In a decisive 99-1 vote, the U.S. Senate has removed a provision from the Big Beautiful Bill — a comprehensive U.S. budget proposal — that would have prohibited states from regulating artificial intelligence (AI) for a decade.
The move defied intense lobbying from Silicon Valley and the Trump administration, with major players like Microsoft, Meta, venture capital firms such as Andreessen Horowitz, and White House technology advisors backing the moratorium.
The initiative was effectively buried by Senator Marsha Blackburn of Tennessee, who feared that a federal ban would undermine the state’s "Elvis Act," a law protecting musicians from unauthorized use of their voices in AI applications.
Her stance proved pivotal in shifting the debate. Notably, even Senator Ted Cruz of Texas, an initial supporter of the moratorium, ultimately voted to exclude it from the tax legislation. Commerce Secretary Howard Lutnick had framed the measure as a national security imperative, yet President Trump himself remained publicly silent on the issue.
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States have already enacted dozens of laws addressing AI risks, ranging from deepfakes to algorithmic discrimination, with over 1,000 bills proposed. Meanwhile, the federal Congress has yet to pass comprehensive AI regulation. This gap highlights a growing tension: tech companies argue that minimal regulation is critical for rapid innovation, a stance that has fueled their development pace. However, this swift advancement often generates problems, inevitably prompting regulatory responses. The tech industry is unlikely to concede easily, setting the stage for ongoing battles over AI governance.
