I might be reading into the literal words too much though. I don't have a sense of how messages like that is read in political science academia and DC (the primary target audience).
But after reading the first few pages in that document, especially with the comparison to Cuba missile crisis and the title "Decoding Intentions", it appears that the word "costly signals" here is about how to properly publicize our intentions, so as not to create misconception that may spiral out of control, like in the case of Cuba missile crisis, where unclear "signals" were given, causing a chain of misunderstanding to pile on top of another, making the situation worse.
The document seems to be a cautionary tale to prevent that kind of thing to happen again, this time with AI systems, especially when it's used in the military, where the consequences may be dire.
So, I interpreted the point of the document as (my wording): Let us be aware on how we are communicating our intentions through our actions, lest miscommunications make chaos out of this rapidly advancing nascent technology breakthrough.