Inside Year One: Artificial Intelligence and Technology Developments Under a New Administration

Consistent with the Trump administration’s broader approach to business more generally, the AI and tech industries have gained significant advantages from the Administration’s deregulatory posture in its first year. In fact, the AI and tech industries have enjoyed even greater benefits than most other industries. After a quick showing of support and influence by several members of big tech, the Administration not only sought to remove prior federal regulatory hurdles to innovation and development in the AI and tech realms, but also sought to expand the federal government’s ability to preempt state laws and regulatory efforts.

For example, during the negotiation of the OBBBA, the version that originally passed the House included a 10-year moratorium on enforcement of state and local laws and regulations governing AI models, AI systems, or automated decision systems (subject to limited exceptions). While that moratorium was ultimately removed, the White House shortly thereafter released America’s AI Action Plan, which instructed various federal agencies to investigate whether they could preempt state and local laws that regulate AI under the general mandate that “[t]he Federal government should not allow AI-related Federal funding to be directed toward states with burdensome AI regulations that waste these funds.”

States Step Up Regulation

Notwithstanding federal deregulation and threats to preempt, several states have taken steps to increase their regulation of tech and AI. For example, California passed SB 53, a first-in-the-nation law that will impose standardized safety disclosure and governance obligations on developers of frontier AI systems. Colorado also moved forward with its Anti-Discrimination in AI Law without amendment during the 2025 legislative session, and the law is set to go into effect in June 2026. Even red states like Texas have brought aggressive enforcement actions against tech companies, including by alleging that AI-powered facial recognition tools violate its biometric identifier law. In the face of federal deregulatory pressure, states across the political spectrum have continued to push forward with AI and tech regulation.

In the closing weeks of 2025, the White House issued an EO that may bring the struggle over this dichotomy to a head. Under the EO, titled Ensuring a National Policy Framework for Artificial Intelligence, the U.S. Attorney General is tasked with establishing an AI Litigation Task Force to challenge unconstitutional, preempted, or otherwise unlawful state AI laws; the Secretary of Commerce is directed to publish an evaluation of state AI laws that conflict with national AI policy priorities; and the Administration is called upon to develop a national AI legislative framework that would preempt conflicting state AI laws.

In other words, the Trump administration has set the stage for a showdown between the state and federal governments over AI and tech regulation, and we will likely see the real battle in 2026.

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