Is Your Privacy at Risk? Shocking New AI Law from the White House Could Change Everything!

A leaked draft executive order (EO) from the White House proposes a significant shift in how artificial intelligence (AI) is governed in the United States. This draft, which surfaced last Tuesday, suggests overriding over 1,000 state-level AI bills, including notable laws in California and Colorado, in favor of a centralized federal standard. This move comes as a surprise, especially following a moratorium on state AI laws that was overwhelmingly voted down by the U.S. Senate on July 1, 2023. Just days later, on July 10, the White House indicated it would not interfere with states' rights to implement “prudent AI laws.”

The draft EO, while not officially confirmed by the White House, raises pressing questions about the future of AI governance in the U.S., particularly concerning the balance of state and federal authority. As it stands, the federal approach could severely limit states' abilities to regulate AI, disrupt existing compliance strategies, and expose developers and deployers to new litigation risks.

In a rapid shift, the White House transitioned from the leaked draft EO to issuing a fact sheet aimed at “accelerating AI for scientific discovery” and launching the Genesis Mission. This initiative seeks to harness datasets for AI-accelerated innovation and emphasizes collaboration with the private sector while incorporating crucial security standards.

Proposed Uniform Standards

The draft EO articulates a clear stance: the proliferation of state legislation poses a threat to innovation in AI. It reiterates the necessity of a “minimally burdensome national standard” to replace what it describes as “50 discordant state ones.” Among the laws specifically targeted are California’s Transparency in Frontier Artificial Intelligence Act (Senate Bill 53) and the Colorado AI Act (CAIA). These laws introduce rigorous consumer privacy standards and are deemed by the draft EO to introduce “catastrophic risk” and standards for “differential treatment or impact” that could impede innovation.

California's Senate Bill 53, aimed at large frontier models and developers, mandates detailed governance and transparency requirements. Organizations covered by the law must provide comprehensive plans on how to identify, assess, and mitigate significant risks, while also aligning their practices with national and international standards. Similarly, the CAIA requires that developers and deployers ensure they understand their obligations to safeguard consumers from known or foreseeable risks, including conducting annual impact assessments and updating them within 90 days of modifications to an AI system.

The draft EO introduces an “AI Litigation Task Force” led by the U.S. Attorney General with the goal of targeting state-specific regulations that are perceived as obstacles to innovation. The task force will focus on eliminating subjective safety standards and the complex patchwork of laws that could force companies to comply with the lowest common denominator. Reports would be published addressing various state laws deemed “onerous,” including those that may infringe on free speech rights by requiring AI developers to disclose sensitive information.

Furthermore, the draft outlines a potential process for the Federal Trade Commission (FTC) to clarify when state laws may be preempted by the FTC Act's prohibition on engaging in deceptive acts or practices affecting commerce. In a direct show of authority, the draft EO also states that federal funding could be withheld from states that continue to enforce laws seen as noncompliant with federal standards.

Security Implications of the Genesis Mission

The newly launched Genesis Mission EO stresses the importance of security standards. It directs the Secretary of Energy to ensure that any platform developed aligns with national security and competitiveness missions, particularly focusing on supply chain security and federal cybersecurity standards. This includes implementing strict data access, cybersecurity, and governance protocols when collaborating with private sector organizations.

Recent data underscores the urgency of these measures. A report from the House Committee on Homeland Security revealed that one in six data breaches in 2025 involved AI-driven cyberattacks. CrowdStrike's annual threat report indicates that AI-powered social engineering attacks, such as voice phishing, are expected to double by year-end, with 320-plus organizations affected by a single AI-enabled threat actor this year.

As organizations brace for the potential federal standardization of AI regulations, especially those in states with active AI laws, it’s crucial for them to assess their governance policies and prepare for evolving federal enforcement. Recommendations include reviewing existing AI governance policies to ensure compliance with emerging federal standards, preparing for potential challenges to state laws, and monitoring the evolving security standards under the Genesis Mission.

The implications of these developments suggest a pivotal moment for AI governance in America. As the federal government takes a more active role, the landscape of AI regulation could dramatically transform, impacting innovation, consumer protection, and compliance strategies across the nation.