Technology

Since this labour is likely to be farmed out to innocent people in developing countries

You don't quite seem to understand how easy it is to train these AI models, and because of that, you're missing a critical point - with open-source technologies like Stable Diffusion, which has models that can be refined and run on a consumer-grade graphics card, the people using models to generate images and the people creating and refining those models are the same people. People who want to generate brand new pokemon sprites can train a model on all the pokemon sprites until it looks good. A few absolute galaxy-brain nerds who want to generate MIDI spectrograms from a text description and convert the output into audio... can apparently do that. And of course, people who want to generate lots of hentai or photorealistic porn can create and fine-tune a model, or multiple models, all by themselves (I won't link any of these, but hundreds are readily available, and thousands exist in total)

In other words, people who already consume CSAM are the people working on models for generating CP, and a subset of those have definitely been trying to make it work with only legal images so that the model itself can be distributed and used without breaking any laws, maybe even hiding in plain sight pretending it's not for making CP. Someone else out there with a different set of fucked-up desires has probably trained a model on gore and snuff images and then used it to create "photos" of people they hate as mutilated messes. There's sick people of all kinds all over the place, and the jury's unfortunately still out on whether this new tool actually causes harm when used in such a manner, or if it's just the newest way they can express their deviance. We don't know yet.

But this genie is already out of the bottle. Banning the use of this technology for specific, narrow use cases just isn't going to be effective without banning AI image generation entirely, and we're past the point where that's feasible. Image generation is a powerful tool that's not going away; it's on us now to figure out what we really believe about harm, health, and personal freedom, and what we want a society with this tool to look like.

Personally, I'm of a mind that if all the data going into the model is legally obtained, anything generated should be considered artistic expression. A person had a thought, then put their thoughts into a tool, which made a picture of those thoughts. No matter how repulsive those thoughts were, I think throwing people in prison for that kind of expression is thought-crime. There's public obscenity at play, of course, but only once they take the step of showing it to other people. If it's just for themselves, and nobody else sees it, who is harmed? Even if it does turn out that it harms the person generating the images (which wouldn't surprise me), that makes it a health issue, like drugs or other addictions, not something to criminalize.