Federal AI Framework Takes Center Stage
President Donald Trump is reportedly preparing an executive order that would override state-level artificial intelligence regulations, aiming to establish a unified federal framework for AI governance. The move comes as the administration seeks to centralize control over AI policy in Washington, potentially blocking regulations in states like California that have taken aggressive approaches to AI oversight.
Key Provisions of the Draft Order
The draft executive order, currently under review, would direct Attorney General Pam Bondi to establish a task force specifically designed to challenge state AI measures. The order would also restrict federal funding to states that pass AI laws deemed “onerous” by federal authorities.
Federal Preemption Strategy
The proposed order would instruct the Federal Trade Commission to issue guidance on how existing consumer protection laws could preempt state AI regulations. This represents a significant federal power grab in the rapidly evolving AI regulatory landscape, where states have been increasingly active in setting their own standards.
Implementation and Oversight
According to the draft summary, AI and crypto czar David Sacks would oversee much of the implementation work outlined in the order. The document is still being revised and could change before any final release, but the administration appears committed to establishing federal dominance in AI governance.
Industry and Legal Perspectives
Sharon Klein, partner at Blank Rome and co-chair of the firm’s Privacy, Security & Data Protection Practice, told Decrypt that such a mandate “would provide a floor for states that do not have AI statutes” and could be “beneficial to businesses in providing a baseline for compliance.”
Potential Concerns
However, Klein noted concerns about whether “a one-size-fits-all rulebook” could “slow emergency responses when AI-generated harms appear locally.” She emphasized that the effectiveness would depend heavily on “the way the statute is implemented, funded, and enforced.”
Legislative Battle Intensifies
The executive order push comes as House Republicans consider using the must-pass National Defense Authorization Act (NDAA) as their final chance this year to advance state-level AI preemption. Majority Leader Steve Scalise confirmed they are “looking at” inserting the provision into the defense bill.
Previous Setbacks
The effort faces significant challenges after the Senate voted 99-1 in July to strip a 10-year moratorium on state AI laws from President Trump’s “One Big Beautiful Bill.” Even a shortened 5-year compromise failed to gain traction, with Senator Marsha Blackburn withdrawing support just one day after striking a deal with Senate Commerce Chair Ted Cruz.
Urgency and National Security Concerns
President Trump amplified the urgency of federal AI regulation on Wednesday, warning that state overregulation threatens America’s lead in the AI race. “Some States are even trying to embed DEI ideology into AI models, producing ‘Woke AI,'” he wrote on social media.
China Competition Factor
The administration’s position emphasizes that American companies should be free to innovate “without cumbersome regulation,” noting how state legislatures have introduced “over 1,000 AI bills” that could undermine the “innovative culture” needed to compete with China.
California’s Regulatory Approach
The draft order specifically criticizes California’s AI regulations, calling its risk disclosure mandates for major AI developers “complex and burdensome.” California has been at the forefront of state-level AI regulation, recently passing separate legislation governing AI companion chatbots that requires them to self-identify and restrict certain content for minors.
Implementation Timeline and Process
Under the proposal, the Commerce Secretary would assess broadband funding eligibility based on states’ AI laws within 90 days, while FCC chair Brendan Carr would initiate proceedings to determine federal disclosure standards that preempt conflicting state rules. This aggressive timeline reflects the administration’s urgency in establishing federal control over AI governance.
