On December 11, 2025, President Trump signed Executive Order 14365, titled 'Ensuring a National Policy Framework for Artificial Intelligence,' which was published in the Federal Register on December 16, 2025. This directive seeks to bolster U.S. leadership in AI by addressing what it describes as excessive state-level regulations that hinder innovation. Issued amid ongoing efforts to remove barriers to AI development, the order revokes prior constraints and mandates federal actions to challenge inconsistent state laws, potentially reshaping the regulatory landscape for AI across the country. Its significance lies in the administration's push for a minimally burdensome national standard to outpace global adversaries in AI supremacy, while protecting aspects like child safety and preventing censorship.
Background and Context
The executive order builds on President Trump's earlier actions, notably Executive Order 14179 from January 23, 2025, which revoked his predecessor's policies seen as paralyzing the AI industry. As stated in Section 1, the administration has already updated federal regulatory frameworks to encourage AI adoption, leading to 'trillions of dollars of investments across the country.' However, the order highlights concerns over a 'patchwork of 50 different regulatory regimes' created by state-by-state rules, which complicate compliance, especially for startups. It criticizes specific state laws, such as Colorado's ban on 'algorithmic discrimination,' for potentially forcing AI models to produce 'false results' to avoid differential impacts on protected groups. This reflects broader political forces, including debates over federalism, interstate commerce, and ideological biases in technology. Key players include the Attorney General, Secretary of Commerce, and newly referenced roles like the Special Advisor for AI and Crypto, underscoring the administration's focus on integrating AI policy with economic and technological priorities.
Key Provisions of the Order
The order outlines several targeted measures to implement its policy of sustaining U.S. AI dominance through minimal regulation. Section 3 directs the Attorney General to establish an AI Litigation Task Force within 30 days, tasked solely with challenging state AI laws deemed inconsistent with federal policy. This includes arguments based on unconstitutional regulation of interstate commerce, preemption by federal rules, or other unlawfulness. The task force will consult with White House advisors on emerging laws warranting action.
Section 4 requires the Secretary of Commerce, within 90 days, to publish an evaluation of state AI laws, identifying those that are 'onerous' or conflict with the order's goals. This evaluation must flag laws requiring AI models to alter 'truthful outputs' or compelling disclosures that could violate the First Amendment. It may also highlight innovative state laws aligning with federal aims.
In Section 5, the order imposes restrictions on federal funding. The Secretary of Commerce must issue a policy notice conditioning eligibility for remaining Broadband Equity Access and Deployment (BEAD) Program funds on states avoiding onerous AI laws. Broader agency assessments will explore conditioning other discretionary grants on states not enacting or enforcing conflicting AI regulations. This leverages federal fiscal authority to influence state behavior, drawing on statutes like 47 U.S.C. 1702.
Sections 6 and 7 direct the Federal Communications Commission (FCC) and Federal Trade Commission (FTC) to develop preemptive standards. The FCC chairman must initiate proceedings for a federal reporting and disclosure standard for AI models, while the FTC must issue a policy statement on how state laws mandating 'deceptive' alterations to AI outputs are preempted under 15 U.S.C. 45's prohibition on unfair practices.
Finally, Section 8 tasks White House advisors with preparing legislative recommendations for a uniform federal AI framework that preempts conflicting state laws, while exempting areas like child safety protections and state procurement.
Legal Precedents and Perspectives
The order invokes constitutional principles, particularly the Commerce Clause, which has been interpreted in cases like South Dakota v. Wayfair, Inc. (2018) to limit state regulations burdening interstate commerce. Preemption arguments align with doctrines from cases such as Arizona v. United States (2012), where federal immigration law preempted state efforts. Perspectives vary: proponents, including industry groups, argue that uniform standards reduce compliance costs and foster innovation, as echoed in the order's emphasis on avoiding a 'fragmented State regulatory landscape.' Critics, such as state rights advocates, may view this as federal overreach, potentially infringing on states' traditional authority in areas like consumer protection. Legal scholars note parallels to telecommunications regulation under the Communications Act, where federal preemption has standardized practices. The order's focus on First Amendment issues, such as preventing compelled speech in AI outputs, draws from precedents like 303 Creative LLC v. Elenis (2023), which protected against forced expression.
Implications for AI Development and Federal-State Relations
Short-term implications include immediate federal scrutiny of state laws, with the AI Litigation Task Force poised to initiate lawsuits, potentially leading to injunctions against laws in states like Colorado. The evaluation by Commerce could spotlight regulations for reform, influencing state legislatures. Funding restrictions under BEAD and other programs may pressure states to align with federal policy, affecting billions in infrastructure investments.
Long-term, the order could accelerate a national AI framework if Congress acts on the recommended legislation, preempting discordant state rules while preserving protections for children and copyrights. This might enhance U.S. competitiveness against adversaries, as the order frames AI as a 'race for supremacy.' However, it raises debates on balancing innovation with risks like bias or misinformation. Different perspectives include tech firms favoring deregulation for growth, versus consumer advocates warning of inadequate safeguards without state input. The involvement of agencies like the FCC and FTC suggests expanded federal oversight, potentially setting precedents for emerging technologies.
In summary, Executive Order 14365 represents a strategic effort by President Trump to centralize AI policy and curb state-level barriers. Potential next steps include the rapid formation of the task force and publication of the state law evaluation, which could trigger litigation and funding decisions. Ongoing challenges involve navigating court battles over preemption and Commerce Clause claims, as well as congressional debates on the proposed legislation. These developments will shape the evolving dialogue on federalism in technology regulation, with stakeholders monitoring how they influence AI's role in national security and economic growth.
