Trump Threatens Funding for States Over AI Regulations
On December 11, 2025, U.S. President Donald Trump announced a significant shift in federal policy regarding artificial intelligence (AI) regulation. He stated that his administration would withhold federal broadband funding from states whose AI regulations are deemed to hinder American technological dominance.
Centralized Approval for AI Regulations
During a press conference, Trump emphasized the need for a central source of approval for AI regulations, arguing that the existence of 50 different regulatory frameworks creates obstacles for the growth of the AI industry. He asserted, “To win, United States AI companies must be free to innovate without cumbersome regulation.”
Concerns Over Unfettered Development
While the Trump administration has embraced AI as a crucial technology, critics raise concerns that unregulated development could pose risks to American citizens. The new order also targets states like Colorado, which have implemented measures to prevent discrimination in AI models, suggesting that these efforts could introduce ideological bias and produce inaccurate outcomes.
Impact of the Order
The order provides the Trump administration with tools to combat what they deem onerous state regulations. White House AI adviser David Sacks noted that while the administration would not oppose rules related to child safety, it aims to evaluate state laws for conflicts with federal priorities. States found in conflict risk losing access to the $42 billion Broadband Equity Access and Deployment fund.
Criticism from Democratic Representatives
Democratic Representative Don Beyer expressed concerns that the order would undermine safety reforms implemented by states and create a “lawless Wild West environment” for AI companies, ultimately putting Americans at risk. He warned that this action could violate the 10th Amendment, which reserves powers not explicitly granted to the federal government for the states or the people.
Call for National Standards
The order calls for collaboration with Congress to develop a national standard that prohibits state laws conflicting with federal policies. This standard aims to protect children, prevent censorship, respect copyrights, and safeguard communities. Until such standards are established, the order seeks to address the most excessive state laws that could stifle innovation.
State Responses and Legislative Actions
Major AI companies, including OpenAI, Google, and Meta Platforms, have argued that the federal government should oversee AI regulations rather than individual states. Conversely, state leaders from both political parties insist on the necessity of implementing guardrails around AI, especially given Congress’s failure to pass comprehensive tech regulations.
For instance, New York became the first state to mandate that online retailers disclose their use of algorithms and personal data in “surveillance pricing.” Additionally, California and Washington are considering bans on personalized pricing methods. Florida Governor Ron DeSantis has proposed an AI Bill of Rights encompassing data privacy and consumer protections, while California Governor Gavin Newsom has signed legislation requiring major AI developers to outline plans for mitigating potential catastrophic risks.
In summary, President Trump’s administration is taking a firm stance on AI regulations, emphasizing the need for centralized control while facing significant pushback from state leaders and critics concerned about the implications for safety and equity.
