Humanity has the debate about AI consciousness backwards

You're taking the sentence out of context and missing the work it is doing. Given some special property, if it doesn't have causal influence, then it is explanatorily impotent. If it does have causal influence then it is just a standard physical property subject to laws and such, i.e. non-special.

> For example, a wire’s conductivity is produced by its physical microstructure. Its conductivity helps explain why current flows through it. The fact that the conductivity itself has a physical explanation does not “bypass” its relevance.

Yes, conductivity is just a physical property (in my quote you left out the parenthetical about being identical to some physical event). It is explanatorily relevant because it is definable within the explanatory regime of physical dynamics.

>Likewise, suppose some biochemical property of neurons is essential to consciousness.

This is the meat of the issue so I will focus on this. The question is what kind of property could a biochemical property be that is not abstract and is crucial for consciousness? My argument is that there are no suitable properties to play the necessary role of grounding consciousness in the "real world" while denying it in a virtual/simulated world. The remainder of the space of candidate properties are non-physical, unscientific, and ultimately wishful thinking.

Given the idea that biology/chemistry reduces to physics, this strongly constrains the space of candidates for a biochemical property to ground consciousness. The content of physics is structure, dynamics, conservation laws, fields, probability, etc. The equations of physics don't describe consciousness, but the behavior and constraints on the entities quantified over. Note that as the equations of physics quantify over relevant entities, they are abstract. To say a biochemical property is crucial for consciousness is just to say that a physical property, broadly construed, is crucial for consciousness. Candidate properties can be divided into two sets: the structure, dynamics, etc of the content of physical theories (we can call these relational properties), and any non-relational/intrinsic properties that are not the content of physical theories but are relevant to the realization of physical events. These latter properties are not the subject matter of physics and we are epistemically blind to whatever they may be.

Crucially, causal closure together with the causal exclusion argument renders the intrinsic properties explanatorily empty with regards to any state reducible to the language of physics, i.e. structure, dynamics, etc. As it turns out, our verbal reports about consciousness can be described by stimulated wave patterns on the air. In other words, these verbal reports can be described in the language of physics. Therefore, by causal closure, they are fully explained by prior events within the subject matter of physics. By causal exclusion, any intrinsic properties of the realizers of these physical events are excluded from explanatory relevance. There is simply no room for "non-abstract biochemical properties" to be explanatorily relevant to verbal reports about consciousness. But if verbal reports about consciousness are to actually be about consciousness, then consciousness must be explanatorily relevant to said verbal reports. Hence consciousness must be definable within the content of the subject matter of physics.

The only saving grace for biological theories are non-causal, metaphysical influences that are somehow relevant to verbal reports. Or epiphenomenalism where consciousness is actually irrelevant to all the things we say about consciousness. Both of these options are unintelligible; they are cures worse than the disease of functionalism. Some like to imagine some kind of emergence, such as "when physical structures take on specific forms, certain states of consciousness manifest". A simulation wouldn't take on this form in the real world and so a simulation wouldn't be conscious. But laws of this nature are absurdly adhoc and don't offer explanations, only brute laws.

This is somewhat begging the question, in that it tacitly presupposes that the system itself is incapable of interpreting it, but if the formation of this bit-pattern has certain consequences, such as the system saying it is in pain, redirecting its attention to finding any means to eliminate it while avoiding anything tending to exacerbate it, and forming memories which will have the consequence that the system will, from now on, try to avoid circumstances likely to cause its recurrence, then on what basis would you reject its own claims of being in pain?