Tag Archives: ethics

The “Anti-Weaponization” Fund

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I have some thoughts on this and how it might work. Of course, I’m speculating; no criteria for eligibility or payout have been set, the five-person “adjudication” panel has not been stood up, and it’s possible the funding will not survive Congressional purse-control oversight. Within that, here I go again.

Payouts, I expect, will be limited to actual loss, with no add-ons related to punitive matters. In many respects, this will be straightforward, but there are a number of areas where losses are not clearly specifiable and/or the alleged losses are highly subjective. These latter include losses from loss of jobs, loss of business revenue, closure of the business. Courts have gotten fairly adept, if widely variable across jurisdictions, in assessing this sort of loss.

Even hazier are things like loss through death of a spouse, loss of the spouse’s income (which is separate from his/her death, even if the income loss resulted from the death), loss of conjugal relations or alienation of affection resulting from divorce or the affair that led to the divorce—and yes, some divorces have occurred as a result of many of the J6 prosecutions and, in the present context, persecutions. Courts make guesses at these losses, but only guesses; they’re not very good at it.

The next, and the overwhelmingly most important, problem, though is this. Given provable or even merely articulable loss that meets fund eligibility criteria to this point, it’s going to be deucedly hard to prove the political targeting, lawfare nature of the cases for which an applicant is seeking recompense. At best, satisfying a court, most likely satisfying the succession of courts, appellate courts, the Supreme Court, with the potential for remands to lower courts for further consideration or for reconsideration, will take years and years to reach a final decision. And that decision may well be that the matter at hand was not, in fact, political targeting, and so no payout is due.

And one more question. Given a final decision, whence the monies for the legal costs of getting to one? Will the Fund pay the government’s legal costs apart from any payout ordered? If not, where will the government’s funding come from?

What Error did she Acknowledge?

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In James Freeman’s Best of the Web Wednesday piece, he wrote of Seattle’s newly elected socialist mayor Katie Wilson’s supposed acknowledgment of her problem vis-à-vis her disdain for big business in a competitive market. In her series of victory laps shortly after her election, she crowed while at a barista union rally,

I am not buying Starbucks, and you should not either.

With the ensuing backlash, which includes an exodus of big businesses like Starbucks from Seattle, she then said,

Those comments were not productive in the sense that they caused more harm than good….

Freeman then quoted, without questioning, Danny Westneat, writing for the Seattle Times:

Admitting errors in public is hard…. Conventional political wisdom says it means you’re weak. In this case, I’d argue it’s a positive sign for the future of both the mayor and Seattle.
It means the mayor is at least more grounded in the real world than some of her blinkered progressive fans….
Maybe this is a chance to reset relations with businesses—at least ones other than Starbucks, where it may be too late.

But what “error” is Westneat claiming Wilson has admitted? In fact, it’s quite clear from Wilson’s own words, and Westneat has chosen to ignore it. Wilson admitted the error of her words, not the error of their intent, which is and always has been, her disdain for and assaults on free markets and the larger businesses that operate in them.

Competition

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In her Free Expression piece concerning the Harvard faculty’s vote to limit the number A grades (but not A- and lower grades) awarded to the school’s pupils, Mary Julia Koch had this:

It’s a fair point that a scarcity of A’s could crank up the competitiveness among an already ambitious group of college kids.

It’s a fair point? What, exactly, is wrong with competition among the pupils for the better grades, and so for the benefits ensuing, beginning with a less stressful and sooner successful job hunt? What’s wrong with increasing the level of that competition?

Harvard’s pupils, even after this grade inflation move (as small as it is), have no idea of the level of competition in our relatively free market economy. Those pupils have no idea of the benefits of competition, from improving their own skills to producing better products and services at the companies that employ them to the follow-on of more and better jobs and better pay.

One professor who doesn’t like the quota said that

she didn’t become a college professor to “rank my students against one another for the convenience of potential employers.”

But that’s precisely the purpose and the benefit of such rankings, and her attitude insults those students who take her classes. College graduates are not simple members of a commodity pool from which a company can select at random. Companies want to hire only the best because that’s what produces the best goods and services, which in turn maximizes the companies’ ability to thrive and grow and do R&D, which in the end maximizes job growth and so employment opportunities. One of the most important tools a company has in discriminating among a pool of brand new college graduates is an honestly done GPA.

The answers to my prior questions is that there’s nothing wrong with competition or with increasing competition. That’s what makes all of our lives better, including those of Harvard’s pupils, who now will be required to level up their game.

Experts Everywhere

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A couple of professors at the University of Pennsylvania’s Wharton School Department of Legal Studies and Business Ethics want a body of Experts to supervise risks from emergent AI, saying that such a body would be better than an FDA-like regulatory body, or Congress through statutorily enabled product-safety laws.

They’re right that having a government body of experts like the FDA do this sort of thing is determinedly suboptimal. They’re right, also, regarding Congress, although Congress is considerably more malleable than a department or agency of bureaucrats.

But another body of Experts?

Bank supervision, which emerged in the Civil War and took its current form out of the Great Depression, offers the best framework for overseeing the most advanced AI labs.

After all,

Frontier AI labs such as OpenAI, Anthropic, and Google DeepMind are different.

And there’s always an excuse for standing up yet another bureaucratic regulatory body. In the case of their bank supervision model, about which they’re so enthusiastic, they give their game away [emphasis added].

Banks are too complex to govern through legislated rules alone, too important to leave to market discipline, and too dynamic for one-time approval.
Bank examiners often sit inside the institutions they oversee.

That’s the problem with our economic system government overlords. With the Panic of 2008, the Federal government created out of whole cloth the myth of some (ultimately government favored) businesses are too big to fail and so must always be guaranteed a government bailout. That confidence in the Federal apparatchiks sitting inside the banks also is misplaced. It’s only necessary to see the failures of the Silvergate, Signature, and First Republic banks to see the intrinsic failure of this. Those banks didn’t only fail through their own mismanagement; they also failed because their regulators were incompetent enough or lazy enough or complacent enough to miss those bank managers’ basic economics error of borrowing short-term while lending long-term and letting those two get ‘way out of balance. That allowed their short-term debts to come due before they had the long-term debt income to cover.

But the good professors want a board of Expert Apparatchiks inside the OpenAIs, Anthropics, and DeepMinds to oversee how these handle risks of emergent AI.

And this:

Banks share information with supervisors that they could never safely disclose publicly.

AI software is too important, too critical to national security, to share with apparatchiks of government. Our Federal government is infamous for its inability to defend against PRC cyber espionage. It’s infamous, also, for its bureaucrat employees leaking confidential financial data about businesses and persons of which those bureaucrats personally disapprove.

And this:

An AI risk supervisor could be funded by industry fees. Its leaders should be Senate-confirmed and removable by the president, but its expert staff should be insulated from day-to-day political pressure.

No.

Experts have their uses, often very important uses. On the witness stand to explain this or that aspect of a crime, balanced by another expert on the witness stand with a differing explanation. In police department forensics sections. As teachers in environments where their expertise is more important to the teaching than their teaching style. In medical and mental health doctor offices.

But in government? Not so much. Experts are useful when they’re part of a range of experts advising, as employees, the government’s decision makers. But as government decision makers? Definitely not so much. For the lack of utility of that last role, it’s only necessary to look at the Fauci-Collins-led experts as bureaucrats, or at the experts of the John Brennan and James Clapper CIA and ODNI, respectively.

The Supreme Court was right when it greatly reduced Chevon Deference in its Loper Bright Enterprises v. Raimondo ruling, making clear that “experts” in government aren’t owed any particular deference on matters of government behaviors and decision-making.

So it is with emergent AI.

Who’s In Charge?

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Is it a company’s leadership, ultimately hired by the company’s owners, the shareholders. or is it a couple of proxy advisers, whose income depends on being the ones consulted over management decisions?

Exxon Mobil, having grown fed up with the anti-business climate of New York, has put before its owners, its shareholders, the proposition that the company should go out from New York, move to Texas, and redomicile there.

The two largest Proxy Advisors aggregate to somewhere between 90% and 97% of the American proxy advisory market. The two, Glass Lewis and Institutional Shareholder Services, are pushing those shareholders to reject the move.

(Aside: they’re not even American companies. Glass Lewis, although headquartered in San Francisco, is owned by Peloton Capital Management, a Canadian company. Institutional Shareholder Services, although headquartered in Rockville, MD, is owned by the German company, Deutsche Börse AG.)

Their motive is obvious. Texas, for instance,

lets companies domiciled in the state require that investors hold at least $1 million in market value, or 3% of voting shares, for six months to submit shareholder proposals. Companies can also require shareholders to own at least 3% of shares to bring lawsuits for breaches of fiduciary duty and self-dealing.

A successful move to Texas would encourage lots more companies to leave States with high business taxes, excessive regulatory environments, and especially relevant to this context, a heavily advisor-permissive suite of regulations. This is a significant reduction in the “advisors'” ability to…influence…the companies they choose to target.

Who runs, then, Exxon Mobil: the shareholders or Glass Lewis and Institutional Shareholder Services?