AI Regulation Mixes 'Humility' and Protecting Children, FTC’s Ferguson Says

In a conversation at an event hosted by the Family Online Safety Institute (FOSI) Monday, Ferguson said engineers "creating" AI "don't know what direction it's going," so regulating it heavily now, as the technology changes constantly, would be a mistake.

A better response would be "regulatory humility," letting "the technology develop,” and ensuring the U.S. remains at the forefront of developing it.

“Blindly racing into regulation or enforcement is very likely to have second-order effects that we will regret,” whereas starting enforcement after states and the federal government have had a chance to experiment and there is a better understanding of the tech is “best."

But "the trade-off for innovation" should never expose "children."

For instance, he argued that the FTC’s orders to various tech companies about AI chatbot interactions with young users were in line with the Trump administration's AI action plan (see 2509110068 and 2507230058). “We want to foster the hospitable regulatory climate, but we have to continue protecting American families -- especially children -- from the development of technology."

Another example is that "one of the first things I told the staff” when I was appointed was bring me “as many COPPA cases as you can find,” Ferguson said, noting that the FTC has brought several COPPA actions this year (see 2509300054, 2509030057 and 2509020069).

While he acknowledged there are “inadequacies” with the law, especially given that it’s from 1998, he argued that “we ought to push this thing to its absolute limit and protect as many children in as many ways as we possibly can.”

Last week at the Association of National Advertisers ad law conference, FTC Commissioner Melissa Holyoak said AI won't get immunity from future FTC enforcement (see 2511040037).

For the moment, though, consumer protection work at the FTC “has largely come to a halt,” owing to the government shutdown, Wilson Sonsini lawyers blogged Friday. But efforts on kids privacy could resume when the shutdown ends, they said.

“The majority of employees have been furloughed, and pending investigations have been paused,” wrote the firm’s Kelly Singleton, Maneesha Mithal and Christopher Olsen. “Only a few FTC actions have been announced during the shutdown, and the Commission has been instructed to only work on cases that present a significant threat to human life or property.”

Congress was moving toward an eventual end to the shutdown Monday after the Senate voted 60-40 Sunday night to invoke cloture on a motion to proceed on Republicans’ House-passed continuing resolution to restore federal funding through Nov. 21 (HR-5371), which will now serve as a vehicle for advancing a compromise package to reopen the government. Senate Majority Leader John Thune, R-S.D., secured support from eight Democrats on Sunday night by promising a separate vote by mid-December on extending Affordable Care Act subsidies. The revised HR-5371 would extend most appropriations through Jan. 30 and would reverse the Trump administration's layoffs of some federal workers during the shutdown.

The timing of Senate and House votes on an amended HR-5371 remained unclear Monday afternoon. Thune told reporters it “would be ideal … for [the Senate] to be able to finish it today and send it to the House.”

House Speaker Mike Johnson, R-La., told reporters he intends to call the chamber back into session once the Senate passes the amended HR-5371. But Senate Homeland Security Committee Chairman Rand Paul, R-Ky., was opposing a unanimous consent to speed the process of clearing HR-5371 unless the chamber’s leaders agreed to hold a vote on an amendment that would remove language that bans intoxicating hemp products.

“When the government shutdown ends, we expect to see continued [FTC] enforcement in the subscription, minor privacy and safety, content moderation, and impersonation areas,” the Wilson Sonsini lawyers said. “We also expect that FTC staff will be eager to make progress on investigations that were paused during the shutdown, which may result in tight deadlines for companies subject to an existing investigation.”

The lawyers also remarked on the privacy experience of Ryan Baasch, who is expected to be nominated as an FTC commissioner to replace Holyoak (see 2510300033 and 2511040037). While at the Texas attorney general’s office, Baasch “launched a state data privacy enforcement team and played a key role in cases involving First Amendment and technology issues,” the lawyers wrote. “Given his history, it is safe to assume that Baasch will be just as focused on technology companies and issues related to content moderation as FTC Chairman Andrew Ferguson.”