On July 1, the U.S. Senate voted 99-1 to remove a proposed 10-year federal ban on state-level AI regulation from President Trump's comprehensive tax-cut and spending bill. The amendment, introduced by Republican Senator Marsha Blackburn, was adopted during a marathon "vote-a-rama" session. Republican Senator Thom Tillis cast the sole vote in favour of retaining the ban.
The original provision sought to prevent states that regulate AI from accessing a new $500 million federal AI infrastructure fund. Major AI companies, including Google and OpenAI, supported the federal preemption to avoid a fragmented regulatory landscape.
Senator Blackburn initially agreed to a compromise with Senator Ted Cruz to shorten the ban to five years and allow limited state regulation. However, she later withdrew her support, arguing that the compromise failed to adequately protect vulnerable populations. She emphasized the necessity of comprehensive federal legislation, such as the Kids Online Safety Act, before limiting states' ability to enact protective regulations.
From the 99-1 vote, you can surmise that the senate believed a 10-year ban was a bridge too far. The alternative is federal regulation (of some kind), which is not anywhere near the top of the agenda, or a world where each state sets its own rules. In that world, AI developers will join data privacy and digital advertising in a patchwork compliance nightmare. For now, it's build fast and hope your AI platform doesn’t cross into a jurisdiction it shouldn't.
As always, your thoughts and comments are both welcome and encouraged. -s
About Shelly Palmer
Shelly Palmer is the Professor of Advanced Media in Residence at Syracuse University’s S.I. Newhouse School of Public Communications and CEO of The Palmer Group, a consulting practice that helps Fortune 500 companies with technology, media and marketing. Named LinkedIn’s “Top Voice in Technology,” he covers tech and business for Good Day New York, is a regular commentator on CNN and writes a popular daily business blog. He's a bestselling author, and the creator of the popular, free online course, Generative AI for Execs. Follow @shellypalmer or visit shellypalmer.com.
