There is a growing disconnect between America’s technology industry and America’s technology legislation. The dissonance between a culture where competition is driving profound feats of innovation and one wherein risk-aversion trumps all has become more pronounced with the proliferation of artificial intelligence (AI). Uniting policy and practice will be essential to maintaining American leadership in AI.

On one hand, the American tech sector is a dynamic and productive beacon to the rest of the world. Last week, the Wall Street Journal reported that European startups are fleeing the European scene for America’s “risk-tolerant” culture. Europe appears increasingly stagnant to innovators, as regulations stifle efforts to compete with other countries. Alternatively, American excitement over AI is reflected in the numbers. Investors are more generous, businesses grow faster, and the steps between idea and reality are far fewer.

Messy as it is, even the ongoing feud between Elon Musk and Sam Altman, both prominent technology businessmen with their own AI tools on the market (Claude and ChatGPT, respectively), points to a culture where competition is explicitly the engine of progress. The eager investors and flashy CEO battles of America’s AI landscape paint a picture of a place where innovators can move fast and think big to create products that shore up American leadership.

The legislative culture around AI is a far cry from the promised land European AI founders imagine it to be. Lawmakers on both sides of the aisle petition for increased regulations on the technology and there is a profound skepticism toward AI. Even the most uncontroversial innovations are receiving ire from politicians eager to regulate. Self-driving cars, powered by AI, have demonstrated tremendous promise as being tremendously safe and capable of preventing tragic deaths via car accidents. Despite the growing body of evidence that these vehicles are not just safe, but safer than human drivers, Congressman Josh Hawley has complained that “only humans ought to drive cars” and vowed to legislate AI powered vehicles away.

This trend of over-regulation is particularly troubling on the state-level, wherein one state’s laws can have consequences for the entire nation. In California, home to the very Silicon Valley of European startup dreams, Governor Gavin Newsom just signed a bill that creates a framework for governing AI models from their inception onward. California’s approach, when coupled with the rest of state-based efforts, could kill America’s AI industry through a thousand cuts rather than one fell swoop.

What can be done to reconcile the tremendous achievements and promise of America’s tech industry with the legislative impulse to regulate? A federal framework can create the national standard necessary to give the businesses and innovators of America much needed clarity. The Constitution makes clear that in matters of interstate commerce, like how AI companies conduct their business and use their product nationally, Congress is responsible for filling any legislative gaps. A federal framework would affirm the roles of both Congress and the free market in creating the best place in the world to innovate and one that continues to attract international talent and business. President Trump and Vice President Vance have taken up the banner at the federal level on several issues, like energy, and are well positioned to provide leadership on this matter.

Links to Learn More

Europe’s AI Startups Look Stateside for Bigger Checks, Quicker Deals-WSJ

Billions in AI investments are caught in regulatory crosshairs – POLITICO

Recent AI Legislation Roundup: The Good, the Bad, the Ugly – Pelican Institute for Public Policy