A new bill from Democratic lawmakers aims to draw a hard boundary around how companies use artificial intelligence in pricing and pay decisions. The proposal targets what its sponsors call surveillance-based price and wage setting: using personal data to make customers pay more or workers earn less.
The debate intensified after Delta announced it is expanding a test using artificial intelligence in pricing. Critics fear the practice could make cheap flights harder to find, while Delta says its system does not create individualized offers from personal information.
What the Bill Would Ban
Reps. Greg Casar (D-Texas) and Rashida Tlaib (D-Mich.) announced the Stop AI Price Gouging and Wage Fixing Act in a press release. The legislation would directly ban companies from using surveillance-based price or wage setting to increase profit margins.
According to lawmakers, the bill is meant to stop companies from using AI systems to infer a person's vulnerability, urgency, or economic position and then change the deal offered to that person. In the pricing context, that could mean charging more based on "how desperate a customer is for a product and the maximum amount a customer is willing to pay." In the workplace context, it could mean lowering pay based on "their financial status, personal associations, and demographics."
The proposal would also give people a way to challenge companies they believe used AI unfairly. Lawmakers said anyone could sue companies found to be using these systems in prohibited ways.
The bill points at two related problems:
- AI pricing that raises what a customer pays based on personal or behavioral data.
- AI wage setting that lowers what a worker earns based on personal circumstances rather than the work performed.
Why Delta Became a Flashpoint
Delta is central to the current fight because lawmakers called out the airline's AI pricing plans while warning that such tools could worsen the US "affordability crisis." They noted that Delta has confirmed it plans to "set 20 percent of prices using AI by the end of the year."
Asked about the bill, a Delta spokesperson said the airline will reach out to Senators to explain its AI pricing. Delta denied that its system uses personalized data for individualized pricing. The company said the system is used to forecast demand for certain flights, respond to emerging market conditions such as jet fuel costs, account for a wide range of undisclosed variables, and learn from pricing decisions.
At the same time, the source article notes that customer purchasing behavior, customer demand, and competitive offers that a customer may be weighing can influence the AI's pricing. That appears to be part of the disagreement: lawmakers and critics may view those inputs as a step toward individualized pricing, while Delta frames the system as an extension of long-running dynamic pricing practices.
"There is no fare product Delta has ever used, is testing or plans to use that targets customers with individualized offers based on personal information or otherwise," Delta said. "A variety of market forces drive the dynamic pricing model that's been used in the global industry for decades, with new tech simply streamlining this process. Delta always complies with regulations around pricing and disclosures."
The Wage Side of the Fight
The legislation is not limited to what consumers pay. Tlaib also criticized companies using AI to "exploit" workers in "desperate" situations, calling the practice "appalling." The one-sheet connected to the bill specifically criticized delivery services that lower drivers' wages based on their "pattern of taking orders." It also pointed to health care companies that base nurses' pay on "an algorithmically-manipulated-bidding war, not the tasks they perform."
That makes the bill broader than a consumer pricing measure. Its core claim is that AI can be used to convert private data into economic pressure, whether the person affected is buying groceries, booking travel, driving deliveries, or working in health care.
Public Citizen, a progressive consumer rights group that endorsed the bill, argued that Congress should act now. In the press release, the group urged lawmakers to draw "a clear line in the sand: companies can offer discounts and fair wages—but not by spying on people."
"Surveillance-based price gouging and wage setting are exploitative practices that deepen inequality and strip consumers and workers of dignity," Public Citizen said.
FTC Scrutiny and a Larger AI Pricing Market
The fight over AI pricing is also tied to Federal Trade Commission scrutiny. In January, the Federal Trade Commission requested information from eight companies: MasterCard, Revionics, Bloomreach, JPMorgan Chase, Task Software, PROS, Accenture, and McKinsey & Co. Lawmakers described those companies as part of a "shadowy market" for AI pricing services.
Those companies confirmed they had provided services to at least 250 companies "that sell goods or services ranging from grocery stores to apparel retailers," lawmakers noted. The FTC inquiry led the agency to conclude that "widespread adoption of this practice may fundamentally upend how consumers buy products and how companies compete."
The American Economic Liberties Project, an anti-monopoly watchdog, also endorsed the bill. Its senior legal counsel, Lee Hepner, connected AI pricing concerns to household costs, saying that "grocery prices have risen 26 percent since the pandemic-era explosion of online shopping" and that this is "dovetailing with new technology designed to squeeze every last penny from consumers."
Hepner argued that banning AI surveillance pricing could help "restore fair, transparent, and predictable pricing." He also warned that "there is no such thing as a good deal when every consumer is charged a different price."
What Enforcement Could Look Like
The proposed law would create several paths for consumers and workers who may not know they were affected by AI systems. Lawmakers said people could pursue claims through their state, the FTC, and the Equal Employment Opportunity Commission.
Violations could require companies to pay back the difference in unfair transactions recommended by AI systems or $3,000, whichever is higher. Willful violations could triple the damages owed.
"Giant corporations should not be allowed to jack up your prices or lower your wages using data they got spying on you," Casar said. "Whether you know it or not, you may already be getting ripped off by corporations using your personal data to charge you more. This problem is only going to get worse, and Congress should act before this becomes a full-blown crisis."
The bill's political future is uncertain. The source article says it is unclear whether Democrats can win enough support from Republicans to pass it. Republican FTC commissioners voted against releasing the report that outlined possible concerns with AI surveillance pricing and wage setting.
In their dissent, commissioners Andrew Ferguson and Melissa Holyoak said the report was published prematurely and criticized Biden's outgoing FTC for "nakedly" politicizing the agency and taking an "unprecedented" step in sharing preliminary summaries of findings. Still, they agreed that when the final report is ready, the "American public and Congress will surely value what the Commission ultimately learns and shares as to whether and how consumers' private data may be used to affect their pocketbooks, especially as the future of our nation's privacy laws is being considered."