Business Leaders Blast 'Deaf' Regulators for Rushing Controversial AI Rules, Warn of 'Significant Harm' to California Economy
California’s business community is in an uproar, sounding the alarm after a state agency hastily pushed through sweeping new regulations governing the use of artificial intelligence and automated decision-making technology (ADMT). In a move that has sparked fears of economic fallout, the California Privacy Protection Agency (CPPA) approved the controversial rules, prompting a blistering response from the California Chamber of Commerce (CalChamber), which has accused the agency of recklessly endangering the state’s already fragile economy.
In a scathing statement issued immediately following the CPPA board's vote, CalChamber declared that the new regulations are "primed to cause significant harm." The organization’s frustration stems not just from the potential impact of the rules themselves, but from what they characterize as a deeply flawed and dangerously rushed approval process that ignored critical input from all sides.
According to CalChamber, the agency turned a blind eye to a mountain of feedback, effectively discarding some 400 pages of detailed public comments submitted by concerned citizens, industry experts, and businesses. This massive volume of input, meant to guide the regulatory process, was seemingly dismissed. Furthermore, the powerful business lobby claims the agency gave the cold shoulder to the state's own leadership, asserting that thoughtful requests made in the spring by Governor Gavin Newsom and a bipartisan group of nearly two dozen legislators "seem to have fallen on "deaf ears."".
The critique highlights a particularly startling claim: that even staunch advocates who typically push for stronger tech regulation raised red flags about the agency's "rush to judgment" during the decisive board meeting. This rare point of agreement between business interests and regulatory proponents suggests a broad consensus that the process was dangerously accelerated, leaving little room for the careful deliberation required for such complex and impactful rules.
Adding fuel to the fire is the agency's own economic analysis, which CalChamber slammed as "paper-thin" and woefully inadequate. The implication is that the CPPA failed to conduct a serious or thorough evaluation of how these far-reaching regulations would impact California's job market and business climate. For critics, this represents a shocking oversight that dismisses the real-world financial consequences for employers and workers across the state.
As California's businesses now brace for the impact of these new ADMT rules, the battle lines have been drawn. The state's leading business advocate has painted a picture of a regulatory body that is unresponsive to public input, legislative guidance, and economic reality, setting the stage for a contentious implementation and an uncertain future for innovation and commerce in the Golden State.
