Talk of Draft AI EO Is ‘Speculation,’ White House Says
Discussion about a draft executive order seeking to block states from regulating AI is “speculation” until something is announced, a White House official said in a statement Thursday (see 2511190059). However, the California Privacy Protection Agency (CalPrivacy) and others condemned the possible preemption attempt.
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The draft EO circulated Wednesday evening with language seeking to set a national AI standard and prevent “50 discordant” state regulations. The document cited regulatory burdens under AI rules in California and Colorado and the introduction of more than 1,000 state bills that “threaten to undermine” an “innovative culture.”
However, the White House official said, “Until officially announced by the WH, discussion about potential executive orders is speculation."
The document outlines roles for the FTC, DOJ and the FCC. It directs FTC Chairman Andrew Ferguson to examine the agency’s Section 5 authority against unfair and deceptive practices. The FTC should issue a policy statement explaining “the circumstances under which State laws that require alterations to the truthful outputs of AI models are preempted by the FTC Act's prohibition on engaging in deceptive acts or practices affecting commerce,” according to the draft.
The document directs DOJ to “establish an AI Litigation Task Force whose sole responsibility shall be to challenge State AI laws, including on grounds that such laws unconstitutionally regulate interstate commerce, are preempted by existing Federal regulations, or are otherwise unlawful in the Attorney General's judgment, including, if appropriate, those laws identified pursuant to section 4 of this order.” The FTC didn’t comment. DOJ referred to the White House statement.
The document asks the Commerce Department to publish a report identifying state AI regulations “that require AI models to alter their truthful outputs, or that may compel AI developers or deployers to disclose or report information in a manner that would violate the First Amendment or any other provision of the Constitution.”
Also, the draft seeks to block states from accessing allocated funding from the $42.5 billion BEAD program if they pass their own AI measures. The draft EO would require NTIA to issue a policy notice within 90 days “specifying the conditions under which States may be eligible for remaining [BEAD funding] that was saved through my Administration’s ‘Benefit of the Bargain’ reforms,” more commonly known as non-deployment funds estimated to total $20 billion.
The draft would direct FCC Chairman Brendan Carr to begin a proceeding within 90 days “to determine whether to adopt a Federal reporting and disclosure standard for AI models that preempts conflicting State laws.”
Leaders of the National Conference of State Legislatures issued a joint statement opposing efforts to block state AI regulations. “NCSL strongly opposes any effort to override state-level artificial intelligence laws whether through executive action or legislation," said NCSL President Marcus Evans, assistant majority leader for the Illinois House, and NCSL President-elect Barry Usher, Montana’s Senate majority whip. "These attempts undermine the democratic process and disregard the extensive bipartisan work already underway in state legislatures. The best path forward is partnership, not preemption.”
CalPrivacy and several consumer groups issued statements in opposition to the draft EO, with CalPrivacy also opposing House Republicans’ reported efforts to attach a new AI moratorium to the defense funding package.
“California has consistently demonstrated that it is possible to support innovation while providing consumers with critical privacy protections, and current federal efforts to block commonsense state laws erode consumer safety and trust,” said CalPrivacy Executive Director Tom Kemp. “These proposals would rob millions of Californians of rights they already enjoy, leaving consumers vulnerable during a time of rapid technological change. We cannot afford to press pause on privacy.”
Center for Democracy & Technology, Public Knowledge and The Leadership Conference’s Center for Civil Rights and Technology also voiced opposition. PK called the draft EO “an illegal and illogical attempt to bully states into complying with the Trump administration’s demands to abandon all consumer protection efforts in the face of AI – at the exact moment Americans need these protections the most.”