So, you’ve probably seen the headlines. Trump signs AI executive orders, and suddenly everyone from Silicon Valley to the state capital in Sacramento is scrambling to figure out what just hit them. It’s a lot to take in. Honestly, the media makes it sound like a total shutdown of regulation, but the reality is way more nuanced—and honestly, a bit of a legal chess match.
Basically, we're looking at a complete 180 from the Biden era. If the old plan was about safety and "trustworthy AI," the new vibe is all about "dominance." No more "woke AI" (the administration's words, not mine) and definitely fewer hoops for developers to jump through. But here's the kicker: the biggest fight isn't even about the tech itself. It’s about who gets to tell the tech companies what to do: the feds or the states.
The December Shockwave: Executive Order 14365
On December 11, 2025, things got real. Trump signed the order titled “Ensuring a National Policy Framework for Artificial Intelligence.” If you’re a fan of state-level protections, this one is a bit of a gut punch. The goal? To stop what the administration calls "onerous and excessive" state laws from creating a "patchwork" of regulations that makes it hard for startups to grow.
Think about it. If you’re building a new AI tool in a garage, you don’t want to hire 50 different lawyers to make sure you’re complying with 50 different sets of rules. That’s the logic here. But the way they’re going about it is pretty aggressive. They aren't just saying "please don't." They're setting up an AI Litigation Task Force within the Department of Justice. Their sole job? Suing states that pass laws the White House doesn't like.
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Money as a Weapon
This is the part that kind of blew my mind. The order actually instructs the Secretary of Commerce to look at federal funding—specifically the $42 billion BEAD program for broadband—and tell states: "Hey, if you keep these 'onerous' AI laws, you might lose your internet infrastructure cash." It’s a massive carrot-and-stick move. If you're a state governor, do you protect your local AI bias law or do you take the billions to bring high-speed internet to your rural counties? Most are going to take the money.
What Happened to the Biden Rules?
Remember that massive 2023 Executive Order from Biden? The one that required companies to report their "red-teaming" results to the government? Gone. Trump scrapped it on day one of his term in January 2025. He called it "dangerous" and a "barrier to innovation."
Instead, he signed Executive Order 14179, "Removing Barriers to American Leadership in Artificial Intelligence." It shifted the focus from "how do we stop AI from being scary?" to "how do we make sure America wins the race against China?"
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The new framework basically says:
- AI should be free from "ideological bias."
- Regulations should be "minimally burdensome."
- The government should help build massive data centers, not slow them down with environmental paperwork.
The "Truthful Output" Fight
There is a really specific part of the new order that has researchers worried. It directs the FTC to look at state laws that force AI models to "alter their truthful outputs."
What does that mean in plain English? Basically, if a state passes a law saying an AI has to be "unbiased" or "fair," the Trump administration might argue that the state is actually forcing the AI to lie or censor itself to fit a political agenda. It's a First Amendment argument waiting to happen. The administration wants AI to be "objective," which is a tall order for a machine that learns from the messy, biased internet.
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What’s Still Allowed? (The Carve-outs)
It’s not a total free-for-all. Even the most "innovation-at-all-costs" policy has its limits. The December order actually leaves some room for states to keep doing their thing in specific areas:
- Child Safety: This is the big one. States can still pass laws to protect kids from AI-generated deepfakes or exploitation.
- Infrastructure: Rules about where you can build data centers and how they connect to the power grid are mostly still in state hands.
- Government Procurement: If a state wants to set high standards for the AI it buys for its own agencies, it can.
Practical Steps for Business Leaders
If you’re running a company or just trying to navigate this mess, you can't just ignore the state laws yet. Why? Because an Executive Order isn't a magic wand. It can't "delete" a state law. Only a court or Congress can do that.
- Don't scrap your compliance yet: If you're doing business in California or Illinois, their AI laws are still on the books. Until the DOJ wins a lawsuit against them, you still have to follow them.
- Audit your tools: The "no ideological bias" rule is going to be a big deal for federal contractors. You need to know if your AI has been "fine-tuned" with specific social agendas, because that could get you in hot water with the feds.
- Watch the BEAD funding: If you're in a state that's fighting the White House on AI, keep an eye on your local tech infrastructure projects. They might get delayed if the funding gets frozen.
- Focus on "Objective Truth": Start looking at how your AI models handle controversial topics. The administration is signaling that "neutrality" is the goal, so leaning into transparency about how your model arrives at an answer is a safe bet.
The bottom line is that the "Wild West" era of AI isn't coming back, but the sheriff is definitely changing. We’re moving from a world of "safety first" to "growth first," and the legal battles over the next few months are going to decide exactly what that looks like on the ground.
Stay alert. The next round of evaluation from the Secretary of Commerce is due by March 11, 2026, and that’s when we’ll see the first "hit list" of state laws the government wants to kill. If your business relies on those laws, you'll need a Plan B.