Is There a New AI Controversy Involving Musk and Newsom?
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Available for free until April 11, PMG Pro’s Technology: California Decoded newsletter delves into how California is shaping tech policy both within the state and on a national scale.
Quick Fix— The legislator leading a significant effort on AI safety expresses optimism this year.
— An exclusive interview with California AG Rob Bonta sheds light on his perspective regarding Trump’s approach to technology.
— Insights on what a major tech lobbying group is focusing on in Sacramento this year.
Welcome to the inaugural edition of California Decoded, the flagship daily newsletter from PMG’s newly established California tech team. I’m Chase DiFeliciantonio, your host for today, providing you with the latest developments in the AI and automation sectors, which will be my primary focus. My colleague Tyler Katzenberger will cover all things related to tech policy, ranging from social media to privacy discussions. We'll introduce the final member of our team, who will report on Silicon Valley politics, tomorrow. Thanks for joining us!
Feel free to send feedback, tips, and story ideas to [email protected] and [email protected].
**Driving the Day:** **ANALYSIS: AI SAFETY IS BACK** — A prominent AI safety bill that has drawn criticism from Big Tech, acclaim from Elon Musk, and criticism from leading congressional Democrats, including Rep. Nancy Pelosi, has resurfaced in Sacramento. The proposed law from state Sen. Scott Wiener is significant not just due to the previous controversy it stirred but also for what its revised version signifies about who controls AI regulation in California and further afield.
Wiener, a Democrat from San Francisco with aspirations for Pelosi’s seat upon her retirement, revived the legislation last Friday after the failure of the previously controversial bill known as SB 1047. The landscape has shifted with this retooled proposal, which currently looks significantly different from the sweeping initiative that faced backlash from the tech industry.
For this iteration of the bill to succeed, Wiener will need to navigate a veto from Gov. Gavin Newsom, which derailed his earlier attempt, and appease a governor who has shown little inclination to take a strong stance against one of California’s most lucrative industries. Wiener will also have to negotiate with major tech players, such as Meta and OpenAI, to temper their opposition, a task he previously struggled to achieve.
Evidently, Wiener is adopting a strategy reminiscent of the tech industry's "fail fast" mentality, reintegrating two critical elements from last year’s attempt: expanding whistleblower protections for AI workers and enhancing public computing facilities for AI research.
“I would be very surprised if the bill drew meaningful opposition from tech,” Wiener remarked to California Decoded on Friday, following the release of the new bill’s language. “But I’ve been surprised before.”
His changed strategy speaks volumes about who will exert influence in the ongoing effort to regulate AI and mitigate risks associated with its deployment — such as excessive energy consumption or greater fears of catastrophic outcomes.
Here’s a breakdown of the key stakeholders Wiener will encounter in his latest AI initiative:
**Musk:** A long-time skeptic of AI risks, Musk begrudgingly supported Wiener’s earlier bill focused on pre-release testing of AI models last year. However, he has not shown a willingness to back up his views with significant resources. Given that the new proposal emphasizes enabling AI developers to report issues internally, it remains unlikely that Musk will actively support this initiative, particularly due to his previous stances against internal leaks at Tesla.
**Newsom:** The governor not only vetoed Wiener’s SB 1047 but also initiated an alternate strategy by bringing together a panel of AI and legal experts to compile a report on effectively addressing the safety challenges posed by AI technology. This report is expected shortly in the first quarter of 2025. Wiener noted that he has not been involved in the panel’s discussions but is open to adjusting his bill based on their recommendations.
This puts Wiener in more of a supportive role, pending insights from notable figures like Stanford’s Fei-Fei Li, known as The Godmother of AI.
**Democrats in Congress:** Pelosi previously opposed Wiener’s former proposal, so her stance on the revised, narrower version remains uncertain. This intra-party dispute occurred during Biden’s administration, contrasting the current environment where the Democrats lack control in Washington, possibly making them more inclined to seek victories in key tech policy areas elsewhere.
**Big Tech:** Last year, AI companies like OpenAI and Meta opposed Wiener’s broader measure, while Anthropic, the creator of the Claude chatbot, offered limited support. Wiener believes the adjusted bill will generate less pushback from the tech sector because it focuses on whistleblower protections instead of an extensive vetting process like the last bill proposed. Yet, it remains to be seen if this approach will succeed.
Anthropic did not provide a comment for California Decoded regarding the bill, and inquiries to OpenAI and Y Combinator went unanswered. Meta had previously urged that the testing rules included in the former bill posed too much liability for startups utilizing its free AI services.
Wiener expressed confidence that removing the testing provisions would mitigate much of the expected opposition. However, substituting them with whistleblower protections may not entirely pacify a tech industry wary of leaks, which could be treated as significant corporate treachery.
Despite inquiries, no tech company outright rejected the bill, suggesting that there remains a possibility for tech to engage constructively this time around.
**Happening Today:** 3:30 p.m. PT — The California Assembly’s Banking and Finance Committee will convene to address, among other items, Republican Assemblymember Phillip Chen’s proposal aimed at reducing state licensing fees for cryptocurrency traders.
**In the Courts:** **EXCLUSIVE: BONTA’S TECH PLAYBOOK** — California Attorney General Rob Bonta remains unfazed by the pressures from Trump and Big Tech regarding stringent AI regulations and data privacy laws, as he conveyed in an exclusive interview with California Decoded hours before our launch.
This comes as Trump intensifies his campaign against tech regulations in Europe, which often inspire legislative measures in California.
“We expect that maybe Trump will want to sue. Maybe he won't. No idea,” Bonta remarked when asked about the potential expansion of Trump’s campaign to California. “We'll take him to court ... and as we usually do, we presume we have a high likelihood of success.”
The Trump administration has threatened tariffs against European taxes on U.S. tech firms, with FCC leader Brendan Carr criticizing what he labeled Europe’s social media “censorship.”
Sound familiar? It is echoed by various tech industry organizations, including Musk’s X, which have launched numerous lawsuits alleging violations of the First Amendment concerning California’s social media and AI deepfake regulations.
While Trump hasn’t specifically targeted California, both he and Musk have frequently criticized its progressive policies.
Bonta indicated that his office is proactive in their approach.
“The laws that we engage on — either we sponsor or that we provide technical assistance on — we're doing deeper dives on all of those,” he stated. “We know the playbook.”
**Influence & Industry:** **GOLD RUSH** — The Chamber of Progress, a liberal and pro-tech organization, is closely monitoring California lawmakers this session after opposing some of the state’s most ambitious social media and AI regulatory initiatives in the past year.
CEO Adam Kovacevich provided today a rundown of the group’s key legislative battles, with Sacramento as a focal point.
On the top of the agenda are proposals mandating warning labels on social media platforms, such as Assemblymember Rebecca Bauer-Kahan’s AB 56, which would require platforms to show unskippable, 90-second health warnings to users daily.
Bauer-Kahan also made the Chamber’s highlight list due to her innovative attempt to prevent tech firms from using copyrighted materials to train AI models without consent from the original creators.
Kovacevich noted that the Chamber of Progress is keeping an eye on reduced versions of previous legislative attempts, including Wiener’s revived AI safety bill and Assemblymember Cecilia Aguiar-Curry’s third attempt to implement human safety operators for autonomous delivery vehicles.
**Byte Sized:** — Reports suggest that Apple is lagging in the AI race, despite collaborating with OpenAI.
— Anthropic now has a valuation of $61.5 billion.
— Alongside California, lawmakers in states like Texas are addressing the energy requirements for data centers.
— John Bostic, who prosecuted Theranos founder Elizabeth Holmes, warns Silicon Valley about the need for caution and transparency regarding new technologies.
With contributions from Nicole Norman.
Got a tip, event, or AI chatbot prompt to share? Contact us: Emma Anderson, California tech editor; Chase DiFeliciantonio, AI and automation reporter; and Tyler Katzenberger, Sacramento tech reporter.
James del Carmen for TROIB News
Quick Fix— The legislator leading a significant effort on AI safety expresses optimism this year.
— An exclusive interview with California AG Rob Bonta sheds light on his perspective regarding Trump’s approach to technology.
— Insights on what a major tech lobbying group is focusing on in Sacramento this year.
Welcome to the inaugural edition of California Decoded, the flagship daily newsletter from PMG’s newly established California tech team. I’m Chase DiFeliciantonio, your host for today, providing you with the latest developments in the AI and automation sectors, which will be my primary focus. My colleague Tyler Katzenberger will cover all things related to tech policy, ranging from social media to privacy discussions. We'll introduce the final member of our team, who will report on Silicon Valley politics, tomorrow. Thanks for joining us!
Feel free to send feedback, tips, and story ideas to [email protected] and [email protected].
**Driving the Day:** **ANALYSIS: AI SAFETY IS BACK** — A prominent AI safety bill that has drawn criticism from Big Tech, acclaim from Elon Musk, and criticism from leading congressional Democrats, including Rep. Nancy Pelosi, has resurfaced in Sacramento. The proposed law from state Sen. Scott Wiener is significant not just due to the previous controversy it stirred but also for what its revised version signifies about who controls AI regulation in California and further afield.
Wiener, a Democrat from San Francisco with aspirations for Pelosi’s seat upon her retirement, revived the legislation last Friday after the failure of the previously controversial bill known as SB 1047. The landscape has shifted with this retooled proposal, which currently looks significantly different from the sweeping initiative that faced backlash from the tech industry.
For this iteration of the bill to succeed, Wiener will need to navigate a veto from Gov. Gavin Newsom, which derailed his earlier attempt, and appease a governor who has shown little inclination to take a strong stance against one of California’s most lucrative industries. Wiener will also have to negotiate with major tech players, such as Meta and OpenAI, to temper their opposition, a task he previously struggled to achieve.
Evidently, Wiener is adopting a strategy reminiscent of the tech industry's "fail fast" mentality, reintegrating two critical elements from last year’s attempt: expanding whistleblower protections for AI workers and enhancing public computing facilities for AI research.
“I would be very surprised if the bill drew meaningful opposition from tech,” Wiener remarked to California Decoded on Friday, following the release of the new bill’s language. “But I’ve been surprised before.”
His changed strategy speaks volumes about who will exert influence in the ongoing effort to regulate AI and mitigate risks associated with its deployment — such as excessive energy consumption or greater fears of catastrophic outcomes.
Here’s a breakdown of the key stakeholders Wiener will encounter in his latest AI initiative:
**Musk:** A long-time skeptic of AI risks, Musk begrudgingly supported Wiener’s earlier bill focused on pre-release testing of AI models last year. However, he has not shown a willingness to back up his views with significant resources. Given that the new proposal emphasizes enabling AI developers to report issues internally, it remains unlikely that Musk will actively support this initiative, particularly due to his previous stances against internal leaks at Tesla.
**Newsom:** The governor not only vetoed Wiener’s SB 1047 but also initiated an alternate strategy by bringing together a panel of AI and legal experts to compile a report on effectively addressing the safety challenges posed by AI technology. This report is expected shortly in the first quarter of 2025. Wiener noted that he has not been involved in the panel’s discussions but is open to adjusting his bill based on their recommendations.
This puts Wiener in more of a supportive role, pending insights from notable figures like Stanford’s Fei-Fei Li, known as The Godmother of AI.
**Democrats in Congress:** Pelosi previously opposed Wiener’s former proposal, so her stance on the revised, narrower version remains uncertain. This intra-party dispute occurred during Biden’s administration, contrasting the current environment where the Democrats lack control in Washington, possibly making them more inclined to seek victories in key tech policy areas elsewhere.
**Big Tech:** Last year, AI companies like OpenAI and Meta opposed Wiener’s broader measure, while Anthropic, the creator of the Claude chatbot, offered limited support. Wiener believes the adjusted bill will generate less pushback from the tech sector because it focuses on whistleblower protections instead of an extensive vetting process like the last bill proposed. Yet, it remains to be seen if this approach will succeed.
Anthropic did not provide a comment for California Decoded regarding the bill, and inquiries to OpenAI and Y Combinator went unanswered. Meta had previously urged that the testing rules included in the former bill posed too much liability for startups utilizing its free AI services.
Wiener expressed confidence that removing the testing provisions would mitigate much of the expected opposition. However, substituting them with whistleblower protections may not entirely pacify a tech industry wary of leaks, which could be treated as significant corporate treachery.
Despite inquiries, no tech company outright rejected the bill, suggesting that there remains a possibility for tech to engage constructively this time around.
**Happening Today:** 3:30 p.m. PT — The California Assembly’s Banking and Finance Committee will convene to address, among other items, Republican Assemblymember Phillip Chen’s proposal aimed at reducing state licensing fees for cryptocurrency traders.
**In the Courts:** **EXCLUSIVE: BONTA’S TECH PLAYBOOK** — California Attorney General Rob Bonta remains unfazed by the pressures from Trump and Big Tech regarding stringent AI regulations and data privacy laws, as he conveyed in an exclusive interview with California Decoded hours before our launch.
This comes as Trump intensifies his campaign against tech regulations in Europe, which often inspire legislative measures in California.
“We expect that maybe Trump will want to sue. Maybe he won't. No idea,” Bonta remarked when asked about the potential expansion of Trump’s campaign to California. “We'll take him to court ... and as we usually do, we presume we have a high likelihood of success.”
The Trump administration has threatened tariffs against European taxes on U.S. tech firms, with FCC leader Brendan Carr criticizing what he labeled Europe’s social media “censorship.”
Sound familiar? It is echoed by various tech industry organizations, including Musk’s X, which have launched numerous lawsuits alleging violations of the First Amendment concerning California’s social media and AI deepfake regulations.
While Trump hasn’t specifically targeted California, both he and Musk have frequently criticized its progressive policies.
Bonta indicated that his office is proactive in their approach.
“The laws that we engage on — either we sponsor or that we provide technical assistance on — we're doing deeper dives on all of those,” he stated. “We know the playbook.”
**Influence & Industry:** **GOLD RUSH** — The Chamber of Progress, a liberal and pro-tech organization, is closely monitoring California lawmakers this session after opposing some of the state’s most ambitious social media and AI regulatory initiatives in the past year.
CEO Adam Kovacevich provided today a rundown of the group’s key legislative battles, with Sacramento as a focal point.
On the top of the agenda are proposals mandating warning labels on social media platforms, such as Assemblymember Rebecca Bauer-Kahan’s AB 56, which would require platforms to show unskippable, 90-second health warnings to users daily.
Bauer-Kahan also made the Chamber’s highlight list due to her innovative attempt to prevent tech firms from using copyrighted materials to train AI models without consent from the original creators.
Kovacevich noted that the Chamber of Progress is keeping an eye on reduced versions of previous legislative attempts, including Wiener’s revived AI safety bill and Assemblymember Cecilia Aguiar-Curry’s third attempt to implement human safety operators for autonomous delivery vehicles.
**Byte Sized:** — Reports suggest that Apple is lagging in the AI race, despite collaborating with OpenAI.
— Anthropic now has a valuation of $61.5 billion.
— Alongside California, lawmakers in states like Texas are addressing the energy requirements for data centers.
— John Bostic, who prosecuted Theranos founder Elizabeth Holmes, warns Silicon Valley about the need for caution and transparency regarding new technologies.
With contributions from Nicole Norman.
Got a tip, event, or AI chatbot prompt to share? Contact us: Emma Anderson, California tech editor; Chase DiFeliciantonio, AI and automation reporter; and Tyler Katzenberger, Sacramento tech reporter.
James del Carmen for TROIB News
