Two Democratic Members of Congress, Greg Casar, (D-TX), and Rashida Talib (D-MI), have introduced legislation to the US House of Representatives that would ban the use of AI surveillance for setting prices and wages.
In Delta’s Q2 earnings report last week, Delta president Glen Hauenstein stated that the airline had already implemented AI-controlled dynamic prices for 3 percent its customers and aims to have 20 percent fares set by the system by the year’s end. Software company Fetcherr provides the pricing code for Delta and other airlines in the industry including Virgin Atlantic and WestJet. He told analyst
“We’re in a heavy testing phase. We like what we see,” . Delta’s decision is not new. Many companies adjust their prices based on the circumstances. For example, the business plan of ride-hailing apps is built around the idea peak demand leads to peak price. The supply and demand principle is at the core of modern economics. Software that crunches massive amounts of data makes the process faster and more efficient.
The use of AI still sparked a public outcry and politicians became interested. The Stop AI Price Gouging and Wage Fixing Actwants to ban advanced AI systems from analysing personal data to set prices and wages. Casar said
“Giant corporations should not be allowed to jack up your prices or lower your wages using data they got spying on you,” . “Whether you know it or not, you may already be getting ripped off by corporations using your personal data to charge you more. This problem is only going to get worse, and Congress should act before this becomes a full blown crisis.”
They want the Equal Employment Opportunity Commission and the FTC to enforce the rules in the bill. The legislation would allow citizens to take legal action against companies that use such practices. Altman fluffs the superintelligence to save humanity while OpenAI slashes price
The FTC released a staff report in January indicating that “surveillance pricing” has already occurred across certain sectors and may be expanding. The agency found companies adjusting prices according to factors like browser type, device, location, past shopping, and inferred characteristics such as wealth.
“The FTC should continue to investigate surveillance pricing practices because Americans deserve to know how their private data is being used to set the prices they pay and whether firms are charging different people different prices for the same good or service,” stated Lina Khan, the departing FTC Chair.
According to the FTC, a consumer who is profiled as being a new parent may be shown more expensive baby thermometers because they are less likely to already own one. The agency found at least 250 companies working with intermediaries to price products using these techniques. These firms often rely upon data from brokers and third-party sources. Lee Hepner is senior legal counsel for the American Economic Liberties Project which supports the legislation.
“Grocery prices have risen 26 percent since the pandemic-era explosion of online shopping, dovetailing with new technology designed to squeeze every last penny from consumers. Federal lawmakers should join this effort to restore fair, transparent, and predictable pricing.”
Both Republican commissioners voted against the FTC’s decision to continue studying this issue. Andrew Ferguson, newly appointed head regulator, was very firm in his rebuttal[PDF[PDF]and said that more study is needed. Republicans control both the House and Senate, so the legislation is unlikely to pass. (r)
