In a move that has set off a firestorm across the political and tech landscapes, President Donald Trump signed an executive order on December 11, 2025, aimed squarely at dismantling state-level regulation of artificial intelligence (AI) in the United States. The order, which directs the Department of Justice to establish a dedicated AI Litigation Task Force, carries a clear mandate: sue states whose AI laws the administration deems "onerous and excessive." Just as notably, the order threatens to withhold crucial federal funding from states that proceed with their own AI regulations, a decision that has drawn both applause and outrage from various corners of the nation.
According to Truthout, the executive order is widely viewed as a major win for Big Tech, whose influence in Washington has grown ever more pronounced. Since the last election cycle, technology corporations have poured at least $1.1 billion into campaign contributions and lobbying efforts, including significant funding for Trump’s inaugural committee and his White House ballroom project. Critics, such as Public Citizen’s co-president Robert Weissman, haven’t minced words: “This reward to Big Tech is a disgraceful invitation to reckless behavior by the world’s largest corporations and a complete override of the federalist principles that Trump and MAGA claim to venerate.”
The order’s primary rationale, as explained by Trump and echoed by the National Association of Manufacturers, is to avoid a "patchwork of 50 different regulatory regimes" that could stifle innovation and complicate compliance, particularly for startups. Trump stated, "State-by-state regulation, by definition, creates a patchwork of 50 different regulatory regimes that makes compliance more challenging, particularly for start-ups. Second, state laws are increasingly responsible for requiring entities to embed ideological bias within models." He added, "My administration must act with the Congress to ensure that there is a minimally burdensome national standard — not 50 discordant state ones."
To that end, the order also instructs the Secretary of Commerce to publish an evaluation of state AI laws that conflict with national policy priorities. States found in violation could see their Broadband Equity Access and Deployment (BEAD) funding withheld, a move that many see as a powerful lever to enforce federal supremacy in tech policy.
Not all are convinced this is the right path. The American Civil Liberties Union (ACLU) has voiced strong opposition, warning of the dangers of unregulated AI. Cody Venzke, a senior policy counsel at the ACLU, remarked, "Although AI might bring substantial benefits, it also carries substantial risks, and America will not win the AI ‘race’ if the AI used by the government, employers, schools, and health care providers is hallucinatory, unreliable, and dangerous."
States such as Colorado and New York have already enacted their own AI laws, while California is set to require the largest AI firms to publish detailed plans for limiting potential risks. California Governor Gavin Newsom has been particularly vocal in his criticism, accusing the Trump administration of self-serving motives. “Today, President Trump continued his ongoing grift in the White House, attempting to enrich himself and his associates,” Newsom declared. “President Trump and Davis Sacks aren’t making policy — they’re running a con. And every day, they push the limits to see how far they can take it.”
Despite the federal push, the order does allow states some leeway to regulate AI in specific domains—namely, to protect children, address data center concerns, and govern state procurement and use of AI. However, critics argue that these carve-outs are insufficient given the wide array of harms already associated with AI technologies. Jenna Sherman, a campaign director at Ultraviolet Action, emphasized the real-world dangers: “These harms of AI — which Trump and the tech sector are clearly happy to ignore — are already here: non-consensual deepfake porn sexualizing women and girls, children being led to suicidal ideation by AI chatbots, and AI-powered scams and crimes targeting older Americans, especially women, to name but a few.”
Public Citizen’s Weissman highlighted that states are not acting out of step with innovation, but rather are "directing innovation in more positive directions" through their regulations. “There is zero evidence that these rules are impeding innovation; in fact, they are directing innovation in more positive directions,” he said.
The business community, for its part, has largely welcomed the executive order. The US Chamber of Commerce and corporate lobbying organizations representing tech giants like Microsoft and Google lauded the move as a win for small businesses and a necessary step to maintain America’s competitive edge in AI. Jay Timmons, president and CEO of the National Association of Manufacturers, commented, “As the president demonstrates his commitment to both advancing American technological dominance and bolstering investment in manufacturing, he is rightly recognizing that winning the global race for AI hinges on getting AI policy right, which means avoiding a cumbersome 50-state patchwork of laws and regulations that would throttle interstate commerce, stifle innovation, limit AI adoption and erode America’s competitive edge.”
Yet, the order’s opponents see it as a dangerous centralization of power and a direct response to failed legislative efforts. The Republican-controlled Congress had previously rejected attempts to ban state AI regulations through broader legislation. Senator Ed Markey (D-Mass.) was unequivocal in his condemnation: “After months of failed lobbying and two defeats in Congress, Big Tech has finally received the return on its ample investment in Donald Trump. With this executive order, Trump is delivering exactly what his billionaire benefactors demanded — all at the expense of our kids, our communities, our workers, and our planet.” Markey pledged continued resistance, stating, “A broad, bipartisan coalition in Congress has rejected the AI moratorium again and again, and I intend to keep that streak going. I will use every tool available to challenge this indefensible and irresponsible power grab. We will defeat it again.”
Experts have raised concerns that the executive order could leave the country in what Ilia Kolochenko, CEO at ImmuniWeb, termed a “regulatory vacuum.” While the order may make life easier for tech companies by preventing contradictory state laws, it could also mean that the US lags behind global counterparts—especially the European Union, which has adopted a far more robust approach to AI regulation. “While President Trump's Executive Order may prevent some US states from enacting or enforcing complex and sometimes contradicting AI state laws and regulations – thereby considerably simplifying business for tech companies in America – it might also have a possible drawback by leaving America in a regulatory vacuum,” Kolochenko observed.
Enforcement of the order is likely to prove contentious, with significant pushback already underway. A recent attempt to limit state AI laws was defeated in the Senate by a landslide 99-1 vote, and several Democratic lawmakers are reportedly preparing legislative challenges to the White House’s approach.
As the dust settles, it’s clear that the battle over AI regulation is far from finished. With states like California vowing to press on with their own rules and a divided Congress gearing up for further clashes, the United States faces a pivotal moment in determining how—and by whom—AI will be governed in the years ahead.