Departing FTC chairwoman Lina Khan warns against 'AI hype'

In her final days as chairwoman of the Federal Trade Commission, Lina Khan has warned of businesses making lofty promises on artificial intelligence that they may fail to deliver for consumers. “There's been a tremendous amount of AI hype that we see in terms of exaggerating what some of these tools can offer,” she said at the Brookings Institution in Washington on Wednesday. “You know, it can harm people by saying, ‘hey, there are all these business opportunities with what this AI tool can do ’, so we've brought consumer-protection cases there.” Ms Khan said the sheer speed of AI development had prompted the FTC to assemble teams to examine policy on the technology's applications, cloud computing, language models and CPUs. “We're trying to figure out the core economic properties, what the market looks like to the extent that it seems dominated by a few players, and to what extent that's being driven by high fixed costs,” she said. It is that sort of approach – a close scrutiny of the work at the heart of technology companies – that has caused Ms Khan to become such a polarising figure in Washington in the past four years. She was 32 when she was appointed FTC chairwoman by President Joe Biden, making her the youngest person ever to serve in that role. Ms Khan was born in London to Pakistani parents and emigrated to the US when she was 11, according to The New York Times. She studied law at Yale University where, in 2017, she wrote an article titled Amazon's Antitrust Paradox. Ms Khan also spent time at Columbia Law School as a professor. Her appointment at the time was considered one of the more progressive moves by the Biden administration because Ms Khan was widely seen as a prominent advocate of aggressive antitrust enforcement against US technology companies. She also been highly critical of corporate mergers and consolidation. She has criticised Apple, Amazon , Meta, Nvidia and Microsoft , to name a few, but her ire has not been limited to Silicon Valley. Ms Khan has also gone after grocery store chains pursuing mergers that she says would drive up prices for consumers, and pharmaceutical companies that she accuses of abusing patent rules to increase prescription prices. “Inhalers are more affordable for countless families after the FTC challenged illegal patenting tricks from pharmaceutical companies,” she told the packed auditorium at Brookings, adding that as a result of her actions, 43 mergers had been abandoned. The backlash from corporate America has been considerable, but for all the criticism against her, she has made some allies on the conservative side of the US political spectrum, chief among them vice president-elect JD Vance, who has praised Ms Khan for her critiques and questioning of technology companies. “This is a really striking moment where there has been bipartisan concern about markets being dominated by fewer companies,” she said when asked about occasional support from Republican officials and state attorneys general. Constitutional law and political science experts have also taken note of Ms Khan's headline-grabbing approach to governing the FTC. “Lina Khan is leading the neo-Brandeisian charge against big business,” said Timothy Kneeland, a political science and history professor at Nazareth College in upstate New York. He was referring to progressive Supreme Court Justice Louis Brandeis, who opposed monopolies and monopolistic practices. “They fear 'autocrats of trade' who make decisions that affect the majority. This policy trend is favoured by progressives on the left and populists on the right.” Prof Kneeland acknowledged that while some of Ms Khan's directives have been successfully overturned by US courts, because of the importance of her position and her prolific policy implementations, she might be one of the most consequential Biden appointments. “The impact of her actions reverberated throughout the business world, especially in places like Silicon Valley, and led to changes in some business practices to avoid action by the FTC,” he said. “She'll be felt for years to come. Indeed, her lawsuit against Meta for their acquisition of WhatsApp and Instagram will likely play out even after she is gone.” Yet with Donald Trump's defeat of Kamala Harris in November, Ms Khan's tenure is coming to an end. Mr Trump has selected Andrew Ferguson, the FTC commissioner, as her successor. As a commissioner, Mr Ferguson will not need congressional confirmation. “Andrew has a proven record of standing up to Big Tech censorship and protecting freedom of speech in our great country,” Mr Trump said in an email announcing the appointment in December. While she did not specifically address Mr Ferguson's appointment during her appearance at Brookings, Ms Khan did speak about future of the FTC without her at the helm. “This work is far from over,” she said. “The FTC must remain vigilant, agile and deeply committed to enforcing the law without fear. I hope whomever takes over the FTC in the coming years and decades will keep the agency's doors open and continue to engage deeply from people from all parts of the country and walks of life.” Prof Kneeland said that Ms Khan's prolific approach during her tenure and her ability to read the public's populist mood might affect how Mr Ferguson moves forward in the months and years ahead. “While serving as an FTC commissioner he has disagreed with some of her decisions but may very well continue these trends to favour consumers and workers,” Prof Kneeland said.

Departing FTC chairwoman Lina Khan warns against 'AI hype'

Big Tech critic and merger sceptic reflects on tenure as youngest head of Federal Trade Commission