Federal AI Regulation Efforts Thwarted
Tech giants have encountered a significant setback this year, as lawmakers have rejected a proposal to use the defense bill to prevent states from enacting and enforcing their own artificial intelligence (AI) regulations. House Majority Leader Steve Scalise indicated that the defense bill was not the appropriate venue for language that would block state-level AI laws.
The technology industry had attempted to leverage the National Defense Authorization Act (NDAA) to forestall states from developing their own AI regulations. Companies such as Meta, OpenAI, Google, and Andreessen Horowitz sought to establish a single national AI law that would supersede more stringent rules in states like California and New York. The companies argued that a unified rule would simplify compliance and mitigate the confusion arising from disparate state-specific regulations.
However, lawmakers on both the House and Senate Armed Services Committees opposed this initiative, contending that introducing a narrowly focused AI law into a comprehensive military appropriations bill was inappropriate. This marks the second instance this year that Congress has blocked similar attempts to override state AI laws. Earlier in the year, the Senate voted 99-1 against a measure designed to curtail state authority over AI. The prevailing sentiment among most lawmakers is that states should retain the power to regulate AI, prioritizing public protection over concerns about costs and regulatory fragmentation.
Despite this outcome, both chambers of Congress acknowledge that discussions regarding AI regulation are ongoing. Lawmakers suggest that a federal rule could still be established to work in conjunction with state laws, provided it respects states' authority and safeguards the public interest.
White House and Tech Leaders' Lobbying Efforts Unsuccessful
David Sacks, the White House AI chief, engaged in extensive discussions with senior Republican leaders in Congress and executives from prominent U.S. AI companies. Sacks and his team advocated that a singular national AI rule would facilitate company compliance, stimulate innovation, and prevent other nations, such as China, from outpacing the United States in AI development.
Nevertheless, lawmakers disagreed, emphasizing the necessity for states to retain the authority to hold companies accountable for harms caused by AI products. Senate Majority Leader John Thune commented that while the White House sought common ground, Congress was unwilling to grant broad exemptions to tech companies or diminish state authority in any significant way.
President Donald Trump had publicly urged Congress to block state-level AI rules, arguing that preemptive language within the defense bill would bolster U.S. companies and enhance their global competitiveness. Despite the coordinated efforts of the President and major tech corporations to advance this proposal, Congress remained unconvinced. Many members of the Armed Services Committee expressed concerns that the proponents had rushed the decision-making process and that integrating an AI law into the defense bill was ill-suited to its primary focus on national defense. They cautioned that such a move could jeopardize the safety of citizens, workers, and communities.
Tech companies are anticipated to intensify their lobbying efforts in the coming year, believing that the political landscape may become more favorable. For now, states retain the ability to create and enforce their own AI regulations, which companies are obligated to follow. This situation underscores the significant influence of congressional decisions, even when confronted with opposition from the White House, major technology firms, and the President.