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4d ago

Trump Budget Proposal's AI Regulation Ban Faces Backlash and Legislative Uncertainty

A provision in the FY2025 reconciliation bill proposing a decade-long moratorium on state AI regulations draws bipartisan opposition and procedural challenges in Congress.

Assembly member Rebecca Bauer-Kahan, D-Orinda, said the House bill's language appeared “sloppily drafted” and questioned whether Republicans who wrote the proposal understand how broadly AI is used.
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Overview

  • Section 43201(c) of the 'One Big Beautiful Bill Act' would prohibit states from enforcing AI regulations for 10 years, with limited exceptions for removing legal barriers to AI adoption.
  • Forty state attorneys general and over 140 organizations have formally opposed the measure, citing risks to public safety, consumer rights, and state sovereignty.
  • California legislators warn the moratorium could block enforcement of laws addressing AI-generated child sexual abuse imagery and deepfake scams targeting seniors.
  • The House Budget Committee narrowly advanced the bill, but at least 21 House Republicans remain undecided, and Senate Byrd Rule concerns may derail the provision.
  • Critics argue the federal preemption undermines state efforts to address AI-related harms, as Congress has yet to enact comprehensive AI regulations.