Donald Trump Tries To Override State AI Regulations via Executive Order

President Donald Trump announced his executive order, “ensuring a national policy framework for artificial intelligence,” on Thursday. While the order self-admittedly does not create a national regulatory framework for the burgeoning technology, the reactions of both AI pessimists and AI optimists suggest that it is a meaningful step toward stymieing state regulation.

Before Thanksgiving, Trump took to Truth Social to call on congressional republicans to put a federal AI standard in the National Defense Authorization Act (NDAA). Trump’s plea did not fall on deaf ears, but was ultimately of no avail. While restrictions on advanced AI chip sales did not make it into the House version of the NDAA—a boon for American GPU manufacturers Nvidia, AMD, and for the growth of the American semiconductor industry—neither did a federal AI regulatory framework.

Trump’s Thursday executive order says that “a carefully crafted national framework can ensure that the United States wins the AI race,” but such a framework does not yet exist. The executive order implicitly acknowledges that the president cannot impose such a framework single-handedly, but emphasizes that the current state-by-state patchwork “imping[es] on interstate commerce.”

As the regulation of interstate commerce is the exclusive jurisdiction of the federal government, the order seeks “to check the most onerous and excessive laws emerging from the States that threaten to stymie innovation,” but notably not those that relate to child safety protections, data center infrastructure, or state government AI procurement and use. To this end, the order includes everything presaged in the unreleased executive order, “eliminating state law obstruction of national AI policy,” which was leaked in November.

First, it conditions federal broadband funding and other discretionary grant programs on the nonenactment and nonenforcement of state AI regulations deemed onerous by the administration. Second, it establishes the AI Litigation Task Force within the Justice Department to evaluate and challenge such regulations. Third, it directs the Federal Communications Commission “to determine whether to adopt a Federal reporting and disclosure standard for AI models that preempts conflicting State laws.” And finally, it directs the Federal Trade Commission (FTC) to issue a statement explaining how state laws that “require alterations to the truthful outputs of AI models are preempted” by the FTC Act’s prohibition on unfair or deceptive acts or practices affecting interstate commerce.

The Center for Democracy and Technology, a progressive technology policy nonprofit, argues that the order is a “set of largely toothless directives,” given that the president “cannot constitutionally preempt state laws.” Neil Chilson, head of AI policy for the Abundance Institute, has a different view. He says the order “is rhetorically less polarizing and legally more watertight” than the leaked executive order. Only time will tell whether the executive order has Trump’s desired effect.