Trump Orders DOJ Attack on State AI Regulations, Threatens Federal Funding

President Donald Trump struck a blow against state-level artificial intelligence regulations on December 11, 2025, signing an executive order that directs the Department of Justice to challenge what he calls “cumbersome” state AI laws.

The executive order, titled “Guaranteeing a National Policy Framework for Artificial Intelligence,” creates a DOJ AI Litigation Task Force to sue states over AI regulations that Trump’s administration considers unconstitutional barriers to commerce.

The order specifically criticizes laws in California and Colorado. California’s law requires complex disclosures about AI systems, while Colorado’s AI Act bans algorithmic discrimination. The administration claims these laws force companies to embed ideological bias in their programming.

“We can’t let America fall behind in the AI race because of 50 different sets of rules,” a White House spokesperson said. “This order guarantees our tech companies can innovate freely.”

Under the order, the Commerce Secretary will evaluate conflicting state laws and refer them to the DOJ for legal action. The Federal Communications Commission will establish a national reporting standard meant to override state requirements. The administration argues these laws may create First Amendment violations through their disclosure requirements.

The Federal Trade Commission is directed to issue policy statements on preempting state laws that might alter truthful AI outputs. The administration also plans to condition federal funding on states agreeing not to implement certain AI regulations.

The move echoes the UK’s pro-innovation approach to AI regulation which focuses on flexibility rather than rigid requirements.

The order also threatens to withhold BEAD Program funding from states deemed to have restrictive AI laws that could undermine broadband deployment initiatives.

Critics worry the order oversteps federal authority by attempting preemption without congressional legislation. Legal experts predict lengthy court battles over the constitutionality of Trump’s approach.

“This is an unprecedented attempt to centralize AI regulation at the federal level,” said a technology policy analyst. “States typically have authority to protect their residents through consumer protection laws.”

Tech industry leaders praised the move, saying it will prevent a confusing patchwork of regulations. Civil rights groups expressed concern that important protections against algorithmic discrimination might be eliminated.

The White House has directed its Office of Legislative Affairs to prepare recommendations for a uniform national AI framework that would protect children and respect copyrights while promoting innovation.