When Complacency is Not an Option: Federal Preemption in the Face of a Growing Patchwork
The Wall Street Journal reported last week that record-breaking valuations of billions of dollars are commonplace in the age of artificial intelligence (AI). The technology has become a clear litmus test for the economic power of businesses and nations alike. A strong country will have strong AI because it powers advancements across sectors and generates wealth and investment unlike any of its precursors. With stakes this high, complacency is not an option. A national framework can balance the promise of AI with the concerns surrounding it, providing the regulatory clarity necessary to leverage the benefits of AI for the people, businesses, and nation as a whole.
A quick temperature check on the state of AI in the U.S. reveals a paradox: the technology is more lucrative and commonplace than ever, and people have come to rely on it for medical breakthroughs, business logistics, and everything in between. Meanwhile, legislation to regulate, limit, or even completely pause AI is multiplying rapidly. In December of last year, the White House identified this problem in an executive orderdescribing three primary consequences of the onslaught of state regulation: a patchwork of laws makes compliance difficult for startups, state laws often try to define bias and discrimination within AI models in ways that can produce false results, and state laws can extend beyond state borders and violate the interstate commerce clause.
What conclusions can be drawn from these contradicting postures? There is a real need to acknowledge the concerns surrounding AI, but tacking on state regulations is not the answer. The growing patchwork of state laws creates an uneasy middle ground. AI cannot be legislated away. It is a reality of the modern economy and one in which countries around the world are vying to lead. Yet a tangle of state legislation attempting to layer on mounds of regulations and create AI-specific laws for concerns already addressed in state laws threatens the businesses and innovators so eager to leverage AI in this critical moment.
A national standard, offering clarity and protection, is the alternative to the chaos of a web of inconsistent regulations. The Pelican Institute joined over 40 organizations in a coalition letter to support federal AI preemption. By preempting some state AI laws for a period of time, the federal government can create “space for Congress to develop a thoughtful, balanced national framework while existing laws and federal agencies continue to apply. A time-limited preemption ensures that federal leadership is established without foreclosing future policymaking or locking in a permanent regulatory outcome before the technology and its uses are fully understood.”
This strategy was attempted last year, but was ultimately unsuccessful due to political resistance. This year, with the vocal support of President Trump and an increase in both AI regulation and innovation, federal preemption stands as a pragmatic response against the growing patchwork.
Hoover Institution Director and former United States Secretary of State Condoleezza Rice recently offered a way to understand the proliferation of AI that resists a fear-based approach: “What is required now is not panic or complacency but renewal. Renewal of America’s commitment to basic research. Renewal of the partnership between government, industry, and academia. Renewal of the idea that technological leadership and democratic values are not in tension but are mutually reinforcing goals.” A national framework offers a path to that very renewal, and to American leadership in AI.
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