Subterms
For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Calls by senior Tories to abolish inheritance tax (IHT) have been met with scepticism from senior economists and tax experts. More than 50 Conservative MPs, including former chancellor […] More
Rumman Chowdhury often has trouble sleeping, but, to her, this is not a problem that requires solving. She has what she calls “2am brain”, a different sort of brain from her day-to-day brain, and the one she relies on for especially urgent or difficult problems. Ideas, even small-scale ones, require care and attention, she says, along with a kind of alchemic intuition. “It’s just like baking,” she says. “You can’t force it, you can’t turn the temperature up, you can’t make it go faster. It will take however long it takes. And when it’s done baking, it will present itself.”It was Chowdhury’s 2am brain that first coined the phrase “moral outsourcing” for a concept that now, as one of the leading thinkers on artificial intelligence, has become a key point in how she considers accountability and governance when it comes to the potentially revolutionary impact of AI.Moral outsourcing, she says, applies the logic of sentience and choice to AI, allowing technologists to effectively reallocate responsibility for the products they build onto the products themselves – technical advancement becomes predestined growth, and bias becomes intractable.“You would never say ‘my racist toaster’ or ‘my sexist laptop’,” she said in a Ted Talk from 2018. “And yet we use these modifiers in our language about artificial intelligence. And in doing so we’re not taking responsibility for the products that we build.” Writing ourselves out of the equation produces systematic ambivalence on par with what the philosopher Hannah Arendt called the “banality of evil” – the wilful and cooperative ignorance that enabled the Holocaust. “It wasn’t just about electing someone into power that had the intent of killing so many people,” she says. “But it’s that entire nations of people also took jobs and positions and did these horrible things.”Chowdhury does not really have one title, she has dozens, among them Responsible AI fellow at Harvard, AI global policy consultant and former head of Twitter’s Meta team (Machine Learning Ethics, Transparency and Accountability). AI has been giving her 2am brain for some time. Back in 2018 Forbes named her one of the five people “building our AI future”.A data scientist by trade, she has always worked in a slightly undefinable, messy realm, traversing the realms of social science, law, philosophy and technology, as she consults with companies and lawmakers in shaping policy and best practices. Around AI, her approach to regulation is unique in its staunch middle-ness – both welcoming of progress and firm in the assertion that “mechanisms of accountability” should exist.Effervescent, patient and soft-spoken, Chowdhury listens with disarming care. She has always found people much more interesting than what they build or do. Before skepticism around tech became reflexive, Chowdhury had fears too – not of the technology itself, but of the corporations that developed and sold it.As the global lead at the responsible AI firm Accenture, she led the team that designed a fairness evaluation tool that pre-empted and corrected algorithmic bias. She went on to start Parity, an ethical AI consulting platform that seeks to bridge “different communities of expertise”. At Twitter – before it became one of the first teams disbanded under Elon Musk – she hosted the company’s first-ever algorithmic bias bounty, inviting outside programmers and data scientists to evaluate the site’s code for potential biases. The exercise revealed a number of problems, including that the site’s photo-cropping software seemed to overwhelmingly prefer faces that were young, feminine and white.This is a strategy known as red-teaming, in which programmers and hackers from outside an organization are encouraged to try and curtail certain safeguards to push a technology to “do bad things to identify what bad things it’s capable of”, says Chowdhury. These kinds of external checks and balances are rarely implemented in the world of tech because of technologists’ fear of “people touching their baby”.She is currently working on another red-teaming event for Def Con – a convention hosted by the hacker organization AI Village. This time, hundreds of hackers are gathering to test ChatGPT, with the collaboration of its founder OpenAI, along with Microsoft, Google and the Biden administration. The “hackathon” is scheduled to run for over 20 hours, providing them with a dataset that is “totally unprecedented”, says Chowdhury, who is organizing the event with Sven Cattell, founder of AI Village and Austin Carson, president of the responsible AI non-profit SeedAI.In Chowdhury’s view, it’s only through this kind of collectivism that proper regulation – and regulation enforcement – can occur. In addition to third-party auditing, she also serves on multiple boards across Europe and the US helping to shape AI policy. She is wary, she tells me, of the instinct to over-regulate, which could lead models to overcorrect and not address ingrained issues. When asked about gay marriage, for example, ChatGPT and other generative AI tools “totally clam up”, trying to make up for the amount of people who have pushed the models to say negative things. But it’s not easy, she adds, to define what is toxic and what is hateful. “It’s a journey that will never end,” she tells me, smiling. “But I’m fine with that.”Early on, when she first started working in tech, she realized that “technologists don’t always understand people, and people don’t always understand technology”, and sought to bridge that gap. In its broadest interpretation, she tells me, her work deals with understanding humans through data. “At the core of technology is this idea that, like, humanity is flawed and that technology can save us,” she says, noting language like “body hacks” that implies a kind of optimization unique to this particular age of technology. There is an aspect of it that kind of wishes we were “divorced from humanity”.Chowdhury has always been drawn to humans, their messiness and cloudiness and unpredictability. As an undergrad at MIT, she studied political science, and, later, after a disillusioning few months in non-profits in which she “knew we could use models and data more effectively, but nobody was”, she went to Columbia for a master’s degree in quantitative methods.skip past newsletter promotionafter newsletter promotionIn the last month, she has spent a week in Spain helping to carry out the launch of the Digital Services Act, another in San Francisco for a cybersecurity conference, another in Boston for her fellowship, and a few days in New York for another round of Def Con press. After a brief while in Houston, where she’s based, she has upcoming talks in Vienna and Pittsburgh on AI nuclear misinformation and Duolingo, respectively.At its core, what she prescribes is a relatively simple dictum: listen, communicate, collaborate. And yet, even as Sam Altman, the founder and CEO of OpenAI, testifies before Congress that he’s committed to preventing AI harms, she still sees familiar tactics at play. When an industry experiences heightened scrutiny, barring off prohibitive regulation often means taking control of a narrative – ie calling for regulation, while simultaneously spending millions in lobbying to prevent the passing of regulatory laws.The problem, she says, is a lack of accountability. Internal risk analysis is often distorted within a company because risk management doesn’t often employ morals. “There is simply risk and then your willingness to take that risk,” she tells me. When the risk of failure or reputational harm becomes too great, it moves to an arena where the rules are bent in a particular direction. In other words: “Let’s play a game where I can win because I have all of the money.”But people, unlike machines, have indefinite priorities and motivations. “There are very few fundamentally good or bad actors in the world,” she says. “People just operate on incentive structures.” Which in turn means that the only way to drive change is to make use of those structures, ebbing them away from any one power source. Certain issues can only be tackled at scale, with cooperation and compromise from many different vectors of power, and AI is one of them.Though, she readily attests that there are limits. Points where compromise is not an option. The rise of surveillance capitalism, she says, is hugely concerning to her. It is a use of technology that, at its core, is unequivocally racist and therefore should not be entertained. “We cannot put lipstick on a pig,” she said at a recent talk on the future of AI at New York University’s School of Social Sciences. “I do not think ethical surveillance can exist.”Chowdhury recently wrote an op-ed for Wired in which she detailed her vision for a global governance board. Whether it be surveillance capitalism or job disruption or nuclear misinformation, only an external board of people can be trusted to govern the technology – one made up of people like her, not tied to any one institution, and one that is globally representative. On Twitter, a few users called her framework idealistic, referring to it as “blue sky thinking” or “not viable”. It’s funny, she tells me, given that these people are “literally trying to build sentient machines”.She’s familiar with the dissonance. “It makes sense,” she says. We’re drawn to hero narratives, the assumption that one person is and should be in charge at any given time. Even as she organizes the Def Con event, she tells me, people find it difficult to understand that there is a team of people working together every step of the way. “We’re getting all this media attention,” she says, “and everybody is kind of like, ‘Who’s in charge?’ And then we all kind of look at each other and we’re like, ‘Um. Everyone?’” More
Joe Biden and the House Republican speaker, Kevin McCarthy, have reached a deal “in principle” to raise the federal government’s $31.4tn debt ceiling, potentially averting an economically destabilising default on 5 June.With any new agreement still required to pass through a divided Congress, the risk that the Treasury department runs short of money to cover all its obligations does however remain.Without raising the debt limit, the US government would default on its bills, a historic first that would likely carry catastrophic consequences. Federal workers would be furloughed, global stock markets would crash and the US economy would probably drop into a recession.As details of the deal begin to come to light, here is a quick guide on the debt ceiling and what it means for the US government and people across the country:What is the debt ceiling?The debt ceiling is the limit on the amount of money the US government can borrow to pay for services, such as social security, Medicare and the military.Each year, the government takes in revenue from taxes and other streams, such as customs duties, but ultimately spends more than it takes in. This leaves the government with a deficit, which has ranged from $400bn to $3tn each year over the last decade. The deficit left at the end of the year ultimately gets tacked on to the country’s total debt.To borrow money, the US treasury issues securities, like US government bonds, that it will eventually pay back with interest. Once the US government hits its debt limit, the treasury cannot issue more securities, essentially stopping a key flow of money into the federal government.Congress is in charge of setting the debt limit, which currently stands at $31.4tn. The debt ceiling has been raised 78 times since 1960, under both Democrat and Republican presidents. At times, the ceiling was briefly suspended and then reinstated at a higher limit, essentially a retroactive raising of the debt ceiling.What happens if the US defaults?The US has never defaulted on its payments before, so exactly what would happen is unclear. It’s not likely to be good.“Failure to meet the government’s obligation would cause irreparable harm to the US economy, the livelihoods of all Americans and global financial stability,” the US treasury secretary, Janet Yellen, said in a letter to Congress in January.Investors would lose faith in the US dollar, causing the economy to weaken quickly. Job cuts would be imminent, and the US federal government would not have the means to continue all its services. Mortgage rates would probably soar – tanking the housing market.Why is the US debt so high?The US debt grows when the government is spending more money or when its revenue is lower.Throughout its history, the US has had at least some amount of debt. But the debt really started to grow in the 80s, after Ronald Reagan’s huge tax cuts. Without as much tax revenue, the government needed to borrow more money to spend.During the 90s, the end of the cold war allowed the government to cut back on defense spending, and a booming economy led to higher tax revenues. But then, in the early 2000s, the dotcom bubble burst, leading to a recession. George W Bush cut taxes twice, in 2001 and 2003, and then the US military campaigns in Iraq and Afghanistan increased spending by as much as nearly $6tn over the course of the war.When the 2008 Great Recession started, the government had to bulk up spending to bail out banks and increase social services as the unemployment rate hit 10%.When the unemployment rate returned to its pre-recession levels, in 2017, a major tax cut was passed under Donald Trump. The debt rose by $7.8tn while he was in office.And then the Covid-19 pandemic hit. The US government passed a series of stimulus bills to offset the worst of the pandemic’s impacts that ultimately totaled $5tn.What are the main contributors to federal government spending?The biggest chunk of US government spending goes to mandatory programs, such as social security, Medicaid and Medicare, which comprise nearly half of the overall annual budget. Military spending takes up the biggest chunk of discretionary spending, taking up 12% of the budget. Other big-ticket items include spending on education, employment training and services and benefits for US veterans. More
The US is careening towards a debt crisis the likes of which we haven’t seen since 2011 when Barack Obama faced off against the Tea Party. No one knows for sure if the federal government is going to default on its debt by the end of this month. But if Democrats and Republicans can’t agree on a compromise, it will have an enormous impact on small businesses around the country.Some 65% of small businesses believe they would be negatively affected by a default, according to a recent report from Goldman Sachs. This is very bad news. Small businesses accounted for 45% of all private-sector jobs in the first quarter of 2022.The first small businesses that will be affected will be those that contract directly with the federal government. Tens of thousands of small businesses received more than $154bn in federal contracts in the fiscal year 2021 – about 27% of all government contract spending that year. And this doesn’t include the small businesses that indirectly received funding from larger construction and other firms that get government money and sub-contract out work to them. If Janet Yellen is forced to prioritize interest and debt payments above all else, then these federal contracts would be suspended and the negative cash flow impact on these small firms would be substantial. Let’s remember: almost half of small businesses have less than three months of cash on hand.Then there are the small businesses that service government properties. A report from the Cato Institute estimates that the federal government owns or leases more than 350,000 buildings and properties around the country. These facilities are a critical revenue source for countless small firms that perform construction, maintenance, security, cleaning, electrical, landscaping and other kinds of services, all which would be potentially interrupted. The employees that go to these buildings every day rely on neighboring businesses for their lunches, dry cleaning, yoga, happy hours and other products and services. If ordered to stay home, these businesses – already reeling from the number of employees now working remotely – would suffer a significant blow.Then there are government functions. Individuals and small business owners rely on many areas of the government for services. They’re applying for passports, questioning the IRS, waiting on regulatory approval and loan guarantees from the Small Business Administration. These and many other critical government services could be suspended if funding is re-directed.These are all immediate effects of what would happen if the government must avoid a loan default. The longer-term effects are even more devastating. If the situation persists credit and financial markets will be volatile and banks will be forced to limit financing to only the most secure (and usually) largest of their customers, which means many small businesses seeking loans will either have to wait or be denied. The Goldman Sachs study found that 77% of small business owners they surveyed were already concerned about their ability to get loans.According to the White House, a default lasting more than three months would cause a significant recession with as many as 8 million people losing their jobs. The stock market – where small business owners park a significant amount of their retirement savings and collateral – could collapse.All of this could not come at a worse time for small businesses. Optimism among business owners – as determined monthly by the National Federation of Independent Businesses – is already at a 10-year low. Bankruptcies are ominously on the rise too, with one research firm reporting a 20% increase in filings from a year ago. An extended shutdown would make these numbers much worse.If you’re a small business owner, what can you do?It sounds obvious but it’s a fact that my very best clients are always thinking ahead. So the first thing you should be doing is preparing. A federal default or shutdown may not happen at all, but that doesn’t mean you shouldn’t be ready for such an event by the end of this month.That means hoarding cash, confirming your credit availability (including credit cards) and communicating with your customers, suppliers, employees and partners. No one should be surprised by your actions – like delaying payments – if a shutdown occurs. They should know that this is something you may be forced to do and they should know this well in advance. The more you tell them of your plans the better they can also plan and the more appreciative they will be.Also, and this is probably no consolation for businesses right now, is to take away an important lesson: diversity is important. If your business relies too much on any one customer (ie the federal government) then once this problem is behind us you should be making it a priority to diversify your customer base. Too much dependence on one source of revenue is too big a risk and even the federal government can’t be relied on to pay its bills on time – or at all.The silver lining in this dangerous, avoidable situation is that it would take time for things to get really, really bad. Although Yellen warns of a default by the end of May, she does have options for at least funding major parts of the government. And quarterly tax payments – expected by mid-June – could help stave off disaster for a while longer. But none of this should stop a business owner from thinking about the consequences now and preparing for this event. Even if we escape this time, given the acrimonious environment in Washington, we shouldn’t be surprised if something like this doesn’t occur again – and soon. More
For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Japanese businesses are committing to invest nearly £18bn in the UK, Rishi Sunak has announced as he meets the bosses of major firms in Tokyo. The prime minister […] More
The CEO of OpenAI, the company responsible for creating artificial intelligence chatbot ChatGPT and image generator Dall-E 2, said “regulation of AI is essential” as he testified in his first appearance in front of the US Congress.Speaking to the Senate judiciary committee on Tuesday, Sam Altman said he supported regulatory guardrails for the technology that would enable the benefits of artificial intelligence while minimizing the harms.“We think that regulatory intervention by governments will be critical to mitigate the risks of increasingly powerful models,” Altman said in his prepared remarks.Altman suggested the US government might consider licensing and testing requirements for development and release of AI models. He proposed establishing a set of safety standards and a specific test models would have to pass before they can be deployed, as well as allowing independent auditors to examine the models before they are launched. He also argued existing frameworks like Section 230, which releases platforms from liability for the content its users post, would not be the right way to regulate the system.“For a very new technology we need a new framework,” Altman said.Both Altman and Gary Marcus, an emeritus professor of psychology and neural science at New York University who also testified at the hearing, called for a new regulatory agency for the technology. AI is complicated and moving fast, Marcus argued, making “an agency whose full-time job” is to regulate it crucial.Throughout the hearing, senators drew parallels between social media and generative AI, and the lessons lawmakers had learned from the government’s failure to act on regulating social platforms.Yet the hearing was far less contentious than those at which the likes of the Meta CEO, Mark Zuckerberg, testified. Many lawmakers gave Altman credit for his calls for regulation and acknowledgment of the pitfalls of generative AI. Even Marcus, brought on to provide skepticism about the technology, called Altman’s testimony sincere.The hearing came as renowned and respected AI experts and ethicists, including former Google researchers Dr Timnit Gebru, who co-led the company’s ethical AI team, and Meredith Whitaker, have been sounding the alarm about the rapid adoption of generative AI, arguing the technology is over-hyped. “The idea that this is going to magically become a source of social good … is a fantasy used to market these programs,” Whitaker, now the president of secure messaging app Signal, recently said in an interview with Meet the Press Reports.Generative AI is a probability machine “designed to spit out things that seem plausible” based on “massive amounts of effectively surveillance data that has been scraped from the web”, she argued.Senators Josh Hawley and Richard Blumenthal said this hearing is just the first step in understanding the technology.Blumenthal said he recognized what he described as the “promises” of the technology including “curing cancer, developing new understandings of physics and biology, or modeling climate and weather”.Potential risks Blumenthal said he was worried about include deepfakes, weaponized disinformation, housing discrimination, harassment of women and impersonation frauds. “For me, perhaps the biggest nightmare is the looming new industrial revolution, the displacement of millions of workers,” he said.Altman said that while OpenAI was building tools that will one day “address some of humanity’s biggest challenges like climate changes and curing cancer”, the current systems were not capable of doing these things yet.But he believes the benefits of the tools deployed so far “vastly outweigh the risks” and said the company conducts extensive testing and implements safety and monitoring systems before releasing any new system.“OpenAI was founded on the belief that artificial intelligence has the ability to improve nearly every aspect of our lives but also that it creates serious risks that we have to work together to manage,” Altman said.Altman said the technology will significantly affect the job market but he believes “there will be far greater jobs on the other side of this”.“The jobs will get better,” he said. “I think it’s important to think of GPT as a tool not a creature … GPT 4 and tools like it are good at doing tasks, not jobs. GPT 4 will, I think, entirely automate away some jobs and it will create new ones that we believe will be much better.”Altman also said he was very concerned about the impact that large language model services will have on elections and misinformation, particularly ahead of the primaries.“There’s a lot that we can and do do,” Altman said in response to a question from Senator Amy Klobuchar about a tweet ChatGPT crafted that listed fake polling locations. “There are things that the model won’t do and there is monitoring. At scale … we can detect someone generating a lot of those [misinformation] tweets.”Altman didn’t have an answer yet for how content creators whose work is being used in AI-generated songs, articles or other works can be compensated, saying the company is engaged with artists and other entities on what that economic model could look like. When asked by Klobuchar about how he plans to remedy threats to local news publications whose content is being scraped and used to train these models, Altman said he hopes the tool would help journalists but that “if there are things that we can do to help local news, we’d certainly like to”.Touched upon but largely missing from the conversation was the potential danger of a small group of power players dominating the industry, a dynamic Whitaker has warned risks entrenching existing power dynamics.“There are only a handful of companies in the world that have the combination of data and infrastructural power to create what we’re calling AI from nose-to-tail,” she said in the Meet the Press interview. “We’re now in a position that this overhyped technology is being created, distributed and ultimately shaped to serve the economic interests of these same handful of actors.” More
Every day 343 workers die from hazardous working conditions in the US. In 2021, the latest year with data available, 5,190 workers in the US were killed on the job and an estimated 120,000 deaths were attributed to occupational diseases.Since 1970, more than 429,000 workers have been killed on the job, but only 128 of those cases have been criminally prosecuted under the Occupational Safety and Health Act (Osha).Now a new report and reintroduced federal legislation is pushing to modernize Osha.Democratic congressmen Joe Courtney and Bobby Scott have co-authored the Protecting America’s Workers Act, which was reintroduced to Congress on 28 April, on Workers’ Memorial Day.“The history of Osha shows that there really is a systemic problem in terms of that mission of getting the rules aligned with the evolving technology that goes into a whole host of sectors in the US economy, whether it’s home construction, healthcare settings, manufacturing, the new processes, the new chemicals, the new machinery that as part of a very dynamic economy, it’s just kind of rocketed past the Osha rules that are in place to protect people,” said Courtney.“It’s just really trying to get a system of workforce protection that is really connected to the actual workplaces that people are going to every day in the 21st century.”The bill includes expanding Osha coverage to the estimated 8 million state and local government workers in 24 states not currently covered by Osha, reinstating an employer record-keeping rule of illnesses and injuries rolled back under the Trump administration, providing authority for increased civil penalties for serious Osha violations, and authorizing felony penalties against employers who knowingly commit Osha violations that result in the death or serious harm of a worker. The bill would also establish rights for families who lose a loved one to a workplace fatality and require Osha to investigate all cases of death or serious injury that occur in a workplace.The AFL-CIO’s Death on the Job 2023 report, released on 26 April, outlines the “toll of neglect” that comes from inadequately addressing workplace safety issues amid aggressive opposition from industry groups and employers against improving and enforcing workers protections.The report cites low civil penalties for safety violations issued by Osha, understaffing and underfunding at Osha, the millions of workers who are currently not covered under Osha which include independent contractors and federal, state and local public workers, inadequate retaliation protections for workers to speak out and report safety issues, and the need to improve and expand data on worker injuries and illnesses.For Black workers, the workplace fatality rate increased from 3.5 per 100,000 workers in 2020 to 4.0 in 2021, the highest rate in a decade, while Latino workers currently have a worker fatality rate of 4.5 per every 100,000 workers, 25% higher than the national average.Younger and older workers are at higher risk for workplace fatalities. Three hundred and fifty workers under the age of 25 died on the job in 2021, while workers over 65 have a risk of 2.3 times higher than other workers of dying on the job.Courtney cited a 2010 incident in Connecticut where six workers were killed in an explosion at a Kleen Energy Systems power plant during cleanup of debris in pipes as an example of an avoidable and tragic workplace fatality incident.“As the process of an investigation went on, it was clear that what caused that was really very well known, unsafe practices, that the Chemical Safety Board, which is a sort of an arm of OshaA, had long identified as being the wrong way to clean the tubes,” he said.The legislation has been introduced numerous times in Congress over the past two decades. Senator Pat Murray of Washington called the legislation “long overdue” when she was reintroducing it in 2013. Joe Biden was a co-sponsor of previous versions of the bill while serving in the Senate.In 2009 testimony in support of the bill, Osha’s assistant secretary David Michaels said the 1970 Osha Act was “tragically outdated and inadequate”, and yet few to no changes or updates have been made in over 50 years since its passage.Courtney noted the political challenges faced in passing the Protecting America’s Workers Act given the current House is under Republican control. But a companion bill in the Senate will be introduced and Courtney said it was important to keep introducing the bill to keep the issues visible.“I think that at some point, the external pressure is going to reach the breaking point in terms of getting this place to move,” he said. More
Lucy Mends was very nervous about vacationing at Disney World in central Florida this spring. From her home in Elkridge, Maryland, the 46-year-old romance novelist had read about a law approved by Governor Ron DeSantis in 2022 that banned discussion of gender identity and sexual orientation in public school classrooms for children between kindergarten and the third grade.Mends became more alarmed over a series of bills introduced during the current session of the state legislature that would extend that ban to include high school students and prohibit transgender people from amending their birth certificates and receiving transition-related care such as hormone therapy and puberty blockers for minors. “They’re demonizing trans people, and it’s very scary,” she said.Under pressure from its employees, the Walt Disney Company publicly opposed the so-called Don’t Say Gay law last year. An angry DeSantis retaliated by denouncing Disney as the “Magic Kingdom of woke corporatism” and signed a bill in February aimed at seizing control of the self-governing special district near Orlando that the corporation has been running ever since Disney World opened its doors in 1972.In any event, Mends went ahead with her Disney World holiday plans. Showing solidarity with the company was a big factor. “Spending money at Disney is like contributing to the fight against DeSantis,” said Mends. “They aren’t going to be deterred by a fascist, and I’m very supportive of that.”The ongoing dispute between DeSantis and his state’s second-largest employer has ramped up in recent days. Disney sued the Florida governor in a Tallahassee federal court in late April for allegedly punishing the company for exercising its first amendment freedom of expression rights by criticizing DeSantis over last year’s Parental Rights in Education Act. The suit seeks to void the governor’s takeover of Disney’s self-governing district after he recently filled its five-member board with allies.That board in turn countered with its own litigation in an Orlando state court that aims to reaffirm its control over design and construction decisions in Disney World’s special district, despite a series of last-minute decisions reached by the previous pro-company board that would strengthen Disney’s autonomy vis-a-vis the state government.The eventual outcome of the legal tug-of-war between DeSantis, who is widely expected to formally announce in the coming weeks whether he will seek the Republican presidential nomination in 2024, and Disney will have profound implications for the Sunshine state overall and the regional economy of central Florida in particular. The company pays more than $1bn in state taxes every year, and the lion’s share of those revenues is generated by the sprawling 25,000-acre (10,000-hectare) Disney World amusement park complex that employs an estimated 65,000 people.One potential casualty may have emerged. Owing to a $578m tax break approved during DeSantis’s first term in office, Disney had been planning to transfer about 2,000 high-paying creative jobs from California to a new regional hub of operations in south-east Orlando as early as this year. That major personnel move is reportedly now on hold in the absence of any specific timetable.The Guardian’s requests for an interview with a Disney executive or spokesperson went unanswered. The governor’s press secretary turned down a similar request on the grounds of what he called the newspaper’s “bias and agenda [which] come before news or truth”.But DeSantis has been very vocal about the company ever since Disney’s then chief executive officer Robert Chapek publicly voiced his “disappointment” over the enactment of the Don’t Say Gay bill in 2022. In his recently published book The Courage to Be Free: Florida’s Blueprint for America’s Revival, the governor blasted Disney for its supposed “support of indoctrinating young schoolchildren in woke gender identity politics” and boasted about how “things got worse for Disney” during DeSantis’s stewardship.That kind of talk worries many folks in central Florida. For starters, such rhetoric squares poorly with the Republican party’s traditionally pro-business policies and staunch opposition to excessive government intervention.“He’s clearly evolved from being a Tea party, small-government, Heritage Foundation type of guy to a more Trumpist, anti-woke leader,” said Congressman Darren Soto, a Democrat whose ninth district encompasses a chunk of the Disney World premises. “It’s a personal vendetta, he has been attacking anybody who stands in his way, and it’s terrible for the economy of central Florida.”Some prominent figures in the region’s hospitality industry feel the governor’s various crusades to further restrict abortion rights, scrap tests on African American affairs for advanced placement high school students, and establish a new law enforcement body to investigate rare instances of voter fraud are misplaced.skip past newsletter promotionafter newsletter promotion“He needs to focus on the shortage of workers and insurance issues, but DeSantis is more busy with his presidential race,” said hotelier Jan Gautam, who has seen his commercial property insurance premiums soar by an estimated 300% in just the last two years. “He has completely neglected those problems, and his approach has to change.”Among the issues at stake in its showdown with the governor is Disney’s unique degree of autonomy as a private corporation, and the charter that its executives negotiated with local government officials in 1967 was a sweetheart deal by any yardstick. It created the Reedy Creek Improvement District that allowed Disney World to function like a quasi-county government in charge of its own roads, construction services, building permits, fire department and waste collection services.According to Richard Foglesong, a political science professor and author of the 2001 book Married to the Mouse: Walt Disney World and Orlando, the company has at times acted like “a state within a state”. Disney attorneys have invoked the original charter to exempt the company from paying certain fees and taxes that were adopted by state and local government bodies during the intervening years. A case in point was a tax that Orange county officials assessed in the 1990s to help cover the budget of its sheriff’s department, which in the company’s view did not apply to Disney because the charter protected it “in perpetuity” from paying taxes adopted after 1967.A similar circumstance applies to impact fees that were introduced to partly defray the cost of construction of new highways and libraries and the establishment of new police and fire departments in Orange county as it entered a period of explosive growth in the 1980s. “They got powers that were excessive and that weren’t granted to competitors that arrived later like the Universal Orlando theme park,” said Foglesong. “That strikes me as unfair.”But the scholar parts ways with DeSantis over the governor’s motives for seeking to end the company’s privileged status and bring its operations under greater state government control. “Disney’s powers need to be addressed, but he’s attacking the company for all the wrong reasons,” he said. “When you look at DeSantis’s statements, it’s pretty clear that he is punishing Disney for talking back to him and challenging him on what can be taught in public schools. Its lawsuit is right on with respect to what it is alleging about the governor’s violation of Disney’s first amendment rights.”Even some of the governor’s sympathizers feel that DeSantis may have overstepped the accepted boundaries of his authority in the case of Disney. As he was awaiting a shuttle bus outside the Walt Disney World Swan hotel on Thursday morning, a 60-year-old Oklahoma City resident expressed unease over DeSantis’s ham-fisted tactics.“I generally support him and I understand where he’s coming from, but on this one he may have gone a little too far,” said James, a frequent visitor to Florida who is active in Republican party circles back home but declined to give his surname. “It seems a little vindictive to me – and if I were a local, I’d be concerned about the 65,000 Disney World employees and all the affiliated ancillary businesses and the jobs they represent.” More
