> Is hair color or texture a relevant way of subdividing people for instance? Are we being "fair" to red haired people? What if red haired people for some reason seem to be less likely to pay back loans?

Machine learning is going to be very good at identifying proxies for features we don't like, even if we don't directly provide those features. Weighting red hair color could be a proxy for the Irish, targeting hair texture could be a proxy for african americans, targeting zip codes has always been a proxy for race, etc.

If we want machine learning to ignore these kind of things it's probably going to have to be a separately weighted training goal that racial groups and so on need to have equal outcomes in the final results.

That's really what AOC is going for here. The black box will happily learn racist ways to weight things all on its own, we can't just throw up our hands and say oh well, if the algorithm is denying black people for home loans then we just have to accept it.

Because, in the short term, being racist is an effective greedy strategy. It's not your business's problem that, say, black people have higher rates of default (or whatever, example). But it also leads to bad social outcomes in the aggregate, and we've agreed that shouldn't be a factor in home loans. And we have to find a way to make sure that The Algorithm (tm) doesn't just find a way to machine-learn redlining or some other proxy for race or other protected characteristics.