Artificial Intelligence and Chip Money: 2024 California Technology Year in Review

Over the last year, California technology grew so pervasive and important that its impact finally became a central preoccupation of California government.

Some of that impact was positive, like a surge of unexpected tax revenue that likely came from one or more profit-gushing, capital-intensive Golden State tech companies like AI chipmaker Nvidia.

But lawmakers were more concerned with harms than benefits.

Gov. Gavin Newsom signed into law bills banning deepfake campaign ads, deepfake content on big online platforms, and disclosure of artificial intelligence content in advertising.

The governor also signed a bill requiring California schools to limit or ban student use cellphones, codifying statewide a practice that has become increasingly common at the district level as educators look to refocus students. Schools in Los Angeles and San Diego took a more critical look at their use of artificial intelligence after unhappy surprises involving chatbots and grading software.

The state bureaucracy moved to update enforcement of existing laws to account for AI. The California Civil Rights Department moved to restrict how employers use the technology to screen job applicants while the Government Operations Agency set rules for how state departments themselves use it.

There were limits to the regulatory impulse: The governor vetoed a bill to make companies test large AI models for their potential to help with mass attacks, reasoning that the bigger threat was overregulating an innovative industry. State agencies, meanwhile, struggled to enforce a law designed to help app workers.

2025 outlook

In 2025, California lawmakers must decide whether to accelerate their regulation of technology under Donald Trump’s second presidential term; Trump has promised to rescind modest AI guardrails installed by the Biden administration and could use the technology to assist with mass deportations. This may include another crack at major AI curbs, given that the governor promised to take another swing at the problem following his veto of the testing bill.

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