President Trump issued an executive order in an attempt to stem the tide of state AI laws and replace them with a national standard.
Why it matters: If successful, the effort could halt the growing patchwork of state AI laws and pave the way for a uniform national framework.
What’s in the Executive Order? The Order seeks to block state AI regulations through several actions, including:
- Creating an “AI Litigation Task Force” at the Department of Justice tasked with challenging state AI laws in court.
- Withholding federal funding—including broadband funds—from states that pass “onerous” AI laws.
- Directing the Federal Communications Commission and the Federal Trade Commission to issue new disclosure and reporting standards that would preempt conflicting state requirements.
The effort to forestall state AI laws is intended to foster continued AI innovation without overregulation: “We remain in the earliest days of this technological revolution and are in a race with adversaries for supremacy within it,” the Executive Order states. “To win, American AI companies must be free to innovate without cumbersome regulation.”
- Notably, several state governors—including Democratic governors in California and Colorado—have recently vetoed or sought to scale back AI laws for similar reasons.
Shaky legal ground: The DOJ litigation task force would seek to eliminate state AI laws on the basis that they unconstitutionally regulate interstate commerce—an uncertain legal argument at best that would likely be challenged. Efforts to preempt state laws through new federal regulatory standards would likely face similar challenges.
A federal AI law? The Executive Order also calls for a federal AI framework to replace the growing number of state laws. The Order directs White House AI and science and technology advisors to prepare legislative recommendations to Congress for a “uniform federal policy framework for AI that preempts state AI laws.”
- In theory, a national AI standard could draw bipartisan support in Congress.
- In practice, reaching a compromise that has enough support to clear the Senate’s 60-vote threshold —and includes state law preemption—remains a tall order.
- Regardless, momentum toward a federal solution is rising as states continue to pass legislation and the effects of AI integration and workforce displacement start to hit home.
Employer considerations:
- A uniform federal AI standard would significantly reduce compliance complexity created by a state patchwork.
- Preemption of more restrictive state rules could limit regulatory risk and operational burden.
- Any eventual federal law is unlikely to match the EU AI Act in scope or compliance demands—expect a more moderate approach.
