Silicon Valley backed Trump to kill AI regulation, now the industry is begging for rules

The AI industry that donated heavily to elect Donald Trump on the promise he would leave the technology alone is now asking for formal regulation, Politico reported on Friday. Executives at frontier AI companies told the outlet they view the administration’s ad hoc approach to model oversight as more damaging than anything the Biden administration had proposed.

The shift has been rapid. Trump entered his second term after a wave of Silicon Valley donations from billionaires who warned that Biden’s AI safety policies would crush American innovation. He spent his first year focused on stopping states from regulating the technology and signed a voluntary executive order on June 2 that asked companies to submit models for 30-day review before release.

But the voluntary framework was overtaken by events almost immediately. The White House imposed export controls on Anthropic’s Mythos 5 and Fable 5 models on June 12, after Amazon’s CEO raised security concerns with the Treasury Secretary. This week, the administration pressured OpenAI to restrict the launch of its latest model, Sol, to roughly 20 government-approved partners, the first time a US company launched a frontier model under a government-managed access list.

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One senior AI executive, granted anonymity by Politico, called the result “a de facto European-style licensing regime.” Paul Lekas, head of global public policy at the Software and Information Industry Association, which represents leading AI companies, said there is “a real need for a formal process” and that the industry wants to avoid releases based on “an ad hoc process and a one-off license.”

The industry representatives also told Politico they are afraid to push the White House for clarity. “It feels like they’re walking on eggshells a little bit,” said one AI policy adviser who works with major frontier labs. Companies fear that lobbying too aggressively could invite export controls or other regulatory retaliation.

Saif Khan, who served as senior adviser on critical and emerging technology at the Commerce Department under Biden, called the Trump approach an overreaction born of earlier dismissiveness. “Because there has been some dismissiveness of the risks, there’s been no preparatory work, no hiring of experts,” Khan told Politico, describing the result as “opaque, almost vibes-based.”

Khan said the administration’s actions amount to “an almost complete moratorium on new releases” that will “start seriously impacting companies’ bottom lines,” calling it far more damaging than anything Biden envisioned. The Biden administration’s own final rule would have imposed export controls on chips and AI model weights for certain countries, but never attempted to block domestic releases.

Dean Ball, a former Trump administration official who authored the White House AI Action Plan and is joining OpenAI as head of strategic futures on July 6, acknowledged the tension. He said the administration’s concerns are “100 percent legitimate” but that “they are likely overreacting to these legitimate concerns.” Ball added that he is glad the White House has arrived at taking AI safety seriously, even if the execution is flawed.

On Friday, the administration partially rescinded the Anthropic export ban, allowing Mythos 5 to be shared with more than 100 approved companies. But Fable 5 remains blocked for reasons the government has not explained. An OpenAI executive told Politico the industry expects the administration to finalize its June 2 executive order soon and replace the current crackdown with the voluntary vetting framework it originally outlined.

Lekas said the tech industry is developing “a coordinated push for an actual framework” on advanced AI rules and wants Washington to codify it, whether through executive order or legislation. He warned that if AI companies cannot agree on a standardized approach to safety, they will keep receiving the same unpredictable treatment.

White House spokesperson Liz Huston defended the president’s record, citing fast-tracked permits for AI infrastructure and the executive order aimed at stopping state-level regulation. “President Trump has clearly and repeatedly articulated his goal: ensure continued American dominance in AI,” Huston said.