Artificial intelligence’s dangerous downside

Op-ed views and opinions expressed are solely those of the author.

A recent and frequent complaint is how credit card companies are inadvertently lowering credit lines without cause and without notice. When outraged customers confront the creditor, they are told to wait for correspondence explaining the decision. Ten days later, they receive a form letter that could apply to 10,000 other customers. In essence, no real explanation, just paper shuffling.

An aggrieved customer added that a follow-up meeting with his personal banker yielded nothing more than, “I can lodge a complaint.” This was done. Two weeks later, another generic response came through. Same outcome.

Artificially lowering credit scores

A higher credit score can result in a lower interest rate. Many are shocked at the difference in installment loan interest rates. An automobile financed by a holder of a 680 credit score versus a 740 score can be two to three points higher. A similarly maligned customer related how Bank of America had lowered his credit line from $11,500 to $3400. There was no scale down. There was no advance notice. There was no explanation.

This customer’s personal banker at BOA quietly surmised the decision to lower the line was made exclusively by A.I. She explained, “They have a program. Nobody really understands how it works.”

The customer concluded ruefully, “It was a good thing that my wife and I were not traveling abroad!”

There was another negative offshoot. Seeking to trade cars, this same customer found that due to the recent credit line reduction on that one card, his Equifax score had dropped, from 741 to 637. The difference in payments for his new Lexus was $813 as opposed to $610 per month, thanks to the change.

Many admittedly do not understand the credit scoring system. In both customers’ cases, there were no recorded late payments at any time. But their credit lines went from 25% usage to 75% usage with those abrupt adjustments. Herein lies the key to the credit scoring system. The lower the balance against the line, the higher the score. It works both ways. If a creditor wants to improve your standing, they can increase the line. Best of all, the creditor need not justify the action. They simply program a specific matrix, input it into the system, and let A.I. do the rest. While impersonal, it’s efficient. Or is it?

Human resources are likewise a potential “trainwreck”

A middle-aged woman applied for an administrative position at the University of Louisville. She was remarkably qualified for the position. Her academic and field experience were unmatched. Yet she had listed only three years of experience. Her resume reflected thirteen years. She had misread the form, which stipulated five years. A.I. threw out her application.

Stubbornly, she called the university and asked to reapply. They consented. The hiring manager mentioned that this type of inconvenience was common.

Worldwide debt collector, Midland Credit is reportedly 90% automation. 99% of their personnel is offshore. Their “bots” often report wrong and dated information to the repositories, Equifax, Experian, and Trans Union. Credit scores may be impacted. Hiring company “bots” subsequently screen applicants based on this information.

There are now “specialists” who teach clients “how” to develop the “bot-proof” resume. Reportedly 75% of applications are eliminated by A.I. “Getting past the bot” has become a tangible service that people are increasingly willing to pay for.

Long-term solution points toward removing artificial intelligence completely from both Financial Services and Human Resources. This includes mortgage lending where Financial Consultants are retiring in favor of “computer, keypunch administrative types,” who are happy to allow A.I. to do the thinking for them. The result: “lending decisions are often made on less important variables, such as current debt-to-income ratios and credit scores, as compared to equity position, type profession and ease of employment transition.”

Positives notwithstanding

There are numerous A.I. advantages. Agriculture first comes to mind. Many are becoming familiar with the “trillion trees initiative.” For those who are not, it’s a goal of planting one trillion trees to consume the increasing CO2. Remarkably progressive idea! The planet would be further “greened” as a bonus. The downside is that “planting trees is rigorous work.” To plant that many would take years and be expensive. Yet it is the ideal function for A.I.

“Increased agricultural output” amounts to planting, harvesting, and exporting non-perishable grains at record levels, because we have the available lands to do it. Sounds good! Unmentioned is the fact that some of the lands referenced are places like the Great Hudson Bay Lowlands in Eastern Manitoba. True, the area has a potential 150-day growing season. Oats and rye will grow there. But how many aspiring farmers relish planting and harvesting oats and rye in a cold, wet muddy land such as the Hudson Bay Lowlands? However, “bots” could easily perform the task.

Ditto for picking cherries in Michigan and harvesting tomatoes in South Florida in July!

Don’t forget about future space colonies on the Moon and Mars! In short, world members need to declare a truce long enough to set some boundaries. We can use A.I. in a positive way, improving everyone’s lives along the way.

At the same time, we must remain aware of the sheer power of A.I. We cannot forget that technology can be a dangerous toy.

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