Tech Brief: Senate Set to Vote on GOP-Led Push to Freeze State AI Laws
By Will Oremus
With research by Andrea Jiménez
June 26, 2025
A Republican-led effort to halt state-level regulation of artificial intelligence is advancing toward a pivotal vote in the U.S. Senate, following a key procedural victory that surprised many observers on Capitol Hill.
The proposal, introduced by Sen. Ted Cruz (R-Texas), is now part of President Donald Trump’s sweeping tax and spending package, formally known as the One Big Beautiful Bill Act. It includes a controversial provision that would impose a 10-year moratorium on state and local governments enacting or enforcing AI-related regulations—unless they choose to forgo specific federal funds tied to broadband and technology infrastructure.
From Blanket Ban to Conditional Freeze
The current version reflects a compromise from the more sweeping language passed by the House last month, which would have unconditionally preempted all existing and future state AI laws. Under Cruz’s revised draft, the moratorium is tied to funding incentives, meaning states would have to choose between regulating AI and receiving federal tech grants.
The provision cleared a critical hurdle last weekend when it survived review by the Senate parliamentarian, who ruled that it could remain within the budget-focused legislation. That decision defied expectations from critics who argued that such a broad regulatory override was too substantive to be included in a fiscal bill.
Industry Support and Political Momentum
Supporters of the moratorium, including Republican leadership and major tech industry groups, argue that a uniform national approach to AI regulation is essential to ensuring American leadership in the rapidly evolving field.
“By creating a single national standard for AI, the bill ends the chaos of 50 different state laws and makes sure American companies can develop cutting-edge tech for our military, infrastructure, and critical industries — without interference from anti-innovation politicians,”
— Commerce Secretary Howard Lutnick, in a social media post on Wednesday
Backers also claim that disparate state laws could stifle innovation, drive up compliance costs, and put U.S. developers at a disadvantage compared to international rivals, particularly China.
Critics Warn of a Regulatory Vacuum
Opponents, including civil rights advocates, AI ethicists, and several state attorneys general, warn that the measure would create a regulatory vacuum at a time when AI tools are already being used in sensitive areas such as hiring, law enforcement, healthcare, and political communication.
They argue the bill would:
- Prevent states from enacting or enforcing safeguards against deepfakes, algorithmic bias, facial recognition misuse, and AI-driven discrimination
- Undermine existing protections already passed in states like California, Colorado, and Illinois
- Leave consumers vulnerable to harm from deceptive or biased AI systems
“This bill isn’t about innovation — it’s about handcuffing states that are trying to protect their residents from real-world harms caused by unregulated AI,” one digital rights advocate said.
What’s Next
The full Senate is expected to vote on the bill in the coming days. If passed, it could represent one of the most significant federal preemptions of state authority in the tech sector in decades.
While the bill has a path to passage under the current Republican majority, it remains to be seen whether moderate senators or Democratic holdouts will seek further amendments — or mount a full-scale opposition.
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