Tuesday, May 16, 2023

U.S. senator uses ChatGPT for opening remarks at a hearing on AI

U.S. Senator Richard Blumenthal opened a hearing on AI with a recording of his voice describing the risks of this emerging technology. 

“Too often we have seen what happens when technology outpaces regulation,” he said. “The unbridled exploitation of personal data, the proliferation of disinformation and the deepening of societal inequalities.”

But he didn’t write it and he didn’t record it.

Drawing chuckles from the hearing room on Tuesday, the Connecticut Democrat said the text was written by OpenAI’s ChatGPT and the audio was a voice application trained on his speeches on the Senate floor.

All eyes turned to Sam Altman, chief executive officer of OpenAI, who was sitting at the witness table, ready to provide testimony, alongside IBM’s Chief Privacy and Trust Officer Christina Montgomery.


Blumenthal said it was amazing that artificial intelligence could produce such a realistic audio clip, as he went on to actually read the rest of his opening statement. But he said the potential applications were potentially terrifying. 

“What if I’d asked it, and what if it had provided an endorsement of Ukraine surrendering or Vladimir Putin’s leadership?” Blumenthal said. “The prospect is scary.”

Blumenthal leads the Senate Judiciary Subcommittee on Privacy, Technology and the Law, which hosted Tuesday’s hearing on artificial intelligence technologies.

Altman and Montgomery during the hearing both called on senators to regulate AI, which is raising ethical, legal and national security concerns.


OpenAI, IBM urge U.S. senate to act on AI regulation

The creator of ChatGPT and the privacy chief of International Business Machines Corp. both called on U.S. senators during a hearing Tuesday to more heavily regulate artificial intelligence technologies that are raising ethical, legal and national security concerns.

Speaking to a Senate Judiciary subcommittee, OpenAI Chief Executive Officer Sam Altman praised the potential of the new technology, which he said could solve humanity’s biggest problems. But he also warned that artificial intelligence is powerful enough to change society in unpredictable ways, and “regulatory intervention by governments will be critical to mitigate the risks.”

“My worst fear is that we, the technology industry, cause significant harm to the world,” Altman said. “If this technology goes wrong, it can go quite wrong.”

IBM’s Chief Privacy and Trust Officer Christina Montgomery focused on a risk-based approach and called for “precision regulation” on how AI tools are used, rather than how they’re developed. 

The senators openly questioned whether Congress is up to the task. Political gridlock and heavy lobbying from big technology firms have complicated efforts in Washington to set basic guardrails for challenges including data security and child protections for social media. And as senators pointed out in their questions, the deliberative process of Congress often lags far behind the pace of technology advancements. 


Demonstrating AI’s power to deceive, Senator Richard Blumenthal, the Connecticut Democrat who chairs the panel, played an AI-written and produced recording that sounded exactly like him during his opening statement. While he urged AI innovators to work with regulators on new restrictions, he recognized that Congress hasn’t passed adequate protections for existing technology. 

“Congress has a choice now. We had the same choice when we faced social media,” Blumenthal said. “Congress failed to meet the moment on social media. Now we have the obligation to do it on AI before the threats and the risks become real.”

Several senators advocated for a new regulatory agency with jurisdiction over AI and other emerging technologies. Altman welcomed that suggestion as a way for the US to continue leading on the technology that springs from American companies.

But Gary Marcus, a New York University professor who testified alongside Altman and Montgomery, warned that a new agency created to police AI would risk being captured by the industry it’s supposed to regulate. 

Lawmakers questioned the potential for dangerous disinformation and the biases inherent in AI models trained on internet content. They raised the risks that AI-fabricated content poses for the democratic process, while also fretting that global adversaries like China could surpass US capabilities. 

AI ‘HALLUCINATIONS’

Blumenthal asked about “hallucinations” when AI technology gets information wrong. Tennessee Republican Marsha Blackburn asked about protections for singers and songwriters in her home state, drawing a pledge from Altman to work with artists on rights and compensation. 

Missouri Senator Josh Hawley, the ranking Republican on the subcommittee, asked whether AI will serve to be as transformative as the printing press, disseminating knowledge more widely, or as destructive as the atomic bomb. 

“To a certain extent, it’s up to us here, and to us as the American people, to write the answer,” Hawley said. “What kind of technology will this be? How will we use it to better our lives?”

Much of the discussion focused on generative AI, which can produce images, audio and text that seem human-crafted. OpenAI has driven many of these developments by introducing products like ChatGPT, which can converse or produce human-like, but not always accurate, blocks of text, as well as DALL-E, which can produce fantastical or eerily realistic images from simple text prompts. 

But there are boundless other ways that machine learning is being deployed across the modern economy. Recommendation algorithms on social media rely on AI, as do programs that analyze large data sets or weather patterns. 


REQUIRING REGISTRATION

The Biden administration has put forth several non-binding guidelines for artificial intelligence. The National Institute of Standards and Technology in January released a voluntary risk management framework to manage the most high-stakes applications of AI. The White House earlier this year published an “AI Bill of Rights” to help consumers navigate the new technology. 

Federal Trade Commission Chair Lina Khan pledged to use existing law to guard against abuses enabled by AI technology. The Department of Homeland Security last month created a task force to study how AI can be be used to secure supply chains and combat drug trafficking. 

In Tuesday’s hearing, Altman focused his initial policy recommendations on required registration for AI models of a certain sophistication. He said companies should be required to get a license to operate and conduct a series of tests before releasing new AI models. 

Montgomery said policymakers should require AI products to be transparent about when users are interacting with a machine. She also touted IBM’s AI ethics board, which provides internal guardrails that Congress has yet to set.

“It’s often said that innovation moves too fast for government to keep up,” Montgomery said. “But while AI may be having its moment, the moment for government to play its proper role has not passed us by.”

Nutrien may slow potash ramp-up plans as earnings, sales down

The CEO of Canadian fertilizer giant Nutrien Ltd. said Thursday the company may consider slowing down its previously announced plan to ramp up potash production, as falling prices and lower sales volumes take a bite out of profits.

"Yes, we would consider slowing down. We're really, as we talked about earlier this year, watching the market," CEO Ken Seitz told analysts on a conference call to discuss the company's disappointing first-quarter financial results.

"If we see that the market's not there, then we'll pace our capital accordingly."

The Saskatoon-based company — the world's largest fertilizer producer — lowered its earnings guidance for the year to between $6.4 billion and $8.0 billion, down from a previously announced range of $8.4 billion to $10 billion.

The company's net earnings for the third quarter were US$576 million, down 58 per cent from US$1.4 billion a year earlier, and its sales for the quarter ended March 31 were US$6.1 billion, down 20 per cent from US$7.7 billion a year earlier.

It has been a volatile period for Nutrien, which achieved record earnings in 2021 and then saw fertilizer prices spike in March of 2022 as the Russia-Ukraine war shook up global agricultural markets and reduced supplies of fertilizer from Eastern Europe.

To meet increased global demand, Nutrien announced in June of last year a plan to ramp up potash production by 40 per cent compared with 2020 production levels — an increase of more than five million tonnes.

The company said it would achieve this by investing in expansions at its existing Saskatchewan mines, including the hiring of approximately 350 people.

But by the second half of 2022, Nutrien had suffered what it called a "historic'' decline in the pace of its potash shipments. In North America and Brazil in particular, farmers appeared to be postponing fertilizer purchases in the face of high prices.

As a result, in February of this year, the company announced it would slightly delay its expansion plans, targeting 2026 instead of 2025 to reach its potash production target of 18 million tonnes.

While Seitz said Thursday the company is open to slowing its plans further, he said he remains bullish on the longer-term outlook for fertilizer. He said Nutrien anticipates increased global potash demand in the second half of the year as a result of lower-than-expected inventories and improved affordability for farmers compared with 2022.

He added that historically, periods of lower-than-normal demand have been followed by years of strong demand growth — and he expects that to happen again.

"The reality is again that we are in a market that's growing," Seitz said.

"We believe that's going to carry on for the absolute foreseeable future — a two and a half to three per cent annual growth rate. New supply's going to be required to meet that growing demand."

Nutrien's share price tumbled Thursday on the company's first-quarter results, trading down almost five per cent on the Toronto Stock Exchange as of mid-day.

The company's diluted net earnings per share for the quarter were US$1.14, down 54 per cent from US$2.49 a year earlier.

This is a corrected story. A previous version ran with a photo of a former CEO.

This report by The Canadian Press was first published May 10, 2023.

Schwartz to step down as Onex investors approve succession plan

ONEX CORPORATION (ONEX:CT)

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Gerry Schwartz will step down as chief executive officer of Onex Corp., the Canadian private equity firm he’s managed for nearly 40 years, after shareholders agreed to extend his voting control until 2026.

Investors backed the firm’s succession plan at the annual meeting Thursday by allowing Schwartz to hang on to the special rights attached to his multiple-voting shares for three more years. That paves the way for President Bobby Le Blanc to replace the founder as CEO. Schwartz will remain chairman.

“Onex is on a certain path to a one-share, one-vote structure,” Schwartz told shareholders. The share rose 1.1 per cent to $61 in Toronto.

Le Blanc, who was promoted to president in 2020, is taking control at a critical moment for the firm as it struggles with fundraising for its sixth flagship fund and lackluster returns. Buyout firms are contending with one of the most difficult investment climates since the 2008 global financial crisis, as higher interest rates make financing deals more expensive.

“It’s a true honor to have the opportunity to lead this team,” Le Blanc said.

 

McCain steps down as Maple Leaf Foods CEO, optimistic about 2023

MAPLE LEAF FOODS INC (MFI:CT)

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The head of Maple Leaf Foods Inc. said he's confident in the future of the company as he hands the reins of the protein producer to current president and chief operating officer Curtis Frank.

CEO Michael McCain will stay on as executive chair of the board of directors for the Mississauga-based firm, and said his family will remain as the company's largest shareholder through McCain Capital.

"When I started at Maple Leaf almost three decades ago, the world was a very different place and the challenges, while many, were perhaps not as profound as they are today," said McCain on a call with analysts Thursday. The company announced a year ago that McCain would be stepping down after taking the top job in 1998.

"Our vision to be the most sustainable protein company on Earth is inspiring and enduring. I could not be more thankful or prouder of the team that we have the resilience that they've shown over decades," he said. 

The remarks came as Maple Leaf reported a loss in its first quarter compared with a profit a year ago as it faced a difficult pork market, cost inflation and higher startup expenses. McCain said on the call that some of the post-pandemic difficulties the industry has faced are starting to abate. 

The company said Thursday it lost $57.7 million or 48 cents per share for the quarter ended March 31 compared with a profit of $13.7 million or 11 cents per share in the same quarter last year.

Sales in the quarter totalled $1.17 billion, up from $1.13 billion in the first three months of 2022.

The company said the increased revenue came as sales in its meat protein group rose to $1.14 billion compared with $1.09 billion in the same quarter last year. Plant protein sales fell to $37.4 million compared with $44.9 million a year earlier.

McCain said in a news release that the company's supply chain has made "exceptional progress back to full normalization," and the company has been raising prices to mitigate inflation. 

Maple Leaf is also taking advantage of renewed access to Chinese markets, he said.

McCain also said that the company hopes to achieve neutral adjusted earnings before interest, taxes, depreciation and amortization on its plant protein business this year.

"Our objective is for the plant protein business to be highly profitable," he said on the call with analysts. 

McCain said the company has seen demand in China for pork products go up, as European supply contracts. 

On an adjusted basis, Maple Leaf said it lost 12 cents per share compared with an adjusted profit of three cents per share in its first quarter last year.

Analysts on average had expected an adjusted loss of 10 cents per share and $1.16 billion in revenue, according to estimates compiled by financial markets data firm Refinitiv.

Analyst Irene Nattel at RBC Capital Markets said in a note that Maple Leaf's meat and plant protein businesses delivered marginally better results than forecast. 

Shares in the company were up almost 10 per cent Thursday at $27.43.

This report by The Canadian Press was first published May 11, 2023.