Monday Morning Moan - Big Govt props up Big Tech. Why Trump 2.0's Federal landgrab is a regulatory win for the AI Bros, but a loss for society as a whole

Well, the AI vendors will be pleased at any rate. The White House has published its proposed policy framework for regulating the Artificial Intelligence sector and it looks set to put the US Federal Government on a collision course with States, much of the rest of the world, most definitely the European Union.

In the regulatory proposals being sent to Congress by the Trump 2.0 administration are, as expected, unashamedly America-first in nature, in keeping with the US Government’s previous declaration of the importance of dominating the global AI leader board. In the foreword, it says:

The Trump Administration is committed to winning the AI race to usher in a new era of human flourishing, economic competitiveness, and national security for the American people. Achieving these goals requires a common-sense national policy framework that both enables American industry to innovate and thrive and ensures that all Americans benefit from this technological revolution.

The Administration recognizes that some Americans feel uncertain about how this transformative technology will affect issues they care about, like their children’s wellbeing or their monthly electricity bill. These issues, along with other emerging AI policy considerations, require strong Federal leadership to ensure the public’s trust in how AI is developed and used in their daily lives.

Principles

There are six core principles in the proposed framework, emphasizing emotive priorities, such as parental responsibility taking priority over Big Government and protecting US Freedom of Speech, ticking boxes clearly intended to appeal to the MAGA heartland.

The six objectives are defined as:

Protecting Children and Empowering Parents: Parents are best equipped to manage their children’s digital environment and upbringing. The Administration is calling on Congress to give parents tools to effectively do that, such as account controls to protect their children’s privacy and manage their device use. The Administration also believes that AI platforms likely to be accessed by minors should implement features to reduce potential sexual exploitation of children or encouragement of self-harm.

Safeguarding and Strengthening American Communities: AI development should strengthen American communities and small businesses through economic growth and energy dominance. The Administration believes that ratepayers should not foot the bill for data centers, and is calling on Congress to streamline permitting so that data centers can generate power on site, enhancing grid reliability. Congress should also augment Federal government ability to combat AI-enabled scams and address AI national security concerns.

Respecting Intellectual Property Rights and Supporting Creators: The creative works and unique identities of American innovators, creators, and publishers must be respected in the age of AI. Yet, for AI to improve it must be able to make fair use of what it learns from the world it inhabits. The Administration is proposing an approach that achieves both of these objectives, enabling AI to thrive while ensuring Americans’ creativity continues propelling our country’s greatness.

Preventing Censorship and Protecting Free Speech: The Federal government must defend free speech and First Amendment protections, while preventing AI systems from being used to silence or censor lawful political expression or dissent. AI cannot become a vehicle for government to dictate right and wrong-think. The Administration is proposing guardrails to ensure that AI can pursue truth and accuracy without limitation.

Enabling Innovation and Ensuring American AI Dominance: The Administration is  calling on Congress to take steps to remove outdated or unnecessary barriers to innovation, accelerate the deployment of AI across industry sectors, and facilitate broad access to the testing environments needed to build and deploy world-class AI systems.

Educating Americans and Developing an AI-Ready Workforce: The Administration wants American workers to participate in and reap the rewards of AI-driven growth, encouraging Congress to further workforce development and skills training programs, expanding opportunities across sectors and creating new jobs in an AI-powered economy.

Big Government strikes back

But despite the anti-Big Government positioning of the current Administration,  a key plank of the policy framework is a power-grab to ensure that the Federal authorities takes charge of the regulatory climate and that attempts at ground level by individual US States to take their own actions are blocked. The framework claims:

Importantly, this framework can succeed only if it is applied uniformly across the United States. A patchwork of conflicting state laws would undermine American innovation and our ability to lead in the global AI race.

The Federal government is uniquely positioned to set a consistent national policy that enables us to win the AI race and deliver its benefits to the American people, while effectively addressing the policy challenges that accompany this transformative technology.

This shouldn’t come as any surprise - Trump 2.0 officials have regularly spoken out against the idea of individual states, such as California, putting in place legislative and regulatory regimes to govern tech firms. Companies should not have to navigate multiple legal frameworks around the country, is the basic argument:

The Federal government must establish a Federal AI policy framework to protect American rights, support innovation, and prevent a fragmented patchwork of state regulations that would hinder our national competitiveness, while respecting federalism and State rights. Congress should pre-empt state AI laws that impose undue burdens to ensure a minimally burdensome national standard consistent with these recommendations, not fifty discordant ones.

That’s not in its own right unreasonable - although ironically is the kind of centralist command-and-control mindset that Trump 2.0 ferociously criticizes the EU for - but could only work in practice if there is a functional Federal-level authority to manage the fast-expanding AI industry. But having declared that States may not go their own way and have to leave matters to Washington, the Framework also insists:

Congress should not create any new Federal rule-making body to regulate AI.

Mark your own homework

So who should manage this? It seems that AI firms should be left to ‘mark their own homework’! Trump 2.0’s plan is that the Federal Government:

...should instead support development and deployment of sector-specific AI applications through existing regulatory bodies with subject matter expertise and through industry-led standards.

To which critics will immediately point out that this has been tried before, such as with the big tobacco lobby where cigarette firms were left to self-regulate and  for years got away with denying the link between their products and cancer, for example. Or we can look to the airline industry where carriers have previously been allowed to self-certify the safety of craft, all good until things start dropping out of the sky!

So, what we’re looking at here is the likes of OpenAI checking its own work and coming back to report that there’s nothing to see here, all OK, carry on as you were. That’s fine if you assume that such as Sam Altman, Elon Musk, Alex Karp, yada yada yada, can be relied upon to act in the best interests of society as a whole, not just the theoretical best for their firms or for pushing AI into ever more hitherto uncolonized areas of human life, essentially uncontested. SexyGPT, here we come. As for AI launching World War III....

Stamping on states-rights

Just in case, US States do decide to fight against this - they will! - the proposed Federal framework seeks to stamp out such defiance, explicitly stating that Congress needs to legislate against this outcome:

States should not be permitted to regulate AI development, because it is an inherently interstate phenomenon with key foreign policy and national security implications. States should not unduly burden Americans’ use of AI for activity that would be lawful if performed without AI. No States should not be permitted to penalize AI developers for a third party’s unlawful conduct involving their models.

Meanwhile on the subject of copyright infringement, where AI model developers have run rampant through other people’s intellectual property and knowledge bases to train up their models, Trump 2.0 comes down again on the side of the vendor lobby. While the US courts start to work their way through multiple copyright cases and doling out massive penalties for theft to AI vendors and the EU, among others, takes action to protect content creators rights, Trump 2.0 sets a course in the opposite direction:

The Administration believes that training of AI models on copyrighted material does not violate copyright laws...Congress should consider enabling licensing frameworks or collective rights systems for rights holders to collectively negotiate compensation from AI providers, without incurring antitrust liability. Any such legislation, however, should not address when or whether such licensing is required.

So, a nod to the rights of content creators, but don’t get in the way of Big Tech as it marauds its way through the sum of human knowledge in pursuit of AI firms share prices.

Hating regulation 

As I read the Framework proposals in their current form, two thoughts spring to mind. 

One is that the money being spent on lobbyists in Washington looks increasingly like money well-spent, even if it is rising year-on-year more than most of their prospects of turning an actual profit. For example, in 2025, OpenAI’s estimated lobbying spending of $2.1 million was up 24% year-on-year, while Meta is alleged to have one lobbyist on the payroll for every six members of the US Congress.

The second is the blunt assessment issued by Salesforce CEO Marc Benioff at The World Economic Forum in Davos in January on the topic of regulation:

These US tech companies, they hate regulation...They hate regulation.

We have been warned.

If enacted in law, this proposed framework would put the US on a collision course with the EU, although in the current political climate that will be the least of Washington’s concerns. But it will create competing global regulatory regimes for US firms to navigate - and budget for - as they expand outside of the domestic market, which in turn isn’t actually terribly supportive of the stated US-first dominance goal.

While the six principles espoused will allow enough ground cover for some political grandstanding and moral posturing, in practice it’s a shameless abdication of societal responsibility to sections of Big Tech that have shown little sign that they can be trusted to self-govern in the best interests of all.

The lines in the sand have been drawn. What happens next in terms of Congressional action will depend a lot on the outcomes of the mid-term elections later in the year. Watch those Big Tech lobbying budgets break the bank!