Why Trump Really Wants to Kill Utah's AI Safety Bill

Donald Trump is making phone calls. Not to world leaders or campaign donors, but to Utah Republicans. His message: kill the AI safety bill. And he's not even president yet.

What's Really Happening

Utah passed its AI Safety Act last year, requiring companies to test high-risk AI systems and report safety measures. It's not the most aggressive AI regulation in America, but it's significant enough to catch Trump's attention.

According to sources familiar with the conversations, Trump has been personally calling Utah Republican legislators, arguing the law "stifles innovation" and benefits only "Silicon Valley giants." The pressure campaign represents Trump's first major intervention in AI policy since his election victory.

Utah isn't California or New York. It's a Republican stronghold that typically embraces business-friendly policies. If Trump can kill AI safety rules here, it sends a clear signal about his administration's approach to tech regulation.

The Real Stakes

This isn't just about one state law. It's about setting the tone for Trump's "AI deregulation agenda."

Trump's team views AI regulation through a simple lens: less oversight means American companies can move faster than Chinese competitors. "We're going to unleash American AI innovation," a Trump transition official told reporters, speaking on condition of anonymity.

But the reality is more nuanced. Big Tech companies like Google and OpenAI actually prefer some regulation—it creates barriers for smaller competitors. Meanwhile, AI startups struggle with compliance costs that can eat up 20-30% of their funding rounds.

The Utah law specifically targets "high-risk" AI systems used in healthcare, criminal justice, and financial services. These are areas where mistakes can ruin lives, not just quarterly earnings.

Winners and Losers

If Trump succeeds, the beneficiaries are clear: AI startups get a regulatory holiday. Companies developing autonomous vehicles, medical diagnosis tools, or financial trading algorithms can deploy faster with fewer safety checks.

Consumers face the downside risk. Less testing means more potential for AI systems that discriminate in hiring, misdiagnose medical conditions, or make biased lending decisions. We've already seen these problems with current AI systems.

Big Tech sits in an awkward position. Short-term regulatory relief sounds good, but it could backfire. If AI systems cause major harm without proper oversight, the eventual regulatory backlash could be far more severe.

The Global Domino Effect

Trump's intervention in Utah reflects a broader strategic calculation about AI supremacy. While the EU tightens AI regulations and China maintains state control over AI development, America is betting on a "move fast and break things" approach.

This creates a regulatory arbitrage opportunity. Companies might relocate AI development to states or countries with lighter oversight. But it also fragments global AI standards, making it harder for companies to operate internationally.

European companies already complain about navigating different AI rules across markets. If the US goes in the opposite direction from the EU's AI Act, that complexity only increases.

What This Means for Your Portfolio

Investors are watching closely. AI startups in regulated sectors like healthcare and finance could see valuations jump if regulatory risks decrease. Conversely, AI safety companies that help with compliance might face headwinds.

The bigger question is whether deregulation actually accelerates innovation or just increases risk. History suggests both can be true simultaneously—just ask anyone who lived through the 2008 financial crisis.