In a significant recent development, Donald Trump’s “Big, Beautiful Bill” had an important provision removed regarding state-level artificial intelligence (AI) laws. During the Senate’s “vote-a-rama,” a staggering 99 to 1 vote led to the removal of limitations on how states could regulate AI within their jurisdictions.
This particular clause, which found strong backing from major tech companies and was pushed by Texas Senator Ted Cruz, would have barred states accepting federal broadband funds from enacting any form of AI regulation. The amendment to eliminate this restriction was proposed by Republican Senator Marsha Blackburn and enjoyed overwhelming bipartisan support, with only Thom Tillis opposing it.
Reuters reports that Ted Cruz expressed disappointment over the full repeal of these regulations. Although he had suggested a compromise that would have allowed a five-year moratorium while permitting states to handle narrow AI-related issues—like combating deepfakes—he ultimately supported striking all regulations. In typical fashion, Cruz’s lamentations about being overlooked could hardly draw sympathy.
It remains uncertain whether Trump has any personal investment in this specific provision, as he did not publicly comment on it. However, several advisors surrounding him displayed clear displeasure over its removal. Bloomberg highlighted that White House advisors Michael Kratsios and David Sacks were proponents of the ban. Sacks specifically warned during an AWS Summit event that imposing regulations on AI at this stage could be detrimental, suggesting it would amount to “killing this thing in the cradle.”
Commerce Secretary Howard Lutnick also supported the initial provision in the bill. He argued that allowing states to create their own AI laws could jeopardize national security. Lutnick has been advocating for comprehensive national AI regulations, though progress on that front appears stalled.
Removing the ban certainly benefits state authorities, who are already moving much faster than federal agencies when it comes to AI regulation. A remarkable 47 states have introduced some form of AI legislation, with nearly one in five having enacted those proposals. This includes several conservative states—contrary to the prevailing notion that only progressive regions like California are taking the lead on AI issues. With this new freedom, states can also pursue Broadband Equity, Access, and Deployment (BEAD) funding without being constrained by restrictive terms.
How is artificial intelligence regulated in different states? It’s critical to recognize that states are taking initiative in setting regulations tailored to local needs, moving more swiftly than federal entities.
What does the repeal of the AI regulation ban mean for states and tech companies? Without the federal restriction, states can now develop their approaches to AI legislation, potentially leading to a more diversified regulatory landscape that better addresses specific local concerns.
Are there any risks associated with state-level AI regulations? Yes, various regulatory approaches may lead to inconsistencies and complications, particularly for businesses operating across state lines, requiring them to navigate different laws.
How many states have passed artificial intelligence-related legislation? As of now, about 47 states have proposed legislation, with 20% of those becoming law—showcasing a robust legislative response across the country.
This change marks a pivotal moment in the discourse around AI governance. As states rush to set their regulations, it’s imperative to keep an eye on how these laws evolve and what implications they bring for both tech companies and consumers alike. For more insights into emerging trends, don’t forget to check out Moyens I/O.