David Sacks’ Bid to Block AI Laws Backfires Spectacularly
▼ Summary
– A leaked draft executive order would have preempted state AI laws and consolidated regulatory power at the federal level, directing agencies to act within 30-90 days.
– The order would have granted significant influence to David Sacks, a special advisor, by requiring all agencies to consult him during implementation.
– The proposal faced immediate backlash from Democrats, tech-skeptical Republicans, and MAGA supporters concerned about federal overreach and Sacks’ power.
– Had it been signed, the order could have punished states by withholding federal funds and created a chilling effect on state AI legislation, despite potential legal challenges.
– The draft was ultimately not signed, and a subsequent AI order focused on uncontroversial National Labs development instead, with Sacks mentioned only once.
A controversial plan to centralize artificial intelligence regulation under federal authority, which would have significantly empowered tech billionaire David Sacks, collapsed after facing intense bipartisan opposition. This proposed executive order would have stripped states of their ability to enact AI laws and concentrated unprecedented influence within the White House, creating a dramatic showdown between Silicon Valley interests and political forces across the ideological spectrum.
Washington insiders were stunned when details of the draft order emerged, revealing its sweeping scope and aggressive timeline. The document directed multiple federal agencies to take punitive actions against states with existing or proposed AI regulations, mandating reports and legal strategies within 30 to 90 days. What raised particular concern was the requirement that all implementing officials must consult with David Sacks, the Special Advisor for AI and Crypto, effectively making him the nation’s de facto AI policy gatekeeper.
The reaction was immediate and forceful. Across the political landscape, figures from Steve Bannon’s War Room to Democratic leadership expressed alarm at what one tech policy adviser described as “a consolidation of power.” Congressional offices prepared opposition statements while policy analysts documented how the order would transfer regulatory authority from numerous agencies to the White House. The scheduled signing never occurred.
Had it been implemented, the order would have created a powerful mechanism for intimidating states into compliance. Legal experts noted that provisions allowing the federal government to withhold funding, from highway projects to education grants, could have paralyzed state legislatures even if courts eventually ruled the order unconstitutional. “The most effective part would be having a chilling effect on state legislation,” observed Charlie Bullock of the Institute for Law and AI, highlighting how financial threats could deter states from pursuing their own AI regulations despite potential legal victories.
Sacks’ unique position as both a government advisor and venture capitalist placed him at the center of the controversy. Unlike other administration figures with tech industry connections, his provisional government status and direct access to major tech CEOs made him particularly influential. “He’s trying to maintain America’s competitive edge in the big picture, and in a more selfish manner, he’s trying to protect the tech industry,” explained the White House adviser, describing Sacks’ approach as protecting “his people.”
The proposal also revealed surprising political alliances forming against tech influence. Both progressive holdovers from the Biden administration and hardline MAGA officials within the current administration found common cause in opposing Sacks’ growing authority. This informal coalition united those wanting stricter tech regulation with those distrustful of technology companies generally, creating an unexpected barrier to the order’s implementation.
Analysis of the draft revealed significant omissions in agency involvement. Conspicuously absent were numerous organizations that had been central to previous AI policy efforts, including the National Institute of Standards and Technology, the Office of Science and Technology Policy, and cybersecurity agencies. Instead, enforcement would have fallen to just four departments, Justice, Commerce, the FTC, and the FCC, all operating under Sacks’ guidance and empowered to punish states pursuing AI legislation.
Populist Republicans proved particularly resistant to the proposal despite their general support for the administration. Their concerns about AI’s impact on conservative values, job security, and states’ rights created fundamental disagreements with the tech-focused approach. Even governors from solidly Republican states like Florida and Arkansas voiced opposition to the moratorium, demonstrating the depth of resistance within the party’s base.
The backlash forced a strategic retreat. Within weeks, the administration signed a different, far less controversial AI order focused on National Labs development, with Sacks mentioned only briefly. The episode revealed the limitations of Silicon Valley’s influence in Washington and the unexpected alliances that can form around technology regulation, proving that even well-connected billionaires can overreach when confronting established political dynamics.
The White House press office declined to comment on the record about the withdrawn order, instead requesting identification of sources who provided information about the internal deliberations.
(Source: The Verge)
