California pushes back against federal AI regulation moratorium

May 28, 2025

On May 22, the U.S. House of Representatives narrowly passed a sweeping 1,116-page legislative package known as the “One Big Beautiful Bill Act.” The controversial bill, approved by a razor-thin 215–214 vote, includes tax cuts and reductions to social programs—but one provision has sparked particular outrage in California: a proposed ten-year moratorium on state-level legislation regulating artificial intelligence.

The bill, which now heads to the Senate, seeks to centralize AI governance exclusively at the federal level, aiming to establish a unified regulatory framework. However, this top-down approach has ignited fierce resistance from California—the nation’s innovation epicenter and the cradle of both the tech and creative industries.

California Draws the Line: “States Have a Right to Protect Their Residents”

In response, a bipartisan coalition of 35 California legislators—comprising 32 Democrats and 3 Republicans—issued an open letter to Congress urging a rejection of the moratorium. The letter warns that the measure undermines public safety, stifles innovation, and erodes core federalist principles. According to the authors, states must retain the right to regulate emerging technologies like AI, especially when such regulation serves to protect children, consumers, and fundamental civil rights.

“We’re not going to pass legislation that will destroy an industry so vital to our economy,” said Assemblymember Rebecca Bauer-Kahan, who chairs California’s Privacy and Consumer Protection Committee.

Governor Gavin Newsom has also voiced strong opposition, stating that the moratorium would effectively nullify existing California laws targeting AI-generated child pornography, deepfake adult content, and robocall scams targeting the elderly.

Between 2016 and 2024, California enacted 42 pieces of AI-related legislation, including pioneering laws against the misuse of deepfakes in election campaigns—cementing its leadership in AI governance nationwide.

Hollywood Speaks Out: Defending Rights in the Age of AI

California’s entertainment sector, centered in Hollywood, is equally alarmed. Unions and creative professionals are calling for local oversight of AI applications, particularly those involving digital likenesses, deepfakes, and intellectual property. Industry insiders fear a federally imposed one-size-fits-all approach could overlook the unique needs of the creative community.

Previously, a coalition of actors, writers, and directors issued an open letter demanding robust safeguards against unregulated AI content generation. They argue that unchecked AI tools could erode artistic control, infringe on personality rights, and destabilize labor protections in an already volatile industry.

A Future Being Decided Today

The coming days may prove pivotal for the future of artificial intelligence regulation and the principle of state autonomy. The bill’s fate now rests with the Senate. If passed without amendments, it is likely to be signed into law by President Donald Trump. However, any proposed changes would require the bill to return to the House for reconsideration.

As AI continues to reshape modern life—from autonomous vehicles to digital storytelling—the question of who holds the power to regulate this transformative force becomes increasingly urgent. While the federal bill advocates for centralized control, California and Hollywood are sending a clear message: local regulation is not a luxury—it’s a necessity.