Senate Lifts AI Ban, 99-1 Vote Favors Federal Preemption

The Republican-controlled US Senate recently voted to lift a decade-long federal ban on state regulation of artificial intelligence. This decision was made during a late-night session and was included in a broader tax-cut and spending proposal. The vote, which took place in the early hours of the morning, saw 99 senators voting in favor of the amendment, with only Republican Senator Thom Tillis dissenting. Tillis argued for maintaining state oversight, while supporters of the amendment praised the near-unanimous vote as a victory for consistent AI policy, asserting that a patchwork of state laws could hinder innovation and create confusion for developers.

The vote occurred during a marathon "vote-a-rama" session, where lawmakers proposed and debated numerous amendments to a single bill. Republicans aim to pass the final package through both chambers before Congress adjourns for the summer recess. This particular vote was one of many taken throughout the night, each amendment shaping the expansive legislation in small but significant ways.

Republican Senator Marsha Blackburn introduced the key amendment to remove the AI provision entirely. Blackburn stated that the current language was insufficient for protecting vulnerable groups and that federal legislation, such as the Kids Online Safety Act and an online privacy framework, was necessary before states could be blocked from enacting their own laws. Just a day earlier, Blackburn had negotiated a compromise with Senate Commerce Chair Ted Cruz that would have limited the preemption to five years, allowing states to enact rules on protecting artists' work or shielding children online, provided they did not place an undue burden on AI firms. However, Blackburn withdrew her support for that deal, stating that the pared-down version still did not adequately safeguard vulnerable groups until a federal privacy and children's safety framework was enacted.

Major technology players in Silicon Valley, including Google and OpenAI, have advocated for federal preemption, arguing that AI startups and established firms need uniform rules rather than navigating a maze of state-by-state mandates. Critics, however, express concern that without state-level checks, there could be gaps in protecting users' privacy and rights. The Senate version of the bill would have only barred states from using a newly proposed $500 million fund earmarked for AI infrastructure. Removing the ban means local governments might still access that fund while pursuing their own regulatory agendas.

Late-night developments continued as Trump took to Truth Social to criticize Tesla CEO Elon Musk, mocking Musk's dependence on federal grants while pretending to oppose public spending. Trump's post highlighted a deepening rift between the and the tech community, particularly over the "big, beautiful bill," which many innovators see as harmful to green energy and tech interests. Prior to Trump's post, Musk had criticized Republicans in Congress who support the President’s tax spending bill, threatening that they would lose their primaries next year. The 940-page document includes a $5 trillion increase to the debt ceiling while cutting federal aid programs. Musk's post underscored the tension within the Republican Party, with some senators signaling they are undecided, potentially joining the two already opposed Republicans and threatening to sink the legislation. With time running short before the August recess, GOP leaders face pressure to keep their ranks united, or risk the whole effort collapsing.

Despite the drama, one thing is clear: the fate of AI regulation and the broader spending package remains uncertain. As summer wears on, lawmakers will have to reconcile technology’s rapid advance with both federal authority and state-level protections, no small task in today’s polarized environment.