The federal government has taken decisive action to centralize artificial intelligence regulation, issuing an executive order on December 11, 2025, that signals a major shift away from the current patchwork of state AI laws.
The "Ensuring a National Policy Framework for Artificial Intelligence Order" aims to establish unified national standards for AI regulation by limiting states' authority to enact and enforce individual AI laws [BIPC]. The Trump Administration has positioned this federal preemption strategy as essential for maintaining U.S. competitiveness in the global AI race.
From Deregulation to Federal Control
This executive order builds on the Trump Administration's broader AI strategy unveiled in July 2025 with "America's AI Action Plan." The comprehensive federal strategy outlined more than 90 policy actions designed to secure U.S. AI leadership through accelerated innovation, infrastructure development, and deregulation [White & Case].
The plan marked a stark departure from the previous Biden Administration's approach. President Trump had already rescinded President Biden's Executive Order on AI safety and security in January 2025, signaling a shift toward a more permissive regulatory environment [White & Case].
Addressing the State Regulation Challenge
The December executive order specifically targets what the administration views as "excessive" state regulation that creates compliance burdens and stifles innovation [America's Credit Unions]. The order argues that fragmented state-by-state approaches hinder business operations and weaken U.S. global competitiveness in AI development.
According to industry analysis, the current regulatory landscape has created significant challenges for enterprises, with overlapping requirements across jurisdictions raising compliance costs and operational complexity [Credo AI]. The administration contends that a unified federal framework will eliminate these inefficiencies.
Implementation and Challenges Ahead
The executive order represents "a bold assertion of federal authority over AI regulation that will reshape the legal landscape for AI development and deployment," according to legal experts [BIPC]. However, the implementation faces potential legal and political challenges as states may resist federal preemption of their regulatory authority.
The timing varies for different aspects of the AI Action Plan. While some measures like revised permitting procedures and procurement guidelines may take effect quickly, others involving infrastructure development and energy grid reforms are expected to take years to implement [MetricStream].
Global Context
This centralized approach contrasts with regulatory developments elsewhere. The European Union continues advancing its comprehensive AI Act, while the United Kingdom has reintroduced legislation to create a central "AI Authority" for oversight [MetricStream]. The U.S. approach prioritizes innovation and deregulation over the more risk-focused frameworks adopted by these jurisdictions.
Looking Forward
Industry observers note that the executive order marks the end of an era of "patchy, state-by-state AI oversight" and indicates clear federal intent to prioritize innovation and uniformity [America's Credit Unions]. The administration has signaled its expectation that Congress will pass legislation establishing formal federal preemption where state laws are deemed obstructive to national AI policy goals.
As the framework develops, businesses and policymakers will be watching closely to see how this federal approach balances innovation promotion with necessary oversight and accountability measures.