Comment by Cato Institute

Mandated transparency may also not actually improve consumer education around their privacy choices. First, many consumers may grow fatigued and frustrated with the constant pop ups and consents as they do with current cookie pop ups. Second, a government mandate — as opposed to an organic best practice — is more likely to communicate to consumers in ways that are not seamless with products and in terms they see fit for their audience by focusing on compliance instead. Finally, mandated transparency in AI is particularly tricky. Often, the ways data is used are of key value to the company. Government transparency mandates could require the disclosure of intellectual property or other competitively valuable information and concerningly set up platforms for pressure from the government to take or not take certain actions. Many companies will likely provide transparency in response to consumers’ expectations and demands. Those who do not may face industry or consumer pressure to do so. Such an approach allows for more flexibility than a regulatory mandate would and raises less concerns about the potential tradeoffs. AI Verified source (2024)