In a dramatic shift from the Biden administration’s approach, President Donald Trump is signaling a new era of unbridled artificial intelligence development in the United States, discarding previous efforts to balance innovation with safety and transparency.
Within his first 24 hours back in Washington, Trump rescinded Biden’s sweeping executive order on AI, immediately halting the implementation of key safety and transparency requirements.
The move has been met with a mixture of cautious optimism from tech leaders and apprehension from experts concerned about the lack of oversight.
A “just build” approach to AI development
Trump’s move to rescind Biden’s AI executive order marks a clear departure from a more cautious approach.
While the Biden administration sought to ensure US leadership in AI while addressing potential risks, Trump’s administration has adopted a “just build” strategy, focusing on speed of development rather than regulation.
The shift was praised by some tech leaders attending the World Economic Forum in Davos, while others raised concerns about the potential implications of such a light-touch approach.
Trump’s plan: billions in funding and a hands-off approach
On Tuesday, Trump announced a new $500 billion joint venture led by SoftBank Group Corp., OpenAI, and Oracle Corp. to fund AI infrastructure in the US.
Softbank’s Masayoshi Son, and tech executives like Sam Altman, and Larry Ellison, joined Trump to announce the venture, with Son pledging an initial investment of $100 billion “immediately,” followed by future investments to bring the total to “at least” $500 billion in AI projects, including data centers and physical campuses.
Son hailed the venture as “the beginning of a golden age,” underlining the level of optimism that the current policy changes have created within the tech community.
Ellison noted that data centers are already under construction, citing one in Abilene, Texas.
Trump also stated that his administration would pave the way for investors to pour money into “AI plants,” with little regard for how those data centers are powered.
A continental divide over AI regulation
With these swift moves, Trump’s approach to AI diverges sharply from that of Europe, setting the stage for a clash over the best approach to regulating AI and competing with China.
The EU, in contrast, has unnerved some leading AI companies by enacting stringent tech legislation focused on privacy and safety.
The Trump administration, on the other hand, has embraced prominent tech figures such as Elon Musk and venture capitalist David Sacks to help shape its policies on tech and AI.
The role of Elon Musk: advocate, investor, and regulator?
Exactly how hands-off Trump’s AI strategy will ultimately be may depend largely on Musk’s influence.
While Musk has invested in AI through his startup, xAI, he has also repeatedly warned of its existential risks if left unchecked.
This creates a dynamic in which a key figure influencing government policy has also cautioned about the potentially dangerous aspects of the technology.
Tech leaders cautiously optimistic, experts express concerns
“It seems clear that the new administration is going to be encouraging of tech and tech growth,” said Demis Hassabis, chief executive officer of Google DeepMind, in an interview with Bloomberg News in Davos, highlighting a degree of optimism from some tech leaders.
He added that:
The administration is getting advice from the people who really understand what’s happening at the cutting edge.
Similarly, OpenAI Chief Financial Officer Sarah Friar told Bloomberg News that the Trump administration has shown “a real willingness to lean in” and “be very on the economic front foot” regarding technology and AI.
Alphabet Inc. President Ruth Porat said Trump’s team wants to “clear away some of the impediments to investing” in the data centers needed for AI, further highlighting the degree of cooperation that is developing.
However, experts like Frank Pasquale, a law professor at Cornell Tech and Cornell Law School, worry about the unintended consequences of winning the “AI war.”
Pasquale warns that by removing guardrails, “Trump is clearing a path for more investment in artificial intelligence where there’s less risk of regulation,” but “there was a lot of good reason to have guardrails in place,” highlighting his concern that companies might build unsafe products if left without oversight.
The looming competition with China
In recent months, OpenAI and other companies have urged governments to facilitate massive investments in data centers and energy sources, with OpenAI specifically calling for the construction of massive 5 gigawatt data centers.
Last week, the Biden administration signed an executive order that mandated federal agencies to lease government land for AI data centers, while also emphasizing the use of clean energy sources.
Trump, on Tuesday, was asked whether he would rescind this order and he replied “no, I wouldn’t do that. That sounds to me like it’s something that I would like.”
Nevertheless, Trump is likely to loosen clean energy requirements, and will leave it up to tech companies to decide whether or not they would like to make use of fossil fuels to power their data centers, according to Bloomberg News, who quoted Joseph Majkut, director of the energy security and climate change program at the Center for Strategic and International Studies.
For the Trump administration, and possibly many within the AI industry, climate and safety are considered secondary to concerns about being outcompeted by China.
At Davos, Alphabet’s Porat said it’s not “a foregone conclusion” that the US will maintain its lead over China in AI, while OpenAI’s Friar added that China is “absolutely investing in this area” and understands the critical role AI will play in their economy and security.
DeepSeek, a Chinese startup, recently unveiled an updated AI model that they claim rivals OpenAI’s technology, and its founder recently appeared at a meeting with Chinese Premier Li Qiang, according to the South China Morning Post.
Alexandr Wang, founder and CEO of Scale AI, wrote in an open letter to Trump about winning the “AI war”, adding “You have the right team in place to take on this challenge and ensure we maintain our lead against adversaries.”
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