Major technology companies are engaged in an aggressive lobbying campaign to prevent states from regulating artificial intelligence for the next decade, sparking debate across political lines and raising concerns about consumer protection.
The controversial provision, included in the House's version of President Donald Trump's "One Big, Beautiful" budget bill passed in May, would prohibit states from enforcing "any law or regulation regulating artificial intelligence models, artificial intelligence systems, or automated decision systems" for 10 years. Tech industry lobbyists representing Amazon, Google, Microsoft, and Meta have been pushing senators to maintain this moratorium in the Senate version.
The Senate Commerce Committee, however, has taken a different approach in its version released in early June. Rather than an outright ban, the Senate text conditions states' ability to receive funding from a $500 million allocation for AI infrastructure on pausing AI regulations through 2035, with certain exceptions.
The proposal has created unusual political alignments, with opposition coming from both progressive Democrats and conservative Republicans. Senator Josh Hawley (R-MO), Senator Marsha Blackburn (R-TN), and Representative Marjorie Taylor Greene (R-GA) have all voiced concerns about the provision.
"We have no idea what AI will be capable of in the next 10 years and giving it free rein and tying states' hands is potentially dangerous," Greene posted on social media after initially voting for the House bill without realizing the provision was included.
Critics, including a coalition of 140 organizations and 260 state lawmakers from all 50 states, argue the moratorium would shield tech companies from accountability for harmful AI systems. They point to existing state laws that protect consumers from AI-related harms such as deepfake scams, algorithmic discrimination, and job displacement.
Proponents, including Senator Thom Tillis (R-NC), counter that a patchwork of state regulations would impede American innovation in the global AI race. "You don't want the number one country in the world for innovation to fall behind on AI," Tillis said.
The provision's fate remains uncertain as the Senate continues to debate the budget bill, with procedural hurdles potentially blocking its inclusion. Under Senate rules, provisions in budget reconciliation bills must be directly tied to budgetary matters, which may disqualify the AI regulation ban.