The position of the FSF is severely misrepresented by the title. Open the full article, you'll see that all FSF says is GitHub Copilot is proprietary software and SaaS, and all forms of proprietary software and SaaS are unacceptable and unjust. What about the copyright issue of machine learning, then? FSF says it's a new thing with many open questions, they are not really sure, right now they are calling for whitepapers from the public to hear your comments [0].
I think it's a reasonable position to take. Reducing the scope of fair use to strengthen copyleft is a double-edged sword, as it simultaneously makes copyright laws more restrictive, such a ruling can potentially be used by proprietary software vendors against the FOSS community in various ways. It's an issue that requires careful considerations.
[0] https://www.fsf.org/blogs/licensing/fsf-funded-call-for-whit...
Could it? Copyright law is FOSS's only protection. That's why it's witty - copyright law against copyright. Weakening copyright law in an ad hoc way is absolutely not good for FOSS. It's fine to rewrite copyright in a way that explicitly allows things like Copilot, as long as FOSS gets to copy bits of proprietary code, too.
Otherwise, after some appeals court judgement that the FOSS community failed to participate in (or even worse, subelements participated in on the wrong side) we're going to end up with a copyright practice that looks like the NFL exception in monopoly law.
This is exactly what I was thinking about. If Copilot is fair use, it means that all proprietary source code, as long as they're publicly available to read, will be free to use as training materials for a hypothetical free and open source machine learning project, which I think would be a good thing. An example is a proprietary program released under a restrictive "source available" license, you can read it but not reuse it under any circumstances (and I believe these projects are already included in Copilot's training data). This is why I said fair use can be a good thing and a ruling to reduce the scope of fair use can potentially be used by proprietary software vendors against the FOSS community.
It would be even better if training from all forms of available proprietary binary code can be fair use, too. It may allow the creation of powerful static binary analysis or code generation tools by learning from essentially all free-to-download proprietary software without copyright restrictions. However, the situation of proprietary binary code is more complicated here. Reverse engineering proprietary binary code is explicitly permitted by the US copyright laws, but the "no reverse engineering" clause in EULA overrides it, and this can be a bad thing. It makes FOSS's fair use right meaningless, meanwhile giving proprietary software vendors a free pass to ignore FOSS licenses.
Thus the outcome is unclear, it may go either way, this is why I said such an issue requires careful considerations.