Going to youtubekids.com, it makes parents (the age check is a 1st grade arithmetic question) agree to this, so they're clearly in violation of the law according to your Paul Lekas quote:
We also use this information to offer users personalized content. We associate an identifier that's unique to the app with the videos your child has watched and terms they've searched for to recommend content likely to be of interest to them, subject to the controls described below.
We use unique identifiers to provide contextual advertising, including ad frequency capping. The app does not allow interest-based advertising or remarketing.
YouTube Kids does not allow your child to share personal information with third parties or make it publicly available.
But then later, they make it clear that they also don't allow your child to avoid sharing personal information with third parties:
For external processing
We may provide individual user information to our affiliates or other trusted businesses or persons to process it for us, based on our instructions and in compliance with our Privacy Policy and any other appropriate confidentiality and security measures.
They then incorporate additional ToS documents by reference. It's already clear they're violating COPPA according to SIIA, so I'm not going to bother continue reading:
You can find additional information about the app in the YouTube Kids Privacy Notice and the Parental Guide. Our Disclosure for Children explains our data processing practices to your child, which we encourage you to review with them.
Dated: August 7, 2019
That was not my understanding of COPPA, how is this violating it if it is used for the service and the parent gives consent?
"Under COPPA, the presence of cookies is permissible for internal operations including fraud detection," said Paul Lekas, head of global public policy at the SIIA, a software industry group whose members include Google and BMO, "so long as cookies and other persistent identifiers are not used to contact an individual, amass a profile or engage in behavioral advertising.""
How would we verify how Google uses cookies. Litigation is one way. When Google gets sued for privacy violations or is subject to regulatory action, it usually settles or pays a fine despite having a larger legal budget and better counsel than its opponents or regulators. Admitting no wrongdoing and yet by implication suggesting exactly that. It would be irrational to believe Google is telling the truth 100% of the time.