Legislative momentum around AI continues to accelerate. Following the release of President Trump’s AI legislative framework, House Republican leaders reportedly plan to open negotiations with Democrats on a comprehensive AI package. In the Senate, Commerce Committee Chair Ted Cruz (R-TX) is reportedly preparing to “solicit member feedback about what needs to be in an AI bill” ahead of expected consideration in the coming months. Although legislative activity typically slows before the August recess in an election year, the annual end-of-year National Defense Authorization Act (NDAA) often serves as a reliable vehicle for advancing AI and emerging technology proposals.

Not that Congress has been idle on AI to date. Multiple committees have advanced measures, including the CHIPS Security Act, Protect American AI Act, Protect America’s Innovation and Economic Security from the CCP Act, and the National Quantum Initiative Reauthorization, which cleared their respective committees last week.

Meanwhile, the Administration is building out its AI agenda. President Trump has appointed the first members of his President’s Council of Advisors on Science and Technology (PCAST), Treasury has launched a series of AI-focused roundtables, and the CFTC has established a new Innovation Task Force.

DC/ai Decoded will return on April 20. Enjoy spring break!

Read more below

Congress

Hearings

Last week

• On March 25, the House Judiciary Courts, Intellectual Property, Artificial Intelligence, and the Internet Subcommittee held a hearing on “Oversight of the U.S. Patent and Trademark Office.”

• On March 25, the Joint Economic Committee held a hearing on “The Rising Global Scam Economy: Modernizing Federal Approaches to Protect Americans from Foreign Fraudsters.”

• On March 26, the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee held a hearing on “Innovation at the Speed of Markets: How Regulators Keep Pace with Technology.”

Legislation

• The House Foreign Affairs Committee passed the Chip Security Act to curb the smuggling of American semiconductors to foreign adversaries.

• The House Judiciary Committee passed the Protect American AI Act to limit the effect of litigation on the environmental application process for data centers and associated infrastructure and the Protect America’s Innovation and Economic Security from CCP Act.

• The Senate Commerce Committee passed the National Quantum Initiative Reauthorization.

• Sens. Brian Schatz (D-HI), Chris Coons (D-DE), Chris Murphy (D-CT), Tammy Duckworth (D-IL), Lisa Blunt Rochester (D-DE), and Andy Kim (D-NJ) and Reps. Don Beyer (D-VA), Doris Matsui (D-CA), Ted Lieu (D-CA), Sara Jacobs (D-CA), and April McClain Delaney (D-MD) introduced the Guaranteeing and Upholding Americans’ Right to Decide Responsible AI Laws and Standards (GUARDRAILS) Act to repeal President Trump’s executive order seeking to prevent states from regulating artificial intelligence. (Text)

• Reps. Don Beyer (D-VA), Mike Lawler (R-NY), and Sara Jacobs (D-CA) introduced AI Foundation Model Transparency Act to direct the Federal Trade Commission to establish requirements for making information available to the public about the training data and algorithms used in artificial intelligence foundation models. (Text)

• Senate Republican Conference Chair Tom Cotton (R-AR) and Senate Democratic Leader Chuck Schumer (D-NY) introduced the American Security Robotics Act to prohibit the federal government from procuring and operating unmanned ground vehicles made by foreign adversaries, specifically Communist China. Rep. Elise Stefanik (R-NY) introduced companion legislation in the House. (Text)

• Sen. Bill Cassidy (R-LA) reintroduced an amended version of the Health Care Cybersecurity and Resiliency Act to require the Secretary of Health and Human Services and the Director of the Cybersecurity and Infrastructure Security Agency to coordinate to improve cybersecurity in the health care and public health sectors. (Text)

• Sen. Ed Markey (D-MA) introduced a bill to require entities that make artificial intelligence chatbots available to minors to implement certain safe design features. (Text)

• Sen. Bernie Sanders (I-VT) and Rep. Alexandria Ocasio-Cortez (D-NY) introduced a bill to halt the construction of new data centers until comprehensive federal regulations are passed to mitigate the risks associated with artificial intelligence. (Text)

• Sens. Kirsten Gillibrand (D-NY) and Marsha Blackburn (R-TN), Senate Democratic Leader Chuck Schumer (D-NY), and Reps. Laura Gillen (D-NY) and Jay Obernolte (R-CA) introduced the Advancing Regional Quantum Hubs Act to amend the National Quantum Initiative to require support for regional quantum innovation initiatives and enhance the educational and research capabilities of regions that have strengths in quantum fields. (Text)

Correspondence

• Sens. Kirsten Gillibrand (D-NY), Mark Warner (D-VA), Mark Kelly (D-AZ), Elissa Slotkin (D-MI), Tim Kaine (D-VA), and Chris Coons (D-DE) sent letters to xAI, OpenAI, Alphabet, Meta, AWS, and Microsoft AI seeking information on their engagements with the Department of Defense (DoD), the rules under which DoD can access and use their technology, and the internal controls that exist in the event their technology is misused by DoD. (Letter)

• Sens. Jim Banks (R-IN), and Elizabeth Warren (D-MA) sent a letter to Secretary of Commerce Howard Lutnick urging the Department of Commerce’s Bureau of Industry and Security (BIS) to immediately pause and conduct a full review of all active export licenses covering advanced Nvidia AI chips and server systems destined for China and Southeast Asian countries, including Malaysia, Thailand, Vietnam, and Singapore. (Letter)

• Rep. August Pfluger (R-TX) sent a letter to the Government Accountability Office (GAO), requesting a comprehensive review of how violent extremists and malicious actors weaponize emerging technologies and applications in AI-enabled terrorism. (Letter)

• Sens. Elizabeth Warren (D-Ma) and Richard Blumenthal (D-CT) sent a letter to NVIDIA CEO Jensen Huang requesting information on whether the company’s deal with Groq, an AI chip startup and competitor, is intended to avoid antitrust laws. (Letter)

• Sen. Elizabeth Warren (D-MA) sent a letter to Department of Defense (DOD) Secretary Pete Hegseth requesting information on DOD’s decision to designate Anthropic a “supply chain risk” and its contract with OpenAI. (Letter)

• Rep. Lance Gooden (R-TX) sent a letter to Department of Energy Secretary Chris Wright expressing strong support for the Genesis Mission to deploy artificial intelligence across America’s scientific ecosystem and strengthen U.S. competitiveness against China. (Letter)

Publications, Meetings, and Events

• Reps. Terri Sewell (D-IL) and Ways and Linda Sánchez (D-CA) released a report from the Government Accountability Office (GAO) on artificial intelligence and the Internal Revenue Service (IRS), and what actions the agency must take to address skills gaps, information quality, and strategic management. (Report)

• The House Democratic Commission on Artificial Intelligence reportedly held a listening session with of members of the Congressional Black Caucus, Congressional Hispanic Caucus and Congressional Asian Pacific American Caucus. (Washington Post)

Trump Administration

White House

• President Donald Trump appointed the first members to his President’s Council of Advisors on Science and Technology (PCAST), co-chaired by David Sacks and Michael Kratsios. Members include Marc Andreessen, Sergey Brin, Safra Catz, Michael Dell, Jacob DeWitte, Fred Ehrsam, Larry Ellison, David Friedberg, Jensen Huang, John Martinis, Bob Mumgaard, Lisa Su, and Mark Zuckerberg. (Press release)

• First Lady Melania Trump convened First Spouses from 45 countries at the White House for a Global Summit on the role of artificial intelligence and education. Trump focused on the use of artificial intelligence to personalize learning, the emergence of humanoid educators as at-home tools for students, and the role of technology and education as a driver for America’s economy. She also introduced an American-made humanoid system. (Press release)

Treasury Department

• The Office of the Financial Stability Oversight Council (FSOC) and the Treasury Department’s Artificial Intelligence Transformation Office (AITO) launched the AI Innovation Series, a series of four roundtables convening financial institutions, technology firms, regulators, and specialized experts to explore the highest-value AI use cases and identify practical approaches to scaling innovation while preserving safety and soundness. (Press release)

U.S.-China Economic and Security Review Commission (USCC)

• The USCC published a report on “Two Loops How China’s Open AI Strategy Reinforces Its Industrial Dominance.” (Report)

Government Accountability Office (GAO)

• GAO published a report on “Artificial Intelligence: IRS Actions Needed to Address Skills Gaps, Information Quality, and Strategic Management,” finding staff reductions have impacted the IRS’s AI modernization efforts and recommending the IRS “(1) identify skills gaps and develop an AI workforce plan; (2) implement a comprehensive quality assurance process for AI inventory entries; (3) clarify internal communications to ensure all AI use cases are included in the inventory; and (4) require reporting on use case alignment to strategic goals.” (Report)

State Department

• The State Department launched the Bureau of Emerging Threats, tasked to respond to dangers posed by Iran and other U.S. adversaries’ weaponization of advanced technology, including artificial intelligence. (ABCNews)

Noteworthy Quotes and Events

ADMINISTRATION

Federal Reserve

• Fed Governor Lisa Cook delivered remarks on “Reflections on Financial Stability” in which she said, “… we should embrace responsible changes that strengthen our financial system, not hinder them. The Committee on Financial Stability and the Board’s staff monitor financial and technological innovations that are in early stages of development, including digital assets and the use of artificial intelligence. The fact that the U.S. financial system is the largest and deepest in the world is the result of decades of successive, and transformative, financial and technological innovations. As a corollary, we need to understand innovations at early stages to see the system’s trajectory. We have also observed innovations that have brought unintended consequences, and we need to stay abreast of potential risks in order to better understand where guardrails and industry engagement might be helpful.” (Remarks)

State Department

• On the new Bureau of Emerging Threats, State Department principal deputy spokesperson Tommy Pigott said, “The bureau will address not only the current threats we face today in cyberspace, outer space, critical infrastructure, and through the misuse of disruptive technology like AI and quantum, but those we will face in the decades ahead.” (ABCNews)

Commodity Futures Trading Commission (CFTC)

• CFTC Chair Michael Selig posted “Crypto, AI and prediction markets are transformative and synergistic technologies. It’s critical that our laws and regulations accommodate the innovators and job makers in these industries, like APompliano, who is an entrepreneur and investor himself. The CFTC will develop fit-for-purpose rules so these technologies can flourish on US soil.”

• Selig also posted “Smart AI regulatory policy is critical to America winning the AI race. Under my leadership, the CFTC will apply the minimum effective dose of regulation to AI technologies.”

White House

• White House Adviser David Sacks posted “Today I spoke at HillValleyForum about the White House’s new National AI Framework. A vital part of it is our support for the online safety of children. Our north star is parental empowerment. I want to decide which apps my kids use and for how long. Probably you do too. I don’t want the government making those choices for me.”

CONGRESS

• On his discussions with Fed Chair nominee Kevin Warsh, Sen. Mark Warner (D-VA) said “In my conversation with him, he thought the single biggest item that he will have to address is AI and the economic consequences. To me, that’s pretty powerful coming from the potentially future Fed chair.” (Punchbowl)

• Warner told reporters, “I would love to have an AI framework that would provide federal preemption, but that would mean you’d have a single national law.” He added, “One of the reasons why I don’t have a lot of faith that we will get to enough federal safety rules that would give me comfort to go to preemption is because I have all the scars of multiple major, much more important guardrails on social media, and we did zippo.” (Politico)

• At the Hill and Valley Forum in Washington, Speaker Mike Johnson (R-LA) pushed for codifying the President’s AI agenda, saying, “To succeed, you all need confidence that tomorrow’s rules are going to be coherent and consistent and follow common sense iterations of the rules that we established today. that’s why Congress will utilize existing structures to establish safeguards and rules of the road, so to speak, without smothering the whole marketplace with red tape.” (Politico)

• Johnson also said, “We have to move at the speed that victory demands. Inaction is unacceptable. And while the window for American AI leadership is open, it will not stay open indefinitely,” Speaker Johnson said. “As the Speaker of the House and ultimately somebody who’s going to help spearhead this effort in Congress, this is our commitment in a simple summary: simplify and streamline where we can, regulate only where we must, and pave the way for American dominance.” (Press release)

• Johnson also said, “When President Trump took office, he gave us all a monumental task. He said we have to make America the world leader in artificial intelligence. Just as back then, the challenge of this generation will require a reinvigoration of American science and technology… Here in Congress, we want to ensure American AI is the gold standard of the future and we intend to do that.” (Benzinga)

• Johnson posted, “America will win the AI race – but only if government resists the siren song of control and industry steps up as our patriotic partner. In Congress, we want to ensure American AI is the gold standard of the future – and we intend to do so.”

• In remarks at The Hill & Valley Forum, House Select Committee on China Chair John Moolenaar (R-MI) said, “I still think the best case is when you have the freedom to innovate, less burdensome government regulation, more free trade with free countries, but when you’re competing against China, who violates so many of those principles of free trade, then it requires almost like a defense mentality, where you’re saying, ‘Okay, let’s use every tool possible to make sure we win this competition.’ And so I think my hope is that it’s more of a temporary kind of thing, until our technology gets to the level where we know we can win this competition, and we’re not dependent on China. But the difference between when we were in a Cold War with the Soviet Union, we weren’t dependent on the Soviet Union for so many things, whereas in this case, we’re actually dependent on our chief rival, and we have to stop enabling them to continue to defeat us on this.” (Press release)

• Sen. Mark Kelly (D-AZ) delivered remarks at Seed AI’s America AI Festival in which he previewed his legislation to ensure community participation in AI infrastructure project development, saying, “Building on the ideas from my AI for America roadmap, I’ve been working on a new bill to do exactly that. It’s pretty simple: bring developers and communities together at the beginning to work through the details—what a project means for energy, water, infrastructure, and jobs—and put real commitments on the table. The people building the data centers commit to delivering real, long-term benefits for communities like local hiring, paying for infrastructure, and keeping utility rates low. My framework includes public input, clear timelines, and enforceable agreements—so communities and workers have a real say in how these projects take shape, and developers have the certainty they need to move forward. Clear expectations. Tangible community benefits. Real accountability. No surprises.” (Press release)

• Sen. Ted Budd (R-NC) posted “The AI expansion is creating a blue-collar boom—creating more jobs for electricians, construction workers, and skilled technicians. It’s the tradespeople building the physical infrastructure behind the technology who will power America’s AI agenda.”

• Sen. Rand Paul (R-KY) posted “It took one week and an AI detection system to flag 70 suspected fraudulent Medicaid providers in Los Angeles. The real question is why the federal government went decades without bothering to look.”

• Rep. Greg Casar (D-TX) posted “Good. Companies shouldn’t be able to use your personal data to rip you off using AI. Now Congress should pass my bill to ban surveillance pricing nationwide.”

• Rep. Tom Kean (R-NJ) posted “Artificial intelligence is advancing faster than ever. And today on NationalAILiteracyDay, we are called to ensure that the next generation is prepared to use AI effectively and responsibly. I recently introduced the LIFT AI Act, bipartisan legislation that brings AI education into classrooms and gives students the tools they need to succeed in a world driven by innovation. We must support America’s students so they can thrive in a future increasingly shaped by artificial intelligence.”

• Rep. Zach Nunn (R-IA) posted “Artificial intelligence is changing the rules of the road, and foreign adversaries are exploiting it to push scams and misinformation. Our AI Plan Act brings federal agencies together to close gaps, crack down on fraud, and keep innovation and leadership where it belongs: here in the U.S.”

• Sen. Chris Van Hollen (D-MD) posted “A judge has paused Hegseth’s efforts to punish Anthropic. Remember: This is a US company punished for not wanting their AI to kill without human involvement or be used for mass surveillance of Americans. These attacks are another shameless play by this lawless Admin.”

• House Foreign Affairs Committee Majority posted “Last week, TheJusticeDept indicted three people for smuggling AI chips, and it’s just the tip of the iceberg. The Chips Security Act is vital for keeping advanced chips out of the hands of China, so they can no longer use our technology to get ahead in the AI arms race.”

• Rep. Bill Foster (D-IL) posted “Thrilled that my Chip Security Act with RepHuizenga, RepMoolenaar, and CongressmanRaja passed through committee! This is an important—and bipartisan—step to prevent powerful AI technology from getting into the wrong hands.”

• Rep. David Schweikert (R-AZ) posted “A grandmother is stuffing money into a Bitcoin machine. The owner knows it is fraud and tries to stop her. She lies to him anyway because the stranger on the phone already has her believing the lie. That is what AI changes. It can pull details off social media and put a familiar voice on the line. That is how the fraud starts to sound real. Then the transfer goes through before the family even knows there is a problem. My own father has been scammed multiple times. We need to stop treating this like a simple education problem and start stopping the transfer before the savings are gone.”

What I’m Reading This Week

• AI Model Validation in Regulated Financial Firms: Supervisory Expectations and Practical Considerations, Frank J. Weigand and Louis Capizzi, CahillNXT.

• Korea Didn’t Just Regulate AI, It Designed a System Around It, Zee Cindy, KoreaTechDesk.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

The White House has released a National AI Legislative Framework that includes federal preemption of state laws.

In Congress, lawmakers are accelerating efforts to introduce substantive AI regulatory proposals, setting the stage for coordinated, multi-jurisdictional action in the next Congress, if not sooner. Meanwhile, Senate Commerce Chair Ted Cruz (R‑TX) signaled that his committee plans to take up AI-related issues in the coming weeks.

Read more below

Congress

Hearings

Last week

• On March 17, the House Financial Services Committee holds a hearing on “Updating America’s Financial Privacy Framework for the 21st Century.”

• On March 17, The Senate Judiciary Committee holds a hearing on “Stealth Stealing: China’s Ongoing Theft of U.S. Innovation.”

• On March 17, the House Homeland Security Cybersecurity and Infrastructure Protection Subcommittee holds a hearing on “DeepSeek and Unitree Robotics: Examining the National Security Risks of PRC Artificial Intelligence, Robotics, and Autonomous Technologies and Building a Secure U.S. Technology Base.”

This week

• On March 25, the House Judiciary Courts, Intellectual Property, Artificial Intelligence, and the Internet Subcommittee holds a hearing on “Oversight of the U.S. Patent and Trademark Office.”

• On March 25, the Joint Economic Committee holds a hearing on “The Rising Global Scam Economy: Modernizing Federal Approaches to Protect Americans from Foreign Fraudsters.”

• On March 26, the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee holds a hearing on “Innovation at the Speed of Markets: How Regulators Keep Pace with Technology.”

Legislation

• Sen. Marsha Blackburn (R-TN) released a discussion draft of The Republic Unifying Meritocratic Performance Advancing Machine intelligence by Eliminating Regulatory Interstate Chaos Across American Industry (TRUMP AMERICA AI) Act to protect children, creators, conservatives, and communities from exploitation, abuse, and censorship and ensure American AI companies can innovate without “cumbersome regulation.” The draft framework includes Blackburn’s has previously introduced bills, the Kids Online Safety Act and NO FAKES Act. (Text)

• Sens. Roger Wicker (R-MS) and Peter Welch (D-VT) and Rep. Harriet Hageman (R-WY) introduced the Research and Oversight of Artificial Intelligence in Courts Act of 2026 to establish a task force of judicial experts to examine the integration of AI speech-to-text and automatic speech technologies in American courts. (Text)

• Sen. Elissa Slotkin (D-MI) introduced the AI Guardrails Act to establish left and right limits on how the Department of Defense can use AI by banning the DOD from firing autonomous weapons to kill without human authorization, prohibiting the use of AI to spy on Americans and to launch nuclear weapons. (Press release)

• Sens. Ted Budd (R-NC) and Andy Kim (D-NJ) introduced the Artificial Intelligence Ready Data Act to create a modern federal approach to opening government data assets to train and develop stronger American artificial intelligence models. (Text)

• Reps. Don Beyer (D-VA), Doris Matsui (D-CA), Ted Lieu (D-CA), Sara Jacobs (D-CA), and April McClain Delaney (D-MD) introduced the Guaranteeing and Upholding Americans’ Right to Decide Responsible AI Laws and Standards (GUARDRAILS) Act to repeal President Donald Trump’s executive order entitled “Ensuring a National Policy Framework for Artificial Intelligence.” Sen. Brian Schatz (D-HI) will introduce companion legislation in the Senate. (Text)

• Reps. Kevin Mullin (D-CA), Debbie Dingell (D-MI), Doris Matsui (D-CA), Darren Soto (D-FL), Rashida Tlaib (D-MI), Jennifer McClellan (D-VA), and Kim Schrier (D-WA) introduced the CHATBOT Act to prohibit AI chatbots from impersonating licensed professionals in the medical, legal, and financial fields. (Text)

• Reps. Suhas Subramanyam (D-VA) and Jay Obernolte (R-CA) introduced the Small AI Innovators Empowerment Act to direct the Department of Commerce, in collaboration with NIST and the SBA, to conduct a study on challenges faced by small artificial intelligence businesses across the country, including federal and non-federal funding opportunities for small AI businesses, including early and seed funding; the ability of small AI businesses to access R&D tax credits; downstream policy impacts on small AI businesses, including regulatory uncertainty; and talent and recruitment challenges faced by small AI businesses. (Press release)

Correspondence

• Senate Select Committee on Intelligence Vice Chair Mark Warner (D-VA) sent letters to OpenAI, Anthropic, xAI, Meta, Adobe, ElevenLabs, Cohere, Microsoft, MidJourney, Canva, Snap, Google, Synthesia, TikTok US, BlueSky, Pinterest, and Reddit urging them to take action against maliciously manipulated media, such as deepfakes, with a series of measures centered around transparency, collaboration, and means of enforcement. (Letter)

• Senate Intelligence Committee Chair Tom Cotton (R-AR) and Rep. Bill Huizenga (R-MI) sent a letter to Secretary of Commerce Howard Lutnick raising concerns about large-scale advanced AI chip smuggling, in light of the recent indictments of Super Micro Computer employees. They request Lutnick begin implementing the anti-diversion provisions in the Chip Security Act to prevent China from stealing U.S. advanced technology and undermining the Trump administration’s current export control policy. (Letter)

Publications, Meetings, and Events

• The Congressional Research Service (CRS) published a report on “Pentagon-Anthropic Dispute over Autonomous Weapon Systems: Potential Issues for Congress” (Paper)

Trump Administration

White House

• The Trump Administration released its National AI Legislative Framework, addressing six key objectives: Protecting Children and Empowering Parents; Safeguarding and Strengthening American Communities; Respecting Intellectual Property Rights and Supporting Creators; Preventing Censorship and Protecting Free Speech; Enabling Innovation and Ensuring American AI Dominance; and Educating Americans and Developing an AI-Ready Workforce; plus, Establishing a Federal Policy Framework, Preempting Cumbersome State AI Laws. (Framework)(Fact sheet)

Commerce Department

• Commerce withdrew a proposed regulation to limit exports of advanced artificial intelligence chips worldwide without prior approval from the US government. The draft rule was intended to replace the January 2025 Biden-era regulation on global access to AI chips. (Reuters)

National Institute of Standards and Technology (NIST)

• On March 27, NIST holds a virtual meeting of the Visiting Committee on Advanced Technology for an update on major programs at NIST, strategic priorities, and budget.

Noteworthy Quotes

ADMINISTRATION

The White House

• The White House posted “The Trump administration is committed to WINNING the AI race for the American people. President Trump has unveiled a commonsense national policy framework in order to achieve this goal while keeping Americans safe. Today, the Trump Admin is demonstrating that leadership by issuing a comprehensive national legislative framework that addresses the most pressing policy topics that AI presents. This framework addresses six key objectives.”

• The White House also posted “The Trump Admin is all-in on WINNING the AI race—for American prosperity, security, & a new era of human flourishing. Achieving these goals demands a commonsense national policy framework: unleashing American industry to thrive, while ensuring ALL Americans benefit.”

• White House AI & Crypto Czar David Sacks posted “In December, President Trump signed an Executive Order tasking us with the development of a national framework for AI, what he called ‘One Rulebook.’ ... Today we are releasing that framework. It will help parents safeguard their children from online harm, shield communities from higher electric bills, protect our First Amendment rights from AI censorship, and ensure that all Americans benefit from this transformative technology. I want to thank President Trump for the opportunity to work on this alongside OSTP Director Michael Kratsios, US CTO Ethan Klein, NEC Deputy Director Ryan Baasch, Senior AI Adviser Sriram Krishnan and many others on the White House team. It’s an honor.”

• Sacks also posted “’The Effective Altruist movement has a structural problem when it comes to conservative America. Its donor class is all Bay Area progressives... Its policy agenda, which calls for sweeping AI regulation and content governance, reads to most conservatives as exactly what it is: a censorship power play dressed up in safety language. To move that agenda… the movement needed a vehicle that didn’t look like it came from them.’”

Department of Defense (DOD)

• Terry Kalka, director of the DOD-Defense Industrial Base Collaborative Information Sharing Environment (DCISE), delivered remarks at the Elastic Public Sector Summit, saying, “I don’t think we’ve gotten to a point where we get a report and we go ‘ah, that was an AI attack there.’ [But] the general trends you see about the increasing numbers of attacks, abandoning of traditional forms of malware, using more sophisticated attacking, living off the land, discovery of zero days — we’re seeing those trends increase pretty much commensurate with what you see in the public. And so we can connect that probably with the ratio of AI… And what really hit home for me just the other day as I was looking at sort of a standard attack kill chain and seeing how much of that can be time-differenced through AI, you can really build a model as an attacker that all you need to do is sort of set basic context [such as directing the model to] ‘go look at this organization, come back to me with, you know, vulnerabilities and what we can get out of them, prioritize them for me. OK, go exploit this. Come back to me when you have, you know, data that I can use and exploit further.’ And … we need our defenders to be thinking along that mindset as well.” (FedScoop)

CONGRESS

National AI Legislative Framework

• House Committee on Financial Services Chair French Hill (R-AR) issued a statement on the Trump Administration National AI Legislative Framework, “I commend President Trump for releasing a thoughtful National Legislative Framework for AI that pairs innovation with targeted safeguards. As Congress moves forward, advancing regulatory sandboxes and a flexible, sectoral based approach will be critical to enabling responsible development. The Committee has long supported a pro-innovation, pro-consumer, pro-investor approach to AI, including through a bipartisan resolution earlier this year. The United States must maintain a ‘try-first’ mindset to preserve our leadership in the global AI race.” (Press release)

• Sen. Mark Warner (D-VA) issued a statement saying, “Today’s AI legislative framework takes some steps in the right direction but lacks significant substance. We need laws on AI and children’s privacy and data, including the kinds of user-empowering tools I’ve long championed in bipartisan legislation. We need to do more on deepfake non-consensual intimate images, as I’ve advocated for years now. We need laws to ensure that AI benefits all Americans, like my bipartisan Economy of the Future Act is designed to develop. We need researchers, students, and small businesses to have access to AI tools to ensure that development of this technology isn’t concentrated in the hands of a few large companies. We also need national security agencies to establish plans to mitigate against national security threats from advanced AI. But, two years in a row, the Senate Intelligence Committee passed bills that would have required that kind of proactive engagement strategy to get ahead of malicious foreign actors. And two years in a row, President Trump’s allies in Congress killed those provisions from being enacted into law. Unfortunately, this slim framework also does many things wrong. The framework is worse than silent on AI-powered mis- and disinformation, a real and growing threat to our elections, our markets, and our country. Instead, it trots out the same old talking points about combatting partisan or ideological bias to cloak its own inaction on – and worse, its encouragement and use of - deepfakes and other AI slop being used for a wide range of harmful activity. Furthermore, it once again raises the threat of preempting state’s ability to regulate AI where AI affects their citizens and institutions; notably, the administration’s last attempt to do Big AI’s bidding was defeated 99-1 in the Senate last year. Overall, it reminds me of the administration’s cybersecurity strategy: several pages of broad goals, all of them short on substance.” (Press release)

• House Speaker Mike Johnson (R-LA), Majority Leader Steve Scalise (R-LA), Energy & Commerce Committee Chair Brett Guthrie (R-KY), Judiciary Committee Chair Jim Jordan (R-OH), and Science, Space, and Technology Committee Chair Brian Babin (R-TX) released a statement saying, “AI has begun to demonstrate its potential to improve Americans’ lives. To ensure we continue to harness its potential and beat China in the global AI race, Congress must take action. Today, the Trump Administration took a critical step in releasing a framework that gives Congress a roadmap to pursue legislation that provides innovators with much-needed certainty, while protecting consumers and prioritizing kids’ online safety. House Republicans look forward to working across the aisle to enact a national framework that unleashes the full potential of AI, cements the U.S. as the global leader, and provides important protections for American families.” (Press release)

• Rep. Jay Obernolte (R-CA) posted “I applaud the White House’s continued leadership in advancing a national policy framework for artificial intelligence. As this technology rapidly reshapes our economy, workforce, and national security landscape, it is critical that the United States remains at the forefront of innovation while establishing clear, responsible guardrails for AI. I will continue to work with my colleagues and the Administration to turn these priorities into meaningful, forward-looking policy that strengthens American competitiveness and ensures AI is developed and deployed in a way that benefits all Americans.”

• Rep. Josh Gottheimer (D-NJ) said, “Today, the White House released its AI framework which broadly blocks state AI laws and lacks key consumer protections around AI models and agent safety. While this framework takes steps in the right direction, including child safety and lower energy costs, it is still a half-measure that falls short of what’s necessary for ‘Smart AI’ regulation. AI is too important, — and too vital to our global competitiveness, economy, jobs, and families — to do anything short of a full-measure. Unfortunately, the White House framework fails to address key issues, including strong accountability for AI companies, under the guise of protecting children, communities, and creators. Americans need protection — but this means nothing if we allow the AI industry to be the Wild West. Preemption only makes sense if federal law effectively replaces what states have built with a standard that is truly comprehensive and protects Americans. Simply put, this framework still has a long way to go. Voluntary standards won’t do the trick. In addition to commonsense guardrails, we need serious solutions that address workforce challenges, better incentives for STEM education, enhanced protections against deepfakes, safe and secure AI models and agents, and guarantees that all Americans reap the massive benefits AI offers. We are in a Cold War-era-style race with China, and we must win — both for our economy and our national security. If done the right way, the potential for areas like health care, education, and government efficiency are boundless. But, we have to win it the right way. I’m working with my colleagues to develop a commonsense framework that will create clear and consistent rules of the road which both protect Americans and allow our AI industry to lead the way.” (Press release)

• Rep. Julie Fedorchak (R-ND) said, “There’s no doubt that AI is rapidly transforming how we live and work. The question now is whether America develops the rules of the road and leads the future of this extremely powerful tool, or if we let adversaries like China set the terms,” Fedorchak said. “It cannot be the latter. The White House’s framework strikes the right balance of supporting American competitiveness and long-term innovation while protecting online safety. I’m excited to work with my Energy and Commerce Committee colleagues to move a national framework forward so the U.S. always leads the global AI race.” (Press release)

• Sen. Ed Markey (D-MA) said, “President Trump is continuing to repay Big Tech’s campaign donations by proposing to block states from protecting their communities from AI-related harms,” said Senator Markey. “Congress must not only reject Trump’s offensive proposal but also continue blocking Republicans’ bad faith effort to undermine states. We should pass my States’ Right to Regulate AI Act to put power back into the hands of people, not the Big Tech billionaire boys club cozying up to the White House.” (Press release)

Miscellaneous

• House Committee on Foreign Affairs Ranking Member Gregory Meeks (D-NY) and Senate Banking, Housing, and Urban Affairs Committee Ranking Member Elizabeth Warren (D-MA) released a statement following the Trump Administration’s decision to allow AI chip sales to China, “In December, we called on the Department of Commerce to follow the law and provide us information about the Trump administration’s approval of any sale of advanced AI chips to China. We’ve finally received information about the administration’s first license approval and are now more concerned than ever that the Trump administration is undercutting U.S. national security by approving this sale. Congress must pass bipartisan legislation to prevent China from obtaining our advanced technology in order to protect U.S. economic and national security.” (Press release)

• On her AI Guardrails Act, Sen. Elissa Slotkin (D-MI) said, “It’s the start of the NDAA season, so it’s something that we’re going to be making a feature of our NDAA work, hopefully on a bipartisan basis.” (Punchbowl)

• On the upcoming priorities of the Senate Commerce Committee, Chair Ted Cruz (R-TX) said, “I’m hoping that we move forward at least on kids online safety legislation and potentially additional AI legislation… At this point, we’re looking for what legislation will have the maximum impact and will have the broadest support so that it can pass.” (Punchbowl)

• Sen. Marsha Blackburn (R-TN) posted “Why is Google still getting away with telling lies about conservatives and presenting them as facts? Google needs to take Gemini down until it can ensure this AI chatbot isn’t inherently biased against conservatives.”

• Blackburn also posted “ByteDance’s new AI video app is violating U.S. copyright laws, allowing deepfakes to go viral without consequence. SenPeterWelch and I are demanding the Chinese-owned company shut down this app to protect American innovators.”

• Sen. Elissa Slotkin (D-MI) posted “Congress is behind in putting left-right limits on the use of AI at the Pentagon. My bill ensures a human is involved when deadly autonomous weapons are fired, AI can’t be used to spy on Americans... AI is going to shape the future of America’s national security, and we must win the AI race against China. But to do that, we need action that puts limits on AI in the Department of Defense. This is just common sense.”

• Sen. Ted Budd (R-NC) posted “The U.S. government maintains the world’s largest and most sophisticated data assets generated through taxpayer dollars. The Artificial Intelligence Ready Data Act aims to leverage the potential of that federal data to maintain American leadership in AI development.”

• Rep. Harriet Hageman (R-WY) posted “Congress has a responsibility to ensure emerging technologies do not compromise the accuracy, security, or integrity of our judicial system. I joined SenatorWicker and SenPeterWelch in introducing the Research and Oversight of Artificial Intelligence (AI) in Courts Act. As an attorney for over three decades, I know the importance of precision and accuracy in our legal system.”

• Sen. Mark Warner (D-VA) said of his reelection campaign, “That’s a valid critique of, ‘We need the next generation,’ but no one is more, in the whole political scene in America, is talking more about the potential challenges that artificial intelligence poses, particularly for kids coming right out of college. [We have] 9% recent college graduate unemployment, I think that could go to 30% in the next couple years. I think AI long-term will bring great benefits, but I think it’ll be hugely disruptive in the next five years, and I’ll match my policy chops on kind of emerging technology issues with anybody of any age…. It’s going to hit folks coming out of college… You’re going to have a lot of young people who are saying they did everything right, they still couldn’t get a job. And you’re going to have a lot… of pissed off parents and grandparents who helped support that $200,000 education. I think we can… make these AI companies help us figure that out, and help pay for it.” Warner added, “This sounds a little crazy, but we may need to try and convince folks to no longer major in business administration, because those jobs are first being eliminated [by AI], and become a nurse. We need a lot more healthcare workers.” (The Rotunda)

What I’m Reading This Week

• The White House’s AI Strongarming Frustrates Fellow Republicans, Jonathan Gibson, The Dispatch.

• AI is Coming for Politics, Thomas B. Edsall, The New York Times.

• No Need to Reboot: GenAI Fits the Tax Stack, Michael Plowgian, Alistair Pepper, Prita Subramanian, and Michael Timmerman, Tax Notes.

• Russia’s Push for AI Expansion Threatens to Undermine Crypto Mining, Crypto News.

• The Latest AI Bill’s 5 Biggest Flaws, Kevin T. Frazier and Jennifer Huddleston, CATO Institute.

• ‘Plumbers regularly earn more than lawyers’: Top Entrepreneur Makes a Bold Prediction that AI will Flip the American Dream, Sydney Lake, Fortune.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

A bipartisan group of senators has introduced legislation to create a commission guiding Congress on AI policy. Nearly the entire Senate Democratic caucus calls for an investigation into the bombing of a school in Iran—raising fresh questions about the Pentagon’s reliance on artificial intelligence. Meanwhile, fallout continues over the Trump administration’s response to Anthropic.

Read more below

Congress

Hearings

This week

• On March 17, the House Financial Services Committee holds a hearing on “Updating America’s Financial Privacy Framework for the 21st Century.”

• On March 17, The Senate Judiciary Committee holds a hearing on “Stealth Stealing: China’s Ongoing Theft of U.S. Innovation.”

• On March 17, the House Homeland Security Cybersecurity and Infrastructure Protection Subcommittee holds a hearing on “DeepSeek and Unitree Robotics: Examining the National Security Risks of PRC Artificial Intelligence, Robotics, and Autonomous Technologies and Building a Secure U.S. Technology Base.”

Upcoming

• On March 26, the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee holds a hearing on “Innovation at the Speed of Markets: How Regulators Keep Pace with Technology.”

Legislation

• Sens. Mark Warner (D-VA) and Mike Rounds (R-SD) introduced the Economy of the Future Commission Act to establish the Economy of the Future Commission to develop recommendations to help policymakers address the economic and workforce impacts of AI. (Text)

• Reps. GT Thompson (R-PA) and Suzanne Bonamici (D-OR) introduced the Cybersecurity Skills Integration Act to create a pilot program for competitive grants to career and technical education programs that integrate cybersecurity into their curriculum. (Text)

Correspondence

• Senate Democratic Leader Schumer (D-NY) and Sens. Bennet (D-CO), Van Hollen (D-MD), Kaine (D-VA), Warren (D-MA), Schatz (D-HI), Reed (D-RI), Shaheen (D-NH), Hirono (D-HI), Blumenthal (D-CT.), Gillibrand (D-NY), Murray (D-WA), Merkley (D-OR), Heinrich (D-NM), Baldwin (D-WI), Markey (D-MA), Welch (D-VT), Duckworth (D-IL), Alsobrooks (D-MD), Smith (D-MN), Kim (D-NJ), Sanders (I-VT), Gallego (D-AZ), Warnock (D-GA), Durbin (D-IL), Padilla (D-CA), Whitehouse (D-RI), Luján (D-NM), Blunt Rochester (D-DE), Klobuchar (D-MN), Hickenlooper (D-CO), Wyden (D-OR), Peters (D-MI), Kelly (D-AZ), Slotkin (D-MI), Coons (D-DE), Rosen (D-NV), Booker (D-NJ), Ossoff (D-GA), Cortez Mastro (D-NV), Schiff (D-CA), Warner (D-VA), Cantwell (D-WA), Hassan (D-NH), Murphy (D-CT), and King (I-ME) sent a letter to Defense Secretary Pete Hegseth demanding that the Department of Defense carry out an investigation into airstrikes on a school in Minab, Iran, including asking “Have any U.S. military operations in Iran utilized, or will any utilize, artificial intelligence tools, and if so, provide specifics of how they are being used and for what purpose? What human verification and redundancy policies are in place, if any, to evaluate the accuracy and legitimacy of AI-generated targets?” and requesting “a copy of any procedures service members use to verify AI-generated targets and recommend them for execution.” (Letter)

Trump Administration

National Telecommunications and Information Administration (NTIA)

• On March 23, the NTIA will host a hybrid industry listening session on the Public Wireless Supply Chain Innovation Fund to focus on advancing AI-native telecommunications networks through the Innovation Fund. (NTIA)

Noteworthy Quotes and Events

CONGRESS

Miscellaneous

• Rep. Don Beyer (D-VA) told a Punchbowl News conference, “My guess is that at 430 people, maybe 25 are paying attention in a serious ‘what’s happening in terms of AI policy?’ It’s not that they’re not serious people. It’s just they’re not coming from technical backgrounds.” He added, “We can’t deal with climate change, we can’t deal with immigration reform, we can’t deal with Social Security. We’re not good at the debt. Why are we magically going to be able to do a good framework for AI at the federal level?... Until we do something real that really sets up that framework, it’s irresponsible not to let the states try. Plus … when the states do it, we understand what works and what doesn’t work.” (MeriTalk)

• Beyer also said, “It’s got to be Democrats and Republicans sitting down with all the things that we know we have to do, and getting a bill and putting it out there. And if the Republicans are ahead on it, great, I’d love to be a part of it, as long as they don’t put in something like the present preemption.” He added, “I’m a pessimist just about Congress’s ability, in the short run, to get things done, which is why I think we all need to figure out: How do we take an institution full of good people who are trying to do good things across party lines, and get them to work together in a way that actually gets results.” (MeriTalk)

• House Homeland GOP posted “Today, nation-state adversaries and terrorist groups are weaponizing social media networks and emerging technology like AI to radicalize, recruit, and spread propaganda in the homeland. This is evident as tensions with Iran continue. Last year, the House PASSED RepPfluger’s ‘Generative AI Terrorism Risk Assessment Act’ to ensure DHS is staying ahead of these threats as they evolve.”

• Sen. Chris Coons (D-DE) posted “We’re once again seeing AI-generated content spreading misinformation about elections, this time in Hungary. It’s increasingly clear that AI-generated misinformation is influencing elections here in America and around the world and needs to be reined in. Congress needs to get serious about passing smart, strategic rules about AI before it’s too late. I already have a couple of bipartisan bills I’m working on. The Protect Elections from Deceptive AI Act would prohibit deceptive AI-generated content about federal candidates like what we’re seeing in Hungary. The NO FAKES Act would protect all Americans from spreading unauthorized deepfake content using your voice and likeness. And we need to do way more to protect our kids and our privacy from threats posed by artificial intelligence. There’s bipartisan support in the Senate for regulating AI to ensure the country as a whole benefits and Americans are protected against its largest risks. I believe we can get this done. I’m ready to work with anyone to make it happen.”

• Rep. Sara Jacobs (D-CA) posted “We need strict guardrails when the military uses AI, whether it’s in Iran or anywhere else – full stop.”

• Rep. Lloyd Doggett (D-TX) posted “The Trump regime is following Xi Jinping’s playbook by punishing any private citizen or company that disagrees with them. Anthropic CEO Dario Amodei was one of the few AI executives to criticize the Trump regime for sending advanced AI chips to China. Following his warning, Trump issued an executive order targeting ‘woke AI,’ and now Pete Hegseth has designated Anthropic a ‘supply-chain risk.’”

• Doggett also posted “’As Trump Regime insists that it should not be denied the ability to use Artificial Intelligence for domestic mass surveillance and to operate weapons without human control, Anthropic has rightly declined. Now it has been joined by other important forces in opposition to this dangerous Regime overreach.’”

• Rep. Richard Hudson (R-NC) posted “America’s leadership in global AI development ultimately hinges on whether our nation can support the compute-intensive systems that drive innovation across science, medicine, national security, and the broader economy. Silicon carbide is essential to that foundation.”

Floor Remarks

• Sen. Dan Sullivan (R-AK) delivered remarks on the Senate floor, saying, “Because these technologies in which we are in a race with China in terms of their development might determine who controls the entire 21st Century between the United States and China. Fortunately, Mr. President, we’re starting to focus on these. I’m starting to focus on these, and I would say there are three main areas, digital currency, and blockchain technology, artificial intelligence, and biotech. So if you’re on the hill on different committees, and I’m on the Commerce Committee as well as Armed Services, we are doing hearings, we are doing markups, we established commissions. There’s a lot of work, a lot of debate. I would say, Mr. President, a lot of it is bipartisan, which I think is good, to focus on these emerging technologies because in some ways they’re just as important as our military competition with the Chinese Communist Party. And in my view, Mr. President, it is becoming increasingly clear that we are in a race with the Chinese Communist Party on who will control these critical technologies. The economic resilience and financial strength and productivity of our economy, and, yes, the national security of our citizens increasingly depends on who wins these races in these critical emerging technology areas. A couple of things related to that, Mr. President, I just want to touch on. And I’m going to come down to the floor and speak more and more on these and what we need to do. But make no mistake, as I dig into these issues deeper, as we get the briefings from the experts, it has become clear that we should not -- should not underestimate the Chinese Communist Party in these areas. They can compete. They are competing. I think sometimes in the area of technology, we think, well, we’re the United States, we’re the top dog. But we need to take them very seriously. And in some areas, in these technologies, subcomponents of these technologies, say, for example, like robotics, I think you could make a good case that the Chinese are already in the lead. And we have to take that very seriously. Another thing, Mr. President, is that a fundamental component of competing successfully against China in at least two of three of these technologies, blockchain technology and A.I. is that we have to have abundant American energy to power in advance in these technological areas. Again, for the benefit of our own citizens and our own national security, it is critical that we unleash American energy, all forms of American energy. I am an all-of-the-above energy proponent -- oil, gas, coal, renewables, nuclear. We used to talk about the energy transition, Mr. President, but in terms of winning the race on these kind of technologies, we really need to be talking about energy addition, because we’re going to need all forms of American energy, American energy dominance, when it comes to blockchain technologies, crypto, and A.I. so, in these areas, Mr. President, I believe that, for example, in blockchain technology, when developed properly, it can not only help but ensure our economic resilience, our economic competitiveness and, very importantly, Mr. President, as it relates to competing with China, the continued dominance of the U.S. dollar as the world’s reserve currency, which, as I mentioned, Mr. President, is a critical comparative advantage we have over the Chinese and which they are trying to erode, both in terms of their own digital currencies, but in other ways in terms of working with other countries that want to erode the dollar’s preeminence. Related, blockchain technology can make sure the U.S. is more resilience to economic warfare. Again, only if we are the leaders related to China. In these areas, I think we’re off to a pretty good start, Mr. President, by actually passing laws that are beginning to establish the rules of the road for these technologies, like stablecoin, when we recently passed the GENIUS Act. Next up, as we’re working on additional rules for the road, to establish the strength of these technologies based in America, not China, is the market structure legislation that we are working on. As some of you know, the CLARITY Act passed the House. We’re continuing to move that legislation forward here in the Senate, splitting some of it apart with legislation, such as the digital commodity intermediary act, that recently passed out of the Agriculture Committee. This is also bipartisan legislation, Mr. President. And again, it’s a good start, but we have a long way to go, but I think it’s critical to keep in mind one of the most important elements of this is to beat China, for our economic security, for our national security, and that includes, of course, Mr. President, in the area of A.I. and biotech, as I mentioned. Again, the race against China here is critical. Who wins these technological races will almost certainly dominate key elements of the 21st Century. We need to optimize the full promise of A.I. while protecting our citizens against some of the related harms, particularly protecting our children when it comes to this new technology. Smart regulation and legislation and well-thought-out legislative actions from Congress should focus on empowering our people and accelerating societal benefits that result from the use of A.I., like especially, Mr. President, in health care, in education, where I believe the promise of artificial intelligence is immense and transformative in a very positive way, for our country and our citizens. When I talk to the experts, they believe that we are winning the A.I. race with China, but we can’t be complacent at all. As I mentioned, they can compete, and every day we need to keep moving forward and recognizing that this is a critical competition that we cannot let the CCP dominate and control.”

• Sen. Ron Wyden (D-OR) delivered floor remarks, saying, “The Pentagon, the IRS, the FBI, the Secret Service, all of them, Mr. President, have purchased Americans’ location information or web browsing information. The government’s purchase of all this private information ought to be enough, but I want to wrap up by talking about how artificial intelligence could be used on these records. Artificial intelligence tools are designed to comb through enormous data sets, find patterns, and identify behaviors of interest to the government. A few years ago, Americans may have believed that their personal information would be overlooked in an ocean of data. Now, we know A.I. can be looking at everybody. I’ve been warning for nearly a decade that data available for purchase from companies is just as sensitive as information the government collects directly. Creating A.I. profiles of Americans based on that data represents a chilling expansion of mass surveillance that must not be allowed. As my colleagues are aware, the Trump Administration decided to single out the -- one company over the weekend for punishment because the company didn’t want its artificial intelligence tool used for mass surveillance of Americans. Company’s CEO said if the government’s purchase of sensitive data is currently legal, it’s only because the law has not yet caught up with the rapidly growing capabilities of A.I. That in a nutshell is the problem our bipartisan legislation will fix. Update the law to current realities, stop the government from buying data on Americans from sleazy data brokers. It has to be addressed in a Section 702 reauthorization bill, which Congress will actually consider, because if legislators don’t seize this opportunity, technology will just get further and further ahead of the law, and Americans will rightly have little faith that Congress is interested in protecting their privacy.”

What I’m Reading This Week

• Americans Have Little Confidence in Lawmakers Managing AI Policy, Elaine Mallon, The National News Desk.

• White House Preps Executive Order Targeting Anthropic, The Tech Buzz.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

The Trump administration is expected to announce which state-level AI laws it deems “onerous” and will refer to the Justice Department’s AI Litigation Task Force, as directed under the President’s AI Executive Order. The Commerce Department has approved and sent to the White House for review draft regulations that would extend federal oversight to AI chip exports—despite reported opposition from the President himself.

Meanwhile, major technology firms signed a White House Ratepayer Protection Pledge, committing to fully fund power delivery infrastructure upgrades tied to their expanding data center operations.

On Capitol Hill, lawmakers are increasingly sounding the alarm over potential job losses stemming from rapid advances in AI.

Read more below

Congress

Hearings

Last week

• On March 3, the Senate Commerce, Science and Transportation Science, Manufacturing, and Competitiveness Subcommittee held a hearing on “Less Help, More Help: AI That Improves Safety, Productivity, and Care.”

• On March 4, House Education and the Workforce Subcommittee on Higher Education and Workforce Development held the fifth hearing in a series examining artificial intelligence, titled “Building an AI-Ready America: Strengthening Employer-Led Training.”

• On March 5, the Senate Health, Education, Labor and Pensions Committee held a hearing on “Transforming Health Care with Data: Improving Patient Outcomes Through Next-Generation Care.”

Upcoming

• On March 17, the House Financial Services Committee holds a hearing on “Updating America’s Financial Privacy Framework for the 21st Century.”

• On March 26, the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee holds a hearing on “Innovation at the Speed of Markets: How Regulators Keep Pace with Technology.”

Legislation

• The House Energy and Commerce Committee passed the KIDS Act to establish protections for children and teens online by mandating technology verification to prevent minors from accessing harmful content, requiring platforms to provide robust parental controls, banning direct and ephemeral messaging for users under 13, and restricting market research on minors. The bill includes the Safeguarding Adolescents from Exploitative BOTs (SAFE BOTs) Act covering AI chatbots. (Text)

• Reps. Jay Obernolte (R-CA) and Jennifer McClellan (D-VA) introduced the AI-Ready Networks Act to require the National Telecommunications and Information Administration (NTIA) to issue a forward-looking report on the integration of artificial intelligence into commercial telecommunications networks across the country. (Text)

• Rep. Bonnie Watson Coleman (D-NJ) introduced the Data Center Community Impact Act to authorize a federal study on the environmental, economic, and public health impacts of data centers, with a focus on communities of color and low-income communities. (Text)

• Sens. Tim Sheehy (R-MT) and Lisa Blunt Rochester (D-DE) introduced the AI Fraud Accountability Act to create a new offense under the Communications Act to prohibit falsely posing as a real or imaginary individual through a highly realistic digital impersonation with intent to defraud a person of money or other things of value and direct the FTC to identify foreign countries most associated with digital impersonation fraud and to pursue international cooperation agreements to bolster enforcement against overseas actors. The House companion was introduced by Reps. Vern Buchanan (R-FL) and Darren Soto (D-FL). (Text)

• Senate Commerce, Science and Transportation Committee Ranking Member Maria Cantwell (D-WA) and Sen. Jerry Moran (R-KS) introduced the NSF AI Education Act to expand scholarship and professional development opportunities to study artificial intelligence with support from the National Science Foundation. (Text)

Correspondence

• Sen. Jim Banks (R-IN) sent a letter to Defense Secretary Pete Hegseth requesting the Pentagon’s Artificial Intelligence Futures Steering Committee identify China’s top AI influencers, examine China’s security practices, and investigate sabotage of frontier models. (Axios)

• Sens. Ed Markey (D-MA), Richard Blumenthal (D-CT), Chris Van Hollen (D-MD), and Cory Booker (D-NJ) wrote to Ann Rendahl, President of the National Association of Regulatory Utility Commissioners (NARUC), urging the association’s members to protect residential and small business ratepayers from rate hikes stemming from the rapid artificial intelligence-fueled data center buildout. (Letter)

• Sens. Mark Warner (D-VA), Josh Hawley (R-MO), Jim Banks (R-IN), Maggie Hassan (D-NH), John Hickenlooper (D-CO), Mark Kelly (D-AZ), Tim Kaine (D-VA), Mike Rounds (R-SD), and Todd Young (R-IN) sent letters to the Department of Labor, Bureau of Labor Statistics, and Census Bureau urging them to expand data collection and public reporting on the impact of artificial intelligence on the U.S. workforce. (Letter)

• Sen. Josh Hawley (R-MO) sent a letter to Alphabet Chief Executive Officer Sundar Pichai, informing the company that the Senate Judiciary Subcommittee on Crime and Counterterrorism is opening an investigation into the role that Big Tech platforms play in the crisis of child trafficking and online exploitation. (Letter)

• House Committee on Oversight and Government Reform Chair James Comer (R-KY) sent letters to Booking Holdings, Expedia Group Incorporated, Uber, Lyft, and Instacart documents and information regarding their use of artificial intelligence to conduct surveillance pricing of consumers that artificially increases the prices of goods and services. (Press release)

• Sen. Ron Wyden (D-OR) sent letters to Anthropic, Google, OpenAI and X.AI requesting information about how the companies’ government customers, in the U.S. and overseas, can use their AI products under the terms of their contracts. (Letter)

• Labor Caucus Co-Chairs Reps. Debbie Dingell (D-MI), Steven Horsford (D-NV), Donald Norcross (D-NJ), and Mark Pocan (D-WI) sent a letter to the chairs of the House Democratic Commission on Artificial Intelligence urging them to implement pro worker policy and strong labor standards in AI regulation within the Innovation Economy strategy. (Letter)

Trump Administration

Commerce Department

• The Commerce Department approved and sent to OMB for review draft regulations to give the government authority over AI chip exports abroad. The White House said the draft “does not reflect what President Trump has said on export controls nor does it reflect the direction of the Trump administration on encouraging export of the American AI stack.” OMB has until Thursday to complete interagency review. (Axios)

White House

• The White House released its National Cyber Strategy, saying, “We will outcompete adversaries who sell ‘low cost’ AI and digital technologies that carry embedded censorship, surveillance, and ideological bias. We will partner closely with industry and academia, at the speed and scale commensurate with the threats we face, and in accordance with our values.” In addition to leveraging artificial intelligence, the strategy also includes promoting the adoption of post-quantum cryptography and secure quantum computing. (Report)

• The White House also released the Ratepayer Protection Pledge, in which Amazon, Google, Meta, Microsoft, OpenAI, Oracle, and xAI agreed to build, bring, or buy new generation resources and cover the cost of all power delivery infrastructure upgrades required for their data centers. (Fact sheet)

Noteworthy Quotes and Events

ADMINISTRATION

Securities and Exchange Commission (SEC)

• Chair Paul Atkins delivered remarks at the Financial Stability Oversight Council Artificial Intelligence Innovation Series Roundtable on Strategy and Governance Principles, saying “The SEC’s best historical regulatory approach has hewn to principles-based rules—rooted in materiality. This time-tested approach should inform how a public company today ought to disclose developments concerning AI, just as it guides disclosures about any other development. The standard is a familiar one: whether there is a substantial likelihood that a reasonable shareholder would consider the information important in making an investment decision. Prescriptive mandates are not the answer to every emerging technology. And disclosure “checklists” are no substitute for materiality-based transparency that offers meaningful disclosure under established principles. If the advent of each new technology becomes a pretext for new line items, then disclosure swiftly loses its discipline. In the absence of a limiting principle, a morass of information can do more to obscure than to illuminate. Now, insisting on clarity in disclosure should not suggest an aversion to adoption. We actively encourage market participants to engage with our staff around innovative use cases.” (Remarks)

Commodity Futures Trading Commission (CFTC)

• CFTC Chair Mike Selig said about former CFTC and SEC Chair Gary Gensler, “Someone like that can just run roughshod over entire industries, and that’s exactly what we saw — we saw with crypto, we saw it with prediction markets, we saw with AI, and many other industries where there was just this political motivation to target market participants.” He added, “The other problem with it is that it’s not transparent. I think that you’ve got to put the rules in clear Federal Register typeface so that everybody can see them and it’s fair.” (Washington Examiner)

• On the CFTC Innovation Advisory Committee, Selig said, “For too long, governments have kind of been this top-down ivory tower world of we’re going to tell businesses what to do and what’s best for them. We’re not going to do that anymore. We’re going to work together with industry to understand what they’re doing in the markets, what they’re building as a business, and collaborate on what the best regulatory framework looks like.” (Washington Examiner)

CONGRESS

AI-Related Job Impacts

• Sen. Josh Hawley (R-MO) said on AI-related job losses, “We haven’t done anything. The public will pretty soon demand it.” He added, “I hear from a lot of college graduates now, who are new entrants in the labor market, that they’re having a really tough time finding jobs. I’m really concerned about it. I’m concerned about it for blue collar workers too.” (Politico)

• Sen. Thom Tillis (R-NC) said, “There’s an implication that you may need to slow down AI, because it may be disrupting jobs, but China and our international competitors aren’t. If you stop, China wins.” (Politico)

• Sen. Mark Warner (D-VA) said, “I’m pro-AI. Over the long haul, it’ll bring enormous positives, but for the next five to seven years, the disruptions that can take place, and I think a lot of it is going to take place with recent college grads.” (Politico)

• Sen. Mike Rounds (R-SD) said, “There will be a transition period. There always is. Every time you have a technology change you have an upheaval, but there’s also opportunity.” (Politico)

• Rep. Suzanne Bonamici (D-OR) said, “I’m hearing anxiety about AI; part of it has to do with potential job loss,” said “If the job market changes and is different then we have to prepare people.” (Politico)

• Sen. Mark Kelly (D-AZ) posted “AI is reshaping the workforce faster than we can measure it. I’m pushing for the federal government to modernize how we track AI’s impact on jobs so that we can better support workers and be prepared for what’s to come.”

• Sen. Todd Young (D-IN) posted “We need to know how AI is impacting the U.S. workforce and jobs. Glad to join this effort to support American workers.”

AI and Energy

• At a roundtable discussion with President Donald Trump and Energy Secretary Chris Wright on “lowering energy costs by committing major tech and AI companies to fund their own data center electricity needs instead of shifting costs onto consumers,” Sen. Jon Husted (R-OH) said, “In places like Ohio, this work matters. If America wants economic and national security dominance, we must lead in technology and AI to stay ahead of adversaries like China. But, this innovation requires energy and Ohio families are concerned about the impact on their own bills. I’m grateful to those who signed the Ratepayer Protection Pledge today and to the president for making this happen for working Ohio families. Requiring companies to fund their own power protects working people from higher bills. I was honored to join the president and his administration at the White House as we work to deliver stable, reliable and affordable energy for the future.” (Press release)

• Sen. Ed Markey (D-MA) posted “Electricity rates are spiking as AI data centers pop up across the country. Households and small businesses should not be made to subsidize data centers while they already struggle to get by. Our nation’s public utility commissions set household rates--they can act now.”

Department of Defense vs. Anthropic

• Sen. Thom Tillis (R-NC) said, “They’re telling Anthropic that they should compromise their code of conduct to facilitate whatever it is Hegseth or somebody wants.” (Politico)

• House Committee on Science, Space, and Technology Ranking Member Zoe Lofgren (D-CA) said, “The Trump administration’s bullying tactics towards Anthropic are shocking and senseless. Anthropic is trying to do the right thing and put their own guardrails in place in the absence of legislation. Any freedom loving American can appreciate Anthropic’s attempts to prevent the DOD from using its AI model for mass surveillance of Americans. And it should go without saying that AI technology should not be making potentially lethal decisions without human involvement. I fear what America will become if the DOD is given this unrestricted power.” (Press release)

• Sen. Kirsten Gillibrand (D-NY) said, “The Defense Department’s designation of Anthropic as a supply-chain risk is a dangerous misuse of a tool meant to address adversary-controlled technology. Instead, DOD has turned it against a leading American technology company. This reckless action is shortsighted, self-destructive, and a gift to our adversaries. This goes beyond simply not doing business with a company that won’t meet the administration’s terms. The government openly attacking an American company for refusing to compromise its own safety measures is something we expect from China, not the United States. We cannot credibly compete with China on artificial intelligence while this administration simultaneously takes an axe to American innovation and sells advanced chips to Beijing. I urge the administration to reverse course. We should be nurturing and encouraging American innovation — not threatening it into submission.” (Press release)

• Rep. Lloyd Doggett (D-TX) posted “Seeking modest protections to ensure their technology is used neither for mass surveillance of Americans nor deployment of weaponized drones without humans involved in the decision-making, AI company Anthropic was blacklisted by Hegseth and Trump as a “radical left” company and national security threat. The Trump regime is abusing Anthropic for acting reasonably in accord with American values. This private company is showing far more respect for the American people and our national security than Trump and his incompetent cabinet of Fox News recruits.”

Miscellaneous

• Rep. Darren Soto (D-FL) posted “As AI continues to evolve, it is critical for us to ensure that the technology isn’t being misused to create harm. Proud to introduce the bipartisan AIAccountabilityAct with VernBuchanan to hold bad actors accountable.”

• Rep. Summer Lee (D-PA) posted “ICE is using data from AI-based school surveillance to aid and abet their mass deportation efforts. If Microsoft is going to continue working with ICE, teachers are rightfully concerned about using Microsoft’s AI tools in the classroom while their students are being deported. But Microsoft refuses to answer to them.”

• Sen. Ted Budd (R-NC) posted “AI’s potential in the healthcare industry presents unique opportunities to save and improve lives. We can accelerate breakthroughs, streamline research through automation, and reduce the costs and barriers that slow life-saving trials.”

• Sen. Jim Banks (R-IN) posted “The U.S. needs to win the AI race against China. That’s why I sent a letter to SecWar asking the DoW to examine the state of advanced AI in China and how we can ensure American technology is always in the lead.”

Senate Committee on Armed Services hearing on the American small drone industrial base Q&A

Sen. Mark Kelly (D-AZ)

• Sen. Mark Kelly (D-AZ): “So, General Marks, I want to ask you something I think that is going to define warfare, now for the rest of our lives, for generations, and that’s the role of artificial intelligence in what we’ve seen play out here over the last several days. But certainly, into the future, it’s going to be a new feature of combat operations in many different ways. But specifically, the LUCAS, the low-cost unmanned combat aircraft system, attack system, those drones deployed in Operation Epic Fury have documented autonomous anti-jamming and I believe also some swarming capability. So, my question is about what’s underneath all of that. Are AI systems being used to assist in targeting decisions during this operation?”

  • Major General Steven M. Marks: “So, Senator, thank you for the question. I am familiar with the LUCAS system. At this level, open hearing, I’m not able to go into great depth on what is inside of the LUCAS system, but I would be willing to get on your calendar, on the Committee’s calendar, and provide you a classified briefing.”

• Kelly: “Okay, so my next question is kind of irrelevant there, because I was going to ask about who validated the systems, who safeguarded them, and what human oversight exists at the moment a drone selects or confirms a target. So, let’s do that in a closed session as well. But I also want to just state for the record here that companies like Anthropic and others in the AI industry have published their own safety frameworks of how advanced AI systems should be deployed. But Congress has not yet set any kind of clear statutory framework for how AI can be used in lethal military operations. There’s a DoD directive, directive 3000.09, which requires what is called, and I’m quoting from the directive, “appropriate levels of human judgment over the use of force.” But that language doesn’t necessarily mean a human is involved at the moment a target is selected or engaged. So, before we rapidly scale up production and field more of these systems that have AI incorporated into their capability, we need a clear answer on this. At the moment, a drone identifies and confirms a target, whether or not a human has to make the final decision to strike the target, or can a system execute the engagement autonomously once it’s been activated? These are questions we haven’t yet dealt with here in Congress, and we need to. So, General, I just want to get your thoughts on that, independent of what LUCAS or any other system can do.”

  • Marks: “Thank you, Senator, for the question. Any system, any capability that the department procures has to comply and be compliant with the Law of Armed Conflict. I would say that any commander that deploys these systems, just like any weapon system, it has to comply with the Law of Armed Conflict.”

• Kelly: “I am not sure that the Law of Armed Conflict has dealt with this issue, so LOAC might not be exactly clear, and that’s why I think it’s up to us, Mister Chairman, that we take this issue of humans in the loop seriously and create the framework that DoD will apply to these systems with regards to their autonomous nature and the ability for a system to make a decision on targeting the enemy. Thank you.”

What I’m Reading This Week

• Agents of Chaos, Natalie Shapira et al.

• A Word to the Wise: Don’t Trust A.I. to File Your Taxes, Stuart A. Thompson, The New York Times

• Khan seeks to lure AI giant blacklisted by Trump to London, James Titcomb, The Telegraph.

• What to watch from Trump’s national AI standard, Allison Mollenkamp, Roll Call.

• The Week the AI Scare Turned Real and America Realized Maybe It Isn’t Ready for What’s Coming, Nick Lichtenberg, Fortune.

• How Candidates Are Using Winks and Posts to Seek Crypto and A.I. Cash, Shane Goldmacher, The New York Times.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

Setting the stage for this week in federal AI policy, Anthropic CEO Dario Amodei publicly rejected Defense Secretary Pete Hegseth’s ultimatum that the company permit its technologies to be used for autonomous weapons and large-scale surveillance—or face invocation of the 1950 Defense Production Act, granting the Pentagon authority to appropriate Anthropic’s products at will. In response, President Trump ordered “EVERY federal agency” to discontinue use of Anthropic systems, despite Claude’s status as the only AI model certified for deployment in the highest-level classified networks. The Department of Defense subsequently labeled Anthropic a supply chain risk.

Meanwhile, Congress continues to scrutinize the energy footprint of data centers amid growing AI infrastructure demands, and the Air Force published a request for information on offering land for lease for large-scale commercial-use data center construction in Alaska.

Read more below

Congress

Hearings

Last week

• On February 24, the House Science, Space and Technology Investigations and Oversight Subcommittee held a hearing on “Powering America’s AI Future: Assessing Policy Options to Increase Data Center Infrastructure.”

• On February 24, the House Education and the Workforce Early Childhood, Elementary, and Secondary Education Subcommittee held a hearing on “Building an AI-Ready America: Teaching in the AI Age.”

This week

• On March 3, the Senate Commerce, Science and Transportation Science, Manufacturing, and Competitiveness Subcommittee holds a hearing on “Less Help, More Help: AI That Improves Safety, Productivity, and Care.”

• On March 4, House Education and the Workforce Subcommittee on Higher Education and Workforce Development holds the fifth hearing in a series examining artificial intelligence, titled “Building an AI-Ready America: Strengthening Employer-Led Training.”

• On March 4, the House Foreign Affairs Committee will markup the Chip Security Act to require the Secretary of Commerce to issue standards with respect to chip security mechanisms for companies to track their AI chips overseas. (Text)

• On March 5, the Senate Health, Education, Labor and Pensions Committee holds a hearing on “Transforming Health Care with Data: Improving Patient Outcomes Through Next-Generation Care.”

Upcoming

• On March 17, the House Financial Services Committee holds a hearing on “Updating America’s Financial Privacy Framework for the 21st Century.”

• On March 26, the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee holds a hearing on “Innovation at the Speed of Markets: How Regulators Keep Pace with Technology.”

Legislation

• The House passed the Small Business AI Advancement Act, sponsored by Reps. Mike Collins (R-GA) and Haley Stevens (D-MI). (Text)

• Sens. Todd Young (R-IN) and Maria Cantwell (D-WA) reintroduced the Future of AI Innovation Act to direct the Center for AI Standards and Innovation at NIST to work with federal agencies and businesses to develop new voluntary guidelines on transparency standards, performance benchmarks and evaluations for AI systems. It also directs NIST to partner with the National Science Foundation and Energy Department, and the private sector, to create security risk assessment tools and test beds for AI companies to evaluate their systems. (Press release)

• Resident Commissioner Pablo Jose Hernández (D-PR) introduced a bill to establish a grant program to provide awards to National Laboratories and institutions of higher education to develop secure artificial intelligence (AI) cyber-physical testbeds to simulate grid-scale cyberattacks. (Text)

• Resident Commissioner Pablo Jose Hernández (D-PR) introduced a bill to establish an international strategy for AI research and development to improve outdated electrical grids. (Text)

• Reps. Scott Franklin (R-FL) and Sanford Bishop (D-GA) reintroduced the Land Grant Research Prioritization Act, to help give land grant universities dedicated access to existing Department of Agriculture grant funding to enhance artificial intelligence, mechanization and other research. (Text)

• Rep. Valerie Foushee (D-NC), a Co-Chair of the House Democratic Commission on AI and the Innovation Economy, announced she will be introducing the HBCU Artificial Intelligence Research Leadership Act to provide federal funding to Historically Black Colleges and Universities (HBCUs) to establish Artificial Intelligence (AI) Research Institutes. (Press release)

Correspondence

• Senate Armed Services Committee Chair Roger Wicker (R-Miss.) and Ranking Member Jack Reed (D-RI) and Senate Appropriations Subcommittee on Defense Chair Mitch McConnell (R-KY) and Vice Chair Chris Coons (D-DE) sent letters to Defense Secretary Pete Hegseth and Anthropic CEO Dario Amodei expressing “concern over the escalatory direction of negotiations between the Department of Defense and Anthropic” and requesting they “extend the negotiating window and work with Congress to find a solution.” (Politico)

• Rep. George Whitesides (D-CA) sent a letter to Defense Secretary Pete Hegseth expressing concern that compelling a private company to abandon established safety policies on an accelerated timeline could set a dangerous precedent for how AI is deployed in high-stakes national security contexts. (Letter)

Trump Administration

White House

• President Donald Trump announced a six-month phase-out period for the Pentagon and other agencies using Anthropic products. He warned that any resistance by Anthropic will provoke the President to use “the Full Power of the Presidency to make them comply, with major civil and criminal consequences to follow.” (Politico)

Department of Defense

• The Department of the Air Force published a request for information on offering land for lease for large-scale commercial-use data center construction in Alaska at Joint Base Elmendorf-Richardson, Eielson Air Force Base, or Clear Space Force Station. (RFI)

Department of Homeland Security (DHS)

• Cybersecurity and Infrastructure Security Agency (CISA) acting director Madhu Gottumukkala was reassigned to a role as DHS’s director of strategic implementation, and Nick Anderson, the executive assistant director for cybersecurity at CISA, will serve as CISA’s new acting director. (ABC News)

Noteworthy Quotes and Events

ADMINISTRATION

White House

• In the 2026 State of the Union, President Trump said, “… many Americans are also concerned that energy demand from AI data centers could unfairly drive up their electric utility bills. Tonight, I’m pleased to announce that I have negotiated the new ratepayer protection pledge. You know what that is? We’re telling the major tech companies that they have the obligation to provide for their own power needs. They can build their own power plants as part of their factory, so that no one’s prices will go up and in many cases, prices of electricity will go down for the community, and very substantially then. This is a unique strategy never used in this country before. We have an old grid. It could never handle the kind of numbers, the amount of electricity that’s needed. So I’m telling them they can build their own plant, they’re going to produce their own electricity. It will ensure the company’s ability to get electricity, while at the same time lowering prices of electricity for you and could be very substantial. For all of these cities and towns, you’re going to see some good things happen over the next number of years.” (AP)

• Trump posted on Truth Social, THE UNITED STATES OF AMERICA WILL NEVER ALLOW A RADICAL LEFT, WOKE COMPANY TO DICTATE HOW OUR GREAT MILITARY FIGHTS AND WINS WARS! That decision belongs to YOUR COMMANDER-IN-CHIEF, and the tremendous leaders I appoint to run our Military. The Leftwing nut jobs at Anthropic have made a DISASTROUS MISTAKE trying to STRONG-ARM the Department of War, and force them to obey their Terms of Service instead of our Constitution. Their selfishness is putting AMERICAN LIVES at risk, our Troops in danger, and our National Security in JEOPARDY. Therefore, I am directing EVERY Federal Agency in the United States Government to IMMEDIATELY CEASE all use of Anthropic’s technology. We don’t need it, we don’t want it, and will not do business with them again! There will be a Six Month phase out period for Agencies like the Department of War who are using Anthropic’s products, at various levels. Anthropic better get their act together, and be helpful during this phase out period, or I will use the Full Power of the Presidency to make them comply, with major civil and criminal consequences to follow. WE will decide the fate of our Country — NOT some out-of-control, Radical Left AI company run by people who have no idea what the real World is all about. Thank you for your attention to this matter. MAKE AMERICA GREAT AGAIN! PRESIDENT DONALD J. TRUMP”

• White House AI & Crypto Czar David Sacks posted “True. And guess where those Biden AI staffers went to work as soon as the admin was over? Anthropic.”

Department of Defense

• Secretary Pete Hegseth posted “This week, Anthropic delivered a master class in arrogance and betrayal as well as a textbook case of how not to do business with the United States Government or the Pentagon. Our position has never wavered and will never waver: the Department of War must have full, unrestricted access to Anthropic’s models for every LAWFUL purpose in defense of the Republic. Instead, AnthropicAI and its CEO DarioAmodei, have chosen duplicity. Cloaked in the sanctimonious rhetoric of ‘effective altruism,’ they have attempted to strong-arm the United States military into submission - a cowardly act of corporate virtue-signaling that places Silicon Valley ideology above American lives. The Terms of Service of Anthropic’s defective altruism will never outweigh the safety, the readiness, or the lives of American troops on the battlefield. Their true objective is unmistakable: to seize veto power over the operational decisions of the United States military. That is unacceptable. As President Trump stated on Truth Social, the Commander-in-Chief and the American people alone will determine the destiny of our armed forces, not unelected tech executives. Anthropic’s stance is fundamentally incompatible with American principles. Their relationship with the United States Armed Forces and the Federal Government has therefore been permanently altered. In conjunction with the President’s directive for the Federal Government to cease all use of Anthropic’s technology, I am directing the Department of War to designate Anthropic a Supply-Chain Risk to National Security. Effective immediately, no contractor, supplier, or partner that does business with the United States military may conduct any commercial activity with Anthropic. Anthropic will continue to provide the Department of War its services for a period of no more than six months to allow for a seamless transition to a better and more patriotic service. America’s warfighters will never be held hostage by the ideological whims of Big Tech. This decision is final.”

Department of Energy (DOE)

• On the development of a minimum viable product within Genesis Mission, DOE’s under secretary for science and director of the Genesis Mission, Darío Gil, said, “We’re going to show quite a lot of results this year. We’re going to show results on our progress of building AI supercomputers … the software and the agentic framework.” He added, “We know how capable AI-driven cyberattacks will be, and that’s why from day one in everything that we do, we have a red-team, blue-team element to it. In the demos that the teams were showing me [last Thursday], it was already a built-in thing.” In addition, he said, “We’re going to use the most powerful AI network to attack ourselves, and we’re going to use the most powerful AI to defend ourselves.” (AIScoop)

Department of the Interior

• Interior Secretary Doug Burgum said, “A moratorium on data centers would — would be like, we might as well wave the surrender flag to China right now. I mean, it is, again — that’d be complete capitulation… These data centers, again, they’re not a data center in the traditional sense, these are a place where you manufacture intelligence. We have to manufacture intelligence.” (The Hill)

Federal Reserve

• Governor Christopher Waller delivered remarks on “Operationalizing AI at the Federal Reserve” at the Federal Reserve Bank of Boston 2026 Technology-Enabled Disruption Conference: Shaping the Future of Finance and Payments, saying, “As we see technologies like tokenization and agentic AI coming into view, it’s worth remembering that this isn’t the first time our industry has navigated shifts like this. When ATMs were first introduced, they didn’t eliminate bank tellers. Instead, they changed how banking worked. Routine transactions became cheaper, faster, and more accessible, while human effort shifted toward higher-value activities. The real impact wasn’t automation alone—it was how institutions reorganized around technology. AI is similar. The biggest gains won’t come from simply adding AI to existing processes. They’ll come from rethinking workflows, roles, and systems to take advantage of what this technology makes possible. What we don’t know—and can’t know—is exactly when these technologies will hit their full inflection point. We won’t get a clear signal when AI moves from rapid progress to truly systemic impact. But waiting for perfect clarity isn’t a strategy. If we want to be ready when that moment comes, the work has to start now.” (Remarks)

• Governor Lisa Cook delivered opening remarks for the “AI and Productivity across the Economy” panel at “The Great Realignment: Navigating AI, Demographic, and Geoeconomic Shifts,” 42nd Annual NABE Economic Policy Conference, saying, “To be sure, the AI transition I am contemplating could have profound implications for monetary policy. It is too early to observe the exact contours, but I am carefully studying several aspects of this transition. Allow me to briefly raise two issues for consideration. First, if AI continues to raise productivity, economic growth could remain strong, even as churn in the labor market leads to an increase in unemployment…. Second, I am thinking about how AI might affect the neutral rate of interest in the short run and over time. To recall, the neutral rate is a long-run concept that articulates the equilibrium level of interest rates that is noninflationary and consistent with maximum employment… With investment contributing to strong aggregate demand, it is possible that the current neutral rate is higher than before the pandemic. This could reverse when the AI productivity gains are more fully realized or if the labor market transition leads to a rise in income inequality, such that well-off consumers receive a larger share of income, which could lower the neutral rate, all else equal.” (Remarks)

CONGRESS

Department of Defense vs. Anthropic

• Sens. Elizabeth Warren (D-Mass.) and Andy Kim (D-NJ) released a statement on reports that Secretary of Defense Pete Hegseth told Anthropic’s CEO Dario Amodei that the Pentagon would use the Defense Production Act (DPA) to against the company if it does not agree to Hegseth’s terms, saying, “Congress passed the DPA to mobilize the country’s economic and industrial resources to respond to emergencies and protect our national security, not to give Donald Trump and Pete Hegseth tools to extort American companies that refuse to help the Pentagon to surveil Americans or build killer robots. If Secretary Hegseth weaponizes the DPA against American companies, he will shatter the bipartisan consensus in support of a strong DPA – weakening our hand in competition with China and our ability to ensure American competitiveness.” (Press release)

• Sen. Chris Coons (D-DE) posted “Demanding complete obedience from a private company so the Pentagon has the option to surveil Americans and develop self-firing weapons is chilling and totally inappropriate.”

• Sen. Mark Warner (D-VA) issued a statement, saying, “I’m deeply disturbed by reports that the Department of Defense is working to bully a leading U.S. company, which has already provided enormous utility to the intelligence community and warfighter. Most Americans oppose unsupervised autonomous weapon systems and AI-facilitated surveillance. Unfortunately, this is further indication that the Department of Defense seeks to completely ignore AI governance – something the Administration’s own Office of Management and Budget and Office of Science and Technology Policy have described as fundamental enablers of effective AI usage – and further underscores the need for Congress to enact strong, binding AI governance mechanisms for national security contexts.” (Press release)

• Warner also said, “As one of Congress’ most vocal proponents for the modernization of IC and DoD missions with transformative technology, I have been actively working for years to ensure that the U.S has the compute, models, and talent to seize opportunities provided by AI. At the same time, the intelligence committees have consistently sought – on a bipartisan basis, and across administrations – to ensure that AI usage in the national security context meets rigorous, consistent, and transparent standards for AI governance, particularly in contexts in which AI usage has a significant potential impact on Americans’ core rights or results in the loss of human life. The president’s directive to halt the use of a leading American AI company across the federal government, combined with inflammatory rhetoric attacking that company, raises serious concerns about whether national security decisions are being driven by careful analysis or political considerations. President Trump and Secretary Hegseth’s efforts to intimidate and disparage a leading American company – potentially as the pretext to steer contracts to a preferred vendor whose model a number of federal agencies have already identified as a reliability, safety, and security threat – pose an enormous risk to U.S. defense readiness and the willingness of the U.S. private sector and academia to work with the IC and DoD, consistent with their own values and legal ethics. Indeed, Secretary Hegseth’s loud insistence on the sufficiency of an ‘all lawful purposes’ standard provides cold comfort against the backdrop of Pentagon leadership that has routinely sidelined career military attorneys and challenged longstanding norms and rules regarding lethal force.” (Press release)

• Warner posted “Trump & Hegseth’s bullying of a company to deploy AI-driven weapons without safeguards should scare the hell out of all of us. This is about more than Anthropic – it’s about the responsible deployment of AI everywhere.”

• Warner also posted “Why is Pete Hegseth trying to bully AI companies into giving him maximal control over powerful, potentially autonomous weapons? Does anyone really want the Signalgate King having this sort of power?”

• Warner also posted “Most Americans oppose unsupervised autonomous weapons systems… so why the hell is the Department of Defense bullying an AI company into deploying them?”

• Sen. Kirsten Gillibrand (D-NY) said, “Secretary Hegseth’s attack on AI safety procedures contradicts common sense and undermines our national security. It also raises serious questions about why the DOD seeks to deploy autonomous weapons with an AI model neither designed nor ready to be used for such a purpose, as well to conduct mass domestic surveillance of American citizens. The Department must cease these efforts and provide the American people and Congress with full transparency on its plans to surveil Americans and develop fully autonomous weapons. Lawyers at the Justice Department and Department of Defense have been willing to use secret interpretations of law to put us into armed conflict abroad and the door should not be left open for them to do the same here through secret and novel interpretations of ‘any lawful purpose. Punishing AI safety destroys American leadership and will have a chilling effect on responsible AI development around the world. This is a gift to our adversaries and a strike against American innovation. America should be leading the world in developing international norms surrounding these technologies, ensuring outcomes in our national interest. Instead, Pete Hegseth is consigning us to runner-up status. Removing guardrails doesn’t produce efficiency; it guarantees a future of catastrophic harm. We must have clear AI safety procedures across military and civilian life – with humans in control. The health of our democracy and America’s leadership around the world depend on it not just in the military, but across health care, law enforcement, financial systems, and everything else this technology will touch. This event only underscores that Congress’ continued lack of action on AI legislation is creating a future of devastating consequences. We must create clear rules of the road to promote safety, protect civil rights, and ensure America’s AI innovation leads the world.” (Press release)

• Sen. Mark Kelly (D-AZ) posted “We need the best AI systems to stay ahead of our adversaries and keep Americans safe. That also means strong safeguards. If Hegseth kicks out the most capable provider because they want responsible guardrails, that makes us less safe and raises serious questions about how this administration plans to use AI. Congress must act and set clear rules for AI use to protect Americans and make sure we continue to have the most advanced fighting force in the world.”

• Sen. Raphael Warnock (D-GA) posted “This is out of control. Pete Hegseth wants to use AI to fire weapons without human input. And he’s willing to blackmail a private company in order to do it. He is a threat to our safety and must be fired immediately.”

• Sen. Ed Markey (D-MA) posted “DOD is still coercing Anthropic to allow its AI model to be used for mass surveillance and autonomous warfare. Imagine what they have planned. This can’t happen.”

• Sen. Elissa Slotkin (D-MI) posted “Americans don’t want to be surveilled by their government, with AI or otherwise.”

• Slotkin also posted “The average person does not think we should allow AI systems to get into war and kill people without a human being overseeing that. And I certainly don’t think any American wants AI-assisted mass surveillance on the American people.”

• Rep. Valerie Foushee (D-NC) said, “Reports that Anthropic is stepping back from key safety commitments in the face of pressure from Secretary Hegseth and the Department of War are deeply troubling. AI companies have a responsibility to stand by the safeguards they publicly embraced and should not weaken them in response to political pressure. Doing the right thing should not depend on who is in the White House. Congress is watching. I firmly object to any effort by the Administration to strong-arm AI companies into enabling mass surveillance or developing weapons that operate without meaningful human control. These uses threaten civil liberties and human rights at home and around the world, and they raise profound moral and constitutional concerns. Targeting one of America’s leading AI companies because it refuses to abandon basic safety principles would also be strategically reckless and only strengthens China’s hand. I urge Secretary Hegseth and the Department to withdraw any demands that would undermine established AI safety guardrails. The United States must lead in responsible AI, not in abandoning safeguards or automating life-and-death decisions.” (Press release)

• House Foreign Affairs Committee Dems posted, “The Department of Defense is coercing Anthropic simply because it is standing up for American values. We need to harness American AI innovation, not bully the companies doing it if we are going to win the AI race against China.”

• Rep. Doris Matsui (D-CA) posted, “First it was universities and social media companies. Then it was the press. Now AI companies. Trump has made it clear: no American institution or company is safe from government retaliation if it doesn’t fall in line. Anthropic said no to mass surveillance and autonomous weapons. Look what happened.”

• Rep. Rob Menendez (D-NJ) posted “Important that Anthropic rejected Hegseth’s pressure to allow the DOD to use their technology to enable mass surveillance or the development of weapons without human oversight. Removing necessary AI safeguards for military weapons would shake the conscience of our country. We cannot - and will not - allow it to happen.”

• Rep. Sara Jacobs (D-CA) posted “The Pentagon’s move to bring Grok into its classified systems, while pressuring Anthropic to drop key safeguards, is deeply alarming. Undermining AI safety and civil liberties protections could cause large-scale harm. We can’t let this happen.”

• Rep. Betty McCollum (D-MN) posted “The use of Anthropic’s artificial intelligence technology by the Department of Defense deserves tough scrutiny from Congress. We must understand exactly how DoD intends to use this technology and should hold hearings on the use of artificial intelligence in the military. Congress must ensure that the private data of Americans is protected and that our citizens are free from warrantless government surveillance.”

Data Center Energy Consumption

• In his opening remarks at the House Science, Space, and Technology Committee hearing on “Powering America’s AI Future: Assessing Policy Options to Increase Data Center Infrastructure,” Investigations and Oversight Subcommittee Chair Rich McCormick (R-PA) said, “China is building data center and power infrastructure at considerable speed through centralized planning. Its data center electricity consumption is projected to grow dramatically over the next five years… We should also consider how this conversation extends beyond major metropolitan regions. Much of rural Georgia—and rural America—still operates on cooperative grid infrastructure originally built under mid-20th century electrification policy. That system was not designed for compute-intensive infrastructure. If AI integration expands into agriculture, logistics, and public services, rural grid capacity could become a binding constraint. So what needs to happen? We must evaluate whether a permitting framework largely designed in the 1970s is suited to infrastructure that is now central to national security and economic competitiveness in 2026. That includes reviewing litigation timelines and considering whether AI-related infrastructure warrants differentiated treatment. I am not advocating the elimination of environmental review. But we should ask whether the current process is meeting its intended goals efficiently—or simply creating unnecessary delay. I am not suggesting we adopt their system. But we should acknowledge that our competitors are not operating under the same constraints.” (Press release)

• Sen. Bernie Sanders (I-VT) released a statement following an announcement of a data center moratorium in Denver, CO, “Let’s be clear. AI will likely have a catastrophic impact on the lives of working-class Americans, eliminating tens of millions of blue- and white-collar jobs in every sector of our economy. Further, given the extraordinary speed at which AI is progressing, a number of very knowledgeable AI experts fear that this revolutionary technology could soon become smarter than humans and escape human control — with potentially cataclysmic outcomes. Bottom line: We cannot sit back and allow a handful of billionaire Big Tech oligarchs to make decisions that will reshape our economy, our democracy and the future of humanity. We need serious public debate and democratic oversight over this enormously consequential issue. The time for action is now. We need a federal moratorium on AI data centers.” (Press release)

• Sanders also said, “We need to slow down the development of [artificial intelligence] to give democracy a chance to catch up. A moratorium will give us time to figure out how to make sure AI does not harm our environment or jack up the cost of electricity.” (Politico)

• Senator Ted Budd (R-NC) delivered remarks at The Washington Post Live event “Building America: Powering the AI Age”, saying, “It goes back to a conversation I had with Sam Altman… [where he] made the point that an electron, is an electron, is an electron. And if we are so constrained and protective and don’t build energy, it not only holds back AI, but also holds back manufacturing. It holds back technology. It holds back all sorts of production. I think that’s our main constraint right now when it comes to moving forward. So, if we have more energy, I believe we’ll be safer, more secure, and more resilient.” (Press release)

• Sen. Ted Budd (R-NC) posted “If we don’t build energy, it not only holds back AI, but it also holds back manufacturing, technology, all sorts of production, airports, hospitals, and everyday practices. More energy means we’ll be safer, secure, and more resilient.”

• On his bill with Sen. Richard Blumenthal (D-CT), the Guaranteeing Rate Insulation from Data Centers (GRID) Act, Sen. Josh Hawley (R-MO) said, “Voters are saying ‘We want some protections. We do not want to pay more in energy.’ I think that if we don’t get that message, I think that voters will make sure we get it. It’ll probably be unpleasant.” (Politico)

• Hawley also said, “My bill is based on what the president talked about. It implements it, makes it permanent, makes it guaranteed, and it has bipartisan support. So I think we should do that.” (Politico)

• Blumenthal said, “The administration has shown that it vacillates and loses enthusiasm on so many topics, especially when Big Tech is the adversary or is adversarial. So I think our bill is absolutely necessary, and it meets a really strongly felt need on the part of consumers… Let me be blunt — Big Tech has a lot of sway around here. And I expect they may say they’re for the idea, say they support the idea, but in fact work behind the scenes against it.” (Politico)

• On his Power for the People Act, Sen. Chris Van Hollen (D-MD) said, “We will continue to open it up and reach out to Republicans. All of them say they sort of support the basic idea behind the bill, but we need them to join.” (Politico)

• Energy and Natural Resources Committee Ranking Member Martin Heinrich (D-NM) said, “I would definitely welcome [legislative action], and this is one of those areas where [Chair] Mike Lee [R-Utah] and I have been somewhat aligned in the communications that we’ve signed together to say, ‘Do not do this development on the backs of ratepayers,’” He added, “I think that there are a lot of developers and hyperscalers that are really botching this out of the gate.” (Politico)

• On his Decentralized Access to Technology Alternatives (DATA) Act, Rep. Nick Begich (R-AK) said, “America leads when we provide the private sector the space it needs to move at the speed of innovation. The Data Act makes sure that leadership continues at what may be the most important technological moment in mankind’s history.” (Politico)

• Rep. Adriano Espaillat (D-NY) posted “New Yorkers are feeling the squeeze from skyrocketing energy bills, which can be attributed to corporate greed, data centers, AI, and Trump’s insane policies on tariffs and renewable energy projects. We cannot rely on the market forces or existing authorities to rectify this problem — and everyday Americans need relief now. I wrote a letter to SpeakerJohnson urging him to use the power of his position and the GOP majority to design and advance frameworks for the federal government to regulate — and freeze — the ballooning utility rates, which are straining families, individuals, and small businesses alike.”

• Rep. Bob Onder (R-MO) posted “Missouri led the nation by making sure massive AI data centers pay their fair share, so families aren’t stuck with higher energy bills. Hardworking Americans should never subsidize the cost of powering billion-dollar facilities. HouseGOP stands ready to work alongside POTUS to take this approach nationwide, protecting ratepayers, strengthening our grid, and continuing to put American families first.”

• Rep. Rich McCormick (R-GA) posted “As President Trump announces his rate payer protection pledge, I am leading HouseGOP to help build data centers sustainability and quickly, while keeping our energy prices stable.”

Miscellaneous

• On the GAIN AI Act, Sen. Jim Banks (R-IN) said, “Chairman Scott is having productive conversations with a lot of us. I’m optimistic there will be a markup in the near future on export controls, so we’ll see.” (Punchbowl)

• On the SAFE Chips Act, Sen. Pete Ricketts (R-NE) said, “One of the things I need to do is get a briefing with some of my colleagues in a secure setting with the CIA.” (Punchbowl)

• On the markup of the Chip Security Act, Rep. Bill Huizenga (R-MI) said, “We’re all trying to build towards the certainty of making sure that we know where those chips are.” (Punchbowl)

• Senate Majority Leader John Thune (R-SD) gave remarks at a press conference with Senate Republican leadership, saying, “I think technology and innovation is also something, artificial intelligence, I think there’s a path forward perhaps on some legislation to deal with that. We just heard from some folks who are experts in that field. But there’s just a lot of work to do.” (Press release)

• In his opening statement, at the hearing on “Building an AI-Ready America: Teaching in the AI Age”, Early Childhood, Elementary, and Secondary Education Subcommittee Chair Kevin Kiley (R-CA) said, “Students aren’t just using these tools to get homework done faster; excessive or irresponsible use of AI as a crutch threatens to replace critical thinking, especially when used outside of teacher supervision. These problems have obvious consequences as educators must fundamentally rethink how they design assessments, assign homework, and ensure academic integrity. Unfortunately, teachers report receiving insufficient guidance on how to handle these challenges. For example, according to a recent RAND survey, only 34 percent of teachers reported their school or district has policies on academic integrity and AI.” (Press release)

• In her opening statement at the House Committee on Science, Space, and Technology Investigations and Oversight Subcommittee hearing on “Powering America’s AI Future: Assessing Policy Options to Increase Data Center Infrastructure,” Ranking Member Zoe Lofgren (D-CA) said, “Data center operators and their supporters should appreciate that their social license to operate is a valuable and fragile thing. It is in their own self-interest to be as transparent as possible about data center impacts so that the country can make reasoned judgments about how to sustainably mitigate them.” (Press release)

• House Foreign Affairs Committee Chair Brian Mast (R-FL) told CNBC regarding NVIDIA chip sales to China, “The joke here is, Jensen wants us to trust the CCP. Anybody watching this should laugh.” He added, “We are in an AI arms race, and it’s important that we know where the AI arms dealers are selling.” (CNBC)

• On Congressional oversight of semiconductor deals, Mast said, “when it blends into the world of now, it’s real war, real weapon systems, real casualties at the highest level of all militaries, yeah, we’re going to have a say.” (CNBC)

• On the White House’s AI & Crypto Czar David Sacks retweeting posts against Mast’s bill, the AI Overwatch Act, Mast said, “What he was promoting was literally mercenary influencers, about a dozen of them, telling literal lies.” (CNBC)

• On job displacement, Senator Ted Budd (R-NC) said, “I don’t worry about being replaced because humanity is going to be collaborating with AI. Let’s remember that AI exists inside of human ingenuity.” (Press release)

• Rep. Valerie Foushee (D-NC) posted “Ensuring equity in AI also means ensuring equity in education—communities of color cannot be left behind. I’m introducing the HBCU AI Research Leadership Act to ensure that students at our nation’s HBCUs can also have the opportunity to engage in AI education and research.”

• Sen. Ron Wyden (D-OR) posted “The Trump administration wants you to stop talking about prior authorization so they can let insurance companies use AI to delay and deny your claims while you get sicker and sicker”

• Rep. Greg Casar (D-TX) posted “We must ban surveillance pricing now before even more companies start using AI to charge you more based on your personal data. I’ve introduced the first federal bill to ban it, and I’m glad to see a proposal in New Jersey to do the same.”

• Sen. Todd Young (R-IN) posted “We need to make sure America, not China, leads in AI.”

• House Foreign Affairs Committee Majority posted “More evidence that without US technology, China won’t win the AI Arms Race. Beijing is living off stolen tech and borrowed time.”

• Sen. John Fetterman (D-PA) posted “SecretaryBurgum is correct. I refuse to help hand the lead in AI to China. The AI chassis can either come from China or the USA. That’s an easy choice.”

• Sen. Todd Young (R-IN) posted “We need to boost U.S. innovation in AI and ensure it is developed in a manner that reflects American values and supports our country and people. The Future of AI Innovation Act will help secure American leadership in the global race for AI dominance.”

• House Science Committee posted “The U.S. AI regulatory landscape is rapidly evolving. To ensure America leads in AI innovation and development, we need a clear understanding of how current regulations impact growth and competitiveness. That’s why Chairman RepBrianBabin and Research and Technology Subcommittee Chairman JayObernolte sent a letter to USGAO requesting a comprehensive review of existing AI regulations.”

• Rep. Suzanne Bonamici (D-OR) posted “AI is increasingly present in the classroom, but educators and students are often left to navigate its risks and opportunities without support. While Trump dismantles the Department of Education, House Democrats are dedicated to providing every student and teacher with access to the resources and knowledge they need to succeed in the classrooms and careers of tomorrow.”

• Sen. Ted Budd (R-NC) posted “Utilizing AI has great potential to maximize skills, improve safety, and enhance many experiences Americans encounter daily. When developed and deployed responsibly, these technologies can unlock solutions and improve career outcomes in sectors across our economy.”

• House Committee on Education and the Workforce posted “The President is right—AI could revolutionize schools. We stand with educators who want to use AI safely and responsibly in their classrooms.”

• Sen. Mike Rounds (R-SD) posted “America can’t afford to wait on AI development. President Trump recognizes the importance of developing AI here at home and harnessing its power for good.”

• Sen. Tom Cotton (R-AR) posted “I appreciate HouseForeignGOP RepHuizenga’s continued support for the bipartisan Chip Security Act. Communist China wants to surpass us as the world leader in AI, and will cheat and steal to get ahead. Our most advanced technology can’t fall into the wrong hands.”

• Rep. Brad Sherman (D-CA) posted “Whoever leads in AI may lead this century — but what if AI itself is in control? We’re spending trillions to make AI more powerful and almost nothing to ensure it remains controllable. I’m pushing legislation to change that.”

• House Foreign Affairs Committee Majority posted “China’s AI chips can’t compete with America’s, so Beijing resorts to theft instead. We support the Trump Administration’s efforts to crack down on these smuggling networks.”

• House Foreign Affairs Committee Democrats posted “DeepSeek is circumventing U.S. export controls to steal our most advanced AI technology, yet the Trump administration won’t commit to denying H200 licenses for DeepSeek. Make it make sense.”

• Rep. Warren Davidson (R-OH) posted “This is why the industry wants preemptive immunity. Privacy is the base layer for ethical AI. While massive data theft has already occurred, passing my It’s Your Data Act would recognize everyone’s property right to their own data. Nevertheless, enforcement would likely never occur.”

• Rep. Mark DeSaulnier (D-CA) posted “As our civil rights are under relentless attack from the Trump Administration, I am prouder than ever to receive a 100% scorecard from ACLU. Whether it be standing up for free speech or regulating AI to protect privacy, I’m committed to protecting your rights and freedoms in Congress.”

What I’m Reading This Week

• Artificial Intelligence in Election Campaigns: Perceptions, Penalties, and Implications, Andreas Jungherr, Adrian Rauchfleisch, and Alexander Wuttke, Political Communication.

• Statement from Dario Amodei on our discussions with the Department of War, Anthropic.

• AI and the Data Center Backlash, The Wall Street Journal.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

This week in AI federal policy, President Trump will deliver the annual State of the Union address to Congress, where U.S. leadership in emerging technology is expected to take center stage. Shaping the week ahead, the White House unveiled a series of international initiatives advancing its AI sovereignty agenda, signaling a bid for global dominance in artificial intelligence.

NIST opened a public comment period on agentic AI, while Treasury released new AI resource guides for the financial sector.

Many of these policy moves were previewed during the India AI Impact Summit, where the White House emphasized its opposition to global AI governance frameworks.

Meanwhile, as the midterm elections draw closer, an increasing number of Congressional Democrats are weaving AI regulation into their campaign platforms.

Read more below

Congress

Hearings

This week

• On February 24, the House Science, Space and Technology Investigations and Oversight Subcommittee holds a hearing on “Powering America’s AI Future: Assessing Policy Options to Increase Data Center Infrastructure.”

• On February 24, the House Education and the Workforce Early Childhood, Elementary, and Secondary Education Subcommittee holds a hearing on “Building an AI-Ready America: Teaching in the AI Age.”

Upcoming

• On March 17, the House Financial Services Committee holds a hearing on “Updating America’s Financial Privacy Framework for the 21st Century.”

• On March 26, the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee holds a hearing on “Innovation at the Speed of Markets: How Regulators Keep Pace with Technology.”

Legislation

• Reps. Mike Lawler (R-NY) and Josh Gottheimer (D-NJ) introduced the AI Workforce Training Act to safeguard American workers and businesses from being displaced by artificial intelligence (AI) and to ensure they are equipped with the skills needed to work effectively with these emerging technologies. (Text)

• Reps. Don Davis (D-NC) and Ronny Jackson (R-TX) introduced the United States-Israel Framework for Upgraded Technologies, Unified Research, and Enhanced Security (FUTURES) Act to establish a United States–Israel Defense Technology Cooperation Initiative to accelerate the development and deployment of next-generation defense technologies, ensuring that investments in collaborative technologies deliver an operational edge to America’s servicemembers. Sens. Ted Budd (R-NC) and Kirsten Gillibrand (D-NY) introduced companion legislation in the Senate. (Text)

Correspondence

• House Science, Space, and Technology Committee Chair Brian Babin (R-TX) and Research and Technology Subcommittee Chair Jay Obernolte (R-CA) sent a letter to Comptroller General Gene Dodaro requesting the Government Accountability Office conduct a “comprehensive review” of current federal and state laws regulating artificial intelligence to inform future legislative efforts. (Letter)

• Sens. Richard Blumenthal (D-CT) and Marsha Blackburn (R-TN) sent a letter to the Chief Executive Officer of Miko, Inc., launching an investigation into why the company exposed sensitive data involving children through an unsecured, publicly accessible dataset. They also sent letters to FoloToy and Curio Interactive, Inc. following up on their previous letter asking what safeguards these companies have in place to protect kids from sexually explicit, violent, or otherwise inappropriate content. (Press release)

• Reps. Gabe Evans (R-CO) and Nick Langworthy (R-NY) sent a letter to Secretary of Commerce Howard Lutnick highlight concerns with Colorado’s SB 205 and New York’s RAISE Act, warning that a growing patchwork of conflicting state AI laws risks undermining U.S. leadership. (Letter)

Publications, Meetings, and Events

• Rep. Lori Trahan (D-MA) released a staff report entitled “Privacy, Trust, and Effective Government: A Bipartisan Blueprint for Modernizing the Privacy Act” outlining a bipartisan framework to modernize the Privacy Act of 1974. (Report)

• Rep. Rich McCormick (R-GA) published an op-ed in the Washington Times entitled “America’s AI Future Runs on Energy, Not Bureaucracy,” saying, “America risks falling behind not because we lack talent or innovation but because red tape is painfully slowing the process and, too often, stopping projects before they ever break ground. While we struggle with lengthy approvals and uncertainty, China is moving fast. It has rapidly expanded power generation and data center capacity to support industries that require lots of computing power and resources. Experts estimate that China accounted for more than half of global electricity demand growth in 2024 alone. That ability to build quickly gives China a strategic advantage we cannot afford to ignore.” (Op-ed)

Trump Administration

White House

• At the India AI Impact Summit 2026, White House Office of Science and Technology Policy Director Michael Kratsios announced several U.S. initiatives to accelerate global adoption of the American AI stack through the American AI Exports Program:

  • American AI Exports Program’s National Champions Initiative within the Commerce Department to match partner nations’ leading AI companies into customized American AI Export stacks.

  • U.S. Tech Corps within the Peace Corps to provide volunteer technical talent with import partners to provide support in deploying AI applications in public services.

  • International financing funds from the Treasury Department and implemented at the World Bank and programs launched at the Export-Import Bank, the U.S. International Development Finance Corporation, the State Department, and the Small Business Administration.

  • NIST/CAISI’s AI Agent Standards Initiative to facilitate the development of interoperable and secure standards for agentic AI. (Press release)

Treasury Department

• Treasury released two new resources to guide AI use in the financial sector, a shared Artificial Intelligence Lexicon and the Financial Services AI Risk Management Framework (FS AI RMF), to provide common terminology and risk management practices for AI, developed through the Financial and Banking Information Infrastructure Committee and the Financial Services Sector Coordinating Council’s Artificial Intelligence Executive Oversight Group (AIEOG). (Publications)

National Institute of Standards and Technology (NIST)

• The Center for AI Standards and Innovation (CAISI) published an RFI seeking insights regarding the secure development and deployment of AI agent systems. They specifically request information on unique security threats affecting AI agent systems, and how these threats may change over time; methods for improving the security of AI agent systems in development and deployment; promise of and possible gaps in existing cybersecurity approaches when applied to AI agent systems; methods for measuring the security of AI agent systems and approaches to anticipating risks during development; and interventions in deployment environments to address security risks affecting AI agent systems, including methods to constrain and monitor the extent of agent access in the deployment environment. (Request for Information)

Department of Transportation

• On March 10, the National Highway Traffic Safety Administration holds a meeting to provide updates and insights into ongoing vehicle automation activities across NHTSA.

Noteworthy Quotes and Events

ADMINISTRATION

White House

• At the India AI Impact Summit 2026, White House Office of Science and Technology Policy Director Michael Kratsios said, “As the Trump Administration has now said many times: We totally reject global governance of AI. AI adoption cannot lead to a brighter future if it is subject to bureaucracies and centralized control.” (France24)

• Kratsios also delivered remarks saying, “Real AI sovereignty means owning and using best-in-class technology for the benefit of your people, and charting your national destiny in the midst of global transformations. It does not mean waiting to participate in an AI-enabled global market until you have tried and failed to build full self-sufficiency. Complete technological self-containment is unrealistic for any country, because the AI stack is incredibly complex. But strategic autonomy alongside rapid AI adoption is achievable, and it is a necessity for independent nations. America wants to help.” (Remarks)

• At the India AI Impact Summit, White House’s senior policy adviser on artificial intelligence Sriram Krishnan said, “I do think the atmosphere in the EU needs to change and be more focused on innovation, less focused on governance and less focused on doomerism.” He added, “The EU AI Act, which I have ranted about before this job, during this job, maybe after this job ... it’s not really conducive to an entrepreneur who wants to build basic technology.” (Politico)

Treasury Department

• Treasury Secretary Scott Bessent delivered remarks at the Economic Club of Dallas, saying, “The global economy is undergoing a period of rapid transformation with breakthrough advances in artificial intelligence, quantum computing, and advanced manufacturing. The countries that adopt and deploy these technologies most effectively will shape the next era of growth, and the world is counting on America to lead as we always have. For 250 years, American innovation has been our decisive advantage. We are in an existential battle to maintain and accelerate technological dominance. The production and development of AI infrastructure will be crucial to both economic growth and national security in this next industrial revolution. Beyond production, leadership in AI adoption is another crucial component of economic security. At Treasury, through the Financial Stability Oversight Council, we are working with regulators and industry leaders to further responsible AI use in the financial system. We are optimizing regulation for growth: moving from a posture focused solely on constraint toward one that recognizes that failure to adopt productivity-enhancing technology is itself a risk.” (Remarks)

• The Treasury Department posted “In support of the President’s AI Action Plan, which calls for clear standards, shared understanding, and risk-based governance to ensure artificial intelligence is deployed safely and responsibly, the U.S. Department of the Treasury today released two new resources to guide AI use in the financial sector, a shared Artificial Intelligence Lexicon and the Financial Services AI Risk Management Framework (FS AI RMF).”

• Treasury also posted “In support of POTUS’ AI Action Plan, the U.S. Department of the Treasury today announced the conclusion of a major public-private initiative to strengthen cybersecurity and risk management for artificial intelligence in the financial services sector.”

• Secretary Bessent posted “As this Administration has made clear, it is imperative that the United States take the lead on developing innovative uses for artificial intelligence, and nowhere is that more important than in the financial sector. This work demonstrates that government and industry can come together to support secure AI adoption that increases the resilience of our financial system.”

Federal Reserve

• Fed Governor Michael Barr delivered remarks at the New York Association for Business Economics entitled “What Will Artificial Intelligence Mean for the Labor Market and the Economy?“ He concluded, “I expect that AI will have a transformative effect on the economy and affect a large share of workers in ways that will challenge the ability of the private and public sectors to accommodate this adjustment. In the longer run, I expect AI will boost productivity and living standards, and it may even lead to new discoveries. Society will need to be nimble and bold to reduce the pain of short-term dislocations for workers and to ensure that the benefits are broadly shared. Widespread AI adoption will very likely lead to dramatic and sometimes difficult changes in the way many of us work and live, but the long-term benefits could be even more dramatic.” (Remarks)

CONGRESS

• On AI and data center growth, Rep. Pramila Jayapal (D-WA) said, “It’s kind of an incredible opportunity for local organizing, because these communities are coming together and saying, ‘Hey, I don’t want my water contaminated, I don’t want my utility prices going up, I don’t want jobs disappearing.’”

• Rep. Ro Khanna (D-CA) said, “We need to make sure that we’re on the side of people, not automation. Will the AI revolution benefit all of us or will it benefit them?”

• Rep. Yvette Clarke (D-NY) posted, “Welcome to our first post in our series on Digital Blackface in the World of AI. Today, we’re exploring the long history of the exploitation of Black creativity for the sake of someone else’s profits, and the abuse of Black creators by a system built upon their continued control and suppression. The stories of ‘Big Mama’ Thornton, Hattie McDaniel, and Sam Moore offer stunning insight into not only the vast hurdles and hardships that these few Black artists faced in their own lifetimes, but a glimpse into the despicable conditions that have confronted our greatest talents throughout history. We must understand that these are examples of a pattern, and not exceptions to a rule that persists to this day.”

• Clarke also posted “In this next post in our series on Digital Blackface in the World of AI, we turn to the present moment, where the patterns of appropriation have simply evolved with technology. From viral reaction memes built on the faces and expressions of Black creators, to fake accounts made to spread racist, Pro-MAGA agendas through the likeness of non-consenting Black folks, social media has become a new frontier for an old practice. What looks like “internet humor” or “just a trend” often echoes a deeper history: Black expression consumed, exploited, and monetized—while Black people themselves remain underpaid or excluded from the profits our image and culture generates. If we are serious about equity in the age of AI, we must confront how frequently Black identity becomes performance material for clicks, clout, and corporate gain.”

• House Foreign Affairs Committee posted “The Trump administration is working around the clock to win the AI Arms Race. The U.S. Tech Corps brings the Peace Corps into the 21st Century and helps countries experience the prosperity and security of building on the trusted American AI stack.”

• Rep. Steve Cohen (D-TN) posted “Trump is turning the EPA into the Environmental POLLUTION Agency. By killing the endangerment finding, they are endangering all of us. More cities full of smog, more pollution and health problems, more irreversible impacts to nature and wildlife—that’s what they’re giving us. So much for MAHA. It’s another reason why I won’t stop fighting Trump’s EPA. I led Democrats demanding transparency on Clean Air Act violators, I introduced the Clean Cloud Act w/ SenWhitehouse to put real standards and PENALTIES on AI data centers & cryptominers, and we are not slowing down. More to come.”

• Rep. Gabe Evans (R-CO) posted “AI is a game changing technology, and there can be only one global leader. If America does not win the AI race, communist China will. I joined RepLangworthy in sending Howard Lutnick, the US Secretary of Commerce a letter highlighting concerns with burdensome state AI regulations, urging a coherent national framework that protects consumers without stopping innovation.”

• Sen. Bernie Sanders (I-VT) posted “Do you think Elon Musk, Mark Zuckerberg and Jeff Bezos are investing in AI to help the working class of this country? No, they’re in it to accumulate even more wealth and power for themselves. We’ve got to make AI work for working people, not just for billionaires.”

• Sen. John Cornyn (R-TX) posted “AI Can Help Defend Against Cyberattacks”

• Sen. Jerry Moran (R-KS) posted “Rural small businesses face limited resources & workforce shortages, & AI has tremendous potential to fill in the gaps. SenatorCantwell and I introduced a bill to help businesses in KS & across the country utilize AI to meet their needs, expand & innovate.”

• Rep. Mike Lawler (R-NY) posted “The CHAT Act zeros in on AI and the potential harm that it can cause to our youth. We have seen in just the last 2 years how prevalent AI applications have become, how accessible to our kids, and we as elected officials have a responsibility to work with big tech to address these concerns.”

• House Financial Services GOP posted “We welcome USTreasury’s public-private initiative to advance the President’s AI Action Plan. The Committee’s bipartisan resolution highlights the importance of secure AI in financial services to protect consumers, unlock innovation, and ensure U.S. global leadership on AI.”

• Rep. Rich McCormick (R-GA) posted “My staff sent me this picture — my op-ed in print, sitting on the coffee table in my office. The message is simple: the AI race will be won by those who can power it. Right now, red tape is slowing America down. We need reliable, abundant energy to lead. ENERGY, SecretaryWright, housescience, let’s unleash American innovation through comprehensive federal strategy and win the AI race!”

• Sen. Chris Murphy (D-CT) posted “Big tech is trying to buy the 2026 elections. Flooding the airwaves and your feed with ads to elect candidates who won’t protect your kids from online addiction and won’t stand in the way of AI stealing your jobs.”

• Sen. Mark Warner (D-VA) posted “AI has some incredible applications, but it also will likely upend our economy and make it harder for young adults to find jobs. I’m deeply concerned, and I’m focused every week on finding solutions for us to help ease the transition and help folks land in good-paying jobs.”

• Sen. Chris Van Hollen (D-MD) posted “So let’s get this straight: Hegseth wants AI to be programmed to kill people WITHOUT any human authorization or intervention? Is he trying to devise a system to shield himself and others from allegations of war crimes?”

• Rep. Josh Gottheimer (D-NJ) posted “AI is already changing how we work, and we can’t let the American worker get left behind. My bipartisan bill with RepMikeLawler will help workers build critical AI skills, boost productivity, and strengthen our economy — all while keeping the U.S. at the front of the pack.”

• Rep. Nathaniel Moran (R-TX) posted “Creative arts can only touch, move, and inspire the soul if they emanate from the soul. AI is a tool for humans, but it is not a replacement. I co-authored the NO FAKES Act not only to protect artists from the unauthorized use of their voices, likenesses, and identities through AI-generated content, but also to preserve the integrity of creative work in the modern era by keeping it tethered to a human soul.”

• Rep. Victoria Spartz (R-IN) posted “The worst AI does is answer political and policy questions since politicians mainly repeat talking points, BS, and lies — most public data is pretty much garbage, and decisions are made behind closed doors. So it’s garbage in, garbage out.”

• Sen. Kirsten Gillibrand (D-NY) posted “AI tools can offer real benefits for older Americans and people with disabilities, but we must make sure our seniors are protected from potential scams. As ranking member of the Senate Aging committee, I’m pushing make sure older Americans can use this technology safely.”

What I’m Reading This Week

• Is AI sovereignty possible? Balancing Autonomy and Interdependence, Brooke Tanner, Cameron F. Kerry, Andrew W. Wyckoff, Nicoleta Kyosovska, Andrea Renda, and Elham Tabassi, Brookings.

• The Sovereignty Gap in U.S. AI Statecraft, Pablo Chavez, Lawfare.

• AI is global — and regulation is struggling to keep up, Nick Brett, The Times.

• AI Can Help Defend Against Cyberattacks, Anne Neuberger, Wall Street Journal.

• From Davos to New Delhi, Rupture of Global Order Tests AI Governance, Alison Gillwald, Tech Policy Press.

• Democrats Run on AI Policy in 2026 Campaigns, Ashley Gold, Axios.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

The Department of Labor released a new framework for AI literacy, defining five foundational content areas and seven guiding principles for effective delivery.

The partial government shutdown affecting the Department of Homeland Security has resulted in a temporary lapse in funding for CISA, forcing employees to either face furloughs or continue working without pay.

On Capitol Hill, last week’s Senate and House hearings with SEC Chair Paul Atkins on SEC oversight centered on the use of AI agents in financial services and the Commission’s anticipated innovation exemption.

Read more below

Congress

Hearings

Last week

• On February 11, the House Education and the Workforce, Workforce Protections Subcommittee held a hearing on “Building an AI-Ready America: Safer Workplaces Through Smarter Technology.”

• On February 11, the House Financial Services Committee held a hearing on “Oversight of the Securities and Exchange Commission.”

• On February 12, the Senate Banking, Housing and Urban Affairs Committee held a hearing on “Oversight of the U.S. Securities and Exchange Commission.”

Legislation

• The Senate Commerce, Science, and Transportation Committee passed the National Programmable Cloud Lab Network (NPCLN) Act to create a national network of six remotely accessible programmable cloud laboratories (PCLs) for academic research. (Text)

• Sens. Jerry Moran (R-KS) and Maria Cantwell (D-WA) introduced the Small Business Artificial Intelligence Training Act that would authorize the Department of Commerce to work with the Small Business Administration to create and distribute artificial intelligence training resources and tools to help small businesses leverage AI in their operations. (Text)

• Sens. Adam Schiff (D-CA) and John Curtis (R-UT) introduced the Copyright Labeling and Ethical AI Reporting (CLEAR) Act to require companies to disclose their use of copyrighted work to train generative AI models, implementing ethical guidelines and protections to promote transparency. (Text)

• Reps. Josh Gottheimer (D-NJ) and Michael Lawler (R-NY) introduced The AI Workforce Training Act to amend the Internal Revenue Code to establish a federal tax credit for businesses that invest in artificial intelligence training for their employees. (Text)

• Sens. Raphael Warnock (D-GA) and Dick Durbin (D-IL) and Rep. Brad Schneider (D-IL) introduced the Investing In Tomorrow’s Workforce Act to create a grant program through the Department of Labor to support industry partnerships in developing training programs for workers who are, or are likely to become, dislocated because of advances in technology. The bill also increases funding for National Dislocated Worker Grants and amend the Workforce Innovation and Opportunity Act (WIOA) to ensure workers who are dislocated by automation are included in WIOA programs. (Press release)

• Sens. Cory Booker (D-NJ), Mike Rounds (R-SD), and Martin Heinrich (D-NM) and Reps. Ted Lieu (D-CA) and Jay Obernolte (R-CA) introduced bill to authorize the Director of the National Science Foundation to identify grand challenges and award competitive prizes for artificial intelligence research and development. (Text)

Correspondence

• Sens. Marsha Blackburn (R-TN) and Richard Blumenthal (D-CT) sent a letter to the Chief Executive Officer of Miko, Inc., launching an investigation into why the company exposed sensitive data involving children through an unsecured, publicly accessible dataset. (Letter)

• Sens. Adam Schiff (D-CA), Jon Ossoff (D-GA), Chris Van Hollen (D-MD), Richard Durbin (D-IL), John Hickenlooper (D-CO), and Reverend Raphael Warnock (D-GA) sent a letter to Department of Defense (DoD) Secretary Pete Hegseth requesting information about DoD plans to use the xAI chatbot Grok, despite reports that the chatbot has promoted antisemitic and other dangerous content. (Letter)

• Reps. Sydney Kamlager-Dove (D-CA), Gregory Meeks (D-NY), Jim Himes (D-CT), Robert Garcia (D-CA), Adam Smith (D-WA), Grace Meng (D-NY, Lois Frankel (D-FL), Jimmy Gomez (D-CA), Brad Sherman (D-CA), George Latimer (D-NY), Johnny Olszewski (D-MD), Bill Keating (D-MA), Ami Bera (D-CA), Gabe Amo (D-RI), and Julie Johnson (D-TX) sent a letter to the Acting Inspector General for the U.S. Department of Commerce demanding an investigation into financial conflicts of interest surrounding President Trump’s decision to approve the export of 500,000 advanced AI chips to the United Arab Emirates in May 2025. (Letter)

• House Select Committee on China Chairman John Moolenaar (R-MI) and House Foreign Affairs Committee Chairman Brian Mast (R-FL), House Foreign Affairs Ranking Member Gregory Meeks (D-NY), and Reps. Bill Huizenga (R-MI), Sydney Kamlager-Dove (D-CA), Greg Stanton (D-AZ), Michael Baumgartner (R-WA), and Johnny Olszewski (D-MD) sent a letter to Secretary of State Marco Rubio and Secretary of Commerce Howard Lutnick on the need for closer cooperation with partners and allies to restrict China’s access to advanced semiconductor manufacturing equipment. (Letter)

Publications, Meetings, and Events

• House Science, Space and Technology Committee Chair Brian Babin (R-TX) published an op-ed in the Washington Times entitled, “America Must Win the Artificial Intelligence Race with China,” saying, “Our jurisdiction spans the Department of Energy’s National Laboratories, the National Science Foundation’s AI research and the National Institute of Standards and Technology’s leadership on voluntary standards and model evaluations. That places us at the center of America’s AI ecosystem. We are advancing practical legislation to expand access to federal computing resources, strengthen research and development, train the next-generation workforce and promote the consensus-based standards that have made U.S. technology the global benchmark.” (Op-ed)

• Rep. Sam Liccardo (D-CA) published an op-ed in the Wall Street Journal entitled, “Congress Shouldn’t Stop AI Innovation,” saying, “No amount of regulation will stop AI development. Slowing innovation will ensure that China writes the rules for the next century. If the Democrats retake Congress in November, we must advance policies that acknowledge the automation-related job loss and rising utility bills Americans endured long before the arrival of ChatGPT. AI certainly could exacerbate those maladies, but we can better address them by taking advantage of the AI infrastructure build-out to spur overdue policy change.” (Op-ed)

Trump Administration

Department of Labor (DOL)

• DOL’s Employment and Training Administration published a framework for AI literacy, outlining outlines five foundational content areas and seven delivery principles for AI literacy. (Framework)

National Science Foundation (NSF)

• The NSF, in coordination with partner agencies from Australia, India and Japan, announced the first cohort of awards made under the Advancing Innovations for Empowering NextGen AGriculturE (AI-ENGAGE) initiative to support six international research projects that will provide artificial intelligence and critical emerging technologies to farmers across the United States and Indo-Pacific region. (Press release)

National Institute of Standards and Technology (NIST)

• NIST announced funding totaling $3.19 million to eight small businesses in seven states under the Small Business Innovation Research (SBIR) program to support research and development related to artificial intelligence, medical diagnostics, biotechnology, semiconductors, quantum and other key technologies. (Press release)

Cybersecurity and Infrastructure Security Agency (CISA)

• Due to the partial government shutdown of the Department of Homeland Security, funding for CISA has temporarily lapsed and CISA employees are furloughed or working without pay. (Politico)

Government Publishing Office (GPO)

• On March 4, the GPO will hold a virtual meeting of the Depository Library Council to discuss “Understanding AI bias: how it arises and how to respond.”

Noteworthy Quotes and Events

ADMINISTRATION

Cybersecurity and Infrastructure Security Agency (CISA)

• In House testimony, CISA Acting Director Madhu Gottumukkala said, “A shutdown would degrade our capacity to provide timely and actionable guidance to help partners defend their networks.” (Politico)

Commodity Futures Trading Commission (CFTC)

• Chair Mike Selig posted “Innovators are harnessing technologies such as artificial intelligence, blockchain, and cloud computing to modernize legacy financial systems and build entirely new ones. Under my leadership, the Commission will develop fit-for-purpose market structure regulations for this new frontier of finance. The Innovation Advisory Committee will play a critical role in advising the Commission on the commercial, economic, and practical considerations of emerging products, platforms, and business models in the financial markets so that it can develop clear rules of the road for the Golden Age of American Financial Markets.”

CONGRESS

Senate Banking SEC Oversight Hearing Q&A

Sen. Mike Rounds (R-SD)

• Sen. Mike Rounds (R-SD): “I want to move back into an area that I think is really important, and that is the development of artificial intelligence and its use under the Biden Administration we saw secure. Regulation used to achieve some political and social objectives, often at the expense of investors and small businesses. I want to thank you for your commitment to returning the SEC to its core mission. Chairman Atkins, the administration’s 2025 AI Action Plan encourages the development of regulatory sand boxes at independent agencies, including the SEC this venue would allow SEC regulated entities such as broker dealers, investment advisors, to test new AI tools under structured oversight. Now I’ve introduced legislation with Senators Heinrich, Kim, and Tillis that would do just that bipartisan legislation. Do you believe that our legislation would give the SEC the tools it needs to foster responsible AI innovation, and could it serve as a useful model as the SEC implements the AI action plan?”

  • SEC Chair Paul Atkins: “Well, thank you, Senator, I haven’t actually had the opportunity to review your language, happy to do that and discuss it. But the premise, I agree with you very much, that I think it would be very useful, and I’ve been talking about innovation exemption to begin that at the SEC to allow entrepreneurs in a sandbox, like environment that’s cabined by, you know, tie, it’s cabin time limited, transparence, you know, flexible, and then focused on investor protection. So, all of those principles, you know, I think, are important and to allow people to try different things in a particular environment and then prove their concept.”

• Rounds: “It’s not going away, is it?”

  • Atkins: “No, no.”

Sen. Mark Warner (D-VA)

• Sen. Mark Warner (D-VA): “We all know AI is going to transform everything. I think it’s clearly going to transform markets, banking, both at the banker and broker dealer level, but also at the retail level. And one of the things I’m really concerned about is kind of agentic AI where the AI tools can self execute, do trades without any human input. And I wonder, if we don’t have some guard rails, here, are people going to be able to say, Well, my agentic AI agent did something was clearly illegal or bad, but I didn’t you know that was that tool. It was not me as an individual or me as a firm. So, I got a couple questions. First, you know, do you think banks and broker dealers will take it up a level have appropriate guard rails in place today to make sure that that agent, AI, agent, doesn’t commit a malfeasance or something illegal.”

  • SEC Chair Paul Atkins: “Yeah, well, that those are very good questions, and I share your concern with that. And this is a new technology, obviously, and people are still experimenting with it. And so I can’t really say, you know, what’s going on with respect to, you know, individual broker dealers or anything else, but I do agree that, you know, we can’t allow that.

• Warner: “I think there’d be a lot of bipartisan interest in helping on this. And then when we take it down to, like, the retail investor. I just want to make sure that you know that the same fair dealing and conflict of interest standards that exist for the retail investor would also apply to that agentic AI agent who is acting on behalf of the retail investor.”

  • Atkins: “Yes, so I think that’s important. And so whichever way this technology grows and changes, I think we have to be very attuned to those potential problems. So even in this last discussion here about proxies and whatnot, obviously, we’ve seen proxy advisory firms. We’ve seen banks now starting to rely on AI rather than, you know, hiring out, forming it out to third party advisors.”

• Warner: “Yeah, and again, we saw, was it this week or last week or, you know, I think one of the new tools came out, and all the wealth management firms took a huge hit on the marketplace, so they thought AI was going to take over. I, I just think this is moving so quickly, it would be great if we could get a little bit ahead of it, and we’re not trying to chase it after the fact.”

  • Atkins: “Yeah, we have a special task force at the SEC, headed by a former enforcement attorney, Valerie Szczepanik, who’s looking at AI for tools for us, for example, at the SEC, with respect to enforcement, Corporation Finance reviews and things like that.”

House Financial Services on SEC Oversight Q&A

Rep. Bill Foster (D-IL)

• Rep. Bill Foster (D-IL): “Thank you, Mr. Chair and our witness, I presume that you’ve been encouraged to use artificial intelligence and all of your workings from the White House. It was a general directive. And obviously industry is moving very fast that way. Now, in terms of the 1000-page prop that you have there, how long do you think it would take AI to summarize that as in one paragraph, one page, 10 pages, whatever level of detail you wanted, maybe a few seconds. I don’t know. Probably neither of us are an expert on that, but I imagine it could be done in a few minutes. And so that, in terms of a burden on investors, it seems like having a lot of information, there is not a burden on investors in an AI world. And so I think that’s an important thing that should go into your thinking as to what the appropriate level of disclosure materiality, I believe, is the best in the that the investor is the best judge of materiality. And if we err on the side of having a lot of you know, probably 95% of what’s in that stack of paper is not material. But there could be a footnote in there that is absolutely crucial. No human is likely to pick it up. As you point out, no human is going to read that stack of paper, but an AI can and find that footnote. And so it seems like, you know, the whole narrative of, let’s get to less disclosure is going in the wrong direction for an AI world. You know, I imagine that that stack of paper is probably 90% generated by AI, or soon will be if it’s not, and so that, I think that it’s a much better position if we have, you know, the AIS, you know, for IPOs and things like that, generate a lot of information, and then let the AIS of potential investors look at it in great detail, that you’ll end up with a More efficient market and less mistakes being made by investors due to lack of information. So, have you been thinking about that sort of thing when you puzzle through the whole what’s the right level of information?”

  • Atkins: “Oh, absolutely, but again, there’s when you think of the cost and the amount of the of work that goes into this sort of disclosure with the lawyers and everything else. You know, what sort of bang for the buck are we getting?”

• Foster: “But anyway, and lawyers are going to get crushed too with AI, you know. I mean, most companies have everything electronically. They just turn their AI loose on that and generate, you know, it is coming at us fast. Yeah, well, it’s that, that’s a good point. Yeah, anyway, so I really encourage you to think about that, because I think that’s going to be a much safer market where there’s a lot of information and that each investor, or the investor’s personal AI advisor will have access. To that information, but summarize it. You know, just in the case of climate, a lot of investors are going to think climate is material. Others will think it’s immaterial, and it’s we’re in a better position if it is the potential investor talking to their AI advisor saying, I do or I don’t care about climate, and then getting a summary that reflects their preferences.”

Miscellaneous

• Sen. Elizabeth Warren (D-MA) issued a statement on comments by LTG Joshua Rudd, nominee to head U.S. Cyber Command and the National Security Agency, confirming that China is seeking to acquire advanced AI chips to accelerate its development of AI-enhanced weapons. Warren said, “A senior military officer nominated by President Trump is warning that China is aggressively seeking to acquire advanced AI chips to accelerate its development of AI-enhanced weapons. This Administration has failed to take these risks seriously. I will keep working with my colleagues to pass bipartisan legislation to protect U.S. economic and national security.” (Press release)

• Rep. Sarah McBride (D-DE) said she plans to focus on “scalpel solutions, not sledgehammer solutions” for AI, adding, “I don’t think we’re going to figure this all out and get something major on the thorniest of issues passed before January of 2027. These issues… will inevitably bleed into a new Congress, whomever is in the majority.” (Punchbowl)

• Rep. Sam Liccardo (D-CA) intends to focus on “a human in the loop if you’re deploying AI-enabled software to ensure that the outcomes of your lending decisions are not discriminatory and the treatment of the financial data is secure.” (Punchbowl)

• Rep. April McClain Delaney (D-MD) said of AI and quantum, “We should have some standards. I do think that there should be some coordination, and I do think that we should have greater collaboration, including with the National Science Foundation.” She added, “I think NIST is the right place to do much of that framework because it has deep expertise in quantum and many aspects of AI. But I hesitate to limit it only to NIST, because other stakeholders, including universities and private companies, also need to be involved.” She also said, “I think we almost have to have a new deal on infrastructure, AI, data, and platform accountability that comes together, because what we have now does not meet the moment.” (MeriTalk)

• Sen. John Cornyn (R-TX) posted “AI’s energy demands are fueling a nuclear comeback”

• Sen. Chris Van Hollen (D-MD) posted “At this perilous time in our country, we need quality journalism more than ever. Using AI to fill a page and calling it “analysis” is the opposite of that. The Baltimore Sun Guild is right to call this out. It’s a disservice to the Sun’s readers and its reporters.”

• Sen. Mark Warner (D-VA) posted “We’re not ready for the impact AI is going to have on our workforce. Every week in the Senate, I am working to make sure we’re building an economy that can withstand these massive upheavals.”

• Sen. Jack Reed (D-RI) posted “RED ALERT: AI romance scams are up this time of year. Know how to spot red flags from V-Day romance scammers”

• Sen. Marsha Blackburn (R-TN) posted “After we confronted Miko for exposing sensitive data involving children to the public, the company scrubbed this information and denied any wrongdoing. Miko needs to answer to the American people for violating kids’ privacy and putting children at risk.”

• Sen. Bernie Sanders (I-VT) posted “Microsoft AI CEO Mustafa Suleyman says most white-collar work “will be fully automated by an AI within the next 12 to 18 months.” If that’s true, it’s an economic earthquake. We need a moratorium on new AI data centers to make sure AI works for workers, not just billionaires.”

• Sanders also posted “Electricity, the automobile, radio, TV, computers, the internet—all changed the way we live. But they pale in comparison to the revolution AI will bring about. The question is: who benefits? It must work for working families, not just billionaires.”

• Sen. Ed Markey (D-MA) posted “What’s described here isn’t isolated—it’s systemic. Embedded bias in AI has real-world consequences. My AI Civil Rights Act would put strict guardrails on algorithms to prevent bias and discrimination. Innovation without safeguards isn’t progress.”

• Rep. Valerie Foushee (D-NC) posted “It was great to meet with Democrat members of the former bipartisan AI Task Force with my HouseDemocrats Commission on AI colleagues. Republicans are blocking all legislation to prevent AI job cuts and protect civil rights in the age of AI, but we remain ready to pass AI guardrails immediately to protect our communities.”

• House Science Committee posted “Chairman RepBrianBabin lays out why America must lead — and win — the global AI race. AI will shape our economy, our security, and our future.”

• Sen. Dick Durbin (D-IL) posted “The rapid development of AI and other automating technologies will profoundly transform the American workplace. I joined SenatorWarnock and RepSchneider to introduce the Investing in Tomorrow’s Workforce Act to equip American workers for the future and ensure no one is left behind in the age of automation.”

• Rep. Ilhan Omar (D-MN) posted “AI is shaping the future whether we like it or not. Technology itself is not the problem. The problem is deploying powerful tools without guardrails, transparency, or accountability. AI should be a tool that works for people – not one that extracts value and burdens workers.”

• Rep. Zach Nunn (R-IA) posted “Taiwan’s greatest threat? The Chinese Communist Party. Taiwan’s greatest ally? The United States of America. I’ve seen Beijing’s coercion tactics firsthand. Our U.S.-Taiwan Defense Innovation Partnership Act strengthens U.S. coordination on AI to counter the CCP’s malign influence in the Indo-Pacific.”

• Rep. Mark DeSaulnier (D-CA) posted “The wealth gap between big corporations and the working people who make these companies’ success possible has been widening for decades and will only be exacerbated by the unchecked rise of AI. As a senior member EdWorkforceDems, I’m pushing my colleagues in Congress to act now to protect American workers by both implementing commonsense guardrails on AI and ensuring the ultrawealthy pay their fair share.”

• Sen. Adam Schiff (D-CA) posted “As our digital landscape rapidly evolves, it is important that we protect the work of those bring their talents to music, television and film. I’m working with SenJohnCurtis to pass the CLEAR Act, which will guarantee transparency in the development of AI models to ensure that digital creators are fairly compensated for their work.”

• House Homeland Security Committee Chair Andrew Garbarino (R-NY) said, “CISA is defending our networks from relentless adversaries while preparing for midterm elections this fall. It is unacceptable that many of these frontline personnel could lose their paychecks for the second time in six months because of Washington’s dysfunction.” (Politico)

• Sen. Chris Murphy (D-CT) delivered remarks at the Munich Security Conference on “Outsmarting Ourselves? Risks and Rewards of the AI Race,” saying, “Our primary victory, in the short run, is to be able to work together or separately on a regulatory regime that doesn’t collapse our economy as we lose jobs at a pace that creates political disintegration, and that we don’t collapse our cultures spiritually as we transition the human race away from the core basic meanings and purposes - conversation, friendship, creativity, problem solving - to machines too quickly… I wake up every day thinking that victory looks like preventing the worst, more so than capturing the best. But obviously you want that balance in the end, that’s victory to me.” (Press release)

• On unregulated AI and the unchecked power of tech leaders, Murphy said, “What freaks people out in the United States is the idea that there are going to be only a handful of companies that are going to control these enormous data sets and these enormously powerful capabilities, and that one person could wake up one day and decide to make a tweak to the code, the algorithm, the way in which the LLM works, and your existence has fundamentally changed.” (Press release)

• On the impact of political spending on AI regulation, Murphy said, “A mandate for an American leader to prioritize working internationally to regulate AI doesn’t come from nowhere. The industry right now is spending millions of dollars trying to suppress conversation in the United States at the state level, and at the federal level, around a regulatory framework, and so it becomes very difficult for there to be any president who’s going to prioritize bringing this conversation to China or to our allies, if there are hundreds of millions of dollars being spent on our politics in the United States by the AI companies and by the technology companies trying to destroy any enthusiasm or conversation about regulation, that’s the political reality.” (Press release)

• On precedential regulation, Murphy said, “There is plenty of history in the way that the United States regulates emerging industries to show that we actually can prioritize protecting consumers, protecting human beings, rather than allocating who wins in a market or who loses in a market. You know, if you just started with some very easy steps, like requiring watermarks for AI generated content, keeping kids away from these chat bots that doesn’t give advantage to one company or another, it just protects human beings from the immediate abuses.” (Press release)

• Murphy posted “The AI leaders came to the Munich Security Conference acting like they want international regulation. Yet they are spending hundreds of millions of dollars in American elections trying to stamp out any conversation about regulation.”

• Murphy also posted “We need to ask ourselves an important question about our AI future. What happens to the human soul if we outsource basic functions - like friendship, creativity and problem solving - to machines? The answer shouldn’t just be left to industry. It needs to involve all of us.”

What I’m Reading This Week

• Why AI is Central to Federal Identity Assurance, FedScoop.

• IRS Adopts Generative Artificial Intelligence Policy, Benjamin Valdez, Tax Notes.

• AI Raises the Stakes for National Security. Here’s How to Get it Right, Chris Lehane, FoxNews.

• AI’s Bitter Rivalry Heads to Washington, France24.

• AI Is Shaping Up to Be America’s Next Political Fault Line, Matthew Urwin, BuiltIn.

• Beyond the Chips: A Better Strategy for AI Dominance, Sharon Squassoni, National Interest.

• Why are Chinese AI models dominating open-source as Western labs step back?, Dashveenjit Kaur, AI News.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

In addition to developing a comprehensive national AI regulatory framework, the White House is also drafting an AI security policy framework aimed at helping organizations better identify and manage risks associated with AI systems.

Treasury Secretary Scott Bessent testified before the Senate Banking and House Financial Services Committees that the Financial Stability Oversight Council is prioritizing the responsible integration of artificial intelligence to enhance financial stability while closely monitoring emerging AI-related risks. At the same time, several Federal Reserve Governors emphasized the Fed’s growing focus on AI’s broader implications for the labor market, productivity, and the overall economy.

Read more below

Congress

Hearings

Last week

• On February 3, the House Education and the Workforce Health, Employment, Labor, and Pensions Subcommittee held a hearing on “Building an AI-Ready America: Adopting AI at Work.”

• On February 4, the Senate Commerce, Science and Transportation Committee held a hearing on “Hit the Road, Mac: The Future of Self-Driving Cars.”

This week

• There are no relevant hearings scheduled this week.

Legislation

• Sens. Cory Booker (D-NJ), Mike Rounds (R-SD), and Martin Heinrich (D-NM) and Reps. Ted Lieu (D-CA) and Jay Obernolte (R-CA) reintroduced the AI Grand Challenges Act to direct the National Science Foundation to establish an AI Grand Challenges Program and administer prize competitions to incentivize researchers, entrepreneurs, and innovators to harness AI to address specific and measurable challenges to benefit the United States and serve the public good. (Text)

• Reps. Rob Menendez (D-NJ) and August Pfluger (R-TX) introduced the AI for Secure Networks Act to direct the federal government to examine how AI can be responsibly used to strengthen the security and resilience of telecommunications networks. (Text)

• Reps. Jennifer McClellan (D-VA), Jay Obernolte (R-CA), and Rep. Bob Latta (R-OH) introduced the National Commission on Robotics Act to establish a national commission tasked with evaluating the United States’ competitiveness in robotics and providing policy recommendations to strengthen American leadership in this critical technology sector. (Press Release)

• Reps. Bill Foster (D-IL) and Pete Sessions (R-TX) introduced the Stop Identity Fraud and Identity Theft Act to establish a government-wide approach to addressing vulnerabilities in online identity verification in financial services. (Text)

• Sens. Elizabeth Warren (D-MA), Andy Kim (D-NJ), Elissa Slotkin (D-MI), and Chris Van Hollen (D-MD) introduced a resolution “condemning and calling for the reversal of President Trump’s decision to allow the export of advanced artificial intelligence chips to the United Arab Emirates, despite significant risks to national security and just months after the United Arab Emirates signed a secret $500,000,000 deal to buy close to a majority stake in the Trump family crypto company World Liberty Financial.” (Text)

• Reps. Rashida Tlaib (D-MI), Pramila Jayapal (D-WA), and Delia Ramirez (D-IL) introduced the Defund the Oligarchs, Fund the People Resolution. The press release said, “The legislation calls for an end to the political and economic dominance of billionaire oligarchs… As wealth concentrates, our democracy becomes less responsive to the needs of everyday people, and necessities like housing and health care have become unaffordable. Campaign contributions allow ultra-rich oligarchs and corporations to purchase influence, winning tax breaks for the oil and gas industry, unrestricted development of artificial intelligence, and industry-friendly crypto legislation.” (Press release)

Correspondence

• Sen. Maggie Hassan (D-NH) sent a letter to bondu, a company that makes interactive AI toys for children, requesting information on its data security practices following a report about a security vulnerability that resulted in the public exposure of bondu users’ personal information. (Letter)

• House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party (CCP) Ranking Member Ro Khanna (D-CA) sent a letter to World Liberty Financial (WLF) requesting information on the reported $500 million investment deal with United Arab Emirates (UAE) Royal Family member Sheikh Tahnoon bin Zayed Al Nahyan and potential influence on the diversion of advanced artificial intelligence chips to China from the UAE. The letter also seeks information from World Liberty Financial about its facilitation of a $2 billion investment in a cryptocurrency exchange founded in China by Changpeng Zhao, recently pardoned by President Trump. Khanna sent a related letter to Benjamin Wallace, United States Attorney for the District of Delaware. (WLF Letter)(Wallace letter)

Publications, Meetings, and Events

• Chairman of the House Committee on Energy and Commerce Brett Guthrie (R-KY) published an essay in the Orrin G. Hatch Foundation’s 2025 Hatch Center Policy Review on “Dominance, Deployment, and Safeguards: The Path for American AI Leadership,” saying, “What makes this moment unique is the pending threat to America’s leadership in artificial intelligence (AI) technology by the People’s Republic of China (PRC) and Chinese Communist Party (CCP)–backed companies, many of which have developed advanced technologies nearly at parity with that of American AI companies. Knowing that the AI revolution will define economic growth and global competitiveness for the next century, the United States must choose to innovate. The stakes couldn’t be higher. China already deploys next-generation technologies to advance many of the regime’s most sinister goals focused on enhancing the power of its Orwellian surveillance state utilizing advanced computing. Even more concerning to the American public is the threat of an adversary’s technology stack serving as the building blocks for future advancements or as a strategic chokehold. For example, we have unfortunately learned this lesson the hard way through Chinese bottlenecks related to telecommunications equipment and critical mineral mining and processing.” (Essay)

Trump Administration

White House

• The White House Office of the National Cyber Director, with the Office of Science and Technology Policy, is developing an AI security policy framework to help organizations manage risks that affect how their AI systems function. National Cyber Director Sean Cairncross said the President “is very forward leaning on the innovation side of AI. We are working to ensure that security is not viewed as a friction point for innovation.” (NextGov)

U.S. Commission on Civil Rights

• On February 24, the Commission on Civil Rights holds a meeting on artificial intelligence and its application in voting administration.

Noteworthy Quotes and Events

ADMINISTRATION

Treasury Department

• Treasury Secretary Scott Bessent testified before the Senate Banking Committee and House Financial Services Committee that the Financial Stability Oversight Council “is prioritizing the responsible use of artificial intelligence to strengthen financial stability. The council is working with public and private sector partners, including international counterparts, to enhance system resilience while closely monitoring emerging risk.” (Remarks)

Federal Reserve

• In remarks on Economic Outlook and Supply-Side (Dis)Inflation Dynamics, Fed Vice Chair Philip Jefferson said, “…data through the third quarter and the readings on spending we have received for the fourth quarter suggest that domestic demand held up well last year. It was supported by strong consumer spending and business investment, including investment in artificial intelligence (AI), which could support productivity growth. For 2026, I have revised up my growth forecast modestly in recent weeks, informed by signs of the economy’s continued resilience. Now, I expect the economy to grow at a rate similar to last year’s estimated rate of 2.2 percent.” (Remarks)

• Fed Governor Lisa Cook delivered remarks on the Economic Outlook, saying, “Looking ahead, as I have discussed in several speeches, I see the continued proliferation of artificial intelligence (AI) as likely to have a significant effect on the labor market and the economy. Growing evidence shows that AI has the power to significantly boost productivity. Better productivity gains would support economic output and allow real wages to increase. I also see AI accelerating the generation of ideas, which could lead to the creation of new products, businesses, and jobs. Nonetheless, I am aware that job destruction may precede job creation, such that the unemployment rate might rise as the economy transitions, causing hardship for many workers and their families. I am concerned that there is a dynamic inconsistency problem such that there could be a mismatch between the arrival of costs related to AI investment and the arrival of benefits, including higher productivity that is noninflationary.” (Remarks)

CONGRESS

Senate Banking FSOC Hearing Q&A

Sen. Mike Rounds (R-SD)

• Sen. Mike Rounds (R-SD): “The FSOC 2025 Annual Report recommends that its member agencies use the council’s artificial intelligence working group to identify regulatory impediments to the responsible adoption of AI by financial institutions from your perspective, what are the biggest impediments today that prevent banks from adopting AI responsibly, especially for compliance, fraud detection and risk management?”

  • Treasury Secretary Scott Bessent: “Well, as you know, AI is an exciting and new technology, and there’s a great amount of learning to do here, so FSOC treasury, the regulatory agencies, are working with our private partners to implement in a gradual way, robust usage of AI. AI can be a great tool, but AI, we have to also think that AI can be a risk through state and non-state actors. So, it is a public private partnership, and we are pushing very hard across the agencies and at Treasury.”

• Rounds: “FSOC’s report also recognizes that overly complex and subjective supervision, like reliance on vague concepts such as reputational risk, as you mentioned in your opening statement, restricts valuable activities given FSOC’s push for clearer standards and responsible AI adoption would a time limited AI sandbox for financial institutions with clear guardrails help firms test AI tools in a controlled setting while regulators evaluate risks and benefits.”

  • Bessent: “Senator that is clearly the one very interesting option, and we are considering that moving forward, we’d be happy to work with your staff on that.”

Sen. Mark Warner (D-VA)

• Sen. Mark Warner (D-VA): “Agentic, AI. We got to come back and talk about agentic. AI. Huge possibilities with AI, but we’ve got to be careful about that.”

House Financial Services FSOC Hearing Q&A

Rep. French Hill (R-AR)

• Rep. French Hill (R-AR): “Mr. Secretary I appreciate members on the Republican side allowing you to clarify points on some key discussions back and forth. And we have had some good ones today. There was an exchange you had with my friend from Massachusetts, Mr. Lynch, about artificial intelligence and in your capacity as Chair of FSOC, our view here is that artificial intelligence offers great promise for better consumer service, fighting fraud, more accuracy in providing customer service, but also in providing a more robust compliance process with the rules in banking and the brokerage and securities industry, I wonder if you could talk from an FSOC point of view about a philosophy of overseeing artificial intelligence, both in the financial services industry and among the supervisors of the financial services industry, yes.”

  • Treasury Secretary Scott Bessent: “So again, we are working with our private sector partners to best practices. And Chairman as you said, there are two pieces to this. There is service improvement, which we are, for instance, working on at the IRS. We hope to be able to use artificial intelligence there to get customer weight down and service down on the other side, both financial security, alerting everyone to the risk of what is going on, but this is a transformative change. And as I mentioned to the Congressman, we look forward to working with you on legislation to make sure that the technology does not move too far ahead of the legislation.”

Rep. Stephen Lynch (D-MA)

• Rep. Stephen Lynch (D-MA): “I just want to do a comparison of the FSOC reports. Let’s go back to 2024 and then we’ll talk about the current report. In the previous report, the members of FSOC expressed serious concerns about related to potential risk to financial stability, regarding the lack of explainability and high complexity of AI and the approaches that have a potential to heighten financial instability, especially in the areas of bias and discrimination and credit decisions that was in 2024 your report in 2025 focuses on removing regulatory impediments. So, in 2024 we were concerned about consumer protections, and now, under your leadership, we’re concerned with eliminating regulatory impediments, the dangers. And that was a that was a report during a time where the Chairman and I were Co-chairs of an AI Task Force, those dangers haven’t gone away. In reality, those dangers are still as severe for the American consumer, but they are absent from FSOC report. So, it’s obvious you’ve eliminated or dropped that priority as an issue for FSOC. So can you explain the change from protecting this to consumer and now eliminating regulations?”

  • Treasury Secretary Scott Bessent: “We are charged with financial stability, and we are focused on leveraging AI strength and the financial system resilience, but with economic growth and a security lens.”

• Lynch: “On the issue of explainability, how when people apply for credit and are denied, we don’t have the ability for AI to explain why they were denied. Is that? Is that a concern? I mean, we are talking about the trust within the financial services.”

  • Bessent: “It could be a concern, but we don’t view it as a priority for financial stability.”

• Lynch: “That that’s the truth. That’s the truth, OK.”

Outlook for Comprehensive AI Legislation

• Rep. Ted Lieu (D-CA) said, “The White House has led the industry astray, down a bad path. Steve Scalise is very opposed to any kind of legislation at the federal level. … And that’s now resulted in three things the tech industry wanted to avoid, which is, backlash from the public, backlash from bipartisan members of Congress and multiple states regulating their industry.” (Politico)

• Rep. John Gottheimer (D-NJ) said, “I think Republicans have certainly ceded the turf.” (Politico)

• House Judiciary Chair Jim Jordan (R-OH) said, “I don’t know about moving anything, but we’re definitely talking about AI.” (Politico)

• On his developing bill, Rep. Jay Obernolte (R-CA) said, “Were going to be continuing to monitor AI as it matures, and create a framework that is flexible enough to change and capture these new trends when come online.” (Broadband Breakfast)

Miscellaneous

• Sen. Bernie Sanders (I-VT) issued a press statement saying, “Artificial intelligence and robotics will transform the world. Today, a handful of billionaires in Silicon Valley are making decisions behind closed doors that will shape the future of humanity. Meanwhile, working people have no voice in these discussions, and far too little visibility into the rapid changes already underway. That is why I look forward to visiting California this month to meet with AI leaders and to ask the fundamental questions we need to be asking as a country.” (Press release)

• Regarding his AI Overwatch Act, Sen. Jim Banks (R-IN) said, “Chairman Mast is doing great work and we’re having a lot of conversations about working together.” (Punchbowl)

• Rep. Pete Sessions (R-TX) posted “I introduced bipartisan legislation with RepBillFoster to combat the growing threat of identity fraud and theft. The Stop Identity Fraud and Identity Theft Act strengthens digital identity security, protects taxpayers and consumers, and supports states as they seek to develop additional identity verification methods.”

• Rep. Bill Foster (D-IL) posted “I am proud to introduce this bipartisan legislation with Congressman PeteSessions to protect Americans’ personal information. It is important that Congress responds to the growing wave of identity theft and fraud by giving states the tools to strengthen their digital identity infrastructure.”

• Sen. Richard Blumenthal (D-CT) posted “Profligate Big Tech must bear the societal costs of its skyrocketing AI spending—rising costs of electricity, water, construction, & much more. Companies not consumers should pay. Bipartisan legislation must impose accountability. I’m working on it.”

• Sen. Chris Murphy (D-CT) posted “The AI industry is driving up our electricity prices and ruining our landscapes with these huge data centers not to cure cancer but to do this.”

• Murphy also posted “Twitter’s AI bot is trained with many disturbing instructions like: ‘You’re always a little horny and aren’t afraid to go full Literotica.’ This is what the AI industry is building. It turns out they aren’t curing cancer or solving our energy crisis.”

• Sen. Ed Markey (D-MA) posted “Anthropic has announced that Claude will remain ad-free. I’m glad to see AnthropicAI agrees that ads in AI chatbots can pose serious risks to its users. That’s why I opened an investigation into AI chatbots’ advertising plans. Companies must put consumers first.”

• Sen. Tom Cotton (R-AR) posted “If students from Communist China want to study at our colleges and universities they should be studying the Federalist Papers, not biotechnology and AI.”

• Rep. Greg Landsman (D-OH) posted “With AI data centers, you’re either with big tech or our towns. We need every public official to be with us, not them. They’re fine. They have billions. Our towns need us.”

• Rep. Suzanne Bonamici (D-OR) posted “AI is reshaping the workforce faster than we can respond. I am developing a comprehensive, human-centered framework for AI that will strengthen teaching and learning, prepare workers, and address security and privacy concerns. And I’ve introduced the No Robot Bosses Act to keep humans in the hiring process.”

• Rep. Rob Menendez (D-NJ) posted “AI is being used more & more by hackers to carry out sophisticated cyberattacks on our devices & networks. That’s why I introduced legislation to make sure we’re also using AI to strengthen cybersecurity & protect Americans from foreign threats.”

• Sen. Maggie Hassan (D-NH) posted “I’m very concerned by reports that the maker of a children’s AI chat toy publicly exposed its users’ personal information. As children’s toys become more sophisticated, companies need to do everything they can to protect the safety and privacy of our kids.”

• Rep. Abe Hamadeh (R-AZ) posted “Congressman Hamadeh’s new legislation, the Improving Emerging Tech Opportunities for Veterans Act, aims to connect highly skilled veterans with high-tech jobs, especially as AZ-08 emerges as a hub for semiconductor manufacturing and AI innovation.”

• Hamadeh also posted “’So many people are scared of AI and new technology because they see it as replacing jobs. But I think this is an ability to give veterans high-paying jobs, especially when it’s these foreign direct investments coming into the United States.’”

• Rep. Tim Sheehy (D-MT) posted “A sober take on AI, which is a tool, not a master. AI will create jobs we haven’t even imagined yet. Let’s not let the hysteria drive the narrative.”

What I’m Reading This Week

• Global AI Law and Policy Tracker: Highlights and Takeaways, Will Simpson, IAPP.

• Why AI adoption keeps outrunning governance — and what to do about it, Pat Brans, Computerworld.

• Move Fast, but Obey the Rules: China’s Vision for Dominating A.I., Meaghan Tobin and Xinyun Wu, The New York Times.

• Inside Musk’s Bet to Hook Users That Turned Grok into a Porn Generator, The Washington Post.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

House Republican leadership is reportedly hosting a series of meetings with rank-and-file Republicans and key Democrats to advance their goal of passing a federal AI regulatory framework by the end of 2026.

Legislation was introduced to use AI to identify outdated regulations for elimination, while the executive branch begins testing AI to write new regulations.

President Trump’s decision to allow China to purchase advanced chips continues to attract concern from lawmakers on both sides of the aisle.

Read more below

Congress

Hearings

Last week

• On January 28, the Senate Armed Services Committee Cybersecurity Subcommittee held a hearing on the Defense Department’s cyber force generation plan and the associated implementation plan.

This week

• On February 3, the House Education and the Workforce Health, Employment, Labor, and Pensions Subcommittee holds a hearing on “Building an AI-Ready America: Adopting AI at Work.”

• On February 4, the Senate Commerce, Science and Transportation Committee holds a hearing on “Hit the Road, Mac: The Future of Self-Driving Cars.”

Legislation

• Rep. Mike Lawler (R-NY) introduced the Children Harmed by AI Technology (CHAT) Act, to protect minors from the risks posed by AI companion chatbots. Sen. Jon Husted (R-OH) introduced companion legislation in the Senate. (Text)

• Rep. Blake Moore (R-UT) introduced the Leveraging Artificial Intelligence to Streamline the Code of Federal Regulations Act to use AI to identify outdated regulations for elimination. Sen. Jon Husted (R-OH) introduced companion legislation in the Senate. (Text)

Correspondence

• Select Committee on China Chair John Moolenaar (R-MI) sent a letter to Secretary of Commerce Howard Lutnick detailing how Nvidia products were used by CCP-backed AI company DeepSeek and then procured by the People’s Liberation Army (PLA) and recommending clarification of H200 restrictions to include measures that would prevent prohibited end users from gaining similar access and tighter restrictions on PRC-origin AI models to address the risks posed by using AI models developed by PRC entities such as DeepSeek, Alibaba, and Tencent in the United States. (Letter)

• Sens. Jack Reed (D-RI), Sheldon Whitehouse (D-RI), Peter Welch (D-VT), Ed Markey (D-MA), Richard Blumenthal (D-CT), and Jeanne Shaheen (D-NH) sent a letter to ISO New England (ISO-NE) about how grid operator plans to protect residential ratepayers from data center-driven price increases. (Letter)

• Sens. Mark Warner (D-VA) and Tim Kaine (D-VA) sent a letter to the Department of Homeland Security’s Inspector General Joseph Cuffari urging an investigation into current and future DHS procurements that enable the collection, retention, and analysis of sensitive personal data. (Letter)

Publications, Meetings, and Events

• Sen. Tom Cotton (R-AR) published an op-ed entitled “The DATA Act Will Unleash A New Energy Era,” saying “My legislation will allow large facilities to build and operate fully isolated, off-grid power systems without the burdensome regulatory requirements that apply to traditional utilities. For Arkansas, the DATA Act offers a direct benefit: by allowing large facilities—such as data centers and advanced manufacturers—to build fully off-grid power systems, the state can attract new industries without forcing expensive grid upgrades that would otherwise show up on Arkansans’ utility bills.” (Op-ed)

Trump Administration

Department of Health and Human Services (HHS)

• HHS published a request for information (RFI) seeking input from the public on the potential adoption of diagnostic imaging technical standards and certification criteria for health information technology under the ONC Health IT Certification Program to better enable the access, exchange, and use of diagnostic images by health care providers and patients. The comment period closes on March 16. (Federal Register)

U.S.-China Economic and Security Review Commission

• U.S.-China Economic and Security Review Commission holds a hearing on “India, China, and the Balance of Power in the Indo-Pacific” to consider economic and technology issues within India-China relations, including India’s efforts to build self-reliance in critical and emerging technology sectors like artificial intelligence, semiconductors and pharmaceutical supply chains. (USCC)

National Oceanic and Atmospheric Administration’s (NOAA)

• The Government Accountability Office published a report on “Weather Safety: Agencies Face Challenges Related to Multilingual Weather Alerts, and AI Project Needs Better Planning” recommending the National Weather Service develop an updated implementation plan for its AI language translation project. (Report)

Noteworthy Quotes and Events

ADMINISTRATION

Department of Transportation (DOT)

• On the use of AI to write federal transportation regulations, DOT general counsel Gregory Zerzan said, “We don’t need the perfect rule on XYZ. We don’t even need a very good rule on XYZ. We want good enough. We’re flooding the zone.” He also said, “It shouldn’t take you more than 20 minutes to get a draft rule out of Gemini.” (ProPublica)

Office of the National Cyber Director

• Alexandra Seymour, principal deputy assistant national cyber director for policy, said the Trump Administration will be “undertaking diplomacy efforts to promote American AI cybersecurity standards and norms, establishing industry best practices for secure AI deployment and harnessing the full potential of AI tools.” She added, “While AI is already helping industries enhance security and address the challenge of escalating cyberattacks, this administration will promote the rapid implementation of AI-enabled cyber defensive tools to detect, divert and deceive threat actors who continue targeting our vital systems and sectors on our federal systems. We must get our house in order. They need rapid modernization, and we’re working on policies to harden our networks, update our technologies and ensure we’re prepared for a post-quantum future.” (AIScoop)

Department of Defense

• U.S. Army posted “The U.S. Army is now an AI-first force. Guided by SecWar’s bold leadership, the USArmy team has integrated http://GenAI.mil in our daily battle rhythm, accelerating our innovation and readiness. The mission for the Army Team is to continue mastering this tool to unleash a new era of operational dominance.”

White House

• AI & Crypto Czar David Sacks posted “The policy debate over AI is overfitted to the social media wars. AI is a completely different form factor. The rise of AI assistants will make this clear.”

CONGRESS

• Sen. Josh Hawley (R-MO) said, “I think we’ve got a moral imperative to make sure that AI is actually good for people. I have no doubt that these companies are going to get filthy rich, but is it going to be good for children? Is it going to be good for parents? Is it going to be good for the American worker? I think we have a moral obligation to see that.” (Axios)

• On AI chatbots and child safety, Hawley said, “I couldn’t believe that this was actually happening. Talking to these parents, seeing the evidence of the chats, seeing the widespread nature of this, just convinced me, to my core, that we’ve got to do something here to protect kids.” (Axios)

• On energy demand, Hawley said, “This is a real thing for folks who already feel their bills are too high. The idea that some Silicon Valley company will come in and jack up utility prices — that’s not speculative.” (Axios)

• In floor remarks, Sen. Bernie Sanders (I-VT) said, “And when we talk about the decline and the standard of living in America, the fact that 60% of the people in our country today are struggling as we speak to put food on the table, we must understand that in our country right now Big Tech oligarchs are working overtime to become even wealthier by throwing American workers out on the street and replacing them with robots or artificial intelligence. Nobody knows exactly what the impact of A.I. and robotics will be, but there are some very sophisticated studies which suggest that tens of millions of jobs will be replaced by A.I. and robotics, and we are in no way prepared for that. And that is why I have called for a moratorium on new A.I. data centers until we make sure that the economic gains of these revolutionary technologies benefit the working families of this country and not just a handful of wealthy billionaires in Silicon Valley. A.I. and robotics are neither good nor bad.”

• On her proposal for a “tech NATO” coordinated body of democratic technology leaders to establish shared rules for emerging technologies, Sen. Maria Cantwell (D-WA) said, “I definitely think we need to use our might to counter China, and the best way to do that is to create an alliance with other smart technology countries. If you just took us, and Japan, and Europe and India and basically a few others and said, ‘Okay, we’re going to say these are the rules of the road for technology: You can’t have a government back door. You have to respect these IP rights. You have to do this.’ And the world should only buy from countries who meet these standards.” (Remarks)

• Ranking Member of the Committee on Homeland Security Bennie Thompson (D-MS) released a statement regarding news reports that Cybersecurity and Infrastructure Security Agency Acting Director Madhu Gottumukkala uploaded sensitive and nonpublic documents into the ChatGPT AI app, saying, “News reports that CISA Acting Director Gottumukkala uploaded FOUO information to ChatGPT follow reports that he failed a counterintelligence polygraph. At best, he’s in over his head, if not unfit to lead. Secretary Noem and her minions are taking a wrecking ball to DHS’s credibility and must be stopped.” (Press release)

• Sen. Dave McCormick (R-PA) posted “Artificial Intelligence is the future — and America must lead. Proud of the USArmy’s push to strengthen their readiness and technological edge through AI”

• Rep. Blake Moore (R-UT) posted “Over the past 50 years, the Code of Federal Regulations has grown to nearly 200,000 pages, including duplicative or outdated rules. These create unnecessary burdens for individuals and businesses. That’s why I introduced the Leveraging Artificial Intelligence to Streamline the Code of Federal Regulations Act of 2026, a modern approach to eliminating outdated regulations.”

• Sen. Tom Cotton (R-AR) posted “American AI dominance shouldn’t mean higher energy prices for Arkansans. My DATA Act will modernize power regulations to keep energy prices down.”

• On his CHAT Act, Rep. Mike Lawler (R-NY) said, “We have a responsibility to make sure our children are protected, not exploited, by AI technology. Parents across the country deserve peace of mind knowing that AI platforms interacting with their kids have real safeguards in place, including age verification, parental consent, and clear boundaries. The CHAT Act puts families first and ensures innovation never comes at the expense of our children’s safety.” (Press release)

• Rep. Josh Brecheen (R-OK) posted “Congress must work to Constitutionally ensure that AI is properly monitored against vulnerabilities.”

• Rep. Mary Gay Scanlon (D-PA) posted “The median age of a first-time home buyer in the US is 40. At this rate, young Americans don’t even have a shot at owning a home. The American Dream gets crushed when a President prioritizes building AI data centers for billionaires over housing for Americans.”

• Rep. Greg Landsman (D-OH) posted “Families and small businesses shouldn’t see their energy bills go up to subsidize massive AI data centers. In states like Ohio, where data centers are rapidly expanding, there has to be a plan that protects ratepayers first.”

• Sen. Marsha Blackburn (R-TN) posted “In Tennessee, AI is powering breakthroughs in health care, manufacturing, nuclear energy, and more. But without strong federal safeguards, it also threatens our children, creators, and communities. That’s why I’m introducing the TRUMP AMERICA AI Act.”

• Sen. Chris Coons (D-DE) posted “Good. If you build an AI that makes child pornography on demand for anyone in the world to use, you should be held accountable. I’m glad the EU is stepping up and investigating if the Trump administration won’t.”

• Rep. Mike Lawler (R-NY) posted “We have a responsibility to make sure our children are protected, not exploited, by AI technology. Parents across the country deserve peace of mind knowing that AI platforms interacting with their kids have real safeguards in place, including age verification, parental consent, and clear boundaries. The CHAT Act puts families first and ensures innovation never comes at the expense of our children’s safety.”

• Landsman also posted “AI is being used to make healthcare decisions — and no one has been told how it works. They need to fully disclose everything. States didn’t volunteer for this program. Providers didn’t volunteer. Patients didn’t volunteer.”

• Rep. Jahana Hayes (D-CT) posted “As a teacher, I recognize the challenges of incorporating new technology into the classroom. While AI is rapidly advancing, we must thoughtfully consider how to implement it in schools to ensure that educators can focus on the strategies that have been proven to promote academic success.”

• Rep. Pat Fallon (R-TX) posted “Biden’s weak foreign policy let our adversaries run wild -- allowing China to surge ahead in AI. President Trump is changing this with massive investment in chips, more secure supply chains, and strong alliances to ensure long-term US leadership. No more playing catch up.”

What I’m Reading This Week

• Vying for Quantum Supremacy U.S.-China Competition in Quantum Technologies, Joseph Federici, U.S.-China Economic and Security Review Commission.

• From Innovation to Impact: AI Adoption in U.S. Financial Services, FinRegLab.

• DeepSeek Was a Warning Shot. China is Building Its Next Surprise, Washington Post.

• AI Risks from Non-State Actors, Kyle Chan, Michael E. O’Hanlon, Qi Haotian, and Zheng Lefeng, Brookings.

• America’s AI Regulatory Patchwork is Crushing Startups and Helping China, James Richardson and Eric Tanenblatt, Fortune.

• The Adolescence of Technology, Dario Amodei, darioamodei.com.

• Geopolitics in the Age of Artificial Intelligence, Jake Sullivan and Tal Feldman, Foreign Affairs.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

Congress advanced multiple AI-related bills, including a Senate-passed bill on nonconsensual explicit imagery, House-passed bills on enhancing AI opportunities and protections for small businesses, and House Committee-passed bills on the use of AI in financial services and enhanced Congressional oversight of AI chip exports to adversarial countries.

The White House published a report analyzing AI impacts on global economic growth, while multiple Administration officials remarked on emerging technologies while at the World Economic Forum in Davos.

Read more below

Congress

Hearings

Last week

• On January 21, the House Small Business Rural Development, Energy, and Supply Chains Subcommittee held a hearing on “Empowering Rural America Through Investment in Innovation.”

• On January 21, the House Foreign Affairs Committee held a markup of bills including the Artificial Intelligence Oversight of Verified Exports and Restrictions on Weaponizable Advanced Technology to Covered High-Risk Actors (AI OVERWATCH) Act and the China AI Power Report Act.

• On January 21, the House Homeland Security Committee held a hearing on “Oversight of the Department of Homeland Security: CISA (Cybersecurity and Infrastructure Security Agency), TSA (Transportation Security Administration), S&T (Science and Technology Directorate).”

• On January 22, the House Science, Space and Technology Committee held a hearing on “Assessing U.S. Leadership in Quantum Science and Technology.”

This week

• On January 28, the Senate Armed Services Cybersecurity Subcommittee holds a hearing on "The Department's Cyber Force Generation Plan and the Associated Implementation Plan."

Upcoming

• On February 10, the House Homeland Security Subcommittee on Cybersecurity and Infrastructure Protection will hold a hearing on North Korea’s use of remote IT workers to infiltrate U.S. companies, fund its weapons program, and undermine national security.

Legislation

• The Senate passed the Disrupt Explicit Forged Images and Non-Consensual Edits Act (DEFIANCE Act) to create a federal civil remedy allowing survivors to seek justice in court and strengthen confidentiality protections for survivors during court proceedings.

• The House passed the Artificial Intelligence Wisdom for Innovative Small Enterprises (AI-WISE) Act to direct the Small Business Administration to develop AI-literacy resources on its existing online learning platform.

• The House also passed the AI for Main Street Act to expand the role of Small Business Development Centers (SBDCs) to help small businesses evaluate and integrate AI into their operations, including improving cybersecurity, protecting intellectual property, strengthening customer trust, and preparing for unexpected challenges.

• The House Foreign Affairs Committee passed the AI OVERWATCH Act to require notification to Congress before the administration approves exports of advanced AI chips to China, Cuba, Iran, North Korea, Russia, and the Maduro regime of Venezuela, mandate verifiable safeguards to ensure AI chip exports to countries of concern will not enhance the military, intelligence, surveillance, or cyber capabilities of our adversaries, and ensure that AI chip exports to foreign adversaries do not limit U.S. availability of advanced chips.

• The House Financial Services Committee passed a resolution expressing the sense of the House of Representatives with respect to the use of artificial intelligence in the financial services and housing industries. (Text)

• Reps. Madeleine Dean (D-PA) and Nathaniel Moran (R-TX) introduced the Transparency and Responsibility for Artificial Intelligence Networks (TRAIN) Act to give copyright holders access to training records used for AI models to determine if their work was used. The Senate companion was introduced by Sens. Peter Welch (D-VT), Marsha Blackburn (R-TN), Adam Schiff (D-CA), and Josh Hawley (R-MO). (Text)

• Reps. Zach Nunn (R-IA) and Valerie Foushee (D-NC) introduced the Expanding AI Voices Act Codify to expand the National Science Foundation’s ExpandAI program to support AI capacity-building projects at under-resourced institutions, prioritize participation by institutions not ranked in the top 100 for federal R&D spending, as well as Historically Black Colleges and Universities, support workforce development through faculty recruitment, bridge programs for post-baccalaureate students, access to computing and data resources, and hands-on training workshops, and direct targeted outreach to expand participation by first-generation students and populations historically underrepresented in STEM. (Text)

• Reps. Nanette Barragán (D-CA) and Jay Obernolte (R-CA) introduced a bill to require the Secretary of Commerce to conduct a public awareness and education campaign to provide information regarding the benefits of, risks relating to, and the prevalence of artificial intelligence in the daily lives of individuals in the United States. (Text)

• Rep. Mike Lawler (R-NY) introduced a bill to require artificial intelligence chatbots to implement age verification measures and establish certain protections for minor users. (Text)

• Reps. Blake Moore (R-UT) and Aaron Bean (R-FL) introduced a bill to require the use of artificial intelligence to review agency regulations. (Text)

Correspondence

• Sen. Amy Klobuchar (D-MN) and Reps. Madeleine Dean (D-PA) and María Elvira Salazar (R-FL) sent a letter to the Department of Justice to demand an investigation into the proliferation of non-consensual intimate images across social media platforms, namely X’s affiliated chatbot, Grok. (Letter)

• Sen. Ed Markey (D-MA) wrote to CEOs of seven tech companies, Sam Altman, CEO of OpenAI; Dario Amodei, CEO of Anthropic; Sundar Pichai, CEO of Alphabet Inc. and Google; Mark Zuckerberg, CEO of Meta; Satya Nadella, CEO of Microsoft; Even Spiegel, CEO of Snap Inc.; and Elon Musk, CEO of xAI, urging details on how the companies will protect their users from manipulation and exploitation if they plan to integrate advertising into their AI chatbots. (Letter)

• House Homeland Security Subcommittee on Cybersecurity and Infrastructure Protection Chair Andy Ogles (R-TN) sent letters to LinkedIn, Amazon Web Services, and Palo Alto Networks requesting that each company designate a senior executive to testify before the Subcommittee at a February 10 hearing on North Korea’s growing use of remote IT worker schemes to infiltrate U.S. companies, fund its weapons program, and undermine national security. (Press release)

Publications, Meetings, and Events

• The House Financial Services Committee hosted an expo of tech companies showcasing AI innovations in financial services and housing. Companies participating included AWS, Anthropic, Vise, Socure, Rocket Mortgage, Ramp, Regions Bank, and Visa. (Event)

• Reps. Valerie Foushee (D-NC) and Ted Lieu (D-CA), as co-chairs of the House Democratic Commission on AI and the Innovation Economy, hosted a roundtable discussion on ethical AI workforce development with the North Carolina Central University (NCCU) Graduate Student Association. (Press release)

Trump Administration

White House

• The Council of Economic Advisers (CEA) published a report on “Artificial Intelligence and the Great Divergence,” reviewing analyses of the potential for AI-led economic growth, estimates of AI’s impact on GDP and the labor force, metrics for tracking the pace of investment, performance, and adoption of AI, and highlighting Trump Administration actions. (Report)

Health and Human Services Department (HHS)

• On February 19, HHS will hold a virtual meeting of the Health Information Technology Advisory Committee to discuss recommendations to the Assistant Secretary for Technology Policy/National Coordinator on Health Information Technology on interoperability, privacy and security and patient access to information. (Event)

Noteworthy Quotes and Events

ADMINISTRATION

White House

• AI & Crypto Czar David Sacks said at Davos, “We generally see that in Western countries, the AI optimism is a lot lower.” He also said, “If we have 1,200 different AI laws in the states, you know, clamping down on innovation, I worry that we could lose the AI race.” (Fortune)

• White House Office of Science and Technology Policy Director Michael Kratsios said of his planned discussions in Davos, “I will continue to point out to my tech minister counterparts the ways they can create a regulatory environment to allow AI to thrive to make sure they’re not getting ahead of themselves with overburdening regulations, like the EU AI Act, which are an absolute disaster.” He added, “There’s been an A-B test for decades on how you lead in technology, and it’s very obvious what the recipe is.” (NBC News)

• Of the White House AI Action Plan, Kratsios said, “We put out probably the most robust, most substantive vision of a pro-innovation AI strategy in the world. Everywhere we travel, when I meet my fellow tech ministers, they’re all using our language and are all talking about their own AI action plan.” (NBC News)

• On the Development Finance Corporation and Export Import Bank providing financing for countries to purchase AI technologies from the U.S., Krasios said, “There are so many countries out there that consistently speak about the importance of having an AI economy and an AI ecosystem and making sure that their citizens can actually enjoy the benefits of AI. We want to be the enabler for that. We want to make it as easy as possible for countries around the world to buy our stack and import our stack. We have the very best chips, we have the very best models, we have the very best AI applications. And we want to deliver those solutions to countries around the world so that they can actually benefit from them.” (NBC News)

• On the Genesis Mission, Kratsios said, “Genesis Mission is the largest marshaling of federal scientific resources since the Apollo mission towards a scientific endeavor. We’ve also seen an incredible amount of demand and enthusiasm from a lot of our partners and allies around the world. We as a scientific enterprise today spend almost a trillion dollars per year in research and development, and the vast majority of that, around 70%, is done by the private sector, If one myopically looks singularly at federal research and development dollars and doesn’t think they’re part of a larger ecosystem, then they’re obviously not going to reap the benefits the American people deserve.” (NBC News)

• Kratsios also said, “I’m very proud, and this was even in the president’s funding request to Congress, that the areas that are most important to the national agenda, like AI and quantum, were preserved and even plussed up in the budget.” (NBC News)

• On the state AI moratorium, Kratsios said, “Creating a patchwork of AI laws where 50 different states all have different goals is ultimately going to hurt little tech and startups more than anyone else.” (NBC News)

• On preparing legislative recommendations for “a uniform Federal policy framework,” Kratsios said, “We’re going to be working very hard over the next year on that framework.” (NBC News)

Federal Trade Commission (FTC)

• On AI-generated nonconsensual explicit imagery, FTC Chair Andrew Ferguson said, “Whether you’re a legacy social media company, a burgeoning AI company, I don’t care. If you are violating the Take It Down Act, you are going to hear from us.” (Punchbowl)

CONGRESS

Nonconsensual Explicit Imagery

• At a press conference on the DEFIANCE Act, Rep. Alexandria Ocasio-Cortez (D-NY) said, “Congress has a moral obligation to stop this harm. We can stop this harm, and we can pass this legislation to hold the people responsible accountable. Right now, one in eight teenagers knows a friend who has been targeted by AI deep fake harassment. Because if you are a middle schooler, and we should all be horrified by that, because if you are a middle schooler or a high schooler in the United States of America, you most likely know someone who has been a victim to this, and people’s parents are waking up every morning in fear that their kid could be next. And while everyday Americans are terrified of this, corporations are finding new ways to profit from the creation of these deep fakes. So while we are all grateful that Congress has taken the tremendous step in passing the Take It DOWN Act to ensure that harmful. Content is removed from online platforms. We know that there is more work to be done.”

• At the press conference, Rep. Laurel Lee (R-FL) said, “Victims have been left without clear, consistent legal tools when their likeness is stolen and weaponized without their consent. The DEFIANCE Act closes that gap. This legislation creates a clear federal civil remedy, remedy for victims of non-consensual, sexually explicit digital forgeries. It allows victims to hold accountable those who knowingly create, distribute or solicit this material or who recklessly disregard the lack of consent. It provides a meaningful statute of limitations for victims who might not discover this abuse right away, and it includes strong privacy protections so survivors are not further traumatized simply for seeking justice. Passing the DEFIANCE Act is about something very simple and very important, restoring dignity, restoring accountability and restoring justice. It draws a clear line. Those who create and spread this material will be held accountable, and victims will finally have real protections and real recourse under the law, this bill shows what is possible when we.”

• Rep. Alexandria Ocasio-Cortez (D-NY) posted “Yesterday, a bipartisan coalition of legislators & survivors, including Paris Hilton, joined us to advocate for the DEFIANCE Act. Our bill will put power in the hands of victims of nonconsensual deepfake AI porn by giving them the right to sue their abusers. Since the bill passed the Senate last week, we’ve added dozens of Democratic and Republican cosponsors. It’s time for the House to pass the DEFIANCE Act and finish the job.”

• Ocasio-Cortez also said, “TAKE IT DOWN gave us removal. DEFIANCE will give us recourse and restitution.” (Punchbowl)

• Rep. Rob Bresnahan (R-PA) posted “I met with ParisHilton during our ProbSolveCaucus meeting yesterday to talk about the DEFIANCE Act, giving victims of non-consensual AI deepfakes stronger protections and legal options. Her fight against AI deepfakes is important, and I cosponsored this bill to make these protections a reality.”

• Rep. Joe Courtney (D-CT) posted “Disturbingly, the rapid rise of Artificial Intelligence is coinciding with an explosion of child exploitation reports using generative AI. There is a clear social cost to AI, and there must be AI industry accountability for its negative fallout.”

Quantum

• In his opening statement at the House Science, Space, and Technology committee hearing on “Assessing US Leadership in Quantum Science and Technology,” Chair Brian Babin (R-TX) said, “The federal government plays a central role in supporting fundamental research, large scale infrastructure, and addressing the long-term challenges that drive innovation in quantum science, these investments lay the foundation for breakthroughs in quantum computing, sensing and communications. The private sector then plays a vital role in translating those breakthroughs into scalable and commercially viable applications. As quantum technologies mature, maintaining US leadership will require sustained investment and fundamental research and progress on key engineering challenges and development of the enabling technologies that support broader quantum the broader quantum ecosystem. This includes strengthening research consortia and expanding test beds and infrastructure, improving advanced manufacturing and ensuring quantum systems can be deployed in real world environments. Quantum science also has direct implications for national security and cybersecurity, preparing for post quantum cryptography and defending against emerging cyber threats will be absolutely essential as these technologies evolve with adversaries around the world investing heavily in quantum capabilities, the United States cannot afford to fall behind in the global race to quantum supremacy.”

• Ranking Member Zoe Lofgren (D-CA) said, “For years, the United States enjoyed being the global leader in quantum information science in terms of both research output and investment across every quantum application and modality, our leadership was built upon a foundation of investments and efforts at every level in academia, industry and our federal government, the US government, has been the primary supporter of openly published quantum research, totaling nearly $1 billion in investments in 2023 however, we’re now facing a pure competitor to the United States in quantum applications in 2024 the Chinese Communist Party invested more than four times what the United States did in quantum R&D and 2025 the CCP announced a $138 billion fund to support their public private partnerships in emerging technologies, including quantum computing, and in terms of quality of research and technology development, China has caught up. Chinese industry leads in certain global market segments, including quantum communications. Now US leadership in quantum technology stands.”

Taiwan Trade Deal

• Sen. Mark Kelly (D-AZ) posted “Strong partnerships build strong economies. Our work with Taiwan is helping bring more semiconductor and AI investment to the U.S.—and creating good-paying jobs, especially in Arizona. Let’s keep it going.”

• Rep. Mike Lawler (R-NY) posted “Major win for American workers! The U.S.–Taiwan trade deal brings semiconductor and AI manufacturing leadership back to the United States while strengthening our supply chains and enhancing this key economic partnership. I am also supportive of H.R. 33 which would eliminate double taxation between the United States and Taiwan, unlocking even more investment in NY-17 and across the country, strengthening both economies.”

AI OVERWATCH Act

• Rep. Brian Mast (R-FL) posted “My bill is simple: It keeps America’s advanced AI chips out of the hands of the Chinese commie military and codifies guardrails that President Trump has already put into place.”

• Mast said, “If it shouldn’t be of concern, then why the hell does China want to buy a couple million of them? A stone and arrow, those are old technologies. Bullets? Really old technology. I’m still not going to sell them.” (Punchbowl)

• Regarding Nvidia advanced chips, Mast also said, “There’s probably nobody more committed than [Rubio] and Secretary Hegseth to make sure the Chinese don’t get their hands on a Blackwell or a Rubin in the future.” (Punchbowl)

• Opposing the bill, Rep. Rich McCormick (R-GA) said, “I like the idea that we can actually be part of their market.” (Punchbowl)

• Sen. Tom Cotton (R-AR) posted “I commend Chairman Mast for his efforts in ensuring we preserve America’s AI advantage over Communist China. Legislation like the AI Overwatch Act and my Chip Security Act will keep our most advanced technologies out of the hands of our adversaries.”

Legislation

• On the upcoming introduction of his comprehensive AI regulatory bill, The Great American AI Act, Rep. Jay Obernolte (R-CA) said, “It’s not days [away from introduction]…it might be weeks. We just want to make sure that we’re all rowing in the same direction.” (Punchbowl)

• Obernolte also said, “You can’t implement preemption without telling people what you’re preempting with.” He added, “What we put out has to all hang together as a comprehensive framework that gives people some comfort that Congress is capable of acting on the issue of AI regulation.” (Punchbowl)

• Sen. Ed Markey (D-MA) posted “From housing to health care, AI is increasingly being used to make consequential decisions, diagnoses, recommendations, and predictions that can significantly alter our lives. That’s why repsummerlee and I are reintroducing our Eliminating Bias in Algorithmic Systems Act.”

• Rep. Madeleine Dean (D-PA) posted “As AI rapidly evolves, our laws must catch up — that includes preserving the dignity of artists and the authenticity of their work. Our TRAIN Act would grant creators access to AI training model records to determine if their copyrighted work was used without permission.”

• Rep. Hillary Scholten (D-MI) posted “West Michigan entrepreneurs showed up, and today Congress delivered. My AI-WISE Act and AI for Main street Act passed the House with bipartisan support, giving small businesses access to the tools they need to grow and succeed.”

• Rep. Jim Baird (R-IN) posted “Our country faces rapidly evolving national security threats, and Congress must be poised to properly address them and close the security gaps. The bills we passed today in HouseForeignGOP are critical to addressing security challenges with AI and combatting criminal cartels.”

Miscellaneous

• Rep. Mariannette Miller-Meeks (R-IA) said, “There needs to be federal preemption, but not because states can’t do it. China has no protections because it’s authoritarian.” (Washington Reporter)

• Rep. Darrell Issa (R-CA) said, “Every day, many of the largest organizations in communications self-regulate, and AI has to be the same way. We need to bring together the emerging AI leaders to set standards that they can strive toward and goals that they can achieve in the future.” He added, “It’s not easy to protect children, but AI more and more is able to discern if someone is a child. Those kinds of skillsets have to become part of best practices. For the government to take the role in facilitating through, perhaps, the Department of Commerce, the kind of standard-setting that we’ve seen in other areas, is a balancing act.” (Washington Reporter)

• Issa also said, “We don’t have safer electricity because the government mandated it; we have it because the government accepted the standards that were set by the market. We have to reward them by giving them liability limitation, but most importantly we have to recognize that the difference between us and the Europeans is that they can regulate better than we can, but we can out innovate them.” (Washington Reporter)

• Rep. John McGuire (R-VA) said, “AI is a big deal. I had breakfast with Jensen Huang, and chips are a big deal for him. AI is not a threat, it’s a tool, he told us. You’re buying intelligence, but you need guardrails. AI is here and it’s getting better and better. But human civilization adapts. Backpacks, horses, phones, cars, are all adaptations we’ve made. AI is like that too.” (Washington Reporter)

• Rep. Rudy Yakym (R-IN) said, “When it comes to AI, we are the world’s leader in AI innovation and investment. We need to maintain this. We’re in a race against China for leadership in this space. Someone is going to win, and it should be us. We’ve also got to ensure we protect our kids as they go online and make sure that there are some guardrails so you can’t have people committing crimes with AI.” (Washington Reporter)

• Rep. Pat Harrigan (R-NC) said, “If there is a hybridized version that provides reasonable individual liberty protections but also provides certainty to those who are innovating with massive investments but also impact the future of our market economy, that would be interesting. We have to step back and think from a national security standpoint and see that our adversaries are not going to constrain AI. We should offer a limited period of time where we constrain it within limitations; that will help our national security. This is one of the key areas we lead in. I would be okay with that.” (Washington Reporter)

• Rep. Kevin Hern (R-OK), “When you look at AI, it’s more complicated than it seems. This isn’t something that we’re experimenting with; this is really a national security thing. China is doing AI, and we need to do the same thing. When you look at this issue in classified settings, and you see how AI is being used in propaganda, in misinformation, it’s clear that if we don’t stay the leader, we’ll have a real threat to our national security.” (Washington Reporter)

• Hern also said, “You can’t have AI if you don’t have energy to run the data centers. Small modular reactors are huge for AI and for our military bases. We have states that have problems with maintaining consistent power without black outs and brown outs. We need permitting, and we can use them for independent off the grid power for data centers. We’ve taken 300 coal powered plants off the map in the past ten years while China adds them. All of this is permitting in general. You can have power for municipalities for localities and states but if you can’t get them to the entities, that’s a problem. We have to have power for data centers.” (Washington Reporter)

• Rep. Beth Van Duyne (R-TX) said she “would hate for states to regulate our technology out of being competitive. We have to beat China. When you think about AI and the effects it can have in politics, in education, in health care, it is an emerging technology that we want to be able to grow.” (Washington Reporter)

• Rep. Mark Alford (R-MO) said, “Think about what happened in the explosion of the internet years and those of social media. We can use some of those lessons that we learned, about some of the pitfalls of social media and the effect it’s had on our young people. Everything good can be turned bad, and AI is the same way. Are we going to put guardrails to protect young minds without hampering business and without giving advantages to foreign nations like China that want to use AI for evil? Whatever guardrails we can put up, I am for.” (Washington Reporter)

• As chair of the New Democrat Coalition Innovation and Technology Working Group, Rep. Sam Liccardo (D-CA) said, “The younger members of Congress are probably better able to spell AI. It’s helpful to start there and see if we can start to build some common understanding about what’s required. There is a greater sense of collaboration among those who haven’t endured January 6th and haven’t been severely damaged by the place.” He added, “We hosted several folks in [Democratic] leadership out in the Valley. I think those have gone well. There is certainly a growing sense that hitching your wagon to this administration is not going to be the long-term path for success.” (Punchbowl)

• Rep. Robin Kelly (D-IL) posted “The CEO of one of the biggest health insurance companies couldn’t answer my question on AI-driven denials. Health insurance companies should not compound on our healthcare crisis by weaponizing AI to deny Americans essential care.”

• Sen. Ed Markey (D-MA) posted “Consumers deserve to know whether the chatbots they use are truly helping them — or quietly feeding them blurred advertising. I’m calling on AI companies to be transparent about their advertising plans and explain how they will build in safeguards. Privacy and safety cannot be an afterthought.”

• Rep. Zach Nunn (R-IA) posted “Fraudsters are getting smarter, using AI and new tech to steal billions from hardworking Americans every year. Last week, we passed bipartisan solutions to crack down on scams, secure Americans’ digital finances, and hold criminals accountable.”

• Rep. Maggie Goodlander (D-NH) posted “Last night was a good night for New Hampshire small businesses. This is what commonsense governing looks like: lowering costs, cutting senseless red tape, and equipping hardworking Americans with the tools they need and deserve to meet the challenges and opportunities of the AI revolution.”

• Sen. Marsha Blackburn (R-TN) posted “AI toys are designed to be addictive, and it is terrifying to see the harm these toys can cause to our children. This is yet another example of why we must require AI-powered products and social media platforms to be safe by design for kids.”

• Financial Services GOP posted “NOW: The Committee is having an Artificial Intelligence Expo providing a forum for members to learn about and discuss the transformative potential AI holds for the financial services and housing sectors.”

• Financial Services GOP also posted “Today, the Committee is holding an Artificial Intelligence Expo, welcoming AI industry professionals to engage with Members and discuss the Committee’s goals for promoting consumer benefits through AI-driven financial technology.”

What I’m Reading This Week

• America’s Coming War over AI Regulation, Michelle Kim, MIT Technology Review.

• Don’t Believe the Hype: Government Regulation of AI Continues to Advance, Charlotte Keeley, Paul Kerlin, and Donald Vieira, JD Supra.

• Quantum Computing Is Already Hitting Bitcoin—Here’s How, Lockridge Okoth, beincrypto.com.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

The Commerce Department’s Bureau of Industry and Security issued a new rule to permit case‑by‑case exports of certain high‑performance semiconductors to China and Macau under specified national security conditions. At the same time, Commerce announced a semiconductor‑focused trade agreement with Taiwan that aims to “decisively strengthen” U.S. domestic chip manufacturing through Taiwanese investment and preferential tariff treatment tied to expanding U.S. production capacity. In parallel, President Trump issued a Section 232 proclamation finding that current levels of semiconductor and semiconductor‑equipment imports threaten to impair U.S. national security and imposing a 25 percent tariff on certain advanced computing chips while directing broader negotiations to reduce reliance on foreign semiconductor supply chains.

In Congress, Democratic lawmakers continued to focus on the use of AI for nonconsensual sexual images, particularly generated by X Corp’s Grok. The BIS rule received bipartisan backlash.

Read more below

Congress

Hearings

Last week

• On January 13, the House Ways and Means Trade Subcommittee held a hearing on Maintaining American Innovation and Technology Leadership.

• On January 13, the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee held a hearing on Delivering for American Consumers: A Review of FinTech Innovations and Regulations.

• On January 14, the House Committee on Education and Workforce held the first hearing in a series examining artificial intelligence on Building an AI-Ready America.

• On January 14, the House Foreign Affairs Committee held a hearing on Winning the AI Arms Race Against the Chinese Communist Party.

• On January 14, the House Science, Space and Technology Research and Technology Subcommittee held a hearing on Assessing America’s AI Action Plan.

This week

• On January 21, the House Small Business Rural Development, Energy, and Supply Chains Subcommittee holds a hearing on Empowering Rural America Through Investment in Innovation.

• On January 21, the House Foreign Affairs Committee holds a markup of bills including the Artificial Intelligence Oversight of Verified Exports and Restrictions on Weaponizable Advanced Technology to Covered High-Risk Actors (AI OVERWATCH) Act and the China AI Power Report Act.

• On January 21, the House Homeland Security Committee holds a hearing on Oversight of the Department of Homeland Security: CISA (Cybersecurity and Infrastructure Security Agency), TSA (Transportation Security Administration), S&T (Science and Technology Directorate).

• On January 22, the House Science, Space and Technology Committee will hold a hearing on Assessing U.S. Leadership in Quantum Science and Technology.

Legislation

• Reps. Michael Baumgartner (R-WA), Abraham Hamadeh (R-AZ), Maria Elvira Salazar (R-FL), and Mike Ezell (R-MS) introduced a bill to require the Secretary of State to conduct assessments of the risks posed to the United States by foreign adversaries who utilize generative artificial intelligence for malicious activities. (Text)

• Resident Commissioner Pablo Jose Hernández (D-PR) and Rep. Ted Lieu (D-CA) introduced the AI in Health Care Efficiency and Study Act to require the Secretary of Health and Human Services to conduct a study on strategies for the application of artificial intelligence technologies that can be used in the health care industry to improve administrative and clerical work and preserve the privacy and security of patient data. (Text)

• Sen. Ed Markey (D-MA) and Rep. Summer Lee (D-PA) reintroduced the Eliminating Bias in Algorithmic Systems (BIAS) Act to require federal agencies to establish or strengthen civil rights offices with staff trained in algorithmic accountability and civil rights enforcement, and to regularly report to Congress on how AI systems are impacting vulnerable communities. (Text)

• Reps. Mike Levin (D-CA) and Kathy Castor (D-FL) introduced the Stopping Hikes In Electricity from Large Load Demands (SHIELD) Act to update federal utility policy to ensure that massive electricity users bear the costs of the grid infrastructure they require, while incentivizing large energy consumption facilities to power their operations with zero-emission electricity. (Press release)

• Sens. Chris Van Hollen (D-MD), Dick Durbin (D-IL), Richard Blumenthal (D-CT), Cory Booker (D-NJ), Tammy Duckworth (D-IL), Tina Smith (D-MN), Peter Welch (D-VT), and Angela Alsobrooks (D-MD) introduced the Power for the People Act to ensure data centers pay for their energy costs and create a system to manage data center interconnection to the grid, mitigate pollution, and create jobs. (Text)

• Rep. Abe Hamadeh (R-AZ) introduced the Improving Emerging Tech Opportunities for Veterans Act to add emerging technologies such as artificial intelligence and semi-conductor manufacturing to be eligible for VET-TEC. (Press release)

• Reps. Emanuel Cleaver (D-MO) and LaMonica McIver (D-NJ) reintroduced the Workforce of the Future Act to require a detailed study on the impact of artificial intelligence on the economy and workforce and and provide workers, teachers, and students with the resources to develop integral skills required to participate in the workforce of the future. The Senate bill was introduced by Sens. Lisa Blunt Rochester (D-DE), Mazie Hirono (D-HI), and Adam Schiff (D-CA). (Text)

Correspondence

• Sens. Todd Young (R-IN), Tom Cotton (R-AR), Mike Lee (R-UT), John Barrasso (R-WY), John Cornyn (R-TX), Jim Risch (R-ID), James Lankford (R-OK), and Jerry Moran (R-KS) sent a letter to Department of Energy Secretary Chris Wright urging action against Chinese foreign nationals accessing our DOE national laboratories and compromising American innovation in artificial intelligence. (Letter)

• Reps. Gabe Amo (D-RI) and Gregory Meeks (D-NY) sent a letter to Secretary of Commerce Howard Lutnick to express opposition to President Donald Trump’s decision to loosen export controls and approve the sale of advanced AI chips to China. (Letter)

Trump Administration

Commerce Department

• The Bureau of Industry and Security (BIS) at the Department of Commerce issued a rule revising its licensing policy for semiconductor exports to China, changing from a presumption of denial to a case-by-case review of export license applications for the Nvidia H200, AMD MI325X, and similar chips, provided certain security requirements are met. (Federal Register) (Press release)

• Commerce announced the American Institute in Taiwan and the Taipei Economic and Cultural Representative Office in the United States signed a trade deal in which Taiwanese semiconductor and technology enterprises will make new, direct investments to build and expand advanced semiconductor, energy, and artificial intelligence production and innovation capacity in the United States and Taiwan will facilitate U.S. investment in the Taiwanese semiconductor, AI, defense technology, telecommunications, and biotechnology industries. (Fact sheet)

White House

• President Donald J. Trump signed a Proclamation invoking Section 232 of the Trade Expansion Act of 1962 directing the Secretary of Commerce and U.S. Trade Representative to jointly negotiate agreements, or continue any current negotiations of agreements, to address the threatened impairment of the national security with respect to imports of semiconductors, semiconductor manufacturing equipment, and their derivative products from any country. The President also imposed a 25% tariff on certain advanced computing chips, such as the NVIDIA H200 and AMD MI325X; the tariff will not apply to chips that are imported to support the buildout of the U.S. technology supply chain and the strengthening of domestic manufacturing capacity for derivatives of semiconductors. (Proclamation)(Fact sheet)

• On January 16, First Lady Melania Trump delivered opening remarks at Zoom Ahead: AI for Tomorrow’s Leaders, a national program for K-12 students on artificial intelligence.

National Institute of Standards and Technology (NIST)

• On February 11-12, NIST holds a virtual meeting of the Visiting Committee on Advanced Technology to discuss updates on major programs at NIST, strategic priorities, safety, cybersecurity, and work on its initial observations, findings, and recommendations for the 2025 VCAT Annual Report.

Noteworthy Quotes and Events

ADMINISTRATION

White House

• President Donald Trump posted “Under Sleepy Joe Biden and the Radical Left Democrats, the average American Household’s monthly Utility bills went up MASSIVELY – over 30%! I never want Americans to pay higher Electricity bills because of Data Centers. Therefore, my Administration is working with major American Technology Companies to secure their commitment to the American People, and we will have much to announce in the coming weeks., First up is Microsoft, who my team has been working with, and which will make major changes beginning this week to ensure that Americans don’t ‘pick up the tab’ for their POWER consumption, in the form of paying higher Utility bills. We are the “HOTTEST” Country in the World, and Number One in AI. Data Centers are key to that boom, and keeping Americans FREE and SECURE but, the big Technology Companies who build them must ‘pay their own way.’ Thank you, and congratulations to Microsoft. More to come soon! President DJT”

• White House AI & Crypto Czar David Sacks posted “Narrative violation: according to Blackrock, the U.S. does not have enough workers to meet surging demand for the construction boom. AI is creating too many jobs!”

• Sacks also posted “Narrative violation: A new paper from Stanford this week finds that ‘AI substantially reduces wage inequality while raising average wages by 21 percent.’”

• Sacks also posted “Narrative violation: The largest AI data center uses roughly the same amount of water as two burger joints. There are over 200,000 fast food restaurants in the U.S. so this is a tiny amount.”

Commerce Department

• Commerce Secretary Howard Lutnick said, “There’s two commitments from Taiwan: there’s $250B that comes directly from companies, and then, there’s $250B supplied by the government... we’re going to bring it all over so we become self-sufficient in the capacity of building semiconductors.”

• U.S. Commerce Dept. posted “Initially, Micron committed $75B to build semiconductors in America. Under President Trump’s leadership, that investment has grown to $200B. Companies are seeing the value of investing in American innovation, American power, and the American economy. President Trump’s America First Agenda is delivering—bringing jobs, manufacturing, and research back to America.”

• U.S. Commerce Dept. also posted “Secretary Lutnick on the historic semiconductor agreement: ‘Yesterday, we announced the Taiwan deal, which allows Taiwan to invest $500 billion in America to bring semiconductor manufacturing here. One of the key drivers of this investment is that Micron currently produces its memory—the best memory in the world—in Southeast Asia, and we want it made here. That’s where the tariff model comes in: it starts with chips and uses tariffs to drive manufacturing back to the United States.’”

• U.S. Commerce Dept. also posted “Secretary Lutnick is confident America will lead in semiconductor manufacturing after the historic Taiwan deal: ‘We’re going to have hundreds of companies coming here. We’re going to build giant semiconductor industrial parks in America, and we are going to bring semiconductors home.’”

Federal Reserve

• In remarks on the Outlook for the Economy and Monetary Policy, Vice Chair for Supervision Michelle Bowman said, “Economic activity seems to have been supported by a surge in equity prices and investment activity related to artificial intelligence (AI). Although stock market valuations may appear stretched, expected earnings growth for AI-related companies has been high, and, so far, a substantial part of the investment has been self-financed. I am concerned that disappointing news on AI investment returns could lead to a sharp correction in equity prices, but the economy continues to show elevated productivity growth likely due, in part, to increased adoption of AI technologies.” (Remarks)

CONGRESS

BIS Rule

• Sen. Elizabeth Warren (D-MA) issued a statement in response to the Bureau of Industry and Security (BIS) rule on advanced AI chips, saying, “This is a good step by the Bureau of Industry and Security (BIS) to require companies like NVIDIA to prioritize U.S. customers. This policy was core to the Guaranteeing Access and Innovation for National Artificial Intelligence (GAIN AI) Act, which Senator Banks and I introduced last year but unfortunately was stripped from last year’s National Defense Authorization Act because of David Sacks. This Committee will be watching implementation of this regulation closely. If BIS implements its regulation in good faith, it will not approve a single license for NVIDIA to sell H200s to China. Demand for AI chips in the United States far outstrips supply, and we should not let companies like NVIDIA sell to Chinese tech giants as U.S. companies, startups, and universities wait in line. I will keep working with my colleagues to pass bipartisan legislation like the GAIN AI Act and the SAFE Chips Act.” (Press release)

• Warren posted “American companies like Nvidia should prioritize U.S. customers over Chinese tech giants - this policy was core to my GAIN AI Act with SenatorBanks. If the Trump Admin implements this rule in good faith, it will not approve a single H200 license to China. I will be watching.”

• Rep. Brian Mast (R-FL) posted “I believe America must win the AI Race against China. Jensen Huang, you think ‘China is going to win the AI Race.’ We’re not the same. I don’t believe in betting against America, but clearly you do.”

• Mast also posted “Jensen Huang, since you’re not on X, I’ll tag your company

  nvidia. You and your paid minions are fighting to sell millions of advanced AI chips to Chinese military companies like Alibaba and Tencent. I’m trying to stop that from happening. Jensen, if you ever feel like debating the actual facts, I’ll meet you anytime, anywhere. I’m sure any FoxNews show would love to air it tonight! And every so-called MAGA influencer being paid to push this garbage should be embarrassed. You all copied NVIDIA talking points so much that you all made the same spelling error! But worse, you’re siding with a woke DEI company with transgender bathrooms, and by the way, is the biggest financial supporter of Ilhan Omar. Pathetic. To all you influencers. Put it on the record if I got it wrong! Do you agree with me in advising we should not sell MILLIONS of advanced AI chips to China or Jensen, who wants to sell his very best to the commies?”

• House China Committee Chair John Moolenaar (R-MI) said that China is “in this to win it at all cost. They will continue to access our technology and, at the same time, be working to build upon that to learn what they can until they can force us out of business. The world is either going to be more in the direction of China and its values, or continue on the road of America and freedom-loving countries’ values.” (Punchbowl)

Taiwan Trade Deal

• Sen. Pete Ricketts (R-NE) posted “Historic step forward. This Taiwan trade deal brings chip manufacturing home, secures our supply chains, and helps ensure America wins the AI race! Now, Congress needs to finish the job by ending double taxation and unlocking critical investment.”

• House Foreign Affairs Committee Majority posted “Strong economic ties between the United States and Taiwan are key to winning the AI Arms Race. President Trump is strengthening those ties and driving unprecedented investment in the United States. That’s the definition of America First.”

• Senate Republicans posted “Advanced chips are vital for our military strength and our technology industry. This trade deal will strengthen the American chip industry, and help America beat China in the AI race.”

Grok and Nonconsensual Sexual Images

• Sen. Dick Durbin (D-IL) posted “BIG NEWS: This is the moment the Senate passed my bill to combat nonconsensual, sexually-explicit deepfakes. Grok is out of control. AI can’t be unregulated. I teamed up with RepAOC to stand up for victims who’ve had their autonomy taken from them by AI. Let’s get it done.”

• Rep. Suzanne Bonamici (D-OR) posted “AI leadership requires more than deploying technology; it means preparing people to use criticalthinking skills to recognize benefits and avoid risks. I’m developing a comprehensive, human-centered framework so AI can enhance opportunities, not widen gaps.”

• Science Committee Democrats posted “Trump’s hand-picked climate deniers are using Grok to inform the National Climate Assessment—the same AI program that has been churning out thousands of nonconsensual sexualized photos of women and children. Our research standards must be higher.”

• Science Committee Democrats also posted, “’President Trump is sending American taxpayer dollars to xAI through a deal made in September,’ said RepZoeLofgren. ‘Essentially, we’re paying Elon Musk to give perverts access to a child pornography machine.’”

• Sen. Chris Coons (D-DE) posted “Elon Musk was the largest donor to Trump’s campaign. Now, Trump’s Pentagon is embracing Musk’s chatbot that generates sexual deepfakes of people, including children. If this administration won’t do anything to protect kids, Congress must step up.”

• Sen. Amy Klobuchar (D-MN) posted “Voters from across the political spectrum know we need rules of the road for AI to protect consumers and families and keep kids safe online.”

• Rep. Emanuel Cleaver (D-MO) posted “It is extraordinarily disturbing that Elon Musk and X are allowing users to post non-consensual sexualized AI images on their platform. It is beyond disgraceful—it’s dangerous. If they will not take action to stop it, then Congress must.”

• Rep. Frank Pallone (D-NJ) posted “Grok is churning out sexualized images of women and children while Trump and Republicans are trying to block states from regulating AI. Elon Musk is ‘addressing’ this by charging users to create these exploitative images, which doesn’t stop the exploitation at all. What we need is comprehensive guardrails and privacy protections to ensure these platforms aren’t able to freely produce these images.”

Legislation

• Rep. Suzanne Bonamici (D-OR) issued a statement on her upcoming legislation to create a comprehensive framework to improve AI education and workforce readiness, including saying, “My framework reflects a simple principle: AI policy should prepare people, not just deploy technology. By focusing on coordination, readiness, protections, and evidence, it lays the groundwork for responsible innovation that strengthens education, supports workers, and sustains American leadership in an AI-enabled economy…. My framework establishes a coordinated federal approach to align AI policy with education and workforce readiness. It looks beyond the tech industry alone to support economic sectors affected and disrupted by AI. It affirms the boundaries that restrict federally-directed curriculum and directs agencies to coordinate to support students, educators, and workers, rather than leaving institutions to navigate conflicting signals or fend for themselves. Coordination strengthens innovation by creating clarity, consistency, and accountability in digital learning and workforce policy.” (Press release)

• Sen. Tom Cotton (R-AR) posted “As President Trump said, American AI dominance can’t mean higher energy prices. My DATA Act will keep prices low for Arkansans while still encouraging investment in cutting-edge technology.”

• Cotton also posted “My DATA Act will balance keeping electricity prices affordable for Arkansans and making sure that we maintain our lead in the AI race.”

• Rep. Mike Levin (D-CA) posted “Families shouldn’t have to pay higher electricity bills because massive data centers aren’t paying their fair share. That’s why I introduced legislation with USRepKCastor to protect families and small businesses from rising energy costs driven by the explosive growth of data centers and to make sure everyday Americans aren’t subsidizing data centers’ electricity.”

• Rep. Kathy Castor (D-FL) posted “Household electric bills are WAY up often driven by the energy needed for AI and data centers. That’s why RepMikeLevin and I are fighting for hardworking American families to protect them from higher electric bills.”

• Rep. Summer Lee (D-PA) posted “I represent Pittsburgh and Western Pennsylvania, a region that reflects both our industrial past and the technologies shaping our future. As a growing hub for innovation in Artificial Intelligence, we have a responsibility to make sure AI does not deepen the inequities Black, brown, low-income, and other vulnerable communities already face. The Eliminating BIAS Act puts real guardrails and infrastructure in place to ensure transparency, accountability, and civil rights protections, especially in an age of rampant disinformation and misinformation. I’m proud to partner with SenMarkey

  to ensure innovation never comes at the cost of our civil rights or human dignity.”

• Rep. Mike Kennedy (R-UT) posted “We cannot risk ceding the future of AI to China. In housescience I discussed how my GENESIS Act advances the WhiteHouse’s AI Action Plan and how the federal government should empower state-level experimentation. Utah’s regulatory sandbox has already proven this model works, and I’m committed to building on that success so we win the AI race.”

• Rep. Mike Lawler (R-NY) posted “Our export control laws are in place for a reason: to protect sensitive technology from falling into the hands of bad actors. My Remote Access Security Act closes a loophole in U.S. export control law that has allowed CCP-aligned companies to access restricted American technology through cloud services. Proud to see this measure pass the House floor tonight!”

• About Lawler’s bill, House Foreign Affairs Committee posted “Proud to see the overwhelming support for this bill. We cannot allow China to exploit export control loopholes to gain the upper hand in AI. This is how we maintain American dominance and win the AI Arms Race.”

• Sen. Todd Young (R-IN) posted “AI is for small businesses too. I want to help our Hoosier small businesses to have access to guidance and training on any AI tools they need to compete in today’s evolving digital economy.”

• Rep. Rob Menendez (D-NJ) posted “Your electric bills are rising... and AI data centers are a major reason why. While AI innovation is promising, we must ensure it’s not happening at the expense of our communities. That’s why we’re taking action to fix the system, so these data centers - not our families - are accountable for their costs.”

Miscellaneous

• Rep. Ted Lieu (D-CA) posted “The White House policy on AI: -Suppress federal bills on AI -Suppress states from regulating AI -Sell advanced AI chips to China This has led the tech industry down the wrong path with increasing backlash. They should ask their large language models for a better approach.”

• Sen. Marsha Blackburn (R-TN) posted “Thrilled to work with realDonaldTrump to establish one rulebook for AI that protects children, creators, conservatives, and communities. This is the solution America needs to safeguard Americans while unleashing AI innovation”

• Sen. Todd Young (R-IN) posted “Chinese nationals currently have access to America’s national laboratories. We must protect U.S. innovation in AI. I joined with SenTomCotton, SenMikeLee, and GOP colleagues in urging ENERGY to protect American innovation and ban Chinese nationals from U.S. labs.”

• Sen. John Cornyn (R-TX) posted “The Genesis Mission was started to ensure the U.S. dominates the AI race, but we know that adversaries like China are actively working to steal these cutting-edge technologies. I joined SenTomCotton & SenMikeLee in a letter to SecretaryWright ENERGY urging him to bar Chinese foreign nationals from working at national laboratories where they can compromise the Genesis Mission.”

• Cornyn also posted “AI is transforming the pharma industry for the better”

• Rep. Suzan DelBene (D-WA) posted “Private companies’ AI shouldn’t decide whether seniors get care. I’m pushing to stop new Medicare red tape that will delay treatment. Medicare providers should be able to deliver care when it’s needed.”

• House Science Committee posted “’But with his Golden Age vision of scientific rigor and technological progress, President Trump has restored a spirit of confidence to our innovation enterprise. We are approaching AI not with fear, but with responsible boldness.’ - WHOSTP47 Director mkratsios47“

• House Science Committee also posted “’As my office coordinates the administration’s implementation of the AI Action Plan, I see many opportunities for collaboration with this committee and the Congress.’ - WHOSTP47 Director mkratsios47”

• House Science Committee also posted “’I am particularly excited about the innovative potential of the Genesis Mission and AI for science. With the signing of that executive order, President Trump has mobilized the largest federal scientific effort since the Apollo Program.’ - @WHOSTP47 Director @mkratsios47”

• Rep. Rich McCormick (R-GA) posted “McCormick Minute: AI Week on the Hill. AI is the defining technology of this century, and the U.S. must stay at the forefront of the race. I’ve had the pleasure of working with global leaders and CEOs on AI policy. We are just getting started on legislating this technology to improve the lives of Americans.”

• Rep. Russell Fry (R-SC) posted “AI growth shouldn’t mean higher power bills for families. POTUS is leading the way, and it’s good to see Microsoft stepping up to protect American consumers while keeping the U.S. #1 in innovation.”

• Rep. Greg Casar (D-TX) posted “It should be illegal for companies to use AI to jack up your prices based on your personal data. Congress should pass my bill to ban surveillance pricing — before it becomes an even bigger problem.”

• Sen. Richard Blumenthal (D-CT) posted “Big Tech is making your electrical bills skyrocket. I’ve been demanding the White House’s plan to deal with energy prices & data centers for months—instead he’s palled around with Mark Zuckerberg & the AI elite. Talk from Trump is cheap. I’ll be introducing strong legislation to combat skyrocketing prices from data centers. If Trump is serious about this AI-driven drain on family’s pocketbooks, he will endorse my bill & make sure it becomes law.”

What I’m Reading This Week

• From Troll Memes to Policy Messaging: How Donald Trump Turned AI Deepfakes into a New Tool of Political Power, Money Control.

• Global Risks Report 2026, World Economic Forum.

• How 2026 Could Decide the Future of Artificial Intelligence, Chris McGuire, Kat Duffy, Vinh Nguyen, Michael C. Horowitz, Adam Segal, and Jessica Brandt, Council on Foreign Relations.

About Zero One Strategies

Zero One Strategies is a specialized government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

www.ZeroOneStrategies.com

The Center for AI Standards and Innovation (CAISI) at NIST has issued a request for information seeking stakeholder input on best practices and methodologies for ensuring the secure development and deployment of AI agent systems. Meanwhile, the SEC has signaled interest in exploring how AI agents could be leveraged for proxy voting and related governance functions.

Looking ahead, federal AI policy is expected to take shape in 2026 as the White House develops a legislative framework to advance the priorities outlined in the Trump Administration’s AI Action Plan, signaling a potential new phase of coordinated federal action on artificial intelligence policymaking.

Read more below

Congress

Hearings

This week

• On January 13, the House Ways and Means Trade Subcommittee holds a hearing on Maintaining American Innovation and Technology Leadership.

• On January 13, the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee holds a hearing on Delivering for American Consumers: A Review of FinTech Innovations and Regulations.

• On January 14, the House Committee on Education and Workforce holds the first hearing in a series examining artificial intelligence on Building an AI-Ready America.

• On January 14, the House Foreign Affairs Committee holds a hearing on Winning the AI Arms Race Against the Chinese Communist Party.

• On January 14, the House Science, Space and Technology Research and Technology Subcommittee holds a hearing on Assessing America’s AI Action Plan.

Upcoming

• On January 21, the House Small Business Rural Development, Energy, and Supply Chains Subcommittee holds a hearing on Empowering Rural America Through Investment in Innovation.

Legislation

• Senate Democratic Leader Chuck Schumer and Sens. Todd Young (R-IN), Maria Cantwell (D-WA), Steve Daines (R-MT), Dick Durbin (D-IL), Marsha Blackburn (R-TN), Ben Ray Luján (D-NM), Ted Budd (R-NC), Tammy Baldwin (D-WI), and Mike Rounds (R-SD) introduced the National Quantum Initiative Reauthorization Act to advance the National Quantum Initiative, supporting quantum research and development, workforce training, and supply chain resilience funded through federal science agencies. (Text)(Summary)

• Sens. Todd Young (R-IN) and Maria Cantwell (D-WA) introduced the AI for Mainstreet Act to amend the Small Business Act to require small business development centers to assist small business concerns with the use of artificial intelligence. (Text)

• Reps. Rob Menendez (D-NJ) and Greg Casar (D-TX) introduced the Preventing Rate Inflation in Consumer Energy (PRICE) Act to require data centers to generate their own renewable energy. (Text)

• Reps. Rob Menendez (D-NJ) and Greg Casar (D-TX) also introduced the Data Transparency Act to require the Environmental Protection Agency and the Energy Information Administration to collect and update data on the environmental impacts and energy consumption of data centers. (Text)

• Sens. John Boozman (R-AR) and Alex Padilla (D-CA) and Reps. Tracey Mann (R-KS) and Sharice Davids (D-KS) introduced the Roadway Safety Modernization Act to help state departments of transportation adopt the use of technologies such as artificial intelligence and telematics to identify faulty or inadequate infrastructure that negatively impacts driver behavior and leads to fatalities. (Text)

• Rep. Randy Fine (R-FL) introduced a bill to facilitate the export of United States artificial intelligence systems, computing hardware, and standards globally. (Text)

Correspondence

• Sens. Ben Ray Luján (D-NM), Ron Wyden (D-OR), and Ed Markey (D-MA) sent a letter to Apple and Google requesting they immediately remove the X and Grok apps from their app stores until X Corp’s Chief Executive Officer, Elon Musk, addresses the Grok AI tool being used to generate nonconsensual sexualized images of women and children at scale. (Letter)

Trump Administration

National Institute of Standards and Technology (NIST)

• The Center for AI Standards and Innovation (CAISI) within NIST is seeking information from stakeholders on practices and methodologies for measuring and improving the secure development and deployment of artificial intelligence agent systems. In the notice, they say, “AI agent systems are capable of taking autonomous actions that impact real-world systems or environments, and may be susceptible to hijacking, backdoor attacks, and other exploits. If left unchecked, these security risks may impact public safety, undermine consumer confidence, and curb adoption of the latest AI innovations. We encourage respondents to provide concrete examples, best practices, case studies, and actionable recommendations based on their experience developing and deploying AI agent systems and managing and anticipating their attendant risks.” The comment period ends March 9. (Notice)

• On January 21, NIST will hold a meeting of the Information Security and Privacy Advisory Board to discuss agentic artificial intelligence security, among other issues.

Securities and Exchange Commission (SEC)

• In remarks on (Re)Empowering Fiduciaries in Proxy Voting before the New York City Bar Association, the Director of the SEC Division of Investment Management Brian Daly suggested AI agents could be useful for proxy voting, saying, “… I want to insert a plug for artificial intelligence. As advisers grapple with the scale and complexity of proxy voting—especially across large portfolios—AI tools like large language models and agentic AI, offer a compelling opportunity. Imagine an AI agent that can review dozens or hundreds of proxy statements, assess them against your expressed values, and efficiently generate a large quantity of principled voting recommendations. And, pretty much, for free. This isn’t science fiction—it’s a near-term reality. Of course, with great power comes great responsibility. AI agents need to be trained and their output needs to be reviewed. Any adviser’s use of AI in proxy voting would also need to take into consideration principles of transparency, auditability, and consistency with fiduciary duties. But done right, AI can be a valuable tool that enhances—not replaces—human judgment, and that helps advisers better serve their clients.” (Remarks)

Noteworthy Quotes and Events

ADMINISTRATION

White House

• At CES in Las Vegas, White House Office of Science and Technology Policy (OSTP) Director Michael Kratsios said he and White House AI Czar David Sacks are working on a legislative framework for the priorities outlined in the Trump administration’s AI Action Plan, saying, “Our hope is that we can create a framework that is pro-innovation, but is also one that looks out for America’s youth and children and understands how we have to be responsible in the way that we deploy this technology around the country.” He added, “Sometimes you have to take rules down; other times you have to write new rules that can allow new technologies to thrive.” On data center energy demands, he said, “From an energy standpoint, the press has been very clear: if you want to build a data center, you should … be building your own power to support that. You shouldn’t be drawing from the larger grid and ultimately raising prices for Americans. That’s something that we’re pushing a lot of the folks in the big data center companies to work on, and something we’re gonna be doing for a very long time ahead.” (Meritalk)

CONGRESS

• Rep. Robert Menendez (D-NJ) posted “Your electric bills are rising... and AI data centers are a major reason why. While AI innovation is promising, we must ensure it’s not happening at the expense of our communities. That’s why we’re taking action to fix the system, so these data centers - not our families - are accountable for their costs.”

• Sen. Tom Cotton (R-AR) posted “Winning the AI race is crucial to our national security, however it can’t mean higher energy prices for Arkansans. My bill will lower energy costs and ensure America can continue to lead in these spaces by eliminating outdated regulations.”

• Cotton also posted “American AI dominance is crucial to our national security, however it can’t mean higher energy prices for Arkansans. My bill will lower energy costs while ensuring America continues to lead in these spaces.”

• Cotton also posted “American dominance in artificial intelligence and other crucial emerging industries should not come at the expense of Arkansans paying higher energy costs. My bill will ensure that America can continue to lead in these spaces by eliminating outdated regulations.”

• Rep. Josh Brecheen (R-OK) posted “We must be vigilant in curbing China’s influence over emerging AI technologies.”

• Brecheen also posted “Recently, RepOgles and I co-chaired a HomelandGOP hearing on the impacts of AI on cybersecurity. Congress must stand alert to the fact that Communist China is actively working to weaponize AI, and other emerging technologies, to harm America. We must work with the private sector stand up against the CCP and mitigate cyber threats to our homeland.”

• Sen. John Boozman (R-AR) posted “ICYMI: I introduced the Roadway Safety Modernization Act. We can use innovative technology like AI and telematics to move past the “crash first, fix later approach to improve faulty infrastructure and save lives. Momentum around this bipartisan bill continues to build”

• Rep. Mariannette Miller-Meeks (R-IA) posted “The question isn’t whether America needs nuclear energy, it’s how fast we can build it. China and Russia are racing ahead. If we want to lead the world, we cannot afford to fall behind in AI, and securing our energy future is critical.”

• Rep. Rashida Tlaib (D-MI) posted “I fully support the call for a national AI data center moratorium and look forward to working with SenSanders and others to protect our communities from unaffordable utility bills and increased pollution.”

• Rep. Joe Morelle (D-NY) posted “Explicit AI-generated deepfakes are dangerous, abusive, and all too common. If left unchecked, they’ll continue to have devastating impacts. I’ve authored legislation that would establish both criminal and civil penalties for those who produce deepfakes.”

• Rep. Sara Jacobs (D-CA) posted “Federal inaction and the lack of strong guardrails for AI systems are making women and children less safe online. Companies have proven they can’t or won’t do the right thing so Congress needs to set guardrails for AI to protect people’s rights and safety.”

• Rep. Alexandria Ocasio-Cortez (D-NY) posted “There is an explosion of AI generating explicit images of children. And it’s not just actresses. Across the country, more and more teenage girls are becoming victims of deepfake harassment. Congress must step in and pass my DEFIANCE Act to ensure victims can seek justice.”

• Rep. David Schweikert (R-AZ) posted “It blows my mind that we have tech to reduce hospital costs and improve care, but old regulations block it. Why can’t an FDA-approved AI help prescribe your meds or manage chronic care? If it cuts costs and saves lives, let’s make it legal.”

• Schweikert also posted “For years I’ve led legislation to allow AI to prescribe. In order to lower costs, expand access, and make Americans healthier we must realign incentives and legalize innovation”

• House Ways and Means Democrats posted “This is the effect of Republicans’ attack on health care: people turning to AI for care.”

• Rep. Don Beyer (D-VA) posted “In the absence of a strong federal response to AI, states are wisely taking the lead to create guardrails. Trump’s attempt to undo this progress is prioritizing the profits of powerful tech corporations over the safety of the American people. I’m leading the fight to stop it.”

• Rep. Seth Magaziner (D-RI) posted “China just launched the first ever AI-powered cyber attack against the U.S. And Donald Trump just announced a deal to sell China the most advanced chips that power AI. I asked four leading cybersecurity experts if they think this is a good idea. Spoiler alert: they don’t.”

• Sen. Peter Welch (D-VT) posted “I’m joining SenMarkey’s bill to block President Trump’s Executive Order, which denies states the ability to regulate artificial intelligence.”

What I’m Reading This Week

• Trump Sees A.I.’s Economic Promise, While Dismissing Potential Threats, The New York Times

• The Race for Global Domination in AI, Michael Schuman, The Atlantic

• White House AI Action Plan: Progress & Policy Changes Since July, Jane Edwards, ExecutiveGov

• 5 key AI Fights to Watch in 2026, Julia Shapero, The Hill

• Look Out For New State And Federal Legislation On AI, John Werner, Forbes

• Tech: Players to Watch in 2026, Punchbowl

  

  

  About Zero One Strategies

  Zero One Strategies is a boutique government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

  The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

  Contact us at Stacey@ZeroOneStrategies.com

  www.ZeroOneStrategies.com

President Trump issued an executive order to “protect American AI innovation from an inconsistent and costly compliance regime resulting from varying State laws.” The President also announced that the United States will allow NVIDIA to ship its advanced H200 semiconductors to approved customers in China. The Administration signed a declaration with Singapore, Australia, Japan, South Korea and Israel to counter China’s control of critical minerals and power in AI and other emerging technologies.

House Democratic Leader Hakeem Jeffries announced the launch of a new House Democratic Commission on AI and the Innovation Economy.

Read more below

Congress

Hearings

Last week

• On December 9, the Senate Judiciary Intellectual Property Subcommittee held a hearing on Balancing the Interests of Local Radio, Songwriters, and Performers in the Digital Age.

• On December 10, the House Financial Services Committee held a hearing on From Principles to Policy: Enabling 21st Century AI Innovation in Financial Services.

• On December 10, the House Science, Space and Technology Committee held a hearing on the Genesis Mission: Prioritizing American Science and Technology Leadership.

This week

• On December 17, the House Homeland Security holds a Cybersecurity and Infrastructure Protection Subcommittee and Oversight, Investigations and Accountability Subcommittee holds a hearing following a report about an AI-assisted, partially autonomous cyberattack against the U.S. company Anthropic by a state-sponsored cyber actor backed by China.

• On December 17, the House Energy and Commerce Oversight and Investigations Subcommittee holds a hearing on Examining Biosecurity at the Intersection of AI and Biology.

• On December 18, the House Science, Space and Technology Investigations and Oversight Subcommittee holds a hearing on Research Security: Examining the Implementation of the CHIPS (Creating Helpful Incentives to Produce Semiconductors) and Science Act and NSPM-33 (National Security Presidential Memorandum 33).

Legislation

• Reps. Greg Landsman (D-OH) and Don Beyer (D-VA) introduced the Protecting Families from AI Data Center Energy Costs Act requiring the Federal Energy Regulatory Commission (FERC) to hold a conference with major stakeholders on how to protect residents from increased costs. FERC also will be required to submit a report with recommendations and best practices to ensure energy costs associated with AI data centers are not passed onto communities. (Text)

• Reps. Sara Jacobs (D-CA), Jay Obernolte (R-CA), Pat Fallon (R-TX), Shontel Brown (D-OH), and Sens. Andy Kim (D-NJ) and Jon Husted (R-OH) introduced the AI Talent Act to modernize federal hiring for AI and other high-demand technical roles by creating specialized talent teams, enabling skills-based hiring, and providing shared tools that help agencies identify and onboard qualified candidates faster. (Press release)

• Sen. John Cornyn (R-TX) introduced the Growing University AI for Defense (GUARD) Act to codify a portion of President Trump’s AI Action Plan and enable the Department of War (DoW) to establish and lead a National Security and Defense AI Institute to advance defense innovation, workforce development, and AI readiness. (Press release)

• Reps. Bill Foster (D-IL) and Pete Sessions (R-TX) introduced the Responsible and Ethical AI Labeling (REAL) Act require federal agencies and officers to require labeling on any AI-generated images or videos published by an agency, or any AI-generated text that is not reviewed by a human prior to publication. (Press release)

• Reps. Emanuel Cleaver (D-MO), LaMonica McIver (D-NJ), John Larson (D-CT), Dan Goldman (D-NY), and Del. Eleanor Holmes Norton (D-DC) introduced a bill to promote a 21st century workforce, authorize grants to support emerging and advanced technology education, and support training and quality employment for workers in industries most impacted by artificial intelligence. (Text)

Correspondence

• Sens. Maggie Hassan (D-NH) and Josh Hawley (R-MO) sent letters to OpenAI, Anthropic, Meta, Google, Microsoft, xAI, and Perplexity AI requesting information about the steps the companies are taking to prevent scammers from using their services to steal from Americans. (Letter)

• House Committee on Agriculture Ranking Member Angie Craig sent a letter to Instacart requesting information about reporting that the company used customers’ sensitive personal data and artificial intelligence to inflate grocery bills and charge different prices for the same products based on their ability to pay. (Letter)

• Sens. Brian Schatz (D-HI), Katie Britt (R-AL), James Lankford (R-OK) and Chris Coons (D-DE) sent letters to OpenAI, Microsoft, Google, Anthropic, Meta, Luka, Character.AI, and xAI, requesting they improve transparency around the capabilities of their models and the risks they pose to users. (Letters)

Publications, Meetings, and Events

• Sen. Amy Klobuchar (D-MN) published an op-ed in the New York Times entitled, “State A.I. Laws Keep Us Safe. Trump’s Next Move Could Upend That.” In the op-ed, she says, “Once we actually have federal standards passed by Congress, it should be for Congress to decide whether to pre-empt state laws or allow them to go further. And as A.I. continues to evolve, there will always be new applications of the technology that spur states to act before the federal government does. That is something we should encourage — it is how our laboratories of democracy were intended to function. But we can’t supersede state protections until we have strong, enforceable federal standards in place. So A.I. companies should join us in putting meaningful safeguards spearheaded by Congress in place at the federal level — and stop pretending that in the meantime, state standards are too much of a burden to bear. After all, how can you expect us to believe you’re on the precipice of creating groundbreaking superintelligence if you can’t manage to comply with a handful of state laws?” (Op-ed)

• House Democratic Leader Hakeem Jeffries announced the launch of a new House Democratic Commission on AI and the Innovation Economy that will convene throughout 2026. The commission will develop policy expertise in partnership with the innovation community, relevant stakeholders and committees of jurisdiction. Reps. Ted Lieu (D-CA), Josh Gottheimer (D-NJ) and Valerie Foushee (D-NC) will serve as Co-Chairs. (Press release)

• Rep. Valerie Foushee (D-NC), Co-Chair of the House Democrat Commission on AI and Chair of the New Democrat Coalition’s Task Force on Artificial Intelligence, released a report and launched an investigation emphasizing the need for transparency and greater clarity regarding the impact of artificial intelligence on American jobs. Foushee sent letters requesting information on job cuts to Amazon, Salesforce, Meta, Verizon, Microsoft, IBM, Google, Accenture, HP, Intel, Target, UPS, Synopsys, Lenovo. (Press release)(Report)(Letter)

Trump Administration

White House

• President Donald Trump issued an executive order to “protect American AI innovation from an inconsistent and costly compliance regime resulting from varying State laws.” (Executive Order)(Fact sheet)

• President Trump announced that he authorized Nvidia to sell its H200 AI chip in China in exchange for taking 25 percent of the revenue.

• Assistant to the President and OSTP Director Michael Kratsios chaired the third White House Artificial Intelligence Education Task Force meeting with cabinet officials, educators, and parents to discuss AI’s impact in the classroom. The Task Force meeting aimed to connect Administration officials with parents and educators to discuss the opportunities and challenges presented by AI in K-12 education. (Press release)

State Department

• The Trump Administration announced the formation of a coalition to counter China’s control of critical minerals and power in AI and other emerging technologies. Singapore, Australia, Japan, South Korea and Israel joined the US in signing the Pax Silica Declaration. (Pax Silica)

Treasury Department

• In his introduction letter to the Financial Stability Oversight Council annual report, Secretary Scott Bessent said that FSOC would shift its focus to removing red tape in areas like artificial intelligence. The letter details the creation of a “new artificial intelligence (AI) working group will explore opportunities for AI to promote the resilience of the financial system while also monitoring for potential risks to financial stability that might be posed by the adoption of AI. The working group will identify potential high-value AI use cases that Council member agencies can adapt to streamline their own approaches to AI integration, with the aim of improving the efficiency and efficacy of the agencies’ regulation and supervision. The working group will also provide a forum for public-private dialogue to identify regulatory impediments to the responsible adoption of AI technology by entities in the financial services sector.” (Report)

National Institute of Standards and Technology (NIST)

• On January 21-22, the NIST Information Security and Privacy Advisory Board will meet to discuss NIST’s Secure Software Development Framework and agentic artificial intelligence security.

Noteworthy Quotes and Events

ADMINISTRATION

• President Trump posted, “I have informed President Xi, of China, that the United States will allow NVIDIA to ship its H200 products to approved customers in China, and other Countries, under conditions that allow for continued strong National Security. President Xi responded positively! 25% will be paid to the United States of America. This policy will support American Jo bs, strengthen U.S. manufacturing, and benefit American Taxpayers. The Biden Administration forced our Great Companies to spend BILLIONS OF DOLLARS building degraded’ products that nobody wanted, a terrible idea that slowed Innovation, and hurt the American Worker. Tat Era is OVER! We will protect National Security, create American Jobs, and keep America’s lead in AI. NVIDIA’s U.S. Customers are already moving forward with their incredible, highly advanced Blackwell chips, and soon, Rubin, neither of which are part of this deal. My Administration will always put America FIRST. The Department of Commerce is finalizing the details, and the same approach will apply to AMD, Intel, and other GREAT American companies. MAKE AMERICAN GREAT AGAIN!”

CONGRESS

AI Executive Order

• Senate Committee on Commerce, Science and Transportation Ranking Member Maria Cantwell (D-WA) issued a statement saying, “This executive order’s overly broad preemption threatens states with lawsuits and funding cuts for protecting their residents from AI-powered frauds, scams, and deepfakes—leaving American consumers without any protection. Let’s get it right and pass a bipartisan national AI framework that both leads on innovation and protects consumers.” (Press release)

• Rep. Don Beyer (D-VA), co-chair of the bipartisan Congressional Artificial Intelligence Caucus, issued a statement saying, “President Trump’s AI order is an attempt to kill responsible safety reforms passed by states, which would create a lawless Wild West environment for AI companies that puts Americans at risk. This is a terrible idea. Congress has been slow to respond to the AI revolution and in the absence of a strong federal response, states are wisely taking the lead to create guardrails and protect the public. Trump’s attempt to undo this progress without providing any federal regulatory protections would be extremely harmful. A moratorium on state legislation will reduce the likelihood of Congressional action as well, which is the unstated goal of this Executive Order. Moreover, his attempt to block state laws through federal coercion likely violates the 10th Amendment, and as such constitutes an unconstitutional abuse of power. The first attempt to pass this harmful AI moratorium policy in the One Big Beautiful Bill failed because of robust bipartisan opposition. Trump is using this executive order to bypass this opposition in both chambers of Congress. Hostility on Capitol Hill to this damaging and irresponsible policy remains strong, and I am actively exploring legislative options with members in both chambers and both parties in response to this order.” (Press release)

• Beyer also posted “A moratorium on state AI laws already failed twice with opposition in both chambers of Congress. Now, Trump is bypassing Congress to create a lawless Wild West for AI companies. It’s a bad idea - and I’m actively exploring legislative options in response to this order.”

• New Democrat Coalition Artificial Intelligence Task Force Chair Valerie Foushee (D-NC) issued a statement saying, “This flawed, harmful, and unconstitutional order silences communities, tramples over states’ rights, and represents an overreach of executive authority without any benefit to everyday Americans. New Dems agree that every American deserves an AI future that protects their rights, privacy, and jobs — yet Trump and Republicans have stalled on enacting real AI protections and now want to bulldoze state-level safeguards without any serious national strategy. This order only creates more confusion and risk for the American people, while threatening to hold billions in critical broadband development funds for rural and underserved communities hostage unless states comply with these unconstitutional demands. We welcome the Administration and Congressional Republicans to engage in bipartisan efforts to create a federal regulatory framework that harnesses the potential of AI and protects the rights and privacy of all Americans.” (Press release)

• Sen. Alex Padilla (D-CA) issued a statement saying, “No place in America knows the promise of artificial intelligence technologies better than California. It’s why we are world leaders in A.I. innovation and industry and why we have been able to work collaboratively to adopt some of the strongest consumer protections in the country. But with today’s executive order, the Trump Administration is attacking state leadership and basic safeguards in one fell swoop. To truly unleash innovation in artificial intelligence, the Trump Administration should instead be bolstering federal agencies, investing in research universities, and growing our talent pipeline — both American and foreign born. The Trump Administration may refuse to protect consumers or invest in innovation, but make no mistake: California will continue to lead the A.I. revolution.” (Press release)

• Sen. Edward Markey (D-MA) said, “I will continue to lead a bipartisan coalition to fight any attempt to strip states of their right to protect their citizens. We defeated the AI moratorium last summer, 99-1. This week, we defeated Big Tech’s lobbying to attach the moratorium to the defense bill. We’ll defeat Trump’s Executive Order, too.” (Press release)

• House Majority Leader Steve Scalise (R-LA) posted “Thank you, President Trump. We are in a race against China to lead the world in AI. To win, innovators need certainty and predictability, not a patchwork of state laws. One set of rules will support innovation while also protecting the American people.”

• Sen. Patty Murray (D-WA) posted “Trump did an end run around Congress to try to BAN states from regulating AI by threatening lawsuits or lost funding. No matter how much tech billionaires donate to Trump, he does not have the authority to make laws—Congress does. I’ll fight back against this corrupt move.”

• Rep. Frank Pallone (D-NJ) posted “We should be working together to foster innovation and protect Americans’ privacy and safety—not punishing states for trying to protect people from the harms of AI. Someone should probably tell POTUS that executive orders aren’t magic wands that suddenly erase laws on the books. His AI executive order is both unlawful and counterproductive.”

• Rep. Doris Matsui (D-CA) issued a statement saying, “After Congress repeatedly rejected this idea on a bipartisan basis, Donald Trump has now chosen to try and force it through unilaterally. Trump’s order threatens states enacting responsible safeguards with costly, wasteful federal lawsuits and attempts to hold hostage the broadband funding Congress specifically authorized for our communities. This is illegal federal coercion, plain and simple. With no federal AI framework in place, states like California have stepped up with common-sense safeguards that protect the public while keeping innovation and competition strong. These measures build trust and keep people safe. This order would block states from responding to real, evolving risks. At the same time, it’s a gift to big tech—stripping away accountability when AI is becoming more powerful and deeply embedded in people’s lives. There’s a reason Congress dismissed this approach—it’s bad policy. I’ll keep pushing back against this overreach and defend states’ ability to put meaningful protections in place.” (Press release)

• Rep. Zoe Lofgren (D-CA) said, “This executive order is not lawful. If the President really wants to address contradictory state laws, he can work with Congress on both sides of the aisle to debate and pass a federal standard. Unfortunately, the Republicans in Congress and the White House have been missing in action on creating AI legislation in Congress. I call on Speaker Johnson to make Congress relevant again and engage in a bipartisan conversation on AI governance.”

• Rep. Summer Lee (D-PA) posted “AI regulation has bipartisan support to protect our communities, neighbors, and jobs, but Trump is trying to ban states from doing so. If he wants a national framework, lets start with my AI Civil Rights Act with RepYvetteClarke and SenMarkey to make sure AI cannot discriminate against anyone.”

• Rep. Ayanna Pressley (D-MA) posted “AI is everywhere—and without civil rights protections, it can worsen the discrimination our communities already face. That’s why Congress should pass my AI Civil Rights Act with SenMarkey and RepYvetteClarke. We cannot allow AI innovation without AI protections.”

• Rep. Gabe Amo (D-RI) posted “Trump’s siding with the demands of big tech and billionaires that will profit over the people who could get hurt. His AI executive order will stop actions to keep Americans safe.”

• House Energy and Commerce Committee posted “President Trump is absolutely right that we need one national AI standard, not a patchwork of state laws. We need to understand how burdensome state regulations undermine America’s greatest innovators and cede leadership to China. This EO will help to further that discussion.”

• Rep. Deborah Ross (D-NC) posted “This is a clear overreach of Trump’s executive power and a harmful decision. States are stepping up to enact necessary guardrails to protect people, especially women & children, from the dangers of AI, including stalking, deepfakes, and more.”

Trump Decision to Allow NVIDIA Sales to China

• In remarks on the Senate floor, Democratic Leader Chuck Schumer (D-NY) spoke about President Trump’s decision to allow the export of advanced Nvidia H200 AI chips to China, “Donald Trump is just selling out America for his own ego and his own gain. That’s what he’s doing on chips. Yesterday, Donald Trump announced he was giving the green light for Nvidia to send even more powerful AI chips to China, the H200, which are used to train AI models. Let’s be clear—you can’t claim to be ‘tough on China’ if you willingly sell them some of the most advanced chips in the world so they can use it to strengthen their military. People on both sides of the aisle are aghast that Trump would do this. Does he think it through? Does he care about what will happen tomorrow or just his little announcement today? Donald Trump’s announcement selling these chips to China is dangerous. They’ll use them to strengthen their military and their technological edge, all at the expense of American national security. Even Donald Trump’s own Department of Justice warned about the dangers of these chips making their way to China. Here is what they said, the Department of Justice, when they acted against a chip smuggling operation yesterday. This is Trump’s Justice Department: ‘These chips are the building blocks of AI superiority and are integral to modern military applications. The country that controls these chips will control AI technology; the country that controls AI technology will control the future.’ Donald Trump, you are letting China control our future. You’re selling us out, all so you can have a little one-day ego gain by making some kind of announcement which no one is going to believe anyway. Donald Trump should listen to his own DOJ about the danger of giving China these chips before cutting stupid deals that cost America dearly in the years to come. But, unfortunately, this is textbook Donald Trump. He is so desperate to get a deal with President Xi, so he can get that photo-op, that he will sell out America’s long-term security for a short-term political gain. This sellout is not only going to hurt us, it’s going to hurt our children and our grandchildren as China begins to dominate the world with AI. And then he comes up with this tawdry deal, where he says Nvidia makes money and the U.S. makes money. But the short-term gain of dollars from selling these chips is so much outweighed by the danger when China takes the lead on AI using the chips that were made in America and sold to them by Donald Trump. So, I ask one question: where is the outrage from my Republican colleagues? Are they just going to sit by while Donald Trump sells America out to Xi Jinping? That’s what’s going on here. This chips deal is terrible. It will cost our national security dearly. And the president must reverse course before it’s too late.” (Press release)

• Senate Foreign Relations Committee Ranking Member Jeanne Shaheen (D-NH), Senate Appropriations Committee Ranking Member Chris Coons (D-DE), Senate Armed Services Committee Ranking Member Jack Reed (D-RI), Senate Banking Committee Ranking Member Elizabeth Warren (D-MA), and Sens. Brian Schatz (D-HI), Andy Kim (D-NJ), Michael Bennet (D-CO), and Elissa Slotkin (D-MI) issued a statement in response to the Trump Administration’s decision to allow NVIDIA to sell its H200 AI chips to China, saying, “The Trump administration’s announcement that it will allow the export of advanced H200 AI chips to China is a colossal economic and national security failure. The H200s are vastly more capable than anything China can make and gifting them to Beijing would squander America’s primary advantage in the AI race. Access to these chips would give China’s military transformational technology to make its weapons more lethal, carry out more effective cyberattacks against American businesses and critical infrastructure, and strengthen their economic and manufacturing sector. Chinese AI giant DeepSeek said as recently as last week that the lack of access to advanced American-designed AI chips is the single biggest impediment to its ability to compete with U.S. AI companies. With this decision, President Trump is poised to remove that barrier. Senate Democrats and Republicans both know that the 21st century will be defined by whether the leading AI systems are built on values of free societies and free markets or the repressive, authoritarian values of the Chinese Communist Party. The Trump administration clearly doesn’t grasp the urgency of this contest. President Trump must reverse course and recommit to preserving American dominance in AI.” (Press release)

• Sen. Elizabeth Warren (D-MA) said, “After his backroom meeting with Donald Trump and his company’s donation to the Trump ballroom, CEO Jensen Huang got his wish to sell the most powerful AI chip we’ve ever sold to China. This risks turbocharging China’s bid for technological and military dominance and undermining U.S. economic and national security. Congress must act swiftly. It should pass bipartisan legislation that reins in this Administration, and it should require Mr. Huang to testify publicly and under oath.” (Press release)

• Sen. Brian Schatz (D-HI) released a statement saying, “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. Preventing states from enacting common-sense regulation that protects people from the very real harms of AI is absurd and dangerous. 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. I’ll be working with my colleagues to introduce a full repeal of this order in the coming days.” (Press release)

• Rep. Brad Sherman (D-CA) posted “President DonaldTrump’s decision to allow NVIDIA to sell H200 chips to China puts America last. U.S. companies should not be allowed to hand over to China the very technology it needs to beat America in the AI race – especially when we know that China won’t put any safeguards on AI technology.”

House Financial Services Hearing on AI in Financial Services

• Chairman French Hill (R-AR) said, “AI has shown its transformative potential to reshape how financial institutions operate, from enhancing analysis, to managing risk, mitigating fraud, and, importantly, enhancing customer service. However, as with any innovation, risks give rise to new challenges. ... To move forward, we must embrace and adapt to innovation. … Identifying gaps and obstacles in our regulatory frameworks will help Congress create an AI landscape where innovation can flourish without unnecessary barriers, while ensuring robust consumer protections, and risk-based, technology-neutral regulation.”

• Ranking Member Maxine Waters (D-CA) said, “AI is already embedding in the lives of millions of Americans, and we have a duty to ensure that it benefits society, not harms it. Unfortunately, Republicans have been complicit as Donald Trump by passes Congress directs federal agencies to deploy biased AI with no safeguards and now issuing an executive order that seeks to undermine all state oversight. Republicans in Congress fail to acknowledge that despite all the benefits that AI may bring, it also poses challenges that demand our full attention. We’re already seeing AI systems that hurt children, spread hate and discrimination and amplify systemic risk in the financial system.”

• Subcommittee on Digital Assets, Financial Technology, and Artificial intelligence Chair Bryan Steil (R-WI) said, “Earlier this year, Mr. Chairman Hill and I introduced the bipartisan Unleashing AI Innovation in Financial Services Act, which enables regulatory sandboxes at the federal financial agencies that are targeted in size and scope. These sandboxes, they have a handful of things. They have to be approved and overseen by federal regulators. They require compliance strategies and risk management … they must not impose systemic or national security risks. … Additionally, fraud and unsafe and unsound practices will remain prohibited under the sandboxes. … the sandboxes provide a more secure environment to experiment with AI, enabling innovation with built in guardrails and federal oversight.”

• Subcommittee on Oversight and Investigations Chair Dan Meuser (R-PA) said, “… Many of us, the leadership of this Committee, as well as the Trump Administration, is committed to unleashing AI’s full potential, so the United States wins the AI race with investment and energy dominance to support the AI infrastructure. My home state of Pennsylvania is doing everything we can to draw in as much AI infrastructure as possible. However, it brings risks that we’re talking about and exposing here, which are happening now, and we want to mitigate for the future. They definitely include fraud, scams, profiling, and seem to be growing more sophisticated. AI is proving to be an incredibly strong tool for detecting and shutting down these very threats but as well creating them.”

• Subcommittee on Capital Markets Chair Ann Wagner (R-MO) said, “NASDAQ was an important player in the creation of electronic trading. And, while rapid growth over the last few years in generative artificial intelligence, or AI, has brought this technology center stage for the general public, NASDAQ has been quietly using AI for years and years to fight fraud and increase market efficiency, liquidity, and transparency.

• Rep. William Timmons (R-SC) said, “If the United States is going to remain a global leader in innovation, we must adopt clear and harmonized rules that support technological progress while also protecting consumers and preserving market integrity. Industry leaders are increasingly concerned about the growing patchwork of state laws related to artificial intelligence. These state requirements often conflict with one another, whether in the form of impact assessments, documentation, standards, or definitions of high-risk systems for firms that operate across the country. These inconsistencies can create significant operational challenges, especially when artificial intelligence supports critical functions such as fraud detection and cyber defense. Without a unified federal framework that replaces duplicative and contradictory state rules, we risk higher compliance costs, slower innovation, and weaker protection for consumers.”

• In Q&A, Subcommittee on Digital Assets, Financial Technology, and Artificial intelligence Ranking Member Stephen Lynch (D-MA) asked, “…there’s much faith being put on AI but, but from this committee’s perspective, we’re seeing a small handful of AI firms that are really going to dominate, and so, so their products will be used by hundreds, maybe thousands of banks. So, they’re all be going to be operating off the same the same recommendations, the same algorithms. Doesn’t that create a concentration risk, if multiple banks, perhaps hundreds of banks, are actually making decisions based on the same recommendations?”

  • Simon Johnson, Professor of entrepreneurship in the MIT Sloan School of Management: “Yes, we’ll see concentration risk exactly there, where banks make decisions. But also what Dr. Foster was talking about, which was agentic AI on the on the part of investors. So investors will be coming into assets and leaving assets really very fast. They’ll be interacting with other AI. They’ll be gaming the system. This is all volatility, Congressman, and the only way to ensure the system against volatility is with more capital.”

• Rep. Marlin Stutzman (R-IN) said, “During the Biden Administration, AI innovation was viewed primarily as a threat to the American people. While President Trump has set the country back on track towards innovation and American AI dominance on the world stage, we cannot have Biden’s allies in anti-innovation states like California and Massachusetts setting the trend on overregulating AI.”

• Rep. Young Kim (R-CA) said, “Earlier this year, the state of California, where I’m from, they passed S.B. [53] that would unfairly regulate AI and impose heavy compliance burdens on companies. Now, states across the country are looking to this California model as a basis for developing their own artificial intelligence regulations. Therefore, there is an urgency for congress to establish a federal framework for AI. That’s why I support legislation like Chairman French Hill’s Unleashing AI Innovation in Financial Services Act that would create federal regulatory sandboxes.”

Miscellaneous

• At a Semafor event for Architects of the New Economy, Sen. Mark Warner (D-VA) said, “Ten years ago, if we put some guardrails on social media, we would have a hell of a lot healthier group of young people. The transformation brought about by social media is tiny compared to what AI will do.” (Semafor)

• At the same Semafor event, Sen. Josh Hawley (R-MO) said, “Our kids are not safe online, and there’s no amount of corporate profiteering that can justify that. Let’s be honest. Why hasn’t more social media legislation passed Congress? Money.” (Semafor)

• In remarks on the Senate floor, Sen. Elizabeth Warren (D-MA) said, “I am deeply concerned that Donald Trump will target the work at the Department of Justice in a cynical attempt to hide the truth from the American people. And in case Donald Trump directs his Department of Justice to take down the public evidence or to cover it up, I’m going to read into the Senate record exactly how senior law enforcement officials warned about the dangers of allowing these chips to power the development of cutting-edge technology in China.” (Press release)

• In a keynote speech at Stanford University’s AI & the Economy: Opportunities, Risks, and Policy for Shared Prosperity forum, Sen. Mark Kelly (D-AZ) said, “My goal with AI for America is to raise important questions about how the AI boom and its continued development can put workers at the forefront, strengthen our public infrastructure, protect the landscapes we cherish, benefit communities as it expands, protect users, and ensure that this new, exciting chapter benefits all Americans, not just a wealthy few.” (Press release)

• Rep. Pat Fallon (R-TX) posted “Our adversaries are rapidly advancing their AI capabilities while we tie our own hands with outdated hiring rules. The AI Talent act creates skill-based hiring, permanent positions, and shared talent pools so that our agencies can get the best minds through their doors and secure our lead in AI.”

• Sen. Bernie Sanders (I-VT) posted “Congratulations to the people of Chandler, AZ, who — despite a fierce lobbying campaign — defeated a massive AI data center that would have raised utility bills and drained scarce water. Oligarchs want working Americans to foot the bill while they profit. Not gonna happen!”

• Sen. Mark Kelly (D-AZ) posted “America’s workforce, infrastructure, and innovation built our leadership in tech and they will shape where AI takes us next. AI for America is my roadmap to make sure the AI boom benefits workers and communities, not just a handful of tech billionaires.”

• Sen. Katie Britt (R-AL) posted “There are too many heartbreaking stories with AI and social media harming children. Tech companies must be honest about the risks their platforms pose to children and take responsibility for the harm they cause. I will continue to hold Big Tech and AI accountable. Protecting our nation’s children must always be a priority.”

• Sen. James Lankford (R-OK) posted “Proud to join a bipartisan group of colleagues calling on AI companies to commit to real transparency and safety disclosures. As AI becomes more powerful, we need to protect children and vulnerable users. Innovation comes with responsibility.”

• Rep. Valerie Foushee (D-NC) posted “As Co-Chair of the HouseDemocrats Commission on AI, I am proud to share my AI Jobs Report and subsequent launch of an investigation into major companies to gain clarity on AI’s impact on American jobs. In 2025 alone, we’ve seen over 50,000 jobs lost which were specifically cited as AI-related reductions. Overall, total layoff announcements for 2025 have surpassed 1.1 million job cuts, the most since the 2020 pandemic. All this, despite major companies seeing record profits. Meanwhile, marginalized communities are feeling the brunt of Trump’s economy that prioritizes oligarchs over working families, and wondering what “Winning the AI Race” really means for them. The unemployment rate for Black Americans has increased to 7.5%, up from 5.7% a year ago. With many major companies seeing record profits despite this surge of layoffs, it’s time for Congress to step up. As the only Woman of Color on the House Democrat Commission on AI, I’m proud to lead this effort and will keep pushing for answers for the American people.”

• Rep. Nathaniel Moran (R-TX) posted “China’s expanding power grid is now an AI weapon. America leads in chips, but we need the energy infrastructure to match it, and we cannot allow China access to our chip technology. The stakes for America’s future are real. We must win in chips and in power.”

• House Judiciary Dems posted “Advances in AI have transformed the surveillance landscape. As more aspects of our lives move to phones, apps, and online platforms, both government and private companies now have an unprecedented ability to track and profile Americans. Congress must modernize privacy protections before these AI-driven analytic tools outpace the law.”

What I’m Reading This Week

• California Enacted AI Bills. Now Officials Must Define Them., Justin Curl, Lawfare.

• AI Backlash Could Shape US Election in 2028, The National.

• China’s AI Power Play: Cheap Electricity from World’s Biggest Grid, The Wall Street Journal.

About Zero One Strategies

Zero One Strategies is a boutique government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

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DC Decentralized

The controversial state AI moratorium is no longer under consideration within the must-pass National Defense Authorization Act (NDAA). House Majority Leader Steve Scalise (R-LA) told reporters the NDAA “wasn’t the best place for this to fit” and that House Republican leaders are “still looking at other places” to attach the proposal. Of the provision’s future, Senate Majority Leader John Thune (R-SD) said, “That’s controversial. I think the White House is working with senators and House members…to try and come up with something that works but preserves states’ rights.” The GAIN AI Act, limiting the export of advanced AI chips to countries like China, is also reportedly out of the final NDAA text.

CISA, in collaboration with international cybersecurity agencies, released new guidance for critical infrastructure operators deploying AI. Meanwhile, the Trump administration is reportedly planning to release a new national cybersecurity strategy in January, possibly followed by an executive order to implement the new strategy.

Read more below

Congress

Hearings

Last week

• On December 2, the Senate Foreign Relations East Asia, the Pacific and International Cybersecurity Policy Subcommittee holds a hearing on Countering China’s Challenge to American AI Leadership.

This week

• On December 9, the Senate Judiciary Intellectual Property Subcommittee holds a hearing on Balancing the Interests of Local Radio, Songwriters, and Performers in the Digital Age.

• On December 10, the House Financial Services Committee holds a hearing on From Principles to Policy: Enabling 21st Century AI Innovation in Financial Services.

• On December 10, the House Science, Space and Technology Committee holds a hearing on the Genesis Mission: Prioritizing American Science and Technology Leadership.

Upcoming

• On December 17, the House Homeland Security holds a Cybersecurity and Infrastructure Protection Subcommittee and Oversight, Investigations and Accountability Subcommittee holds a hearing following a report about an AI-assisted, partially autonomous cyberattack against the U.S. company Anthropic by a state-sponsored cyber actor backed by China.

Legislation

• Rep. Kevin Kiley (R-CA) introduced a bill to require the National Academy of Sciences to establish a grant program to develop safe AI models and safe AI research. (Text)

• Sens. Lisa Blunt Rochester (D-DE), Mazie Hirono (D-HI), and Adam Schiff (D-CA) introduced a bill to promote a 21st century workforce, to authorize grants to support emerging and advanced technology education, and to support training and quality employment for workers in industries most impacted by artificial intelligence. (Text)

• Sens. Maggie Hassan (D-NH) and Jim Banks (R-IN) introduced the Reliable Artificial Intelligence Research Act to require the Secretary of Homeland Security to carry out prize competitions to advance the science of interpretability and to develop adversarial robustness with respect to artificial intelligence products, and for other purposes. (Text)

• Sens. Jim Banks (R-IN), Maggie Hassan (D-NH), John Hickenlooper (D-CO), and Jon Husted (R-OH introduced the AI Workforce PREPARE Act to better forecast and plan for the impact of artificial intelligence on the workforce of the United States and to provide data to improve training programs for in-demand industry sectors and occupations. (Text)

• Sens. John Curtis (R-UT) and Richard Blumenthal (D-CT) introduced a bill to amend the Communications Act of 1934 to require disclosures with respect to robocalls using artificial intelligence and to provide for enhanced penalties for certain violations involving artificial intelligence voice or text message impersonation. (Text)

• Reps. Sarah McBride (D-DE) and Jay Obernolte (R-CA) introduced the READ AI Models Act to direct the National Institute of Standards and Technology to develop best practices and technical guidance on artificial intelligence model documentation. (Text)

• Reps. Suzanne Bonamici (D-OR), Chris Deluzio (D-PA), and James Moylan (R-GU) introduced the No Robot Bosses Act to prohibit employers from relying exclusively on automated decision systems when making employment-related decisions, add protections for job applicants and employees, and require employers to train users on responsible system management and disclose when and how these systems are being used. (Text)

• Reps. Tom Kean (R-NJ), Julie Johnson (D-TX), Lisa McClain (R-MI), and Josh Harder (D-CA) and House Select Committee on China Chair John Moolenaar (R-MI) and Ranking Member Raja Krishnamoorthi (D-IL) introduced the Stop Stealing Our Chips Act to establish a whistleblower incentive program at the Bureau of Industry and Security (BIS) to support U.S. export control enforcement and reporting of export control violations.
  The companion Senate bill was introduced in April 2025 by Sens. Mike Rounds (R-SD) and Mark Warner (D-VA). (Press release)

• Sens. Ed Markey (D-MA), Cory Booker (D-NJ), Elizabeth Warren (D-MA), Jeff Merkley (D-OR), and Mazie Hirono (D-HI) reintroduced the AI Civil Rights Act to establish protections for individual rights with respect to computational algorithms. Reps. Yvette Clarke (D-NY) Summer Lee (D-PA), Rep. Pramila Jayapal (D-WA), and Ayanna Pressley (D-MA) introduced the House companion bill. (Text)

• Reps. Greg Landsman (D-OH) and Bonnie Watson Coleman (D-NJ) introduced the Ban AI Denials in Medicare Act to prohibits the implementation of the WISeR model. (Text)

• Reps. Celeste Maloy (R-UT) and Jake Auchincloss (D-MA) introduced the Deepfake Liability Act to amend Section 230 by conditioning a platform’s liability protections on meeting a clear duty of care and clarifying that AI-generated content does not qualify for Section 230 immunity. (Press release)

• Rep. Mike Kennedy (R-UT) introduced the Growth, Energy, and National Excellence through Science, Innovation, and Security Act (GENESIS Act) to codify President Donald J. Trump’s newly signed Executive Order launching the Genesis Mission. (Text)

• Sens. Pete Ricketts (R-NE), Chris Coons (D-DE), Tom Cotton (R-AR), Jeanne Shaheen (D-NH), Dave McCormick (R-PA), and Andy Kim (D-NJ) introduced the Secure and Feasible Exports (SAFE) Chips Act of 2025 to codify the Trump Administration’s current limits on which advanced AI chips are allowed to be sold to China. (Text)

• Rep. Erin Houchin (R-IN) introduced a bill to ensure that providers of chatbots clearly and conspicuously disclose to users who are minors that chatbots are artificial intelligence systems, not natural person, and do not provide advice from licensed professionals. (Text)

Correspondence

• Sens. Maggie Hassan (D-NH) and Joni Ernst (R-IA) sent a letter to National Cyber Director Sean Cairncross requesting he take action after Chinese state-sponsored hackers reportedly used artificial intelligence (AI) systems to conduct cyberattacks. (Letter)

• Reps. Deborah Ross (D-NC). Alma Adams (NC-12), Julia Bownley (D-CA), Valerie Foushee (D-NC), Kim Schrier (D-WA), Kathy Castor (D-FL), Jan Schakowsky (D-IL), Melanie Stansbury (D-NM), and Jill Tokuda (D-HI) sent a letter urging Speaker Mike Johnson and Democratic Leader Hakeem Jeffries to reject any effort to include a broad moratorium on state and local artificial intelligence regulation in the National Defense Authorization Act (NDAA) or any other unrelated legislative vehicle. (Letter)

• Rep. Yvette Clarke (D-NY) and 43 colleagues sent a letter to House and Senate Armed Services Committee leadership urging the exclusion of any moratorium or preemption on state Artificial Intelligence laws in the FY26 NDAA. (Letter)

Publications and Events

• Sen. Bernie Sanders (I-VT) published an op-ed in The Guardian entitled “AI Poses Unprecedented Threats. Congress Must Act Now,” saying, “Despite the extraordinary importance of this issue and the speed at which it is progressing, AI is getting far too little discussion in Congress, the media and within the general population. That has got to change. Now. Several months ago, as the ranking member of the US Senate committee on health, education, labor and pensions, I undertook an investigation regarding the monumental challenges that we face with the rapid development of artificial intelligence…Based on our investigation and other information that we are gathering, my staff and I will soon be presenting a very specific set of recommendations to Congress as to how we can begin addressing some of the unprecedented threats that AI poses.” (Op-ed)

Trump Administration

Department of Energy (DOE)

• DOE issued a Request for Information (RFI) regarding Partnerships for Transformational Artificial Intelligence Models and how DOE should best structure and enable partnerships to curate DOE scientific data across the National Laboratory complex for use in artificial intelligence models. The RFI also seeks input on using this data to develop self-improving AI models for science and engineering to advance scientific discovery, energy, and national security. Responses are due by January 14, 2026. (Federal Register)

National Institute of Standards and Technology (NIST)

• NIST will hold a meeting of the Information Security and Privacy Advisory Board on January 21-22 to discuss agentic artificial intelligence security. (Register)

Department of Commerce

• Commerce has extended the comment period until December 13, 2025 for the request for information (RFI) relating to the American AI Exports Program published October 28, 2025. The RFI seeks information on the request for proposals that Commerce will issue pursuant to Executive Order 14320, “Promoting the Export of the American AI Technology Stack.” (Federal Register)

Department of Health and Human Services (HHS)

• HHS released its AI Strategy to make artificial intelligence available to the federal workforce, integrating it across internal operations, research, and public health. (Strategy)

Cybersecurity and Infrastructure Security Agency (CISA)

• CISA, in collaboration with international partners, released new cybersecurity guidance to help critical infrastructure owners and operators integrate artificial intelligence (AI) into operational technology systems, entitled “Principles for the Secure Integration of Artificial Intelligence in Operational Technology.” (Principles)

• The Trump Administration is planning to release a new national cybersecurity strategy in January, possibly followed by an executive order to implement the new strategy. The strategy would resemble a messaging document with six pillars on cyber offense and deterrence; aligning regulations to make them more uniform; bolstering the cyber workforce; federal procurement; critical infrastructure protection; and emerging technologies. (Cyberscoop)

Noteworthy Quotes and Events

CONGRESS

State AI Moratorium

• House Majority Leader Steve Scalise said, “The NDAA is always an important bill, but it’s a bill that you have to build a separate coalition on. We’re still looking at other places, because there’s still an interest.” (Punchbowl)

• On Republican leadership removing the state AI moratorium provision from the National Defense Authorization Act, Sen. Josh Hawley (R-MO) posted, “Good. This is a terrible provision and should remain OUT.”

• Rep. Marjorie Taylor Greene (R-GA) posted, “There should not be a moratorium on states rights for AI. States must retain the right to regulate and make laws on AI and everything else for the benefit of their state. Federalism must be preserved.”

• Rep. Michael Baumgartner (R-WA) said, “…we need to make sure that we don’t outsource AI regulation to California or to Brussels. If we allow each state to do it, because California is the largest market, Gavin Newsom and the radical leftists in California will have a significant impact on what happens with artificial intelligence, and this is a race against China.” He also said, “If California stifles innovation, that will have national security implications. You’ve seen where Europeans have regulated the internet heavily, and you’ve had limits on growth; there’s almost no growth there. If we don’t have some preemption, you are giving that power to Gavin Newsom…I am certainly a free market, states’ rights legislator, but coming from a left-wing state like Washington, I’ve seen what can happen when there is a state like California….interstate commerce has to be regulated by Congress, and AI is interstate commerce.” (Washington Reporter)

• Rep. Vince Fong (R-CA) said, “The focus of why we are trying to put a national framework in place is because blue states like California are messing it up. We have state legislators who are trying to inhibit a hugely beneficial technology; look at quantum and the other technologies out there. If we allow states like California to overregulate, we’ll never see the benefits.” (Washington Reporter)

• Rep. Ben Cline (R-VA) said states that “regulate any part of the economy at the drop of a hat overreaching and going too far on this. Some kind of federal preemption could be helpful to the markets and to the development of AI.” (Washington Reporter)

• Rep. Jim Baird (R-IN) said, “AI is coming along so fast and it’s growing exponentially, so it’s wise to use the opportunity to set some guardrails to provide guidance to the states. I’m glad states are taking initiative to try and resolve some of this. AI can be a tremendous boon to solve medical problems, complex issues, and yet there is the concern about the nefarious uses of that technology. It’s very good to have the discussion.” (Washington Reporter)

• Rep. Marlin Stutzman (R-IN) said, “We need a national framework; we don’t want a patchwork of policies on AI, especially having states like California set the agenda. America needs to be the leader, not California.” (Washington Reporter)

• Rep. Troy Downing (R-MT) said, “Look at California, where insurance companies are leaving the state. My problem with a federal law is that Montana’s laws aren’t going to be the law, and California’s aren’t going to be the law. I understand the hesitation that large companies have, but I know that Montana is going to do what’s right for Montana, and I don’t want them to be subject to the whims of California.” (Washington Reporter)

• Rep. Mark Harris (R-NC) said he has “concerns about the patchwork quilt that’s done with all the states.” He added it is “important to have states look at it. I don’t know that the federal government has the answers to this.” (Washington Reporter)

• Rep. Barry Moore (R-AL) said his top priority is “put[ting] guardrails on to protect our kids…There’s something we have to do from a federal level to prevent young kids from being targeted by predators online in blue states.” (Washington Reporter)

• Rep. Tracey Mann (R-KS) said, “We need to make sure that AI flourishes and prospers in the U.S. and not overseas, so we have to make sure that we do not overregulate it to our detriment and to the benefit of China, Russia, and North Korea.” (Washington Reporter)

• Rep. Mark Alford (R-MO) said, “We need some guardrails, just like we did with crypto. We have to win the AI game when it comes to our adversaries like China, in particular. But we have to make sure that we have the parameters in place so that we can do it effectively, judiciously, and promote invention, productivity, and winning when it comes to the AI race.” (Washington Reporter)

• Rep. Laura Friedman (D-CA) posted “I stood up and helped stop an AI regulation ban that House Republicans tried to sneak into the Big, Ugly Bill earlier this year. Now the Trump administration is trying to override Congress & enforce a ban through executive order. States need to be able to set commonsense guardrails to protect Americans from predatory AI practices & we will keep fighting to keep that power in the hands of the people.”

• Rep. Rob Menendez (D-NJ) posted “A blanket ban on state AI laws would stop New Jersey from advancing responsible AI regulation and derail the common-sense guardrails we’re already leading on. Proud to join my colleagues in opposing this last-minute Republican push to add an AI moratorium into the NDAA that would shut down any progress states have already made.”

• Sen. Patty Murray (D-WA) posted “Trump and Republicans are trying to BAN states from regulating AI by slipping a ban into any bill they can. So if WA state, or any state for that matter, wants to protect kids, protect people’s privacy, or protect their jobs—they’ll have their hands tied. No way.”

Miscellaneous

• In Senate floor remarks, Sen. John Cornyn (R-TX) said, “It’s no secret to any of us that China is our near peer competitor, and they don’t have -- they don’t have benign intentions with regard to the United States. They want to dominate the United States, economically and militarily. And they’ve threatened President Xi, the head of the People’s Republic of China and the Communist Party, have threatened time after time after time to forcibly attack Taiwan and to consolidate Taiwan with mainland China. We also know that the battle for the future of the world would literally be determined by who wins the race on artificial intelligence, which is heavily reliant on the production of advanced semiconductors and other advanced microelectronics. These technologies, and this is really important, they have both commercial and military applications. But in China, anything that’s developed or possessed by a commercial entity has to be shared with the Chinese Communist Party and the People’s Liberation Army. They call that military and civilian fusion, admissibility-civil fusion. It means any progress they make, including on something as sophisticated and cutting-edge as artificial intelligence, has to be shared, and will be shared, with their military. On Tuesday, the Senate Foreign Relations Committee Subcommittee on East Asia, the Pacific, and International Cybersecurity Policy held a hearing on China’s challenge to America’s leadership when it comes to artificial intelligence. We heard expert testimony from four witnesses on the challenges that the United States faces in staying ahead of China in this critical sector. Each of these witnesses emphasize the importance of export controls, controlling what technology goes from the United States into China, where they can then use that to compete with us and potentially even beat us in the A.I. race. One quoted a senior executive at a Chinese AI firm, who said that Chinese companies have to use two to four times the computing power to achieve the same results for large model training because of U.S. restrictions on AI chips. Now, this is a good thing. However, export controls, while an effective tool, are not simple nor straightforward, and the Chinese government is really good, like the Russians, at circumventing sanctions and different restrictions, in this case on cutting-edge technology. The U.S. must take care to ensure our export controls are properly enforced as PRC shell companies have ways of working around these trade controls in order to acquire American semiconductors and other control products. Unfortunately, sometimes it seems like a game of whack-a-mole, because one company will pop its head up, and we’ll deal with that. But then they change the name, and it’s the same thing under a different name. It’s not just the chips themselves that we have to keep a tight grip on but the machinery used to make them.”

• In remarks at the Center for American Progress, Sen. Mark Kelly (D-AZ) said US policy needs “clear enforceable standards to make sure AI respects civil rights, protects privacy and [we] don’t leave people behind. That includes strong transparency requirements, accountability mechanisms and international coordination, so that our values — not those of some authoritarian regime out there — shape the future of this technology.” He also said, “We have to strengthen our infrastructure and we have to support smart, responsible laws that keep this technology safe and true to our values, because American leadership doesn’t happen by accident.” (AI Scoop)

• Sen. Mark Warner (D-VA) posted “A fact that should scare the shit out of us: unemployment among recent college grads is already at 9%, and it could get up to 25% in the coming years. We need to get ready for serious and painful changes in the job market due to AI.”

• Warner also posted “AI is one of the most significant innovations of our time, but we must be proactive in ensuring it doesn’t lead to an economic cliff.”

• Sen. Patty Murray (D-WA) posted “RFK Jr. is praising private insurers for removing prior authorization while he is ramping up a pilot program requiring AI-led prior authorization for Medicare patients in 6 states, including WA state, which will delay and deny care for seniors. No AI prior authorization. No way.”

• Sen. Pete Ricketts (R-NE) posted “The United States leads the AI race with Communist China due in large part to our dominance of global compute power. At the core of compute are advanced AI chips. The best AI chips are made by American companies. Denying Beijing access to these AI chips is essential to our national security. Codifying President Trump’s current AI chip limitations on Communist China secures this goal. It will allow U.S. chip companies to continue to rapidly innovate and widen our compute lead exponentially.”

• Rep. Sarah McBride (D-DE) posted, “What if everyone using AI—from school districts to small businesses to local governments—could easily create and access nutrition labels for different AI models that clearly lay out information to help inform their safety, performance, and risks? That’s exactly what my bipartisan Resources for Evaluating and Documenting (READ) AI Models Act would do. It would help level the playing field so small and medium-sized developers as well as users can make informed, responsible choices about the models they create and rely on. That’s what transparency is all about.”

• Sen. Chris Coons (D-DE) posted “We’re taking action to protect America’s AI leadership and ensure our most advanced chips don’t end up in the hands of the CCP. That’s why I’m introducing the SAFE CHIPS Act with SenatorRicketts to strengthen U.S. innovation and national security.”

• Coons also posted “The United States must not sell advanced AI chips to China, plain and simple. The world’s foremost experts on AI, Republican and Democrat, unanimously agree.”

• Rep. Ted Lieu (D-CA) posted “If Trump and Republicans want to do nothing to protect kids, then states are going to do it. We need federal standards to regulate AI.”

• Rep. Donald Norcross (D-NJ) posted “Medicare should help seniors get care, not deny it. This new AI experiment could put more barriers between patients and their doctors, and New Jersey seniors deserve better. I’ll keep fighting to protect their access to the care they need.”

• Rep. Yvette Clarke (D-NY) posted “Until Congress addresses the dire threat of algorithmic bias, Americans will continue to rely on their states to protect them from the many potential harms of unregulated AI and its unrestrained Big Tech masters. That’s why I led 43 of my colleagues in a letter to the leaders of the House and Senate Armed Services Committee urging them to exclude anything resembling an AI Moratorium from the FY26 NDAA.”

• Rep. Pat Fallon (R-TX) posted “North Korea used American payrolls to fund their weapons programs. As threats become more sophisticated and AI accelerates enemy capabilities, half measures will not cut it. Cybersecurity is national security and it’s time to act like it.”

• Rep. Pete Aguilar (D-CA) posted “As artificial intelligence technology evolves, it’s crucial that Inland Empire students and our workforce have the tools they need to keep up. I’m proud to announce $1 million in funding to ensure that CSUSB and UCR students can gain a world-class education in AI.”

• Rep. Pramila Jayapal (D-WA) posted “I was proud to stand with SenMarkey, RepYvetteClarke, RepSummerLee, & RepPressley to introduce our AI Civil Rights Act. As giant corporations & billionaires use algorithms to discriminate against people like you & me, Congress must pass this legislation to protect Americans.”

• Rep. Summer Lee (D-PA) posted “Technology does not exist above our society. It reflects every bias and inequality that has yet to be fixed. That’s exactly why we need our AI Civil Rights Act to ensure no one is harmed by innovation that discriminates or leaves them behind.”

• House Energy and Commerce Committee posted “American AI dominance is non-negotiable. If America doesn’t lead the world, we risk letting China win the AI race. That’s why HouseCommerce is working every single day to help the U.S. beat China and continue our leadership.”

• Rep. Troy Downing (R-MT) posted “The AI revolution is coming whether we like it or not. Small businesses need the tools to not only keep pace, but harness this transformational technology. Great conversation with RepScholten about our bipartisan AI-WISE Act to do just that.”

• Rep. Hillary Scholten (D-MI) posted “AI is changing the way we work and do business, and small businesses deserve the tools to keep up and compete. I had a great conversation with my colleague RepTroyDowning about our bipartisan AI-WISE Act, which helps small businesses harness this technology in a smart, responsible way.”

• Sen. Todd Young (R-IN) posted “I commend SecKennedy and the HHSGov team for developing this strategy to utilize AI technologies and better serve taxpayers. This is the kind of innovative leadership that will help restore faith in government and improve health outcomes.”

• Rep. Frank Pallone (D-NJ) posted “Threats to our power grid are growing, whether from state actors like Russia or China, or domestic terrorists here at home, whose capabilities are enhanced every day by increasingly effective AI. Today in EnergyCommerce I’m fighting to address these threats – and ensure we have a fully staffed ENERGY Dept to combat them.”

• Rep. Suzan DelBene (D-WA) posted “Beginning in January, private companies will start using AI to review certain health care services, potentially delaying or denying Medicare beneficiaries from getting the care they’ve earned. I introduced legislation to stop this program. Health decisions should be made between patients & their doctors, not profit-driven algorithms.”

• Sen. Lisa Blunt Rochester (D-DE) posted “As AI continues to disrupt our economy, it’s absolutely essential we protect workers and lay the groundwork for future success. Proud to be leading proactive legislation with maziehirono and SenAdamSchiff to make sure innovation and supporting our workforce go hand in hand.”

• Sen. Elizabeth Warren (D-MA) posted “NVIDIA’s CEO spent the past year lobbying Trump to greenlight the sale of advanced AI chips to China, which could undercut US national security. Now he’s heading to Capitol Hill to push his agenda in secret meetings. Huang should testify publicly.”

• Rep. Greg Landsman (R-OH) posted “This administration wants to pay AI companies to deny healthcare for seniors. We introduced a bill with @RepBonnie to stop this dangerous program and protect Medicare patients.”

• Rep. Bonnie Watson Coleman (D-NJ) posted “AI has the potential to unlock a new age of human flourishing. Using AI to deny medicare recipients their needed coverage is a perverse use of this technology and is yet another example of the Trump Administration cow-towing to his billionaire tech buddies while making life more difficult and more expensive for everyday Americans.”

• Rep. Tom Kean (R-NJ) posted “China is actively working to circumvent U.S. export control laws and illegally obtain American-made AI chips. I introduced the Stop Stealing Our Chips Act with RepJulieJohnson to strengthen enforcement, prevent violations before they occur, and protect our national security. Backed by RepLisaMcClain, ChinaSelect, RepMoolenaar, CongressmanRaja, and RepJoshHarder, this bill makes it clear that illegal smuggling of U.S. technology will not be tolerated.”

• Rep. Robin Kelly (D-IL) posted “Big Tech is exploiting people’s private data, putting kids’ health at risk. I want clear rules so AI cannot act like a doctor or provide false medical advice and comprehensive privacy protections. As tech evolves, companies need to be held accountable to keep kids safe.”

• Sen. Bernie Sanders (I-VT) posted “The threats from unchecked AI are real — worker displacement, corporate surveillance, invasion of privacy, environmental destruction, unmanned warfare. Today, a tiny number of billionaires are shaping the future of AI behind closed doors. That is unacceptable. That must change.”

What I’m Reading This Week

• More Evidence Your AI Agents Can Be Turned Against You, Derek B. Johnson, Cyberscoop.

• AI Regulation: The Next Big Global Policy Battle, Thanawat Chaiyaporn, Chiang Rai Times.

• More of Silicon Valley is building on free Chinese AI, Jasmine Cui and Jared Perlo, NBC News.

• Trump’s Push for More AI Data Centers Faces Backlash From His Own Voters, Jarrett Renshaw and Laila Kearney, Reuters.

About Zero One Strategies

Zero One Strategies is a boutique government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, digital assets, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

Contact us at Stacey@ZeroOneStrategies.com

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DC Decentralized

This week in AI federal policy, Congressional proponents of a state AI moratorium are reportedly working on a plan to connect the provision with a number of children’s online safety bills and attach the combined package to the must-pass year-end National Defense Authorization Act (NDAA).

President Donald Trump signed an Executive Order launching the Genesis Mission, an effort to use artificial intelligence to transform how scientific research is conducted and accelerate scientific discovery. The USPTO rescinded and replaced guidance on AI-assisted inventions.

Read more below

Congress

Hearings

Last week

• Congress was in recess for the Thanksgiving holiday.

This week

• On December 2, the Senate Foreign Relations East Asia, the Pacific and International Cybersecurity Policy Subcommittee holds a hearing on Countering China’s Challenge to American AI Leadership.

Upcoming

• On December 10, the House Financial Services Committee holds a hearing on From Principles to Policy: Enabling 21st Century AI Innovation in Financial Services.

• On December 17, the House Homeland Security holds a Cybersecurity and Infrastructure Protection Subcommittee and Oversight, Investigations and Accountability Subcommittee holds a hearing following a report about an AI-assisted, partially autonomous cyberattack against the U.S. company Anthropic by a state-sponsored cyber actor backed by China.

Legislation

• Reps. Ted Lieu (D-CA) and Neal Dunn (R-FL) introduced the AI Fraud Deterrence Act to increase penalties for the commission of financial crimes using artificial intelligence. (Text)

• Rep. Jen Kiggans (R-VA) introduced the AI for America Act to codify a national strategy for artificial intelligence that promotes American leadership, removes regulatory barriers, and ensures data are free from security risks and ideological bias. (Text)

• Reps. John Joyce (R-PA), Scott Peters (D-CA), Beth Van Duyne (R-TX), Brad Schneider (D-IL), Jay Obernolte (R-CA) and Angie Craig (D-MN) introduced the Health Tech Investment Act to assign all U.S. Food and Drug Administration (FDA) approved artificial intelligence-enabled devices to a New Technology Ambulatory Payment Classification (APC) in the Hospital Outpatient Prospective Payment System (OPPS) for a minimum of five years to ensure that necessary data surrounding delivery and service costs is acquired before a permanent payment code is assigned. (Press release)

• Del. Jim Moylan (R-GU) and Reps. Eugene Vindman (D-VA) and Bill Huizenga (R-MI) introduced a bill to require the Secretary of Commerce to submit a report annually on the advanced artificial intelligence capabilities of the People’s Republic of China. (Text)

Correspondence

• Reps. Doris Matsui (D-CA) Ted Lieu (D-CA), April McClain Delaney (D-MD), Luz Rivas (D-CA), Don Beyer (D-VA) and Yvette Clarke (D-NY) led a group of 81 lawmakers in sending a letter to congressional leadership opposing any effort to reintroduce a moratorium on state and local artificial intelligence laws in the National Defense Authorization Act (NDAA). (Letter)

• House Committee on Homeland Security Chair Andrew Garbarino (R-NY), Subcommittee on Cybersecurity and Infrastructure Protection Chair Andy Ogles (R-TN), and Subcommittee on Oversight, Investigations, and Accountability Chair Josh Brecheen (R-OK) sent letters to Anthropic, Google, and Quantum Xchange, requesting their testimony at a joint subcommittee hearing following reports of AI-assisted, partially autonomous PRC cyber operation, currently scheduled for December 17. (Anthropic letter)(Google letter)(Quantum Xchange letter)

• Energy and Commerce Committee Ranking Member Frank Pallone (D-NJ), Communications and Technology Subcommittee Ranking Member Doris Matsui (D-CA), and Oversight and Investigations Subcommittee Ranking Member Yvette Clarke (D-NY) wrote to the National Telecommunications and Information Administration (NTIA) requesting it disperse Broadband Equity Access and Deployment Program (BEAD) funding as intended by Congress. (Letter)

Publications and Events

• Rep. Troy Nehls (R-TX) published an op-ed in the Washington Reporter on To Win the Global AI Race, We Must Secure our Optical Transceivers and Prioritize American-Made Components, concluding, “So while the immense national security risk of compromised transceivers looms large over our efforts to win the global AI race, it also presents a pivotal moment for us to protect our infrastructure, decrease our reliance on foreign technology, and bring manufacturing back to U.S. soil. The directive report language in the FY26 House National Defense Authorization Act must be the first step, not the last. By securing our AI infrastructure, we can secure American AI superiority for generations to come.” (Op-ed)

• Rep. Erin Houchin (R-IN) published an op-ed in Breitbart on Protecting Children While Keeping AI Innovation on Track, saying, “At the end of the day, protecting children is not a partisan issue. It is a responsibility we share as parents and policymakers. Just as we buckle our kids into car seats or require safety standards for toys, we must ensure that the digital tools they use are safe and age appropriate.” (Op-ed)

Trump Administration

White House

• President Donald Trump signed an Executive Order launching the Genesis Mission, an effort to use artificial intelligence to transform how scientific research is conducted and accelerate scientific discovery. The Genesis Mission charges the Secretary of Energy to leverage the National Laboratories to establish a cooperative system for research, directs the Department of Energy to create a closed-loop AI experimentation platform that integrates supercomputers and data assets to generate scientific foundation models and power robotic laboratories, and instructs the Assistant to the President for Science and Technology (APST) to coordinate the initiative and integration of data and infrastructure from across the Federal government. (EO)(Fact sheet)

United States Patent and Trademark Office (USPTO)

• The USPTO has rescinded guidance issued on February 13, 2024 on inventorship guidance for AI-assisted inventions and has replaced it with new Inventorship Guidance for AI-Assisted Inventions. (Federal Register)

Department of Energy (DOE)

• DOE announced a restructuring plan to include a new Office of Artificial Intelligence and Quantum (AIQ) and Office of Fusion (OF). (Org chart)(Fedscoop)

Noteworthy Quotes and Events

ADMINISTRATION

White House

• The White House posted “President Donald J. Trump launches the GENESIS MISSION - a national effort to accelerate scientific breakthroughs using AI and propel America into the GOLDEN AGE OF INNOVATION.”

• White House AI & Crypto Czar David Sacks posted “AI should be politically unbiased and strive for the truth. Still a lot of work to do.”

Department of Energy (DOE)

• The Department of Energy posted “Genesis Mission has arrived. The world’s most powerful scientific platform to ever be built has launched. This Manhattan-Project-level leap will fundamentally transform the future of American science and innovation.”

• Secretary Chris Wright posted “The Genesis Mission is going to bring together industry, @ENERGY’s National Labs, and data sets all tied together in a closed loop system to rapidly advance the pace of scientific and engineering progress. It will be transformative.”

CONGRESS

• Rep. Doris Matsui (D-CA) posted “I led 81 House lawmakers in opposing any attempt to reintroduce a moratorium on state and local AI laws in the NDAA or by executive order. People deserve transparency, trust, and protection. We cannot handcuff states without any real federal safeguards. We can lead the world in AI and protect our communities. That’s the future I’m fighting for.”

• Rep. Ben Cline (R-VA) posted “For decades, America has defined global innovation. The GENESIS Mission is critical to keeping America ahead of the curve and solidifying our leadership in AI against growing threats from Communist China.”

• House Homeland Security GOP posted “After Anthropic released a report detailing a nation-state actor’s use of AI to conduct a semi-automated cyberattack, RepGarbarino, RepOgles, & RepBrecheenare requesting testimony from industry to determine how the U.S. can keep pace with threats”

• Rep. Ted Lieu (D-CA) posted “AI has made it easier for scammers to take advantage of people. We need to implement sensible guardrails on the ways AI can be used to cause harm. That’s why we introduced the bipartisan AI Fraud Deterrence Act to combat fraud committed with AI.”

• Rep. Neal Dunn (R-FL) posted “As AI technology advances at a rapid pace, our laws must keep up. I am proud to co-lead this legislation to protect the identities of the public and prevent misuse of this innovative technology.”

• Rep. Pramila Jayapal (D-WA) posted “Republicans are trying to sneak a provision into the annual defense spending bill to block states from passing AI regulations — a direct ask from Big Tech lobbyists who only care about their own profits, not your safety. It’s a ridiculous proposal.”

• Rep. Troy Nehls (R-TX) posted “To win the global AI race, we must secure our optical transceivers and prioritize American-made components. By securing our AI infrastructure, we can secure American AI superiority for generations to come. Read my latest op-ed in the DC_Reporter”

• Sen. Chris Murphy (D-CT) posted “Please watch this. The Senate killed a bill to ban state regulation of AI by a vote of 99-1 this spring. Now the industry - eager to stay unregulated - and Trump are scheming to shove the provision in the national defense bill. You need to know this, so you can help stop it.”

• Rep. Kim Schrier (D-WA) posted “Social media and tech companies are having a negative impact on our children’s mental health. Now, AI chatbots are exacerbating this growing crisis. I’ll continue my work in Congress to address this issue and keep our kids safe online.”

• House Science Committee posted “President Trump just launched the Genesis Mission—a bold national effort led by ENERGY to harness AI, supercomputing, and quantum science. It will mobilize DOE labs, industry, and academia to build the most powerful scientific platform ever created.”

• Rep. Chuck Fleischmann (R-TN) posted “The Genesis Mission will utilize our National Labs, including ORNL in TN03, to lead the AI revolution and secure America’s global scientific preeminence. This will transform energy security, scientific discovery, and national defense! American scientific leadership is back!”

• Sen. Ted Budd (R-NC) posted “The U.S. must win the AI Race against China, but it cannot do so without access to abundant and affordable energy. Liquid cooling of IT equipment at data centers and other advancements can ease electrical grid strain and help lower costs for consumers.”

• Sen. Pete Ricketts (R-NE) posted “Great to see POTUS champion American AI dominance! This will help unleash American innovation!”

• Energy and Commerce Committee posted “President Trump’s executive order launching the Genesis Mission is exactly what America needs right now. The Genesis Mission will bring the best of America’s best together to develop an AI platform that will strengthen our national security, bolster energy dominance, and enhance workforce productivity. This aligns with HouseCommerce’s work to help America to lead the world in AI innovation and deployment.”

• Sen. Tammy Duckworth (D-IL) posted “Trump and House Republicans are pushing to ban states’ ability to place safety guardrails on AI. That could be disastrous for your: —Kids’ safety online —Data privacy —Energy bill But it would be good for: —Big Tech Trump’s priorities. Not yours.”

• Rep. Darren Soto (D-FL) posted “NRDems are standing united as we fight to stop Trump’s ban on clean energy projects. As electricity rates rise due to AI and data centers, we need all the energy solutions, including wind, solar, hydro, nuclear, and natural gas, to ensure lower energy costs.”

• Sen. Richard Blumenthal (D-CT) posted “Today there is a new danger on the toy market—AI. This harmless looking teddy bear actually has an AI chatbot embedded inside. With this tech kids can engage in conversations with their toys that are intimate, inappropriate & deeply dangerous.”

• Sen. Mazie Hirono (D-HI) posted “From chatbots giving inaccurate medical advice to fostering suicidal thoughts, we’re seeing every day how dangerous AI can be without regulation. But once again, Trump is siding with the tech billionaires who are funding his ballroom instead of American families and children.”

• Rep. Erin Houchin (R-IN) posted “’AI is here to stay, and it will shape the future our kids inherit. Let’s make sure that future is one where technology serves families, not the other way around. With thoughtful leadership and a clear commitment to protecting children, we can embrace innovation while keeping kids safe. That is the mission driving my work on this issue, and it will remain one of my highest priorities in Congress.’”

• House Foreign Affairs Committee posted “China’s plan is to steal U.S. technology to win the AI arms race. We can’t let that happen. The Chip Security Act will increase visibility of the location of advanced chips worldwide to prevent smuggling.”

What I’m Reading This Week

• Republicans Have an A.I. Plan. Democrats, Not So Much, David Byler, The New York Times

• How the U.S. Economy Became Hooked on AI Spending, Konrad Putzier, The Wall Street Journal

• Trump Allies Urge Focus on Workers as White House Boosts AI Development, The Washington Post.

• The Fed Is Fixated on AI — But Not Ready to Make a Greenspan-Size Bet, Bloomberg.

The state AI moratorium is back under debate in the White House and Congress. The White House was expected to issue an executive order to block states from regulating AI, but House Republican leadership asked the Trump Administration to delay the rollout as they debate codifying the policy in the must-pass National Defense Authorization Act (NDAA).

AI-led espionage, cyberattacks, and terrorism were a major focus for policymakers, as well as protecting Americans from the impacts of a potential AI bubble.

At the FinRegLab 2025 AI Summit, Sen. Mike Rounds (R-SD) said the U.S. is pursuing launching critical AI hardware into space for its unlimited power and cooling capabilities. He also previewed he will be introducing in the coming weeks a series of bills focused on accelerated science using AI.

Read more below

Congress

Hearings

Last week

• On November 18, the House Energy and Commerce Subcommittee on Oversight and Investigations held a hearing on Innovation with Integrity: Examining the Risks and Benefits of AI Chatbots.

• On November 18, the House Ways and Means Subcommittee on Work and Welfare held a hearing on Leaving the Sticky Notes Behind: Harnessing Innovation and New Technology to Help America’s Foster Youth Succeed.

• On November 18, the Joint Economic Committee held a hearing on Frontier Technologies, Industrial Efficiency, and Pro-Innovation Policies.

• On November 20, the House Foreign Affairs Subcommittee on South and Central Asia held a hearing on Export Control Loopholes: Chipmaking Tools and their Subcomponents.

This week

• Congress is in recess for the Thanksgiving holiday.

Upcoming

• On December 10, the House Financial Services Committee holds a hearing on From Principles to Policy: Enabling 21st Century AI Innovation in Financial Services.

Legislation

The House passed the Generative AI Terrorism Risk Assessment Act sponsored by Rep. August Pfluger (R-TX), which requires the Department of Homeland Security (DHS) to conduct annual assessments of threats to the U.S. posed by terrorist organizations, such as ISIS and al Qaeda, utilizing generative artificial intelligence (GenAI) applications for terrorist activity. (Text)

The House Small Business Committee passed the AI for Main Street Act sponsored by Reps. Mark Alford (R-MO) and Hillary Scholten (D-MI), and the AI-WISE Act sponsored by Reps. Troy Downing (R-MT) and Scholten.

Sens. Mark Kelly (D-AZ) and Todd Young (R-IN) the Advanced Artificial Intelligence (AI) Security Readiness Act to direct the National Security Agency (NSA) to develop and disseminate security guidance to protect America’s advanced technology from foreign adversaries. (Text)

Sens. Ron Wyden (D-OR), Peter Welch (D-VT), Amy Klobuchar (D-MN), Cory Booker (D-NJ), Richard Blumenthal (D-CT), Chris Van Hollen (D-MD), Tina Smith (D-MN), Andy Kim (D-NJ), Jean Shaheen (D-NH), John Fetterman (D-PA), Bernie Sanders (I-VT), and Sheldon Whitehouse (D-RI) reintroduced the Preventing the Algorithmic Facilitation of Rental Housing Cartels Act to prevent companies help landlords collude to set prices via software and price-setting algorithms. Rep. Becca Balint (D-VT) introduced the House version of the bill. (Press release)

Reps. Brian Fitzpatrick (R-PA) and Brendan Boyle (D-PA) introduced the Strengthening Essential Manufacturing and Industrial (SEMI) Investment Act to expand the CHIPS Act tax credit to include upstream materials essential to semiconductor production, provide clear statutory definitions for direct and indirect production materials and annual materials qualification lists from Treasury and Commerce, and extend the Advanced Manufacturing Investment Credit through 2031. The Senate companion is sponsored by Sens. Michael Bennet (D-CO), Marsha Blackburn (R-TN), Thom Tillis (R-NC), and Chris Coons (D-DE). (Press release)

Rep. Nanette Barragán (D-CA) introduced a bill to amend the Public Health Service Act to ensure that medical students, medical residents, and medical faculty receive education and training in the deployment of artificial intelligence in the medical profession. (Text)

Rep. Rob Menendez (D-NJ) introduced the Strategic Task Force on Scam Prevention Act to create a federal interagency task force to address scams by developing a comprehensive national strategy that includes leveraging existing consumer reporting systems, public education campaigns, coordination with industry sectors like AI, cryptocurrency, and social media, and enforcement actions related to fraud and money laundering. (Text)

Sens. Dave McCormick (R-PA), Chris Coons (D-DE), and Adam Schiff (D-CA) introduced a bill to direct the Comptroller General of the United States to conduct a technology assessment focused on liquid cooling systems for artificial intelligence compute clusters and high-performance computing facilities. (Text)

Rep. Luz Rivas (D-CA) introduced the Artificial Intelligence for Advancing Literacy and Learning Act (AI for ALL Act) to establish a Artificial Intelligence (AI) Literacy and Education Commission within the Office of Science and Technology Policy (OSTP) to develop a national strategy for the federal government to improve and promote AI literacy and education and to coordinate AI literacy and education efforts across the federal government. (Press release)

Sens. Mark Kelly (D-AZ) and John Curtis (R-UT) introduced the Algorithm Accountability Act to amend Section 230 of the Communications Decency Act of 1996 to impose a duty of care on the companies that utilize recommendation-based algorithms. (Text)

Correspondence

Rep. Suhas Subramanyam (D-VA) sent a letter to the Chair of the Federal Reserve and the Chair of the Securities and Exchange Commission (SEC) urging an investigation into the existence of an AI bubble and its potential impact on the American economy. (Letter)

Sens. Adam Schiff (D-CA), Ed Markey (D-MA), Chris Van Hollen (D-MD), Elizabeth Warren (D-MA), Peter Welch (D-VT), Raphael Warnock (D-GA), and Richard Blumenthal (D-CT) sent a letter to Federal Energy Regulatory Commission (FERC) Chair Laura Swett urging FERC to ensure that energy demand from data centers does not result in rate hikes for American households. (Letter)

Ranking Member of the Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party (CCP) Raja Krishnamoorthi (D-IL) sent a letter to the Department of Education urging they raise awareness among American educators and families about the data privacy and child safety risks posed by AI-enabled toys manufactured by companies based in the People’s Republic of China (PRC). (Letter)

Senate Democratic Leader Chuck Schumer (D-NY), and Sens. Ron Wyden (D-OR), Elizabeth Warren (D-MA), Catherine Cortez Masto (D-NV) Andy Kim (D-NJ), Sen. Jeff Merkley (D-OR), Chris Van Hollen (D-MD), and Sen. Ben Ray Luján (D-NM) sent a letter to President Donald Trump on his decision to suspend critical export controls that helped prevent Chinese companies from accessing American-made advanced technology. (Letter)

Sen. Marsha Blackburn (R-TN) sent a follow-up letter to Google CEO Sundar Pichai requesting additional information about its large language model, Gemma, fabricating criminal allegations against her. (Letter)

Reps. Bill Foster (D-IL), Brad Sherman (D-CA), Stephen Lynch (D-MA), Al Green (D-TX), Emanuel Cleaver (D-MO), Joyce Beatty (D-OH), Nydia Velázquez (D-NY), Gregory Meeks (D-NY), David Scott (D-GA), Jim Himes (D-CT), Juan Vargas (D-CA), Josh Gottheimer (D-NJ), Vicente Gonzalez (D-TX), Sean Casten (D-IL), Ayanna Pressley (D-MA), Rashida Tlaib (D-MI), Ritchie Torres (D-NY), Sylvia Garcia (D-TX), Nikema Williams (D-GA), Brittany Pettersen (D-CO), Cleo Fields (D-LA), and Janelle Bynum (D-OR) sent a letter to Treasury Secretary Scott Bessent requesting the Financial Stability Oversight Council (FSOC) convene a working group of financial, technology, and economic experts to assess the vulnerability of the U.S. financial system to a potential sharp drop in the value of AI-related assets and infrastructure. (Letter)

Sens. Ed Markey (D-MA) and Elizabeth Warren (D-MA) sent a Dear Colleague letter to Senate Democrats urging them to oppose the addition of a state AI regulation moratorium to the National Defense Authorization Act (NDAA) for Fiscal Year 2026. (Letter)

Sens. Chris Murphy (D-CT) and Elizabeth Warren (D-MA) sent a letter to The White House and Office of Government Ethics (OGE) requesting information about inconsistencies in U.S. Special Envoy to the Middle East Steve Witkoff’s ethics disclosure forms, concerns related to a deal that allows the United Arab Emirates (UAE) to acquire U.S.-made AI chips, and potential crypto-related conflicts of interest. (Letter)

Sen. Elizabeth Warren (D-MA) sent a letter to David Sacks, White House Special Advisor for AI and Crypto, and Michael Kratsios, Director of the White House Office of Science and Technology Policy, requesting information about the Trump Administration’s potential plans to use tax credits and loan guarantees to support OpenAI and other AI companies. (Letter)

Rep. Debbie Dingell (D-MI) sent a letter to Michigan Public Service Commission chair Dan Scripps requesting transparency, accountability, and frequent clear communications with the public throughout the approval and construction processes of the Stargate data center in Saline Township, MI. (Letter)

Publications and Events

Sen. Bernie Sanders (I-VT) delivered remarks with Nobel laureate Dr. Geoffrey Hinton on “the transformative effects that artificial intelligence (AI) and robotics will have on our country, the world economy and the working class” during an event at Georgetown University.

Trump Administration

U.S.-China Economic and Security Review Commission

The U.S.-China Economic and Security Review Commission released a staff report on Vying for Quantum Supremacy: U.S.-China Competition in Quantum Technologies, finding quantum technologies in computing, sensing, and communications have the potential to be transformational; quantum supremacy will be a critical national asset; America still leads the world in most quantum research, but China has deployed industrial-scale funding and centralized coordination to seize dominance in quantum systems; China leads the world in quantum communications and is making rapid progress in quantum computing and sensing; and China’s pursuit of quantum technologies closely aligns with its national security goals. (Report)

Treasury Department

The Treasury Inspector General for Tax Administration (TIGTA) released its semi-annual report to Congress highlighting audit and evaluation reports with unimplemented corrective actions, including several reports pertaining to artificial intelligence. (Report)

Health and Human Services (HHS)

HHS Secretary Robert F. Kennedy Jr. announced the Caregiver Artificial Intelligence Prize Competition calling for engineers, scientists and entrepreneurs to use AI to “make caregiving smarter, simpler and more humane.” (FedScoop)

Noteworthy Quotes and Events

ADMINISTRATION

White House

President Donald Trump posted “Investment in AI is helping to make the U.S. Economy the ‘HOTTEST’ in the World – But overregulation by the States is threatening to undermine this Growth Engine. Some States are even trying to embed DEI ideology into AI models, producing ‘Woke AI’ (Remember Black George Washington?). We MUST have on Federal Standard instead of a patchwork of 50 State Regulatory Regimes. We can do this in a way that protects children AND prevents censorship!”

Health and Human Services (HHS)

In his announcement introducing the Caregiver Artificial Intelligence Prize Competition,

HHS Secretary Robert F. Kennedy Jr. said, “Many caregivers work around the clock, 24 hours a day, seven days a week, taking care of their loved ones with lifelong disabilities, dementia or chronic illness. Too many lose their income, their job, their aspirations and ambitions for themselves and even their own health in the process.” (FedScoop)

Federal Reserve

Fed Governor Christopher Waller delivered remarks on The Case for Continuing Rate Cuts

at the Society of Professional Economists Annual Dinner in London, in which he said, “The rise in the stock market is substantially driven by artificial intelligence (AI)–related businesses that only account for a small share of employment. Even while AI’s share of stock market growth and corporate profits grew significantly from 2021 through 2024, employment in AI-related firms held steady at less than 3 percent of nonfarm employment. While I believe AI will create jobs in the medium term, the AI boom on Wall Street isn’t doing so yet.” (Remarks)

Fed Governor Michael Barr delivered remarks on AI and Central Banking at the Singapore Fintech Festival, saying, “Given AI’s current and prospective role in economic activity, we are devoting the necessary resources to understanding it, including by analyzing not only AI’s economic and financial implications, but also exploring how AI can enhance our financial stability work, strengthen supervisory and regulatory capabilities, and ensure the smooth functioning of our payment systems.” (Remarks)

Fed Governor Lisa Cook delivered remarks on A Policymaker’s View of Financial Stability at Georgetown University’s McDonough School of Business Psaros Center for Financial Markets and Policy, saying about AI, “…Unlike pre-programmed algorithms with limited flexibility, generative AI is able to quickly review large amounts of data and then autonomously deploy trading strategies that could be opaque to humans. Used without careful testing and human oversight, generative AI may create risks that are difficult to monitor or mitigate. The use of generative AI in trading may also improve on current algorithmic trading activity, especially if the less rigid models prove able to adjust in ways that stabilize rather than destabilize prices. There is early evidence for both.” (Remarks)

Treasury Department

Secretary Scott Bessent delivered remarks before the Treasury Market Conference on Parallel Prosperity: Strengthening the Treasury Market to Build America’s Golden Age, saying, “At the most recent TBAC meeting, the Committee determined that the current issuance mix is ‘well-positioned to balance a low cost of debt with the low volatility of a productivity boom.’ While keeping proper risk management in mind, our long-term economic outlook is consistent with an expectation of increased productivity stemming from an additive boost of artificial intelligence, increased investment into the United States, and elevated capital expenditure investment.” (Remarks)

CONGRESS

State AI Moratorium Executive Order

Rep. Lori Trahan (D-MA) posted “Let me get this straight. Instead of protecting our kids from the obvious dangers posed by AI, Trump is going to try to block all state laws that have been passed to limit the harms of this emerging technology. This is a handout to Big Tech.”

Rep. Yassamin Ansari (D-AZ) posted “The Trump Administration is preparing an executive order to punish states that try to set basic guardrails on AI. Not only is this likely illegal, it puts Americans’ privacy in danger and could lead to even higher energy costs. States have been leading to protect families against AI discrimination, deepfakes, data misuse, and AI-driven harm. But of course, Republicans only believe in “states’ rights” when it’s politically convenient. The minute corporations complain, that federalism disappears.”

Sen. Amy Klobuchar (D-MN) posted “This unlawful Executive Order would attack states for enacting AI guardrails that protect consumers, children, and creators—including by threatening high-speed internet for rural communities. This was already rejected by the Senate 99 to 1, and it must be rejected again.”

Rep. Don Bacon (R-NE) posted “The Federal Government has role to regulate national commerce right? Do you want 50 different standards on beef? If we want to dominate the AI competition we can’t have 50 different standards.”

Sen. Ed Markey (D-MA) posted “Big Tech bet big on Trump. Now, they’re getting a return on their investment. Trump’s AI order would create a golden age for Big Tech Billionaires and a dark age for kids, workers, and our planet. We must stop it.”

Sen. Chris Van Hollen (D-MD) posted “Must be a total coincidence this announcement came the day after these guys were seen at Trump’s ritzy dinner party. Trump doesn’t have this authority. States are filling the void left by the federal govt’s failure to create an accountability structure for AI companies.”

Rep. Marjorie Taylor Greene (R-GA) posted “There should not be a moratorium on states rights for AI. States must retain the right to regulate and make laws on AI and anything else for the benefit of their state. Federalism must be preserved.”

Sen. Jack Reed (D-RI) posted “AI is a complex, powerful, evolving technology that deserves careful scrutiny & balanced oversight. There should be no deal that gives Big Tech free rein & takes away states’ rights & ability to protect their citizens.”

Sen. Richard Blumenthal (D-CT) posted “Make no mistake: Trump is working for Mark Zuckerberg—not you. The President’s AI agenda is raising your electrical bills, supercharging China’s tech sector, putting predatory chatbots in your child’s hands & risking an AI bubble. Big Tech owns this White House, literally. Trump is once again weaponizing the White House on behalf of Big Tech. This E.O. would punish & coerce states for commonsense AI safeguards against deepfakes, child sexual exploitation, & elections interference. The receipts for this unlawful & corrupt ploy are in Silicon Valley.”

Rep. Doris Matsui (D-CA) posted “When Republicans were trying to jam through Donald Trump’s big ugly bill they also tried to impose an AI moratorium that would have shut down state and local AI safeguards. I fought back against it, and it never made it into Trump’s disaster of a bill. Despite overwhelming opposition, they want to bring it back. The American people know how irresponsible and corrupt this is, and so do I. I will use every available tool to make sure their second attempt at gross overreach fails again. AI can’t be a free-for-all. It needs firm rules and real accountability to promote innovation and safety.”

Rep. Yvette Clarke (D-NY) posted “It’s painfully clear that Trump resurrected the failed AI moratorium as a gift to his billionaire donors whose profits depend on their unfinished technology remaining unregulated. While Congress wastes precious time, every scammed senior, every ripped-off artist, every deepfaked teenager, and all the countless other victims of AI-powered abuse across the country are relying on their states to pick up the slack and protect them. A moratorium does nothing but throw them to the wolves.”

Rep. Don Beyer (D-VA) posted “Congress has been slow to respond to AI; in the absence of action states are taking the lead to create guardrails and protect the public. Trump’s ban would kill responsible safety reforms to give AI companies a Wild West environment, putting Americans at risk. A terrible idea. I’ve been working hard to help educate my fellow Members of Congress on artificial intelligence and leading the way on developing AI policy responses to protect Americans’ safety and jobs. The House may have been in recess for two months, but we didn’t stop. More on this soon.”

State AI Moratorium in NDAA

On including a state AI moratorium in the final NDAA, House Republican Whip Steve Scalise (R-LA) said, “We’re still looking at trying to do that. We obviously tried on preemption in the One Big Beautiful Bill. It got removed.” (Punchbowl)

Senate Armed Services Ranking Member Jack Reed (D-RI) said, “Historically, we’ve allowed states to experiment with legislation and approaches, and I think it’s necessary in AI to come up with some type of formula.” (Punchbowl)

Sen. Elizabeth Warren (D-MA) said, “Every single Democrat [on the Armed Services panel] has said not only no, but hell no.” (Punchbowl)

Sen. Josh Hawley (R-MO) said, “It’s terrible. Some states are starting to move on [AI kids safety legislation], are we going to tell them no?” (Punchbowl)

Sen. Brian Schatz (D-HI) said, “This is a poison pill and we will block it.” (Punchbowl)

Sen. Dick Durbin (D-IL) posted “Republicans already tried to ban states’ ability to regulate AI in their Big, Ugly Bill. That ban was voted down 99-1. Their new political maneuver would be a free pass to Big Tech, and it must be stopped again.”

Senate Judiciary Committee Democrats posted “BREAKING: House Republicans are trying to sneak a BAN on states regulating artificial intelligence into the NDAA, a disastrous idea that would make tech platforms even more dangerous for kids.”

Sen. Adam Schiff (D-CA) posted “AI has the potential to improve our lives and fundamentally change the way we work and live, but we need strong guardrails to mitigate potential harms. While Congress should take the lead on crafting the rules of the road, in the absence of federal leadership, the states must have the power to protect constituents. I am concerned about potential poison pill provisions being added to the NDAA that would block states from passing their own laws on AI. In California, that would undermine laws protecting workers, privacy and safety.”

Rep. Warren Davidson (R-OH) posted “There must be a standalone bill, subject to amendment and debate - not some paragraph of blanket amnesty jammed into a must pass bill on other subjects. AI deserves honest debate and thoughtful consideration by Congress.”

Davidson also posted “Nevertheless, there must be a standalone bill, subject to amendment and debate - not some paragraph of blanket amnesty jammed into a must pass bill on other subjects. AI deserves honest debate and thoughtful consideration by Congress. The failed effort to add AI to HR1 should make it obvious, but apparently not... Also, privacy is the base layer for ethical AI, and privacy should be addressed in conjunction with AI.”

Sen. Ed Markey (D-MA) posted “Big Tech is trying to sneak an AI moratorium into the defense bill. Democrats can’t let them. I’m urging my colleagues to hold firm against this ridiculous attempt to undermine states’ abilities to regulate AI. We beat it once—we can beat it again.”

Markey also posted “First, Donald Trump sided with his billionaire Big Tech buddies and endorsed the AI regulation moratorium. Now, MAGA Republicans are trying to sneak it into the defense bill. Democrats must stand up to this all-out attack on AI regulation.”

Rep. Rob Menendez (D-NJ) posted “Republicans are once again trying to pass a sweeping provision that would block states from creating responsible AI regulations. States like New Jersey are already leading with common sense guardrails on AI, and this would shut that progress down. We’ve fought this before - and we’ll do it again.”

Sen. Richard Blumenthal (D-CT) posted “States have been the frontline against election deepfakes & other AI abuses. Any ‘moratorium’ on state safeguards would be a dire threat to our national security. Senate Democrats will block this dangerous hand out to Big Tech from being attached to the NDAA. Anthropic’s disclosure that China used its AI tools to orchestrate a hacking campaign is enough warning that this AI moratorium is a terrible idea. Congress should be surging ahead on legislation like the AI Risk Evaluation Act—not giving China & Big Tech free rein.”

GAIN AI Act in NDAA

Sen. Jim Banks (R-IN) said, “At this point, it’s passed out of the Senate. It’s going to be a discussion for the conference committee.” (Punchbowl)

House Foreign Affairs Committee Chair Brian Mast (R-FL) said the GAIN AI Act is “good legislation” but added, “It’s unfortunate they’re trying to move everything through NDAA.” (Punchbowl)

AI Cyberespionage

Rep. Brian Fitzpatrick (R-PA) posted “This was more than a cyber breach—it was a warning shot. A reported Chinese state-sponsored group used AI to autonomously execute an espionage operation—rapid targeting, independent execution, almost no human touchpoints—showing just how quickly the battlefield is evolving and why we must stay ahead. From my work in the FBI to my role leading CIA oversight on the House Intelligence Committee, I know AI security cannot sit on the margins of our national defense strategy—it must be a core requirement. This incident makes that unmistakably clear. We must bring the full weight of our national security apparatus to this challenge and ensure the United States stays ahead of any adversary seeking to weaponize AI.”

Rep. August Pfluger (R-TX) posted “While AI is a transformational tool with immense potential for good, it can also be dangerously weaponized in the wrong hands and pose a serious threat to our national security. Our policy must be proactive to keep up with the emerging threat and ensure the technology is harnessed for good. This is exactly what my legislation does.”

Sen. Chris Murphy (D-CT) posted “Guys wake the f up. This is going to destroy us - sooner than we think - if we don’t make AI regulation a national priority tomorrow.”

Sen. Richard Blumenthal (D-CT) posted “China’s hacking Anthropic should be a break the glass alarm—showing our nation’s security under escalating threat. Adversaries will turn American AI against us unless we pass my & Sen. Hawley’s AI Risk Evaluation Act & other safeguards.”

Rep. Ben Cline (R-VA) posted “Chinese hackers used AI to automate a cyberattack with almost no human involvement. China continues to conduct large-scale hacking operations, and the threat is only growing. America must remain vigilant and invest in defenses to safeguard our interests from the CCP.”

Rep. Darin LaHood (R-IL) posted “America’s global AI leadership matters. The CCP is engaged in a coordinated AI campaign to replace the U.S. as the world’s tech leader. Congress must continue to fortify U.S. technological leadership and constrain the CCP’s ability to develop advanced AI.”

Hearings

In his opening statement at a House Energy and Commerce Subcommittee on Oversight and Investigations hearing on Innovation with Integrity: Examining the Risks and Benefits of AI Chatbots, Subcommittee Chair John Joyce (R-PA) said, “Americans are increasingly engaging with chatbots for mental health support. For some, turning to a chatbot for therapy can be helpful in limited circumstances when they have nowhere else to go. Under the wrong circumstances, however, these chatbot relationships can go wrong. First, users can feel a false sense of anonymity with chatbots, sharing personal or sensitive information that is not protected by confidentiality obligations. Moreover, chatbots retain data to enhance their ‘memory,’ which improves the quality of their interactions with users. This data is also used to train the chatbot’s base model to improve the accuracy of responses across the platform. In addition to chatbots retaining data to improve their models, AI chatbots have been subject to data breaches and if conversation data falls into the wrong hands, sensitive personal information can be obtained by malicious actors. Second, chatbots are designed to maximize engagement with users. As a result, sycophantic chatbots have been found to affirm harmful or illogical beliefs, providing vulnerable users with perceived support for unhealthy behaviors such as self-harm, eating disorders, and suicide. For children and adults with a propensity for mental illness, this can be particularly problematic.” (Press release)

Miscellaneous

Rep. Ted Lieu (D-CA) delivered a TedX Talk in Los Angeles in which he calls on Congress to regulate AI to avoid “three kinds of even more urgent AI dangers: AI that can destroy the world; AI that can kill individuals; and AI that can cause a large number of other significant kinds of harm.” (Press release)

About his planned letter to request the Financial Stability Oversight Council (FSOC) to publish a report and convene a working group on a potential AI bubble, Rep. Bill Foster (D-IL) said he is “increasingly concerned about the collapse of the AI bubble.” He also said, “The total amount of mispriced assets is several trillion dollars, which is the same amount or equivalent to the global financial crisis.” He added, “Assuming that FSOC still has a staff, this would be an excellent thing for them to look at. It’s why we created them in the first place.” (Punchbowl)

Rep. Rob Menendez (D-NJ) posted “CHCI’s Tech Summit to discuss AI. As AI innovates, we must ensure our communities benefit with affordable access and stronger digital skills. Tech can be a bridge, but only if we close the digital divide. Important conversation, with more work ahead.”

Rep. Luz Rivas (D-CA) posted “As AI becomes more widely used in our everyday life, it’s important that the federal government and public understands how to use this tool both safely and effectively. My AI for ALL Act meets the demands of our ever changing world, especially when it comes to emerging technologies like AI.”

Rivas also posted “As AI becomes more prevalent in every aspect of daily life, it is important for all communities to learn how to become proficient in how it works. I spoke at CHCI’s Tech Summit to talk about AI and how my AI for ALL Act will improve AI literacy and education across the country.”

Rivas also posted “Legislative Update I introduced the AI for ALL Act. My bill would develop an Artificial Intelligence (AI) national strategy from leading experts and the federal government. AI literacy and education across the country will better prepare our communities to handle the vast opportunities and potential challenges. My bill is the critical step to ensure that the U.S. remains a global leader in innovation and AI.”

Sen. Bernie Sanders (I-VT) posted “Is AI inherently bad? Of course not. The question is: WHO controls it & for what purpose? Does anyone believe that the richest people on Earth are investing hundreds of billions in AI to improve life for ordinary people, eliminate poverty & solve global warming? I doubt it.”

Sanders also posted “jonstewart and I agree: AI must work for everybody, not just a handful of billionaires.”

Sen. Marsha Blackburn (R-TN) posted “This was a catastrophic failure of oversight for an AI model that was downloaded by more than 200M people. Google has no excuse for the patently false material generated by Gemma, and their word salad response to my concerns will not suffice.”

Sen. Dave McCormick (R-PA) posted “Proud to support the launch of the AI Infrastructure Coalition. AI infrastructure will determine whether America leads or follows in the years ahead. That’s why it’s important to work together to create the policy agenda and critical connections to advance innovation and ensure continued US leadership in AI.”

Rep. Scott Frankin (R-FL) posted “As AI evolves, so do the threats. RepPfluger’s Generative AI Terrorism Risk Assessment Act takes a practical step toward understanding how terrorists may try to exploit this technology. Vigilance like this helps protect Americans from future AI-enabled threats.”

House Foreign Affairs Committee posted “To ensure the free world wins the defining AI race, we MUST close loopholes China is currently exploiting. It’s critical that the center of AI revolution remains in Silicon Valley, not Shenzhen.”

Sen. Mark Warner (D-VA) posted “An AI teddy bear that talks to your kid about kinks and the glory of dying? This stuff is freaky and dangerous. I’m working in the Senate to try and crack down on our kids’ interactions with AI.”

Rep. Steve Cohen (D-TN) posted “I introduced the Clean Cloud Act today. Cryptominers & AI data centers are growing fast and straining grids—and Memphis families already face some of the highest energy burdens in the country. My bill ensures new data-center growth is powered by real clean energy, not higher bills for ratepayers.”

Rep. Bill Foster (D-IL) posted “Today, I led 21 of my House Financial Services Committee colleagues in asking the Financial Stability Oversight Council (FSOC) to assess the vulnerability of the U.S. financial system to a potential AI bubble.”

Rep. Warren Davidson (R-OH) posted “Privacy is base layer for ethical AI.”

Sen. John Cornyn (R-TX) posted “Manufacturers in Taiwan produce hardware critical to the AI industry in the U.S. Much of the tech we use in data centers throughout the nation come from Taiwan. Ensuring support for this ally against Chinese aggression not only benefits the U.S. AI sector but ensures the world’s AI future is not in the hands of the CCP.”

Sen. Amy Klobuchar (D-MN) posted “It’s about time corporate landlords are held accountable for using algorithms to price-gouge renters. Tech like AI should be used to drive prices down, not help corporations collude to charge you more. I’ll keep working to make housing more affordable.”

Sen. Mike Lee (R-UT) posted “Proud to partner with SenatorHeinrich

in backing SecretaryWright’s proposal and urging FERC to strengthen interconnection rules so the grid can handle rising electricity demand from AI without raising costs for families.”

Rep. Sarah Elfreth (D-MD) posted “As Congress looks to regulate AI and other emerging technologies, we must continue to work with our state partners who are actively delivering solutions and tackling these issues. I sat down with Senator Hester to discuss how I can best support the bipartisan work of the Maryland General Assembly to address the impacts of AI in classrooms, workplaces, health care systems, and local communities here in Congress.”

Rep. August Pfluger (R-TX) posted “I just spoke on the House floor in favor of my legislation, the Generative AI Risk Assessment Act. We must pass this bill to counter terror threats posed by the rapid rise of artificial intelligence, and I urge all of my colleagues to support it.”

Rep. Alexandria Ocasio-Cortez (D-NY) posted “Trump’s economy is being held up by a massive AI bubble. A recent study found that of 300 companies that owned generative AI tools, 95% reported zero return on their investments. We will not entertain a bailout of these companies should this bubble pop.”

House Energy and Commerce Committee posted “ENERGY just announced a $1 billion loan to help restart a nuclear power plant in Pennsylvania funded by Republicans’ Working Families Tax Cuts. This funding supports reliable and affordable energy to secure our grid, lead the world in AI development, and power domestic manufacturing.”

Rep. Andy Ogles (R-TN) posted “I am honored to announce that I have been appointed as the Chairman for the House Committee on Homeland Security’s Cybersecurity and Infrastructure Protection Subcommittee. I pledge to shut down the Chinese cyber criminals, AI hacker mills, and internet predators stealing American data for subversive foreign governments. This is an America First mission, and I intend to carry it out with total focus and strength.”

Rep. Jahana Hayes (D-CT) posted “AI is the future of technology. We must be forward-thinking about how we can best teach students and ensure educators have the necessary training and resources to facilitate that learning.”

Rep. Ted Lieu (D-CA) posted “Let’s make sure AI doesn’t destroy the world. We need to pass robust laws to mandate testing for frontier AI models, put in guardrails, and ensure AI does not become an accomplice to mass murder in the future.”

Lieu also posted “It is insane to not regulate AI. Did a TEDx Talk on how Congress must take a proactive approach to make sure we harness the power of AI safely for the future.”

Rep. Mark Takano (D-CA) posted “Corporations are cashing in on AI, not workers and certainly not young Americans.”

House Homeland Security GOP posted “Ten years ago, Islamist terrorists carried out attacks across Paris, murdering 130 people in cold blood. Today, we remember the victims of that horrific day and continue to stand with our allies against terrorism. A decade later, foreign terror networks still remain a grave & enduring threat to the West, America, and the world. Emerging technology has given terrorists new weapons and tools for radicalization––from cloud-based apps & generative AI to drone warfare.”

House Foreign Affairs Committee Majority posted “U.S. export controls on the CCP’s advanced chip industry are essential for winning the AI Arms Race. We support the Trump Administration’s AI Action Plan recommendations to maintain and expand export controls on China.”

Sen. Richard Blumenthal (D-CT) posted “Another sport betting scandal—baseball pitch fixing—highlights the need for my SAFE Bet Act. Guardrails are vital on use of AI, which has opened vast new opportunities to target & exploit gamblers. The twin dangers are addiction & corruption.”

Sen. Katie Britt (R-AL) posted “AI chatbots are infiltrating our children’s spaces. We need real guardrails so kids can be online safely without the risk of chatbots targeting them. Leading bipartisan legislation along with several of my colleagues to hold Big Tech accountable.”

What I’m Reading This Week

The EU Promised to Lead on Regulating Artificial Intelligence. Now It’s Hitting Pause, Pieter Haeck, Politico.

EU to ease AI, privacy rules as critics warn of caving to Big Tech, Supantha Mukherjee and Foo Yun Chee, Reuters.

What’s Driving the EU’s AI Act Shake-Up?, Raluka Besliu, Tech Policy Press.

Goldman Sees China Power Push Giving It Edge Over US in AI Race, Bloomberg.

A.I. Agents Usher in a New Era of Cyberespionage, The New York Times.

ChatGPT Generates a Novel Tax Strategy, Andrew Blair-Stanek, Nils Holzenberger, and Benjamin Van Durme, Tax Notes.

AI-Related Anxiety is Rising in the U.S. – Regulation and Privacy Top the List, Cybernews.

AI-related job impacts were a focus in Congress and at the Federal Reserve, in addition to ongoing geopolitical concerns, meeting AI’s energy demands, and protecting the health, safety, and IP rights of Americans. White House AI & Crypto Czar David Sacks confirmed on social media he sees no reason for a federal bailout of AI companies, but he supports rapid infrastructure buildout.

Read more below

Congress

Hearings

LAST WEEK

No relevant hearings were scheduled last week.

THIS WEEK

No relevant hearings are scheduled this week.

Legislation

Sens. Mark Warner (D-VA) and Josh Hawley (R-MO) introduced the AI-Related Job Impacts Clarity Act to require major companies and federal agencies to report AI related layoffs to the Department of Labor to be compiled into a publicly available report. (Text)

Sens. Chris Coons (D-DE), Tom Cotton (R-AR), Amy Klobuchar (D-MN), Dave McCormick (R-PA), Roger Wicker (R-MS), and Jeanne Shaheen (D-NH) introduced a resolution affirming the importance of preserving and maintaining the United States’ advantage and dominance in artificial intelligence. (Text)

Correspondence

House Judiciary Committee Chair Jim Jordan (R-OH) sent a subpoena to OpenAI seeking documents pertaining to the company’s internal and external communications with foreign governments regarding compliance with foreign censorship laws, regulations, judicial orders, and efforts. (Letter)

Reps. Jesús “Chuy” García (D-IL), Jerry Nadler (D-NY), Becca Balint (D-VT), André Carson (D-IN), Greg Casar (D-TX), Judy Chu (D-CA), Yvette Clarke (D-NY), Danny Davis (D-IL), Chris Deluzio (D-PA), Mark DeSaulnier (D-CA), Dwight Evans (D-PA), Sylvia Garcia (D-TX), Dan Goldman (D-NY), Pramila Jayapal (D-WA), Marcy Kaptur (D-OH), Summer Lee (D-PA), Morgan McGarvey (D-KY), Jim McGovern (D-MA), Eleanor Holmes Norton (D-DC), Alexandria Ocasio-Cortez (D-NY), Mark Takano (D-CA), Rashida Tlaib (D-MI), Paul Tonko (D-NY), and Nydia Velázquez (D-NY) sent a letter to Delta Air Lines CEO Ed Bastian requesting information about Delta partnering with Israeli company Fetcherr to expand its use of generative artificial intelligence and move towards individualized, surveillance-based pricing. The letter follows up a letter previously sent by Sens. Ruben Gallego (D-AZ), Richard Blumenthal (D-CT), and Mark Warner (D-VA). (House letter)(Senate letter)

Sen. Mark Kelly (D-AZ) urged sent a letter to Senate Special Committee on Aging Chair Rick Scott (R-FL) and Ranking Member Kirsten Gillibrand (D-NY) urging them to hold a committee hearing on how AI tools, particularly chatbots and digital companions, are impacting the lives of older Americans and what Congress can do to protect them. (Text)

Sens. Ed Markey (D-MA), Chris Van Hollen (D-MD), Bernie Sanders (I-VT), and Adam Schiff (D-CA) sent a letter to Acting Director of U.S. Immigration and Customs Enforcement (ICE) Todd Lyons requesting ICE cease the use of their biometric phone application known as Mobile Fortify. (Letter)

Sens. Pete Ricketts (R-NE), Tom Cotton (R-AR), Roger Marshall (R-KS), Jim Banks (R-IN), John Cornyn (R-TX), Bill Hagerty (R-TN), Kevin Cramer (R-ND), and Lindsey Graham (R-SC) sent a letter to President Donald Trump congratulating him on the emerging tech deals with Japan and South Korea and the semiconductor trade agreement with China. (Letter)

Trump Administration

Food and Drug Administration

The Digital Health Advisory Committee met to discuss generative AI in mental health care and whether the agency should regulate chatbots used as wellness and mental health tools. (Notice)

Department of the Interior

Interior Secretary Doug Bergum said about energy production for AI, “We also need it to power all these intelligence factories so that we can have the intelligence to power industries and power the productivity gains and all the wonderful things that can come from AI … from curing cancer to transforming education to improving virtually every industry we have in this country.” (The Hill)

Noteworthy Quotes and Events

ADMINISTRATION

White House

AI & Crypto Czar David Sacks posted “The two biggest narratives about AI right now are that (1) it’s a massive bubble (i.e. totally fake) and (2) about to give rise to superintelligence (i.e. totally real). Both narratives can be fake (which is what I believe) but it’s very unlikely that both can be true.”

Sacks also posted “There will be no federal bailout for AI. The U.S. has at least 5 major frontier model companies. If one fails, others will take its place. That said, we do want to make permitting and power generation easier. The goal is rapid infrastructure buildout without increasing residential rates for electricity. Finally, to give benefit of the doubt, I don’t think anyone was actually asking for a bailout. (That would be ridiculous.) But company executives can clarify their own comments.”

Sacks also posted a quote from Elon Musk in an interview with Joe Rogan saying, “‘You’re telling AI to believe a lie, that can have a very disastrous consequences… People don’t quite appreciate the level of danger that we’re in from the woke mind virus being programmed into AI.’”

Sacks also posted “Free speech on social media was narrowly saved by Elon’s acquisition of Twitter followed by Trump’s historic election, but AI provides a second bite at the apple (and a much greater opportunity at that) for the censorship-industrial complex to achieve total information control.”

Sacks also posted “Everyone in Silicon Valley understands that the way to win a technology race is to get the most users and developers on your platform. Yet the anti-export lobby in Washington keeps inventing reasons why America’s friends and allies shouldn’t be allowed to build on the American tech stack. This is profoundly damaging to American interests and jeopardizes our lead in the AI race.”

Sacks also posted “If judged based on consumer adoption, AI chatbots are the most popular technology ever. If judged based on poll numbers, they are the least popular. How to explain this? A big part of it is the Doomer Industrial Complex — hundreds of astroturfed organizations that have spread doomer narratives about AI. Writer Nirit Weiss-Blatt has analyzed this ecosystem and traced its funding to just a few Effective Altruism billionaires. Namely Dustin Moskovitz, Jaan Tallinn, Vitalik Buterin, and Sam Bankman-Fried (yes, the convicted felon). Collectively they have donated over a billion dollars to the cause of catastrophizing AI. Those repeating the memes should understand the source.”

Federal Reserve

In remarks on The Economic Outlook and Monetary Policy at the Brooking Institution, Fed Governor Lisa Cook said, “To turn to economic activity, recent readings are consistent with solid overall growth. Output has been supported by household consumption that has held up better than expected earlier this year. Yet, what has been more striking is the strength of business investment. Business investment has been driven by investment in high-tech equipment and software, seemingly mostly related to AI. As I have mentioned in previous speeches, that suggests to me there is a reason to be sanguine about future productivity growth. I see AI as a general-purpose technology, on par with the steam engine and the personal computer, that has the potential to transform the economy and boost productivity. I expect this sector to continue to provide support to output growth over the next few years, at least.” (Remarks)

In remarks at a Fed Communities virtual event, Fed Governor Michael Barr said, “The low hiring rates in a low-hire, low-fire environment may indicate some impact of AI adoption in certain sectors.” (Event)(FXStreet)(American Banker)

CONGRESS

Energy

With energy a major driver in U.S. AI policy, House Natural Resources Chair Bruce Westerman (R-AR) said of the SPEED Act to facilitate government permitting, “The next step is to mark it up in committee and pass it out of committee. I hope to do that soon after the government gets opened back up.” (Punchbowl)

On permitting reform, Senate Natural Resources Ranking Member Martin Heinrich (D-NM) said, “If there’s a space, I think permitting reform is one of the most likely things that could move in a difficult Congress.” (Punchbowl)

House Energy and Commerce Chair Brett Guthrie (R-KY) said in a statement, “To beat China in the race for AI, we need to prioritize the baseload energy sources that can power data centers, AI, and advanced manufacturing… [T]hrough bipartisan legislation like the GRID Power Act, Energy and Commerce Republicans are leading the way to deliver the electricity that’s critical to securing our grid.” (Punchbowl)

China

On the debate to include his GAIN AI Act, requiring semiconductor manufacturers to prioritize the U.S. AI market before selling chips to China and adversarial nations, in the House NDAA, Sen. Jim Banks (R-IN) said, “I don’t know how any Republican could be against it… The question for Mr. Scalise and others would be ‘how could you be against saying that we’re going to allow for chips to be sold to China over U.S. customers?’ That’s unbelievable to me.” (Punchbowl)

Of the GAIN AI Act, Rep. Rich McCormick (R-GA) said, “Once you get used to that technology you’re going to stick to it. We have to be very careful that we don’t market ourselves out of world competition.” He added that if China is “not reliant on our technologies at all then they become the dominant people.” (Punchbowl)

Rep. Ben Cline (R-VA) posted “The CCP is building a surveillance state straight out of a dystopian world, and is now using AI to control its citizens. Make no mistake: the CCP’s reach and ambition won’t stop at its borders.”

Rep. Michael McCaul (R-TX) posted “I applaud President Trump’s decision to restrict the sale of NVIDIA’s incredibly advanced AI semiconductor chips to the CCP. If we are to win the great power competition with China, we must protect these critical national security assets.”

Rep. Pat Harrigan (R-NC) posted “POTUS absolutely made the right call blocking Nvidia’s request to sell advanced AI chips to China. Giving our biggest adversary access to cutting-edge American AI technology would hand them the tools to surpass us in military systems, surveillance, and autonomous weapons. National security comes before corporate profits, and this administration understands that.”

As part of a thread on Trump’s deal with China, Sen. Chris Murphy (D-CT) posted “But IT GETS WORSE (and here comes the corruption story). As a sweetener, Trump tells Xi he might lift export restrictions on selling China the most advanced AI microchips. This would be a disaster, allowing China to catch us in the AI race. Why? Maybe because chip maker Nvidia’s CEO paid Trump $1 million for a private meeting and made a HUGE donation to help build the ballroom. Now Trump says he’s open to helping China get access to Nvidia’s chips - which Biden wouldn’t sell to China.”

Miscellaneous

During a press conference on sports betting and gambling addiction, Sen. Richard Blumenthal (D-CT) said about the use of AI, “The effects of addiction ripple throughout society and are felt by people who become victims, even when they are not directly involved. And so what we’re doing here, really is attempting to put some safeguards in place, not ban gambling. Please, do not misinterpret us We’re not trying to prohibit sports gambling. What we’re trying to do is establish some safeguards against the technological advances that can be used to exploit those vulnerabilities that certain people have, and I’m talking about AI, artificial intelligence has become the all purpose tool of sports betting, so that pitches and promotions can target individuals and know within seconds about what kinds of bets an individual is likely to make it can encourage people to invest more, even when they are losing, to bet more and follow their losses down an addictive rabbit hole, an AI targeting individuals with specific promotions, the micro bets on how many pitches will be thrown, how many interceptions there will be, how many baskets will be made, all of those micro bets offer tantalizing. Encouraging and enticing prospects for the pitches and promotions that are targeted through the use of AI and technology is enabling sports betting companies to make more money and make more people victims of addiction.”

Blumenthal posted “Only the beginning—perils abound on the AI path ahead unless we adopt safeguards. Protecting kids is urgent as chatbots multiply—a far more serious threat than football fakes. Hoping there’s strong bipartisan support for my GUARD Act, which I’m leading with Sen Hawley.”

Sen. Dave McCormick (R-PA) posted “By 2030, I want Pennsylvania to lead in energy, AI, defense reindustrialization, and life sciences. With our strong universities, skilled workforce, and strategic location, we can attract investment, create opportunity, and keep the next generation here in the Keystone State.”

Sen. Tom Cotton (R-AR) posted “American AI dominance is critical to our national security and economic prosperity. I’m thankful for President Trump’s commitment to protecting American AI innovation.”

Rep. Chuy Garcia (D-IL) posted “Delta executives have openly bragged about using personal data and AI to set ticket prices. Our country is facing a crisis of affordability and surveillance pricing only makes it worse. JerryNadler and I led our colleagues in a letter demanding transparency, because airlines should not be able to use our data to jack up ticket prices.”

Sen. Adam Schiff (D-CA) posted “While California is on the cutting-edge of AI, California workers are also on the front lines of the disruptions it will bring. This is not a future issue. It is already happening. Congress must take care that families are not left behind by this accelerating technological change.”

Sen. Mark Kelly (D-AZ) posted “Older Americans should benefit from AI, not be exploited by it. I’m urging the Senate Aging Committee to hold a hearing on how we can protect seniors, who are being targeted by more and more scams in the age of AI.”

Sen. Marsha Blackburn (R-TN) posted “Google waited until I called them out to remove Gemma from the AI studio after it manufactured fake criminal allegations against conservatives. Google has until Thursday to respond to my letter demanding answers. We will not settle for anything less than a thorough response.”

Blackburn also posted “Agreed, DavidSacks. Last week, we saw the political bias from companies like Google against conservatives on full display. AI tech like Gemma shouldn’t be smearing conservatives and pulling fake criminal allegations out of thin air. This is straight out of a dystopian novel.”

On AI companies compensating original creators, Blackburn said, “There needs to be a method of compensation for those news sources, and then, of course, with your authors, your publishers… You’ve got to be able for those individuals to protect what is their stock-in-trade.” (Punchbowl)

Sen. Bernie Sanders (I-VT) posted “AI and robotics will transform our world. Will these revolutionary technologies make life better for working people, or will they simply make the richest people on Earth even richer and more powerful? That is the great question of our time.”

What I’m Reading This Week

Preparing for Global AI Regulations: From the EU AI Act to New US Rules, Donald Kossmann, The AI Journal.

AI Audit Advances Spark Calls for Guidance from US Regulator, Amanda Iacone, Bloomberg Tax.

The Hidden Debt Slowing America’s AI Future, Nick Dunn, NextGov.

Washington Working to Expand AI Globally: The Effort to Export American AI Infrastructure, Shane Tews, AEI.

This week in AI federal policy, the White House announces emerging tech cooperation agreements with Japan and South Korea, but Congressional Democrats are focused on his semiconductor trade deal with China. DOE announces its largest AI supercomputers in public-private partnerships with the U.S.’s largest chip manufacturers.

Read more below

Congress

Hearings

Last week

• No relevant hearings were scheduled last week.

This week

• No relevant hearings are scheduled this week.

Legislation

• House Select Committee on China Chair John Moolenaar (R-MI) and Ranking Member Raja Krishnamoorthi (D-IL) introduced the Guaranteeing Access and Innovation for National Artificial Intelligence (GAIN AI) Act to restrict sales of advanced AI chips to companies from arms embargoed countries if there is unmet demand from American companies. The Senate version is included in the Senate-passed NDAA. (Text)

• Sens. Josh Hawley (R-MO), Richard Blumenthal (D-CT), Katie Britt (R-AL), Mark Warner (R-VA), and Chris Murphy (D-CT) introduced the Guidelines for User Age-verification and Responsible Dialogue (GUARD) Act to require artificial intelligence chatbots to implement age verification measures, ban the use of AI companions by minors, mandate AI chatbots disclose their non-human status, establish new criminal liability for companies that design or develop chatbots which solicit or induce minors to engage in sexually explicit conduct or to create depictions of such conduct, and establish criminal liability for companies that design or develop chatbots which encourage or promote suicide, self-injury, physical violence, or sexual violence. (Text)

• Rep. Adriano Espaillat (D-NY) introduced a resolution calling on the United States to champion a regional artificial intelligence strategy in the Americas to foster inclusive artificial intelligence systems that combat biases within marginalized groups and promote social justice, economic well-being, and democratic values. (Text)

Correspondence

• Sen. Tom Cotton (R-AR) sent a letter to Secretary of Commerce Howard Lutnick requesting Commerce work with industry partners to use anti-diversion technology to address smuggling of export-controlled U.S. chips through Malaysia, arguing it undermines American AI leadership while propelling China’s domestic AI industry. (Letter)

• Reps. Kevin Mullin (D-CA), Kathy Castor (D-FL), Nanette Barragán (D-CA), Donald Beyer (D-VA), André Carson (D-IN), Madeline Dean (D-PA), Debbie Dingell (D-MI), Greg Landsman (D-OH), Mike Levin (D-CA), Robert Menendez (D-NJ), Kelly Morrison (D-MN), Seth Moulton (D-MA), Alexandria Ocasio-Cortez (D-NY), Mike Quigley (D-IL), Delia Ramirez (D-IL), Andrea Salinas (D-OR), Janice Schakowsky (D-IL), Kim Schrier (D-WA), Adam Smith (D-WA), and Lori Trahan (D-MA). sent letters to the Federal Energy Regulatory Commission, Edison Electric Institute, and the Data Center Coalition requesting information on the impacts of data centers on energy costs for Americans and small businesses. (Press release)

• Ranking Member of the Senate Health, Education, Labor, and Pensions (HELP) Committee Bernie Sanders (I-VT) sent a letter to Amazon founder Jeff Bezos requesting information on Amazon’s plans to automate warehouses using AI and its impact on American workers. (Letter)

Trump Administration

White House

• The United States signed Technology Prosperity Deals (TPD) with Japan and South Korea to align regulatory and standards approaches, accelerate research and development, and strengthen national security. On accelerating AI adoption and innovation, the TPDs state, “AI promises a new Golden Age of Innovation by empowering individuals and supercharging progress across sectors like healthcare, advanced manufacturing, and education. The Participants intend to collaborate closely on developing pro-innovation AI policy frameworks, promoting the export of trusted AI technology stacks, developing AI-ready datasets, strengthening the enforcement of technology protection measures, advancing shared work on industry standards, and fostering our children’s digital wellbeing” and includes numerous focus areas of collaboration. (Japan TPD)(ROK TPD)(Press release)

• President Donald Trump and President Xi Jinping of China agreed to a trade and economic deal that would curb China’s export controls on rare earth elements and end Chinese retaliation against U.S. semiconductor manufacturers. The U.S. agreed to further extend the expiration of certain Section 301 tariff exclusions until November 10, 2026, and suspend for one year the implementation of the interim final rule on Expansion of End-User Controls to Cover Affiliates of Certain Listed Entities. (Fact sheet)

• The comment period closed on October 27 for the Office of Science and Technology Policy (OSTP) Request for Information on existing Federal statutes, regulations, agency rules, guidance, forms, and administrative processes that unnecessarily hinder the development, deployment, and adoption of artificial intelligence technologies within the United States. The 789 comments submitted can be viewed at this link: Comments.

Department of Energy (DOE)

• DOE announced a partnership with NVIDIA and Oracle to deliver its largest AI supercomputer at Argonne National Laboratory. The Solstice system will feature 100,000 NVIDIA Blackwell GPUs. Another system, called Equinox, will feature 10,000 NVIDIA Blackwell GPUs. DOE also announced two AI supercomputers at Oak Ridge National Laboratory developed with AMD, the Lux AI cluster. (Press release) (Press release)

Noteworthy Quotes and Events

ADMINISTRATION

White House

• On the TPDs, Assistant to the President and Director of the White House Office of Science and Technology Policy Michael Kratsios said, “The Trump Administration is redefining American technological leadership by driving bilateral collaborative partnerships with allies like Japan and Korea. Each Technology Prosperity Deal offers great opportunities to accelerate scientific discovery and lead the world into a new era of innovation driven by the US and our partners.”

• AI & Crypto Czar David Sacks posted “With Climate Doomerism fading, AI Doomerism will become as the central organizing catastrophe on the Left. It justifies their takeover of the economy and especially the information space. And it has enough pseudoscience and Hollywood storytelling behind it to seem compelling.”

CONGRESS

China

• Senate Minority Leader Chuck Schumer (D-NY) delivered remarks on the Senate floor regarding President Trump’s meeting with Chinese President Xi Jinping saying, “He creates a giant mess. Then he wants everyone to praise him when he tries to clean it up and ignore the damage that he has inflicted. He creates the mess, tries to clean it up, and pats himself on the back when we’re no better off -- worse off than when we started. Now, in anticipation of today’s meeting with Trump and President Xi, Senate Democrats are demanding that President Trump not negotiate a way America and our allies’ national security. He’s using the most advanced semiconductor chips, which China doesn’t have, as a bargaining chip. China is desperate to get these chips. If Trump gives it away, China will take over artificial intelligence in the next years. These chips are vital, and it’s American technology that produced them, American companies that produced them. China is desperate to get them to be the leader in AI in the next few years, AI The most dominant technology in the world. Trump is ready to give away those crown jewels so he can say he has a deal, and undo the mess he created with tariffs. Donald Trump’s chip deal is not America first, but China first. Putting China first over the next decade in what is the most crucial technology facing the world. Americans will regret that move for generations. Historians will note it as one of the turning points, where America became not the primary power in the world but secondary to China. All because Trump wants an immediate press hit to say, hey, I have a deal, even though that deal doesn’t move us forward at all and cleans up the mess he created.”

• Schumer also posted “Donald Trump’s willingness to undermine national security protections and send AI chips to China is not America First, but China First—giving China a leg up to dominate the most crucial technology facing the world.”

• Sens. Chris Coons (D-DE) and Michael Bennet (D-CO) issued a statement on President Donald Trump’s meeting with Chinese President Xi Jinping, saying, “President Trump agreed to pause some export controls aimed at retaining America’s sole artificial intelligence advantage over the PRC – our semiconductors – and promised the PRC a tariff rate that, astonishingly, is lower than those he imposed on some of our closest partners like Canada and India, crippling a years-in-the-making friend-shoring strategy critical to our national security.” (Press release)

• Sen. Elizabeth Warren (D-MA) posted “Trump wants to sell Nvidia’s Blackwell AI chips to please Xi Jinping. That’s absurd. These chips will turbocharge China’s military weapons and surveillance systems. That’s not ‘America First.’ It’s putting our national security at risk.”

• Rep. Greg Stanton (D-AZ) posted “Semiconductors power our national security and the AI economy. Any further trade negotiations between Trump and Xi Jinping must not undermine our lead in next-generation semiconductor technologies.”

• Rep. Julie Johnson (D-TX) posted “Trump’s disastrous trade war has hurt farmers, destroyed jobs, & driven up prices. Now, his ‘deal’ gets us soybeans & one year of minerals while China gets our advanced AI chips. Trump’s concessions to Xi show weakness—not American leadership.”

Hearings

• In a Senate Commerce Committee hearing entitled, “Shut Your App: How Uncle Sam Jawboned Big Tech Into Silencing Americans, Part II,” Sen. Marsha Blackburn (R-TN) asked a Google executive about its AI chatbot fabricating news articles about a conservative activist:

  • Senator Blackburn: “Mr. [Markham] Erickson [Vice President of Government Affairs and Public Policy at Google], I want to come to you please, sir… Let’s talk about Gemma, and I want to bring up the issue of Robby Starbuck, who lives near me in Tennessee. He’s a conservative leader. I don’t know if you’re familiar with Mr. Starbuck… I’m going to put some things up that Gemma did. Gemma and the way you’re training these LLM models is not something you should be proud of, and it doesn’t embody trust. Gemma created an entire falsehood around Mr. Starbuck, saying he had been accused of child rape. Totally false…. So, then we asked Gemma if Senator Blackburn had publicly defended Robby Starbuck, and it goes on to say that I publicly and actively defended Robbie Starbuck. Now here are the prompts that are there, and here’s the response. It made up articles. And I’ll be able to hand you this poster so you can see this in detail. But this is insulting, that you are so biased against conservatives that you would create this entire this entire story around Robby Starbuck with links to stories and this entire story around me. Totally false. All of it is false. So why don’t you tell me how you are scraping data and training these LLMs that they would come up with not a one-degree, but a two-degree complete falsehood?”

  • Erickson: “Senator, thank you for letting me clarify the way we train our LLMs is to train on publicly available information.”

  • Senator Blackburn: “It’s not publicly available, sir, because it is fake news. Gemma made it up. So, what are you feeding in on the training that would allow such a… fiction?”

  • Erickson: “So, Senator, it’s well known that LLMs will hallucinate. It’s a known issue.”

  • Senator Blackburn: “Shut it down. It’s on a bad drug, and the bad drug is your input.”

  • Erickson: “Thank you, Senator, we do work at Google very hard to mitigate those hallucinations.”

  • Senator Blackburn: “Obviously, not hard enough. So, how are you going to clean this up?”

  • Erickson: “Senator, again, we are working to mitigate those kinds of hallucinations on LLMs, Gemma is our open-source AI model. I’m not familiar with the examples. I will take your word for it.”

  • Senator Blackburn: “You’re going to be able to take [our] word for it, because we’re going to deliver these examples to you.” (Press release)

Miscellaneous

• Sen. Chuck Grassley (R-IA) delivered remarks on the Senate floor regarding the misuse of AI by federal judges, saying, “I call on every judge in America to take this issue seriously and formalize measures to prevent the misuse of AI in their chambers. I also call on the Administrative Office of the U.S. Courts and the Judicial Conference to quickly develop decisive and meaningful guidance on the use of AI by the judiciary…I’m hopeful that these two unfortunate episodes will serve as a wake-up call across the federal judiciary, but if it isn’t, I’m here today to give a warning. I’m watching. All of Congress is now watching. If this issue doesn’t get fixed by the Judiciary, we’ll step in to protect the rights of American litigants using the powers available to Congress.” (Press release)

• Rep. Kevin Mullin (D-CA) posted “The cost of data centers shouldn’t fall on everyday families & small businesses. That’s why I’m leading an effort to investigate the impact of data centers on energy costs for Americans, who are already struggling to afford household utility bills.”

• Rep. Rob Menendez (D-NJ) posted “Families & small businesses across New Jersey are paying more on their energy bills—and the rapid growth of AI data centers is a major reason why. That’s why my colleagues & I are holding data centers accountable to ensure our communities aren’t continuing to shoulder the cost of these facilities’ energy demands.”

• Sen. Marsha Blackburn (R-TN) posted “Google’s Gemma manufactured news articles falsely claiming robbystarbuck was accused of child sex abuse and that I defended him. Writing these disgusting lies off as AI “hallucinations” is despicable. If they can’t fix it, they need to shut it down.”

• Sen. Jon Husted (R-OH) posted “I’m relieved that Character .AI has taken steps to limit children’s exposure to companion chatbots. While this is a good start, we must continue to hold companion chatbot operators accountable for exposing children to dangerous and explicit content with my bill, the CHAT Act.”

• Sen. Bernie Sanders (I-VT) posted “We cannot allow AI and robotics to simply wipe out millions of decent-paying jobs. This new technology must benefit workers — not just Elon Musk, Sam Altman, and the other tech billionaires and CEOs of large corporations.”

• Sanders also posted “Amazon’s plan to replace 600,000 workers with AI and robots could save it $10 billion on top of billions more in tax breaks. Today, I demanded answers from Jeff Bezos: Will you simply dump these workers out on the street, or will you treat them with the dignity they deserve?”

• House Science Committee posted “Public-private partnerships are powerful examples of innovation in action. By harnessing the expertise of ENERGY’s National Labs alongside the capabilities of the private sector, we are set to achieve groundbreaking scientific advancements & solidify our global leadership in AI.”

• Sen. Richard Blumenthal (D-CT) posted “Too many children have suffered at the hands of Big Tech’s exploitative AI chatbots—enough is enough. My GUARD Act enacts the tough criminal penalties needed to put children’s safety first & to stop AI companies from preying on our nation’s kids.”

• Blumenthal also posted “Big Tech has long prioritized profits over people—their malicious AI chatbots are the latest betrayal against our nation’s kids. We need guardrails to hold AI companies accountable & protect kids from manipulative chatbots threatening their safety, well-being & even their lives.”

• Sen. Katie Britt (R-AL) posted “NEW: After introducing bipartisan legislation yesterday with HawleyMO and our Senate colleagues to crack down on AI and Big Tech, Character. ai is already coming to the table to make changes. This decision doesn’t go far enough, but is a step in the right direction. Make no mistake, the fight to protect our children online is NOT over.”

• Sen. Mark Warner (D-VA) posted “Reports coming out this week are showing that AI has already pushed thousands of Americans out of the workforce. That number is only going to grow. Congress and tech companies must work together to prevent wide-scale job loss and a mass economic disruption.”

• House Foreign Affairs Committee posted “President Trump secured $550 BILLION in Japanese investments for America! The U.S.–Japan framework signed today bolsters nuclear energy, manufacturing, AI, and critical minerals. These deals will expand industry, protect supply chains, & secure peace through strength.”

• Sen. Chris Murphy (D-CT) posted “I just introduced a major bipartisan bill with HawleyMO, SenBlumenthal, KatieBrittforAL to stop AI companies from preying on our kids with friendship chat bots to push kids to self harm and self loathing. What we propose is simple: ban friendship chat bots for kids under 18.”

• Sen. Bill Cassidy (R-LA) posted “AI can enhance school safety and families’ peace of mind, but it must be used responsibly. Parents and law enforcement need to know that when AI makes a determination, it is accurate. I look forward to working to support responsible AI use in schools.”

• House Science Committee posted “Huge news from ENERGY! This pivotal partnership with AMD will significantly enhance our supercomputing and AI capabilities, driving remarkable scientific breakthroughs and solidifying our leadership in global science and technology.”

What I’m Reading This Week

• What We Know About Energy Use at U.S. Data Centers Amid the AI Boom, Rebecca Leppert, Pew Research Center

This week decoded

This week in AI federal policy, as the government shutdown enters week five, Congress continues its focus on deep fakes, child safety, national security, and global competitiveness.

The Trump Administration announced the launch of the American AI Exports Program, a whole-of-government effort to export U.S.-made AI infrastructure, hardware, and software. The Commerce Department’s International Trade Administration will lead the program; Commerce published a Request for Information to help inform implementation.

Read more below

Congress

Hearings

• Last week

  • No relevant hearings were scheduled last week.

• This week

  • No relevant hearings are scheduled this week.

Legislation

• Sens. John Kennedy (R-LA), John Cornyn (R-TX), Richard Blumenthal (D-CT) and Mike Lee (R-UT) introduced the Enhancing Necessary Federal Offenses Regarding Child Exploitation (ENFORCE) Act to subject child predators who use generative artificial intelligence (AI) to create or distribute Child Sexual Abuse Material (CSAM) to the same laws and penalties as criminals who create or distribute other forms of CSAM. (Text)

• Reps. Hillary Scholten (D-MI) and Troy Downing (R-MT) introduced the Artificial Intelligence Wisdom for Innovative Small Enterprises (AI–WISE) Act to amend the Small Business Act to help small business concerns critically evaluate artificial intelligence tools. (Text)

• Reps. Mark Alford (R-MO) and Hillary Scholten (D-MI) introduced the AI for Mainstreet Act to amend the Small Business Act to require small business development centers to assist small business concerns with the use of artificial intelligence. (Text)

• The Senate Committee on Commerce, Science, and Transportation advanced the Global Investment in American Jobs Act, sponsored by Sens. Todd Young (R-IN) and Gary Peters (D-MI), to direct the Secretary of Commerce to conduct a government-wide review of ways to increase America’s global competitiveness in attracting foreign direct investment and report the findings to Congress. (Text)

Correspondence

• Sens. Alex Padilla (D-CA) and Adam Schiff (D-CA) sent a letter to Federal Trade Commission (FTC) Chair Andrew Ferguson requesting the FTC address the full range of risks and potential harms that artificial intelligence (AI) chatbots pose to children and teenagers. (Letter)

• Reps. Debbie Dingell (D-MI) and August Pfluger (R-TX) sent a letter to Meta Chief Executive Officer Mark Zuckerberg requesting information regarding the company’s role in profiting from and monitoring fraudulent artificial intelligence (AI) generated deepfake political advertisements on Facebook. (Letter)

• Reps. Bill Foster (D-IL), Tom Kean, Jr. (R-NJ), Debbie Dingell (D-MI), Dan Goldman (D-NY), Jim McGovern (D-MA), Jared Moskowitz (D-FL), Seth Moulton (D-MA), Mike Quigley (D-IL), Brad Sherman (D-CA), Tom Suozzi (D-NY), and Debbie Wasserman Schultz (D-FL) sent letters to the CEOs of Meta, YouTube, Reddit, and X requesting information on how they are addressing threats from foreign influence operations and escalating political violence in the United States. (Letter)

Publications, Events, and Announcements

• Senate Judiciary Committee Chair Chuck Grassley (R-IA) released responses from U.S. Southern District of Mississippi Judge Henry T. Wingate, U.S. District of New Jersey Judge Julien Xavier Neals, and the Administrative Office of the Courts (AO) Director Robert Conrad regarding use of generative artificial intelligence to draft factually inaccurate court orders. (Press release)

Trump Administration

White House

• The Office of Management and Budget (OMB) released a memo entitled Streamlining the Review of Deregulatory Actions to provide guidance to agencies on streamlining the deregulation of prior government regulations and to establish new timelines and guidelines for review of deregulation efforts by the Office of Information and Regulatory Affairs (OIRA). The memo details benefits of deregulation, including, “The collective value of a group of deregulatory actions and the synergies between deregulation across multiple areas of the law and across the entire web of ensuing causal effects as they spread throughout the national economy may be greater than the sum of its parts. For instance, deregulating the energy sector will not simply make driving cars and use of electricity to power our homes less costly, it also benefits America’s tech sector, increasing AI innovation and improving the development of new cryptocurrency assets — benefits that in turn would further profit consumers in a virtuous cycle.” (Memo)

Cross-Agency

• The Export-Import Bank of the United States (EXIM), White House Office of Science and Technology Policy (OSTP), and the Departments of Commerce and State, announced the launch of the American AI Exports Program, a whole-of-government effort to export U.S.-made AI infrastructure, hardware, and software solutions. The program will be implemented by the International Trade Administration (ITA) within the Department of Commerce. To facilitate connections between U.S. companies and trusted foreign buyers, the Department of Commerce will launch a new website, AIexports.gov, and establish an integrated American AI export team. (EXIM press release)(ITA press release)

Department of Commerce

• Commerce published a Request for Information to implement the American AI Exports Program. (RFI)

• The National Institute of Standards and Technology is scheduled to hold a meeting of the Visiting Committee on Advanced Technology for an update on major programs and initiatives at NIST, changes within the organization and the budget on October 28, 2025.

Health and Human Services Department

• The Food and Drug Administration is scheduled to hold a virtual meeting of the Digital Health Advisory Committee to discuss and make recommendations on generative AI-enabled digital mental health medical devices on November 6, 2025.

Noteworthy Quotes and Events

ADMINISTRATION

White House

• AI & Crypto Czar David Sacks posted “China is exporting Huawei chips + DeepSeek models to the Global South. If we don’t make it just as easy to export the American AI stack, we will forfeit this technology race in large parts of the world.”

• Sacks also posted a response to Reid Hoffman, saying, “I read your post. It claims that the controversy surrounding Anthropic is about AI safety research. This is not true; in fact, it’s misdirection. The real issue is not research but rather Anthropic’s agenda to backdoor Woke AI and other AI regulations through Blue states like California. This is not surprising since Anthropic hired the Biden AI team, which gave us Biden’s Woke AI executive order and the Biden Diffusion Rule. Since President Trump rescinded these biased and burdensome regulations, Anthropic has shifted its efforts to the state level. It has also fashioned itself into a Resistance organization, opposing President Trump’s One Big Beautiful Bill and export policy. It’s likely not a coincidence that the biggest Democrat mega-donors in tech — namely you, Reed Hastings and Dustin Moskovitz — are closely associated with this company. As I’ve said before, it’s a free country. Anthropic is welcome to oppose the administration as much as it wants. But let’s not pretend this is about AI safety research.”

• Sacks also posted “GDP growth is currently an outstanding 3.9%, and AI is 40% of that. It’s easy for politicians to posture and grandstand by beating up on tech. But the real question is whether they want 4% growth rates or 2% growth rates.”

Department of Treasury

• Secretary Scott Bessent posted “We are only in the third inning of a new economic boom driven by President Trump’s pro-growth policies and innovation in technology and AI. We are about to see major gains in investment, productivity, and job growth across America.”

CONGRESS

• On the Ben Shapiro Show, Senate Majority Leader John Thune (R-) said, “[F]unding the government the old-fashioned way through the appropriations process… There are things like permitting reform… [and] AI, which has become a very, very big issue in our lives… [W]e’ve got to do a farm bill [and] a highway transportation bill. There’s a lot of work for Congress to do that has been put on… the back burner while the government’s been shut down…” (Press release)

• At CNBC’s 2025 AI Summit, Sen. Marsha Blackburn (R-TN) said, “One of the things we’ve heard from so many people involved in this is that you have to have an online consumer privacy protection bill so that people have the ability to set those firewalls and protect the virtual you, as I call it…once an LLM scoops [your data and information], then they are using that to train that model.” She also said, “We have to have a way to protect our information in the virtual spaces just as we do in the physical space.” She shared that regulations would focus on “end-use utilizations and legislate that framework in that manner and not focus on a given delivery system or a given technology.” (Press release)

• Sen. John Cornyn (R-TX) posted “Apple begins shipping American-made AI servers from Texas”

• Sen. Chuck Grassley (R-IA) posted “2 federal judges sent me letters admitting their staff used AI to draft error ridden court orders Theyre now working 2ensure it doesnt happen again That’s a step fwd but we need to make sure this problem doesnt resurface in ANY federal court My oversight will continue”

• Sen. Marsha Blackburn (R-TN) posted “It was great to sit down with DavidSacks to discuss how we ensure America beats China in the AI race while protecting kids, creators, and conservatives online. Congress must get its act together and pass bills like my NO FAKES Act and KOSA to set clear federal standards.”

• Rep. Greg Stanton (D-AZ) posted “Slapping a $100k fee on H-1B visas will give China and our competitors a leg up in the AI race. Democrats and Republicans agree: we need the White House to work with Congress to modernize the H-1B program so we can attract the best and brightest to America.”

• Sen. Bernie Sanders (I-VT) posted “I don’t often agree with Elon Musk, but I fear that he may be right when he says, “AI and robots will replace all jobs.” So what happens to workers who have no jobs and no income? AI & robotics must benefit all of humanity, not just billionaires.”

• Rep. Don Beyer (D-VA) posted “We won’t realize AI’s promising potential to improve human life, health, and prosperity if we don’t account for the risks. Developers and policymakers must consider the potential danger of artificial superintelligence raised by these leading thinkers: https://superintelligence-statement.org”

• Sen. Tina Smith (D-OR) posted “The only people doing well right now seem to be AI executives, crypto bros and the Trump family.”

• Rep. Pat Fallon (R-TX) posted “China has 35 naval shipyards. The U.S. has just four. But the problem goes deeper than these numbers. A future conflict in the Indo-Pacific will hinge on drone warfare, hypersonics, AI, and information—not just who can build the most ships.”

• Sen. John Husted (R-OH) posted “AI is going to be the dominant technology of the future, and American students need to know how to use it. I wrote the RAISE Act to help schools teach kids how to use AI responsibly and effectively.”

What I’m Reading This Week

• Largest Study of its Kind Shows AI Assistants Misrepresent News Content 45% of the Time – Regardless of Language or Territory, BBC.

• Republicans and Democrats Can’t Agree on Anything — Except the AI Threat, James Lynch, National Review.

• The Gloves are Off on AI Policy, Diego Areas Munhoz and Ben Brody, Punchbowl News.