THE BUZZ: Assemblymember Rebecca Bauer-Kahan wants California to take the lead on regulating artificial intelligence before it’s too late.

President Joe Biden this week signed an executive order marking the most ambitious national effort yet to guide a rapidly-evolving technology. The sweeping measure was praised by both industry and consumer advocates as an important first step, but without more forceful action from Congress, its impacts are likely to be limited.

Enter California — home of the globe’s most powerful tech companies and the Democrats who have become increasingly willing to go up against them.

Bauer-Kahan, whose Bay Area district includes major tech hubs, is championing an effort to prohibit “algorithmic discrimination” — regulating automated decision tools that make a determination that may have a significant effect on a person’s life, such as in hiring, medical decisions, or parole rulings.

Her bill didn’t make it out of the Legislature this year, but attracted the attention of tech companies and industry groups across the nation. We caught up with the lawmaker shortly after her trip to D.C. to hear about what’s next for her legislation, and the future of AI in California.

This conversation has been edited for length and clarity

You just got back from Washington, where you met with White House leaders about AI regulation. After that trip, and Biden’s sweeping executive order, what do you see as California’s role in this arena?

“I think [Biden’s order] is very complementary … but I think our work will go a step further in ensuring that we’re creating a market for safe AI.”

Do you think Washington is looking to California to lead on this issue?

“I wouldn’t say Washington is looking to California. I think they would like to be the ones acting — there’s no question in my mind — but I don’t think they can.

I think they are open to the states acting. It does create a patchwork across the country that is really hard to comply with for these companies that will be operating across state borders. So I see the benefit of a single system of regulation, but none of us trust that D.C. can get there fast enough. AI is moving at such a rapid clip.“

AI is such a broad field. Why did you zero in on the question of algorithmic bias with Assembly Bill 331?

“I have been on the privacy committee my entire tenure, so five years now, and I had seen our previous chair, Assemblymember [Edwin] Chau, do his bills, and every single one failed on this question of ‘What is AI?’ and the definition of AI.

So I came into this thinking, ‘OK, that can’t be what stops this, because we have to protect society, so how do we think about it differently?’

To me, this felt like the lowest-hanging fruit, and the most important thing to do first because we all agree, hopefully, that we should not be discriminating in these consequential areas.

I think a much larger stab at AI is much harder, because we don’t really know where it’s going at this point.”

But even your bill, as narrow and low-hanging as it was, didn’t pass. What does that say about the path forward for regulation?

“It didn’t pass in the black hole of appropriations, so I think that is a different beast. But it did really get incredible support in committee, and every Democrat voted for it, including very moderate members, and Republicans who sat on those committees spoke very positively about it — they didn’t actually vote for it — but they were not poo-pooing it in ways that I actually was anticipating, to be honest with you.

I do remain optimistic that this is something we can build consensus around.”

Can you tell us why you think it failed and what you’ve learned for the next round?

“It was a really tough budget year. And anything we do in this space, if we want it to be enacted in a meaningful way and we want meaningful enforcement, it will require us to build up expertise and it will require us to build up our agencies to do what they are not doing today.

A year ago, when we first started drafting legislation, ChatGPT had not even been dropped.

I think people are much more aware, even a year later, how prolific this is in our lives, and that we as a government are actually behind the ball.

There were people who would say to me, ‘This is premature,’ and I would say ‘Fifty percent of these decisions are being made by AI today’ — and that was a year ago. I imagine today it’s even more. So we really need to catch up to where the technology is going.”

California prides itself on being an incubator for innovation, but some of our tech leaders here have derided Biden’s order as stifling innovation. How do you respond to that?

“I was a regulatory lawyer at the beginning of my career, and I understand from that work that it is their job to innovate and create and to build successful businesses and employ Californians. And it is our job as the government to protect society. And I do truly believe that if we’re smart and thoughtful about how we do this, we can do both.”

What will happen if California doesn’t regulate AI?

“What I had hoped for when I introduced AB 331 was that we could set the stage for a national standard, that we wouldn’t have patchwork regulation, but we would have other states follow our lead.

But I think it is dangerous for us to let other states go first and set a standard that is not up to California standards — or that is not as nimble in allowing innovation. “

Do you think it will take another ballot initiative threat like with the privacy laws to pass AI legislation in California?

“I was on a panel a week ago and I said I don’t think we should allow that to happen. But I think that if we don’t act — I just saw a poll that 90 percent of Californians want us to regulate AI.

So if that is where the electorate is, they will act without us if we don’t act. I truly believe that.”

What can we expect from you next year in terms of AI regulation?

“This one [AB 331] will be back, I promise. It won’t be the exact bill, but it will be back.

We’re looking a lot at what is federally preempted and what isn’t.

I imagine there’s going to be a lot in this space.

And to your point about innovation and regulation, we do need to be careful to make sure we balance the two, because there’s a lot of benefit. I’ll tell you the other day I had to help my son with his math, and I used Chat GPT to help me learn how to do it.”

Did it work?

“It did, but it... it was not advanced math.”

GOOD MORNING. Happy Wednesday. Thanks for waking up with Playbook.

PLAYBOOK TIP LINE — What other tech bills are you watching? Give us a ring or drop us a line.

Now you can text us at ‪916-562-0685‬‪ — save it as “CA Playbook” in your contacts now. Or drop us a line at [email protected] and [email protected], or on Twitter —@DustinGardiner and @Lara_Korte

WHERE’S GAVIN? Nothing official announced.

SPOTTED: HALLOWEEN EDITION — Plenty of California politicians took to social media Tuesday to celebrate the spookiest day of the year. Some of our favorite highlights:

• Senate President Pro Tem Toni Atkins and her wife, Jennifer LeSar, were looking very skeletal in matching jumpsuits as they posed on their porch with pups, Mia and Joey. Atkins tweeted, “Happy Howl-oween!”
• Other lawmakers posted selfies with their children and young relatives. Check out these extra cute shots from former Assembly Speaker Anthony Rendon and Assemblymember Evan Low.
• But the holiday wouldn’t be complete without some tricks. Democratic Rep. Pete Aguilar tweeted that the NRCC sent him a mailman costume. It was a dig after former Speaker Kevin McCarthy labeled Aguilar “Post Office Pete” as they bickered over his legislative record. Aguilar fired back at Republicans: “The NRCC just wasted donor money to send me a Halloween costume. No wonder the @dccc and Democrats are outraising House Republicans.”

FUNDING TRACK — California officials are pushing hard to secure $3 billion in federal infrastructure funding to ramp up construction on the state’s embattled high-speed rail project.

Former House Speaker Nancy Pelosi and Gov. Newsom are tag-teaming the effort. They’re lobbying the Biden administration to make the state’s case for the funding, which officials say will help complete the train’s initial 119-mile segment in the Central Valley.

Pelosi has been one of the project’s most vocal advocates behind the scenes in Washington. In recent months, Pelosi’s office said she has expressed her support for the project to President Biden, Transportation Secretary Pete Buttigieg and infrastructure coordinator Mitch Landrieu.

“If we are to have high-speed rail in America, our hopes are riding on California,” Pelosi told Playbook.

The former speaker has called high-speed rail a transformational project, both in terms of its potential to reduce planet-warming emissions from cars and to make America competitive with other countries that have extensive bullet train systems.

Pelosi has long been the project’s champion on Capitol Hill, helping to secure $3.5 billion in funding during President Barack Obama’s administration. She also successfully defended that funding when former President Donald Trump threatened to claw it back. Still, about 85 percent of the project has been funded at the state level.

Newsom, who rode a bullet train during his recent trip to China, sent a letter to Biden to reiterate the project’s potential benefits. He called the rail line “world-class infrastructure.”

But the project has long been controversial in California because of the cost and repeated construction delays. Even some Democrats in the Legislature have questioned whether building the Central Valley segment first could depress ridership.

TREND ALERT — Take note, Gov. Newsom, you’re not the only California Democrat who can challenge a Republican presidential candidate.

Rep. Ro Khanna is set this morning to debate Vivek Ramaswamy at St. Anselm College in Manchester, N.H. in what has been billed as a conversation about the “future of America.” The debate, which will air at 7 a.m. PT, will likely focus on their two big areas of disagreement: race and the economy.

For Ramaswamy, it’s a hail Mary attempt to claw back some points as he falls to the bottom of the GOP presidential pack. But for Khanna, a progressive with serious ambition, it’s a chance to bring his vision to a national audience — similar to another California Democrat we know.

Khanna told us he’s taking a different tack than the governor, however.

“It’s totally different,” he said. “This is a fireside chat. Substantive, civil conversation. Not going back and forth, a political smackdown.”

Newsom’s years-long feud with Florida Gov. Ron DeSantis has earned the two plenty of national attention, and after trading increasingly-hostile barbs on everything from gender issues to Disney this year, the two will go head-to-head at the end of November in a debate hosted by FOX News.

Khanna, who seriously considered a run for Senate earlier this year and is seen as a potential White House contender in 2028, dismissed the idea that he’s in it for the attention.

“People want to go on cable news, they want a viral clip, they want to hit someone with a zinger, and that’s not helpful in our nation that’s deeply polarized,” he told POLITICO.

Newsom didn’t have any advice for his fellow Californian, but did have some thoughts on Ramaswamy and DeSantis.

“I don’t understand why a presidential candidate would be debating a non-presidential candidate,” he said on a call with reporters Tuesday. “You’ll have to ask them why. I quite sincerely don’t understand.”

— with help from Sejal Govindarao and Lisa Kashinsky

TENDERLOIN CRACKDOWN: Drug-related arrests are surging in downtown San Francisco as police — with help from state and federal law enforcement — target open-air drug markets. The Sheriff’s Office announced it would reopen its annex jail in San Bruno to deal with a 32 percent surge in prisoners over last year. (San Francisco Chronicle)

BIRTHDAYS — Apple’s Tim Cook … Rep. Darrell Issa (R-Calif.) (7-0) … Alex Byers … Sonia Sroka … Caitlan Dowling …

(was Tuesday): Ron Rifkin ... Marc Berman

CALIFORNIA POLICY IS ALWAYS CHANGING: Know your next move. From Sacramento to Silicon Valley, POLITICO California Pro provides policy professionals with the in-depth reporting and tools they need to get ahead of policy trends and political developments shaping the Golden State. To learn more about the exclusive insight and analysis this subscriber-only service offers, click here.

Want to make an impact? POLITICO California has a variety of solutions available for partners looking to reach and activate the most influential people in the Golden State. Have a petition you want signed? A cause you’re promoting? Seeking to increase brand awareness amongst this key audience? Share your message with our influential readers to foster engagement and drive action. Contact Jesse Shapiro to find out how: [email protected].