The AI Regulation Dilemma: Spur Innovation, or Guardrails? — Where Are We and the Impact of Trump 2

The Trump 2 AI agenda prioritizes US AI leadership by opposing AI regulation on bias and frontier AI risks, favoring innovation and AI expansion. With comprehensive federal AI regulation unlikely, states are advancing AI laws addressing bias, harmful content, transparency, frontier model risk and other risks. Meanwhile, the EU AI Act effectively imposes global obligations. The emerging patchwork of state rules will burden US companies more than would a unified federal approach, seemingly undermining White House deregulatory goals. So, ironically, the Trump team AI agenda may accelerate disparate state-level regulation and impede AI innovation. US companies therefore face a fragmented landscape similar to privacy regulation where the EU AI Act — in the role of GDPR — has set the stage, and the states are asserting themselves with various incremental requirements. Other recent developments covered will include the finalization of the EU GPAI Code of Practice, certain newly enacted state laws, and a quick overview of AI regulation outside the U.S. and EU.