WASHINGTON – House Republicans have surprised tech industry watchers, adding clauses to the Republican signed “big, beautiful” tax bill, and a clause that prohibits states and regions from regulating artificial intelligence for a decade.
The short but consequential provisions that fall within the fundamental markup of the House Energy and Commercial Commission are a major benefit to the AI industry. This has lobbyed for uniform, light touch regulations to develop technologies that promise to transform society.
However, while the provisions will be widespread if enacted, they face long odds in the US Senate.
“I don’t know if that will pass,” Sen. John Cornyn of R-Texas, referring to provisions that require every part of budget adjustment bills, such as the GOP plan, to focus primarily on budget issues rather than on general policy purposes.
“That sounds like a policy change. I’m not going to speculate what Congressman is trying to do, but I don’t think it’s going to be a breach of it,” Cornyn said.
Senators on both parties have expressed interest in artificial intelligence and believe Congress should take the lead in regulating technology. But lawmakers have introduced many bills, including several bipartisan efforts to influence artificial intelligence, but few have seen meaningful progress in a deeply divided Congress.
The exception is a bipartisan bill that is expected to be signed into law by President Donald Trump next week. This would enact stricter penalties for the distribution of realistic and AI-generated intimate “venge porn” images without human consent.
“AI doesn’t understand state borders, so it’s very important that the federal government is something that sets interstate commerce. That’s in our constitution. There’s no patchwork of 50 states,” however Moreno said it’s unclear whether the House’s proposed ban could accomplish that through Senate proceedings.
The AI clause in the bill states that “we cannot enforce any laws or regulations regulating artificial intelligence models, artificial intelligence systems, or automated decision systems.” The language can hinder regulations regarding the system, ranging from popular commercial models such as ChatGpt to systems that help you make decisions about who will be hired or find a home.
State regulations regarding the use of AI in business, research, utility, educational environments and government are prohibited.
Congressional pushbacks to state-led AI regulations were part of a wider move led by the Trump administration, repealing policies and business approaches that sought to limit the harm and widespread bias of AI.
Half of all US states, including Alabama, have so far enacted laws regulating the deep state of AI in political campaigns, according to the watchdog organization’s public citizen tracker.
Most of these laws were passed within the last year as cases in the 2024 democratic elections around the world highlighted the threat of realistic AI audio clips, videos and images to deceive voters.
California Sen. Scott Winner called the Republican proposal “really gross” in a social media post. Wiener, a San Francisco Democrat, wrote the Landmark Law last year, which would have created the first safety measures for advanced artificial intelligence models. The bill was rejected by fellow San Francisco California Governor Gavin Newsom.
“Congress cannot provide meaningful AI regulations to protect its citizens, but it cannot act while banning actions,” Wiener wrote.
A bipartisan group of dozens of state attorney generals also sent letters to Congress on Friday against the bill.
“AI brings true promises, but also real dangers, and South Carolina has worked hard to protect our citizens,” the Republican South Carolina Attorney General said in a statement. “Instead of stepping on a real solution now, Congress wants to tie our hands down and push all-round missions from Washington without any clear direction. That’s not leadership.
As the debate unfolds, AI industry leaders are pushing their research while competing with their rivals to develop the best and most widely used AI systems. They are asking Congressmen for uniform, flawless rules on technology, saying they need to move quickly through the latest models to compete with Chinese companies.
Sam Altman, CEO of ChatGpt Maker Openai, testified at a senator’s hearing last week that the “patchwork” of AI regulations “is extremely burdensome and greatly undermines our ability to do what we need.”
“One federal framework, it’s a light touch, and it makes us think of as important and great at the speed that this moment is looking for,” Altman told Sen. Cynthia Ramis, a Wyoming Republican.
Senator Ted Cruz came up with the idea of a 10-year “learning period” for AI at the same hearing that includes three other high-tech company executives.
“Would you support a 10-year learning period in a state that is issuing comprehensive AI regulations, or in any way support the federal government’s preemption to create a uniform playing field for AI developers and employers?” asked the Texas Republican.
“I don’t know what a decade of learning period means, but I think a uniform arena sounds great to me when one federal approach focuses on light touches.”
Microsoft president Brad Smith also provided measured support for “giving the country time” so that early internet commerce with limited US regulations could flourish.
“There’s a lot of details to be attacked, but giving the federal government the ability to lead, especially in areas such as product safety and pre-release reviews, will help grow this industry,” Smith said.
For some executives, it was at least a change of tone. Altman testified to Congress two years ago about the need for AI regulation, and five years ago, Smith praised Microsoft’s hometown of Washington for a “significant breakthrough” that passed through the first guardrail on the use of facial recognition, a form of AI.
Ten GOP senators said they were sympathetic to the idea of creating a national framework for AI. However, it is unclear whether the majority will be able to work with Democrats to find a filibuster prevention solution.
“I’m not against this concept, in fact, interstate commerce suggests that it is Congress’s responsibility to regulate these types of activities rather than states,” said Sen. Mike Round, a South Dakota Republican.
“If we do that state by state, we’re going to bring real confusion in our hands,” Round said.
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Matt Brown and Matt O’Brien. O’Brien reported from Providence, Rhode Island. Ali Swenson of Associated Press Writers in New York, Jesse Bedyne of Denver, Jeffrey Collins of Columbia, South Carolina, and Trans Ngün of Sacramento, California contributed to the report.
