requires the as we said,
an unacceptable risk. It prohibits systems that without express consent,
identify emotions, capture biometic intent, you know, those attributes that
were really sensitive about as people in this atmosphere. It
also would require generative AI developers to keep detailed records
of data sets that they used to train. So the bill,
again going back to the unist frame work, really looks
at risk and risk management and some of those perils
that we talk about. The risk management framework looks at governmap,
measure and manage and that is a framework that has
been used by NIS, really by the EU, by Colorado
and other states. Now that's not to say that people
everyone is happy about it, right, and really with AI,
we can go back to nineteen fifty with Alan Turing r.
AI has been with us a long time and in
our daily lives. But until chat GPT appeared on the scene,
people weren't really cognizant about it. Once people became cognizant,
then it's oh, what does this mean for my privacy?
My data? Is there transparency? Do I know when AI
is being used? However, there is this, as I said,
promise in peril or this also this issue of how
do we have innovation right without too much risk? As
you mentioned, people are concerned if this stifles innovation, where
will that mean for us as a state? We know
that we're getting ready to have some big investments in
this state right in AI. What would that mean for
the country you mentioned China, And of course we've heard
a lot about China and AI recently. But on the
other hand, people really are concerned about I would say,
their privacy and about this algorithmic discrimination in decision making
and also other areas. There are other bills, of course,
have been filed dealing with using AI for mental health,
or using AI and making decisions with insurance and healthcare.
So there are other concerns that people have.
Speaker 1: Yeah, it seems like the would you say, the broad
kind of fee of a lot of these bills is
sort of designed from a kind of consumer protection standpoint.
Speaker 2: Yes, I would say it is designed from a consumer
protection and transparency standpoint. The bills, you know, they may say, well,
you can use it for mental health, but there has
to be a provider involved. Keeping the human in the loop.
I would say, you know, when you're looking at health insurance,
you know you have to disclose perhaps that you're using
eye and you have to if it's for specialty care,
specialist for instance, has to review it. So consumer protection,
transparency and accountability and kind of I would say, keeping
that human in the loop.
Speaker 1: It's interesting because in some ways this feels like a
very familiar kind of conversation between innovation and industry and
creation and all those kinds of things, and you know,
the consumer protection, the fears about the negative impacts of
this technology, and I just I find it a little
bit striking that we're seeing, you know, at least a
significant segment of the Republican Party sort of going in
the direction of consumer protection this time around. What do
you think it is that's different about AI that's setting
up this conversation.
Speaker 2: Well, certainly, I think that there are a lot of
legislators who have followed the path that for instance, social
media took and lack of privacy with data and they're
feeling that this is a big concern of their constituents.
And seeing now with AI, you know, your data, your
personal data is being used to train it. For instance,
your personal data may be available. You may not know
when it's being used. It may you know, is it
making decisions without a human and a loop. And I
think that those are issues that you know trands, they're
they're beyond party boundaries, and that many constituents across the
board are very concerned with these issues and concerned with
the I would say, the path for instance, that data
and social media has taken with you know, lack of
privacy and now seeing AI.
Speaker 1: Yeah, I mean among the things in this this trega bill,
it bans deep fakes right, and certain use of biomarkers
like facial recognition that you know, they don't want people
pulling a bunch of pictures from Facebook to be able
to identify your face, you know, wherever you are walking
across the street. Another thing it bans is social scoring,
which I'm quoting from the MIT Technology Review. The definition
of that a practice in which authoritarian governments, specifically China,
rank people's trustworthiness and punish them for undesirable behaviors such
as stealing or not paying back loans. Right essentially seen
as a you know, sort of way to rank citizens
or or identify citizens as types of risk and that
kind of I mean, I think, you know, another big
part of the Republican Party is freedom right. And there
were a little bit about surveillance and just you know,
whether it's big companies or the government itself sort of
you know, reaching into the personal lives in a way
that feels uncomfortable to that's right.
Speaker 2: It's that privacy issue. They're very concerned about you not
knowing your data is being used, you not knowing that
your face is being used, to the biometric markers, your
voice being taken. You know, there was a case in
Arizona over a year ago, a really horrible situation, and
there was legislation in the Arizona legislature where there was
a deep fake of a young woman's voice and it
was it was her voice, and they called her mother
and her younger was there too, and said that she
had been kidnapped asking for ransom. Well, in fact, she
had not been kidnapped, and that was not her voice,
but it was a replica, let's say, of her voice
a deep fake. So there are a lot of concerns
I think about criminal elements, about privacy, and as you said,
about freedom, my freedom to walk down the street without
being ranked as a threat to society, or my freedom
to control how my image and likeness and voices being used.
Speaker 3: All right.
Speaker 1: Today's trip cast is presented by the Texas Tribune Membership program.
The Texas Tribune's in depth coverage of Texas politics relies
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a fifteen thousand dollars match for Amplify Austin Day. Support
independent journalism by making a donation online today. Okay, So
I want to ask you a little bit about just
the state's ability to succeed in this process.
Speaker 3: Right.
Speaker 1: We saw a you know, after this bill came out.
Joe Lonsdale, who I mentioned sort of in the opening,
a venture capitalist, a very influential one both politically and
in the tech world, came out very strongly against this
trega bill. He says he did kill innovation, kill jobs,
let China win the AI race. He essentially argued that
it would create a new AI governing agency in Texas
and see the regulation of AI to you know, bureaucrats, right,
the dread of bureaucrats tell me a little bit about
the industry response.
Speaker 2: Sure, sure, and it's not you know, you mentioned his statements,
but he's not the only one. There were articles, I
think in Forbes there was an opinion piece, and I
believe the Dallas Morning News last week.
Speaker 1: If you google TREGA, all the top links are industry
aligned groups with articles and other things kind of speaking
out against this.
Speaker 2: Right, you know, there was another article, everything is bigger
in Texas. TREGA is no exception. But will it, you know,
provide accountability? So and they're saying no, it wouldn't. And
so any time that you file a significant bill, Having
spent ten years in the legislature myself, I can tell
you that you're going it's a starting point, and you're
going to expect that there will be changes, that there
will be amendments. And with a bill like this, even
though there was a stakeholder group and a lot of input,
I think the bill that's filed, I think it's safe
to say probably is not going to be the final
piece of legislation, and so we take it as a
starting point. And certainly there is this concern about innovation.
You know, we're in another industrial revolution, and with every
industrial revolution, whether you say we're in the fourth or
fifth or whatever, you know, we have seen concerns about
the you know, the perils of the new technology, but
also the promise. And there are concerns, you know, with
AI about work and future work, for instance, will people
be out of jobs or will there be new jobs?
And we can look back at history and see this,
So I think there there is a real issue here
with balancing innovation and protecting people's freedom and privacy and
having that transparency and that when you file a bill
like this, you know you can expect that there will
be some.
Speaker 3: Amendments, right right, absolutely, you know.
Speaker 1: I Lonsdale, after he put out a little sort of
a tweet threadgras this, he came back not too long
later said he met with quote relevant leaders in Texas
and that they agreed, again I'm quoting him, conservatives must
block the creation of AI regulatory agencies.
Speaker 3: So I think, you know, you're exactly right.
Speaker 1: It sounds like there is there's going to be some
resistance to some of these ideas. Right here, I want
to talk a little bit about enforcement here. So the
bill as it's currently laid out, would place enforcement in
the hands of the Attorney generals. That's correct, organizations that
violate the rules and that would be subject to fines
in the like ten thousand dollars range per instance. But
of course we know that a lot of these things
are done on a mass scale, so those ten thousand
dollars finds can can really add up. I mean, you
may remember the Attorney General's lawsuit against Facebook for use
of facial recognition. Again, it was one of those you know,
individual finds. Those individual finds ended up adding up to
one point four billion dollars worth of settlements. So you
could really see, you know, some aggressive actions related to this.
But I mean, one of the things I wonder about
is I read this bill is Texas state government isn't
exactly known for being a tech know, logically advanced, and
how it goes about things. I mean, you know, the
computer systems, all those types of things.
Speaker 2: Well, there is another bill that calls for training of
certain employees on cybersecurity and artificial intelligence.
Speaker 3: Well there you go.
Speaker 1: I mean, what does Texas have the capacity to regulate this.
Do you think if even if a bill like this
were to.
Speaker 2: Be passed, you know, the Attorney General's Office, as you said,
would be the enforcement mechanism, not the Department of Information Resources,
does it have the capacity? I think that depends on
the who are the employees and what training do they have?
And as I said, I think that is incredibly important
having of course the systems in place, but also the
training of state employees.
Speaker 1: Okay, and so the other thing here to be thinking
of is just again that debate. I mean, this is
going on in a lot of different ways. I think
one conversation is do you do this in a piecemeal approach?
Right with individual you know, here's an AI healthcare bill,
as an AI education bill and all those types of things.
There are a lot of different measures about that. But
even when you get into the individual cases, it can
it can get a little bit dicey when you go
into the details. There was a conversation in the Senate
Business and Commerce Committee last week Charles Schwartner finding a
bill that would ban health insurers from using AI to
deny treatment or downcoading patient's treatment. He argued pretty passionately
against the idea I'm quoting here that insurers are quote
deploying AI that is focused on their bottom line in
my opinion, over you know, patient well being basically.
Speaker 3: But los culd course.
Speaker 1: Another very conservative senator came right back at it and said,
you know, this bill could cost billions of dollars to
the state, right that we have you know, Medicaid programs
and things like that that might be able to use
AI to root out fraud or identify in efficiencies and
things like that. And I understand that there's fears, but
there's also real opportunities here for.
Speaker 2: It to get back to the promise and the peril again, right,
And this has been a national issue. You've probably seen
some headlines nationally about insurers using AI and were they
relying solely on an algorithm to deny coverage and insurance,
particularly for specialty care. And there have been several bills filed,
as I mentioned, dealing with healthcare, with mental health, and
with health insurance. And I think the question will be
do you have a bill that denies the use of
AI completely or do you have a bill that says
you can use AI. But as I said, you have
to have a human in the loop, a human has
to review it. And you know there are other bills
that have been filed that say, well, you can use AI. However,
if it's specialty care, the specialist, for instance, has to
review it, so you keep that human in the loop.
And a lot of what we're seeing around the country
and around the world is that discussion of whether it's
in domestic violence cases in Spain where you had a
situation where a particularly police department was relying solely on
AI predictive analysis to say whether an abuse or would
abuse again, and there was not a human in the loop,
and a woman ended up dying. And so a lot
of the conversation now has turned to using it but
ensuring that a human makes the final decision and is reviewing.
So I think it's this discussion of where are you
on this continuum. Do you not use it at all,
do you use it and you solely rely on the AI,
or are you somewhere in the middle in this continuum
where you use it. But you must have humans and
professionals who are in the loop and who are reviewing
and making the final decision.
Speaker 1: How important is it that the legislature figure out some
answers to that question this session. I mean one of
the challenges of the Texas legislature is they only meet
every two years. That's right, at the pace that technology
is growing and changing. Is this sort of their last
chance to sort of put down a marker on this,
do you think? Well?
Speaker 2: I think that's why you have seen so many bills
filed this session. As you said, technology is changing, as
we are doing, as we are talking right now, right,
and with the biennial legislature, you do have limited opportunities.
And again with chat GPT, with what we've seen with
health insurance and others. Yes, I think that there are
many members across the board who feel that it is
important this session to get a handle on this and
pass some legislation.
Speaker 1: Okay, I mean my other question is is the state
level the right level to be doing this?
Speaker 3: Right?
Speaker 1: I mean, a lot of this employment will I mean,
this AI deployment will be happening outside the state but
affecting Texans, but it also affects you know, Californians and
right Vermontors and everyone or else? I mean, should this
not be a federal level discussion as opposed to a
state level well?
Speaker 2: Or should it be a worldwide I mean technology does
not know boundaries, right. And this is a really good
question because as we know, you know, federal law superseded
state laws, and state laws supersede local laws. So the
Austin City of Austin has been looking at policies and
looking closely at what's happening with TREGA. They want to,
you know, align they have common issues and concerns, for instance.
But what you tend to see is when you don't
have action at the federal level. So we have had
no congressional action and we you know, the Biden executive
Order of course no longer exists. And so when you
don't have action at the federal level, and legislators have constituents,
and if those constituents have concerns, what you see is
there's this vacuum, and you will see the states, not
just Texas, step in. And if constituents at the local
level have concerns, right, and the states are not stepping in,
you will see individual cities step in. And then you
will see industry say, wait a minute, we have this
patchwork of different cities within the state or different states, right.
I think that what happens in a Texas is very
important whether it's textbooks or AI right regulation because we
have a very large population here in this state, right,
and so that's important whether it's Texas or California or Florida,
New York. And you do see this kind of alignment
of states who have already passed or are considering around
this NIST model, the one that the e used use,
the one that Colorado used around mitigating risk.
Speaker 3: Okay, okay, and.
Speaker 1: What about just there's other aspects to this too, which
is trying to attract you know, while you're thinking about
how you regulate it, you're also trying to attract companies
and developers into this state. I mean, Joe Lonsdale is
an example of that. You came from California two crisis.
There has been a lot of activity recently. You saw
Apple make an announcement of a development data center in Houston.
Facebook bringing their content moderation staff here. I mean yes,
you know, particularly after Trump one the election, there is
data centers exactly. There seems to be a lot of
interest in bringing folks here. But that creates its own challenges,
not just in terms of how you regulate it, but
also how do you build.
Speaker 3: Up the infrastructure to support it.
Speaker 1: Let's talk a little bit about the power grid and
how that ruts into this.
Speaker 2: Yes, certainly we've heard a lot about the power grid
in Texas over the past few years. We seem to
everyone or be having some very very cold weather at times,
and we know that we have our own grid. Now
there's discussion about some connectivity with another grid, but we'll
put that aside for the moment. Texas has its own
power grid. And it's not just power, it's water. So
these data centers, whether they're beings for AI or crypto right,
use an enormous amount of power and an enormous amount
of water and they're noisy, right, And so there are
concerns about the power grid and will there be the
capacity and should there be requirements for some of these
data centers to have their own source of power you
know many nuclear or other sources that people are talking about.
And what does it mean also for water, we know
that this is a major session for water and last
session was too a lot of funding, but this is
a really really major session for water and water supply
and distribution. And how does that fit in with the
data centers because they also use a lot of water?
Speaker 1: Absolutely, absolutely, and then there's one more aspect that I
want to talk about, which is how are we preparing
you know, our students are our future workforce for an
AI world. Is that a topic that is that is
being discussed in the capital as well. Oh?
Speaker 2: Absolutely, And it's a topic that I have spent a
lot of time on the past years and continue to.
You know, I think that learning begins, you know, the
day you're born, and it ends the day you leave
this earth, and that it's very important that we be
cognizant starting in elementary school all the way through people's PhDs,
that they have the appropriate curriculum related to AI. You know,
is coding going away, Well, it's coding at a different level.
I think that it's very important that we focus on
our students and the residents being continuous learners, having critical
thinking skills, having people's skills, being able to write, and
continuous learning, and that we look at jobs where they
may need new trading right as we say, upskilling or reskilling,
and that this be part of our curriculum in an
appropriate manner throughout education and beyond, whether we're partnering with
community colleges or industry. And there are many that need
within their own organizations to have this continuous training, whether
you're a large city or a major nonprofit, or a
big company or even a smaller company.
Speaker 1: So I mean, I hear when people talk about sort
of AI's impact on work in the you know, near future,
they talk a lot about how, you know, AI can
be a very very speedy and useful intern or entry
level employee.
Speaker 2: Right right, everybody's adding an assistant exactly.
Speaker 1: You can you talk about coding it? Can it can
write code when given direction, Yes, if you're if you're
at a law firm, you know, it can maybe do
some of that paralegal work. That's that early kind of
work in sort of reviewing documents, legal system exactly what
it's not quite there yet on is making big strategic
decisions and everything like that. So how how does the
education system adjust for that world?
Speaker 2: One of the ways that the education system needs to
adjust for that world is really focusing on the critical
thinking skills of students. Right, So, you may be a
financial analyst, but it's no longer there are no more
Excel spreadsheets, right, you have AI, and you need those
higher link level critical thinking skills to do the analysis.
You may be a coder, but you're coding at a
different level because AI is doing the we'll call it
fundamental coding. Right. You know, you may be a paralegal,
but you are now needing to think at that higher level.
And so that is really what is so important, those
analytical skills, those critical thinking skills, being nimble. Also, there
are various situations where AI does not and I don't
think ever will have the capability. And that's for instance,
if empathy is required, right, if it's a situation with
a doctor or a lawyer, or a teacher or an
educator where you have to have those people skills, the
empathy leadership within organizations.
Speaker 1: Okay, and so I guess here's my last question. How
confident do you feel in the state's ability to get
this right this session? How this feels like a complicated issue.
It feels like there's a lot of nuance, a lot
of expertise needed. Is the Texas legislature equipped to end
in a good place in early June?
Speaker 2: Texas legislature has dealt, is dealing and will deal with
in the future a lot of very complicated issues. And
I think that the process is set up, you know,
it's set up frankly, to kill bills, not to pass them. Say,
visualize the Summer Olympics with those people who are running
the hurdles one after another. So the system is set
up really to vet bills, to get input, to have amendments,
to have discussion, to get to a place where people
feel comfortable.
Speaker 1: All right, well, we will watch and see what happens. Indeed,
thank you so much for being here. Thank you to
Rob and Chris. A reminder the Texas Tribuunion membership program
as participating in Amplify Austin this week. Please check out
our website if you would like to donate and contribute.
Eleanor and James will be back next week and we'll
see you then