Tech industry rattled by Trump's unpredictable AI policy U-turns

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U.S. President Donald Trump’s abrupt shift toward an aggressive and unpredictable oversight regime for artificial intelligence has some in the industry yearning for some Biden-style regulation. It’s a reversal that few would have predicted at the start of Trump’s second term, after he swept into office on a wave of donations from Silicon Valley billionaires who warned that former President Joe Biden’s AI safety policy would crush U.S. innovation. Trump had signaled an intention to leave AI alone to flourish, and in his first year he mostly focused on stopping states from regulating the technology. But the arrival of powerful new AI models from Anthropic and OpenAI caused the White House to clamp down this month on the firms’ ability to release their most advanced products, for fear that bad actors might use them to unleash cyberattacks. The shift to new AI controls has been chaotic and imprecise — leaving the American AI industry in limbo at the same time that its Chinese competitors are gaining ground. The unpredictability was on display again Friday when the Trump administration partially rescinded its export ban on Anthropic’s most advanced artificial intelligence model — de-escalating a confrontation that has caused confusion across the American AI industry. But a second advanced Anthropic model, called Fable 5, remains blocked for reasons that remain opaque. And Anthropic’s top competitor, OpenAI, limited the release of its most advanced model this week because of similar cyber concerns from the White House. The moves have whipsawed an industry that had come to believe it had a partner in the White House, but is now facing a growing bipartisan backlash and an uncertain regulatory regime whose scope and scale seems to change week by week. One senior executive at an AI company, granted anonymity to avoid retaliation, was bluntly critical of the hurdles the administration has put in the way of new models. “This seems like a de facto European-style licensing regime,” the executive said. Paul Lekas, head of global public policy and government affairs at the Software Information Industry Association trade group, which represents some of the leading AI companies, said there is a “real need for a formal process.” “We want to avoid a situation where the release of any model or piece of software is based on an ad hoc process and a one-off license process,” Lekas said. One OpenAI executive, granted anonymity to describe discussions with the administration, said the industry is looking for “clarity” from the administration — a phrase repeated across interviews with half a dozen other lobbyists and industry representatives. But the industry representatives also said they’re wary of pushing the White House for answers, lest they end up hit with export controls or other blunt tools of regulation. “It feels like they’re walking on eggshells a little bit,” said one AI policy adviser who works with major frontier labs, granted anonymity to candidly describe the landscape. White House spokesperson Liz Huston, in a statement, defended the president’s efforts to facilitate innovation in the AI industry, including fast-tracking permits for AI infrastructure and signing an executive order that aimed to stop a patchwork of differing state laws on the technology. “President Trump has clearly and repeatedly articulated his goal: ensure continued American dominance in AI and other cutting-edge technologies,” Huston said. “President Trump and the entire Administration will continue to cement America as the world’s premier innovation powerhouse.” The first sign of the administration’s pivot on AI policy came in early June when, after weeks of debate, Trump signed an executive order that laid out a voluntary vetting process for companies developing advanced AI models. But before the order was implemented, the White House went much further — in mid-June, it imposed export controls on Anthropic’s Mythos 5 and Fable models, blocking the company from releasing its new product over potential security concerns. And this week, the administration pressured OpenAI to restrict the release of its new GPT-5.6 model to a small group of partners approved by the administration. Saif Khan, a former adviser on emerging technology in the Biden administration, called the Trump administration’s actions an overreaction to predictable safety concerns, and suggested it stemmed from the White House’s prior laissez-faire attitude toward AI rules. “Because there has been some dismissiveness of the risks, there’s been no preparatory work, no hiring of experts that you need to do this work,” Khan said. “And now you have this opaque, almost vibes-based system for what is going to get approved and what’s not.” Khan called the new White House approach far more damaging to the AI industry than anything the Biden administration had envisioned, including a rule introduced just as the former left office that would have imposed export controls for certain countries on both semiconductor chips and the weights of advanced AI models. “The administration’s current actions have resulted in an almost complete moratorium on new releases,” Khan said. “And that’s going to start seriously impacting companies’ bottom lines.” Dean Ball, a former Trump administration official and OpenAI’s incoming head of strategic futures, said it was inevitable that the White House would need to take a more heavy-handed approach, but added that it could have found a middle ground. “It can be true that a fully laissez-faire attitude is not appropriate to this technology, and it can also be true that, while the Trump administration’s concerns here are like 100 percent legitimate, there are various ways in which I think they are likely overreacting to these legitimate concerns,” Ball said. Despite the fast-spreading chaos, some in the AI industry are hopeful that the White House will revert to its previous hands-off baseline. “They are in the middle of a process,” said the OpenAI executive. The person suggested the administration will soon finalize the executive order that Trump signed earlier this month — and that once it does, it could replace the current crackdown with the voluntary vetting regime outlined in that order. “I think they understand that it’s important to get to a finalized framework as soon as possible,” the OpenAI executive said. “Because the labs are continuing to release models, and it’s important for the labs to continue to release models to ensure that the U.S. stays a leader in AI.” As a whole, many in the AI industry have come to agree that the White House’s new slant toward regulation is a necessary shift, even if they disagree with the execution. “In the bigger picture, like yes, there are things the administration is doing that I’m not so much of a fan of, in terms of the abruptness and the opacity and the strictness, but the more fundamental point is that I’m glad they’ve arrived to the conclusion that they have — to take this stuff seriously,” Ball said. Lekas also said that the tech industry is developing a “coordinated push for an actual framework” on advanced AI rules. And he said the tech lobby wants Washington to put it in writing — whether it’s through an executive order or more permanent levers in Congress. That effort will require the tech companies to agree on a standardized approach for AI safety. If they can’t row in the same direction, they may keep receiving the same unpredictable treatment. “It would behoove industry to coalesce around a best practice,” Lekas said.