Federal AI Ban Overturned: Senate Boosts State Regulatory Power

A 10-year federal moratorium on state artificial intelligence regulation, initially part of President Trump’s comprehensive tax and spending bill, has been decisively overturned by the U.S. Senate. The 99-1 vote during a “vote-a-rama” session significantly boosts the regulatory power of individual states over AI technologies.
Republican Senator Marsha Blackburn was the driving force behind the successful amendment to strike the ban. Her efforts underscore a growing recognition in the Senate that states are crucial in addressing the multifaceted impacts of AI, particularly in areas requiring local adaptation and immediate protective measures.
The Senate’s earlier iteration of the bill had a softer impact, merely stipulating that states with AI regulations would be ineligible for a new $500 million fund for AI infrastructure. The complete removal of the ban, however, grants states unfettered freedom, eliminating any federal financial or regulatory impediments to their AI initiatives.
This move contrasts with the preferences of major AI companies like Google and OpenAI, who have publicly advocated for federal preemption to prevent a fragmented regulatory environment that could hinder innovation. However, Senator Blackburn strongly argued that “Until Congress passes federally preemptive legislation like the Kids Online Safety Act and an online privacy framework, we can’t block states from making laws that protect their citizens.”