Senate Keeps AI Regulation Ban In Trump’s Budget Bill

The provision to block U.S. states from enforcing their own AI laws stays in President Donald Trump’s broad tax and spending bill until further notice.

The Republican effort to block U.S. states from implementing new AI regulations will remain part of President Donald Trump’s extensive tax and spending package until further notice.

The decision benefits major technology companies, which reject different state-based AI legislation, as noted by Bloomberg.

The Senate version of the bill would reduce federal broadband funding for states that implement AI regulations. The Senate made an unexpected decision, allowing Republicans to keep the provision despite Democratic opposition, as noted by Bloomberg.

TechPolicy notes that, should this moratorium become law, it would be one of the most far-reaching federal interventions in technology policy in decades.

However, the fight isn’t over. Senator Marsha Blackburn, and other Republicans oppose the ban because they believe states should maintain their authority, as reported by Bloomberg.

Blackburn expressed her opposition to the proposed moratorium, saying: “We do not need a moratorium that would prohibit our states from stepping up and protecting citizens in their state,” as reported by Bloomberg.

The Guardian reports that Microsoft, together with Google and Amazon have actively worked to stop state-level AI regulations because they want to avoid different regulatory frameworks across America. Microsoft chief scientist Eric Horvitz expressed concern that blocking regulation would create obstacles for AI development, and slow down its progress.

The proposed law would establish a 10-year moratorium on state AI regulations, which would nullify current laws in California, New York, and other states regarding privacy and bias, as reported by Bloomberg.

The Republican Party plans to pass the bill before July 4, but ongoing discussions about AI regulations, tax policies, and other matters may extend the timeline, says Blommberg.

The ban faces criticism for potentially harming consumer protection, as noted by the AI safety think tank Center for Responsible Innovation.

Stuart Russell, a computer science professor at the University of California, Berkeley, questioned the logic of deploying AI technology that even its creators admit carries a 10% to 30% risk of causing human extinction. “We would never accept anything close to that level of risk for any other technology,” he said, as reported by The Guardian.

U.S. governance of AI will experience a fundamental transformation through this decision, regardless of whether states participate in the process.