Josh Hawley to Target 'Surveillance Pricing' With New AI Legislation

Senator Josh Hawley (R-Mo.) has announced plans to introduce federal legislation targeting "surveillance pricing," a practice where companies use artificial intelligence to maximize costs for individual consumers. The move follows a Senate Judiciary Committee hearing convened by Hawley on August 4, 2026, titled "Your Data, Their Profit: The Consumer Cost of AI Surveillance Pricing."

At the center of the proposal is the effort to curb the use of AI to analyze personal data—including browsing behavior, location data, and purchase history—to predict the highest price a specific consumer is likely to pay. During the proceedings, Hawley explicitly highlighted the airline industry, citing concerns over the use of AI to generate individualized fares. Describing the practice as "one of the biggest scams in American history," Hawley stated that AI surveillance pricing is "the unholy trinity of everything Americans hate: spying on people, ripping them off and taking away jobs."

The Shift to Hyper-Personalization

Surveillance pricing represents a significant evolution of traditional dynamic pricing. While dynamic pricing typically adjusts costs based on broad market trends or demand, surveillance pricing allows firms to move toward hyper-personalized models. By leveraging a user's perceived "willingness to pay" through data harvesting, companies can shift from market-based adjustments to individual-based profit optimization.

This trend has already triggered regulatory responses at the state level. New Jersey has recently enacted the Fair Price Protection Act, which bans surveillance pricing, specifically within grocery stores, signaling a growing legislative appetite to protect consumers from algorithmic price discrimination.

Industry Implications

If passed, Hawley's legislation could establish a federal standard against personalized pricing, potentially disrupting the revenue models of e-commerce platforms, airlines, and other tech-driven services. These industries rely heavily on consumer data to optimize profit margins, and a federal ban would force a return to more transparent, uniform pricing structures.

The proposal sits at a critical intersection of AI regulation, consumer privacy, and antitrust concerns. By targeting the mechanism of price optimization, the bill seeks to limit the financial incentive for companies to engage in aggressive consumer data collection.

What's Next

As Senator Hawley moves toward introducing the formal bill, the focus will shift to the specific scope of the ban and which industries will be most heavily impacted. While the New Jersey model focused on essential goods like groceries, a federal mandate could extend to a much wider array of digital and physical services. Observers will be watching for the legislative language to see if the bill provides exemptions for certain types of dynamic pricing or if it creates a blanket prohibition on AI-driven individualized pricing.