January 26: This week in AI federal policy
DC/ai Decoded: A weekly newsletter on U.S. policy developments in artificial intelligence and quantum
This week decoded
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
