Trump Scraps Biden AI Executive Order After Musk and Zuckerberg Lobbying Efforts

The highly anticipated ceremony had been scheduled, with industry CEOs confirmed on the guest list. Then, unexpectedly, it was canceled.

On Thursday, US President Donald Trump abruptly scrapped a planned AI executive order that had already faced multiple delays. The decision came amid concerns that the regulatory framework could potentially undermine America's competitive advantage in the global AI race against China.

"We're leading China, we're leading everybody, and I don't want to do anything that's going to get in the way of that lead," Trump stated to reporters in the Oval Office. However, what remained unsaid was the critical detail: the order had been effectively killed by the very industry it was designed to regulate.

🚫 Lobbied Out in One Night

According to Semafor, which first uncovered the backstory, the White House's plans were derailed following direct interventions from industry titans. Between Wednesday night and Thursday morning, Elon Musk of xAI, Meta CEO Mark Zuckerberg, and venture capitalist David Sacks (Trump's former AI and cryptocurrency advisor) all personally contacted the President.

The persuasive argument, according to multiple US media sources, appealed to the "accelerationist" faction within the administration, including officials at the National Economic Council and Vice President's office staffers.

The proposed executive order was notably modest in scope—establishing a voluntary mechanism for AI developers to engage with federal agencies and submit advanced models for security review up to 90 days before public release. No licensing requirements. No mandatory waiting periods. Completely voluntary.

Yet even this minimal framework proved too restrictive. Trump acknowledged postponing the order "because I didn't like certain aspects of it," without elaborating on specifics. He expressed concern it "could have been a blocker"—a revealing statement from a president who has consistently positioned AI as a critical jobs and national security priority.

⚠️ A Regulatory Vacuum with Serious Consequences

The United States has yet to enact comprehensive AI legislation. The existing governance framework remains fragmented and piecemeal, assembled through executive orders, agency guidance, and voluntary industry agreements.

Earlier this month, the federal Centre for AI Standards and Innovation announced evaluation agreements with Google DeepMind, Microsoft, and xAI, enabling government assessment of models before public deployment. This program continues despite Thursday's cancellation.

However, the broader landscape reveals significant regulatory drift. In early March, the Trump administration released a National AI Legislative Framework urging Congress to preempt state-level AI laws that "impose undue burdens," advocating for unified national standards over what it characterized as "fifty discordant ones." Congress has taken no action.

📊 The China Contrast

The contrast with China's approach is stark and increasingly difficult to dismiss. Beijing's State Council issued a 2026 legislative work plan in May outlining accelerated comprehensive AI legislation—the first time AI governance language appeared in formal planning documents. The National People's Congress has listed AI legislation for review for the third consecutive year.

In April, Beijing implemented new regulations requiring AI companies to establish internal ethics review committees. China is actively writing rules. Washington is canceling ceremonies.

🎯 Who Actually Shapes US AI Policy?

Thursday's events revealed what had been implicit for months: in the current administration, effective veto power over AI regulation rests with a small group of industry leaders with direct presidential access.

• Elon Musk, whose xAI directly competes with OpenAI and Anthropic, has structural incentives to maintain an open regulatory environment
• Mark Zuckerberg's Meta has positioned itself as a champion of open-source AI development
• David Sacks, despite formally leaving his White House advisory role in March, clearly retains substantial influence over executive action

Separately, Semafor reports that OpenAI has secured White House support for a parallel effort to advance AI regulations at the state level—a curious maneuver given Trump's earlier executive order threatening states that enacted AI laws the administration opposed.

That the administration appears to simultaneously discourage state regulation while endorsing OpenAI's state-level strategy suggests the policy coherence problem runs deeper than one postponed signing ceremony.

🌐 The China Frame: A Double-Edged Sword

Trump's stated rationale for the pullback—protecting America's lead over China—represents the same logic driving every major AI policy decision since his return to office, from the H200 export license framework to the Stargate infrastructure program. It's also the logic Beijing is monitoring closely.

At the Trump-Xi summit in Beijing earlier this month, both leaders agreed to launch an intergovernmental dialogue on AI, according to the Chinese Foreign Ministry. Beijing will have noted that Washington's internal debate about even voluntary AI oversight was resolved not by policymakers, but by companies that profit most from regulatory absence.

In a report by the South China Morning Post, Lizzi C. Lee, a fellow at the Asia Society Policy Institute's Centre for China Analysis, observed that both nations grapple with the same fundamental question: where should the regulatory frontier sit for frontier AI, particularly as models become more autonomous and cybersecurity-relevant?

"I think a separate, potentially more important race is on governance and safety: not about who has the most advanced models, but who can govern powerful AI without choking off innovation," Lee stated.

Kyle Chan at the Brookings Institution articulated it more directly: "AI safety and regulation can be done in a way that doesn't compromise innovation."

Neither argument proved persuasive on Thursday. Whether these perspectives gain traction in future deliberations—assuming there are future deliberations—remains uncertain.

(Photo by White House)