President Donald Trump’s Crypto Czar David Sacks, a prominent Silicon Valley investor and venture capitalist, is putting in overtime defending his boss’s push for federal AI oversight.
Sacks argues that the administration is only focused on pushing back on the “most onerous examples of state regulation” while listing reasons such a move is needed for continued innovation in the AI industry.
David Sacks defends Trump on AI
Donald Trump signed an executive order titled “Ensuring a National Policy Framework for Artificial Intelligence,” aimed at establishing a unified federal regulatory framework for AI on Thursday.
The move seeks to preempt or override state-level AI regulations, which the administration views as a “patchwork” that burdens companies and discourages U.S. competitiveness, particularly against China.
However, it has drawn sharp criticism from Democrats, some states, and AI safety advocates, who argue it strips away essential consumer protections without providing immediate federal replacements.
Sacks disagrees, saying the move, which involves developing with Congress a common standard for oversight of the emerging technology, is more about easing a growing compliance burden for companies than anything else.
Right now, AI model development is taking place across multiple states, all with their own regulatory standards. Sacks highlighted that as an issue.
He acknowledged that the U.S. is currently leading China where AI is concerned, but that innovation could fall behind if forced to comply with a patchwork of conflicting AI rules emerging across all 50 states.
While speaking on Fox Business’ “Mornings with Maria”, he said, “If you have to report to 50 different state regulators at 50 different times with 50 different definitions, it’s extremely onerous. And it’s going to slow down innovation, and it’s going to hinder our progress in the AI race.”
“So if we want to stay in the lead, as President Trump has declared, we need to have a single national standard, one standard for AI, so that the most onerous states, the most draconian ones, can’t hold you up,” he added. “We want to work with Congress on this.”
Until a national standard is in place, Sacks claims the administration is prepared to push back against what it sees as excessively restrictive state regulations.
Some states will not accept the order without a fight
The order is widely expected to face legal challenges, especially from states with provisions already in place. Many of these states are expected to treat the order as a case of federal overreach as it affects their respective abilities to govern technology within their borders.
California State Senator Scott Wiener has already drawn the battle lines. “It’s absurd for Trump to think he can weaponize the DOJ and Commerce to undermine those state rights,” Wiener said in a statement. “If the Trump Administration tries to enforce this ridiculous order, we will see them in court.”
Democratic U.S. Senator Brian Schatz has also shared plans to draft legislation that would seek a full repeal of the order.
“Embracing the amazing possibilities of AI can’t come at the cost of leaving Americans vulnerable to its profound risks, which is exactly what this executive order does,” Schatz said. “Congress has a responsibility to get this technology right – and quickly – but states must be allowed to act in the public interest in the meantime.”
Meanwhile, Sacks has said the provision that calls on the Justice Department to sue states over AI rules will only go after the most burdensome regulations.
While he expressed uncertainty about whether the administration would seek to challenge California or New York, he singled out a law in Colorado seeking to prohibit algorithmic discrimination and tagged it “probably the most excessive.”
Trump resorted to the executive order because White House officials and Republican lawmakers reportedly refused to include similar legislation preempting state AI laws in a must-pass defense bill earlier this month.
The order calls for Sacks and other administration officials to work with Congress on legislation for a “minimally burdensome national standard.”
Unfortunately, it has come at a time when more state lawmakers have started expressing an eagerness to impose some rules of the road on the ever-growing AI sector. Experts foresee complications, as any state passing legislation would face potential conflict with the White House.
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