President Donald Trump’s decision late Monday to scrap a 2023 executive order by President Joe Biden to reduce artificial intelligence’s (AI) potential harm to national security, consumers and workers, lifts a major hurdle in the tech industry’s race to monetize a multi-trillion-dollar market.
Executive Order 14110 on “Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence” was intended to fill a void after U.S. lawmakers failed to pass AI safety legislation. It forced developers with large AI models like OpenAI’s GPT lineup to share the results of safety tests with the federal government before they were released to the public.
But the Republican Party insisted the order hindered AI innovation, and candidate Trump vowed to “support AI development rooted in free speech and human flourishing.”
At stake is the astonishing economic impact of AI, which could reach $20 trillion worldwide by 2030, prompting a land rush by Big Tech, a constellation of startups and nearly every major business.
Unimpeded by federal guardrails, AI leaders such as OpenAI and Anthropic and their corporate sponsors are now primarily responsible for self-regulation – the same scenario that led to innumerable political and cultural issues with social media companies like Facebook and X when they were allowed to police themselves.
Trump’s action strongly indicates he won’t push for an AI bill, leaving that task to Congress, says Cliff Jurkiewicz, vice president of global strategy at Phenom, an AI company specializing in HR.
“The cancelation of the executive order puts the onus squarely back on the industry,” Steve Wilson, chief product officer at Exabeam, said in an email. “AI safety and security are among the most important issues of this decade, so we have to get this right. Leaders across our industry must step up to learn about these risks and contribute to solutions.”
“Really bad idea! We basically don’t yet know what bad traits and problems errant AI can cause. Letting a ‘free market’ decide what is best simply means we will be forced to go back and correct issues after the fact when they are discovered (if they’re discovered), rather than preemptively trying to solve them,” Jack Gold, principal tech analyst at J. Gold Associates, said in an email.
Trump rescinded Biden’s order hours after his inauguration ceremony, where he was joined on the dais by tech leaders Elon Musk, Amazon.com Inc. founder Jeff Bezos, Meta Platforms Inc. CEO Mark Zuckerberg, Apple Inc. CEO Tim Cook, and Alphabet Inc. CEO Sundar Pichai – all of whom are aggressively pursuing AI initiatives. Many of them contributed to Trump’s presidential campaign or inauguration budget.
On Tuesday, President Trump announced up to $500 billion in private sector AI infrastructure investment in the U.S. OpenAI CEO Sam Altman, Softbank CEO Masayoshi Son, and Oracle Corp. co-founder Larry Ellison attended the White House event, where the three companies said they are working together to create a venture called Stargate as part of the arrangement.
The new administration’s first actions on AI mark an about-face from the Biden team. In his last few months in office, Biden announced a new regulatory framework restricting some international sharing of AI chips and models. Biden’s “Artificial Intelligence Diffusion” for cyber defense elicited a stiff rebuke from NVIDIA Corp.
Meanwhile, industry observers are closely eyeing the Federal Trade Commission and its preliminary antitrust investigation of OpenAI, Microsoft, Amazon, and Anthropic under the leadership of its previous chair, Lina Khan. It remains unclear what incoming FTC head, Andrew Ferguson will do.
“The best way to think about regulating AI is not about controlling what’s happening today but preparing for the future,” Kumar Garg, president of Renaissance Philanthropy, said in an email. “The focus should be on ensuring we have the right people, partnerships between industry and government, and systems in place to adapt as AI technology becomes more advanced. Creating strict, fixed rules is challenging because they can quickly become outdated as technology changes.”
A hands-off government stance on AI oversight comes in stark contrast to a slew of actions at the World Economic Forum intended to encourage responsible AI use.
The World Economic Forum’s AI Governance Alliance Tuesday launched the Industries in the Intelligent Age roadmap for businesses and governments to adopt and scale AI, as well as issued a new report outlining how AI can drive inclusive economic growth and societal progress.
“AI holds transformative potential to address society’s most pressing challenges – but unlocking this requires informed, adaptable and responsible policy-making,” Cathy Li, head of AI, Data and the Metaverse at the World Economic Forum, said in a statement.
