President Trump Signs Executive Order to Prevent States from Regulating AI

What Happened?

President Trump signed an executive order aimed at banning individual states from passing their own regulation on AI, although the order exempts any state-level efforts to protect children. ‘We want to have one central source of approval,’ Trump told reporters in the Oval Office on Thursday.

Big tech companies praised the executive order, saying, ‘We look forward to working with the White House and Congress to set nationwide standards and a clear rulebook for innovators.’  California Governor Gavin Newsome criticized the order, accusing President Trump of ‘trying to enrich himself and his associates.’

Why it Matters

Since the introduction of ChatGPT in 2022, AI use and applications have grown significantly, and the number of people using AI has doubled to nearly half a billion worldwide. Big tech companies are pouring billions of dollars into data centers to support another round of AI growth, which they believe will impact every sector of the economy. As is usually the case with new innovations, technology is ahead of the law and government regulators are struggling to catch up. 

The argument for a single regulation to govern AI in the United States is a sound one, because if individual states each created their own regulatory framework, the result would be a patchwork of rules that could make AI difficult for users and owners. The problem is that legally, the U.S. Constitution specifically grants Congress the authority to regulate interstate commerce, not the President. 

Because Constitutional authority to regulate interstate commerce belongs to Congress, it is likely President Trump’s executive order would be ruled unconstitutional if challenged in court. States like California, which is home to the tech industry and already has a well-developed set of laws governing both big tech and AI, would likely be the first to challenge the executive order in court. Though, because the order is so new, they have yet to do so. 

A federal regulatory framework for AI is needed, but only Congress can legally enact one. Congress often moves slowly, which can be frustrating both for industries and consumers. In the meantime, new technologies like AI often go unregulated, or governed by a patchwork of conflicting state laws. Even if the new executive order is overturned in court, it could still spur Congress to move more quickly and devise federal guidelines for AI.

How it Affects You

As long as it is in effect, the executive order bans states from regulating AI on their own, but it is unclear how the Trump Administration would enforce that mandate on states that might choose not to follow it. Withholding federal funding is a tactic the Trump Administration has tried before, but that also runs into legal problems because money allocated by Congress cannot be legally discontinued by the executive branch.