Congress Could Recalibrate America’s Morass Of AI Laws Into ‘Federal Floor, State Ceiling’

AI And The Law

As a quick background, I’ve been extensively covering and analyzing a myriad of facets regarding the intersection of AI and the law for many years. You can find my writings not only in my Forbes column but also as posted in Bloomberg Law, ABA Law Journal, The National Jurist, The Global Legal Post, Lawyer Monthly, The Legal Technologist, MIT Computational Law Journal, and so on.

There are two major perspectives on the mixture of AI and law:

• (1) Law & AI. The application of laws to the governance and regulation of AI.
• (2) AI & Law. The application of AI to perform legal reasoning.

Thus, you can apply the law to AI, and conversely, you can apply AI to the law. For my big picture overview of both of these exciting and rapidly evolving realms, see my discussion at the link here and the link here.

When it comes to applying the law to AI, the aim is to establish suitable regulations and provide appropriate governance on how AI should be devised and implemented. There are longstanding concerns that AI makers aren’t giving due attention to the ethical ramifications of their wares. Ethical issues are construed as “soft laws” and aren’t as formidable as legally enacted laws, known as “hard laws”. To level the playing field and keep AI makers on the up-and-up, some believe that we need more AI laws.

On the other side of the coin is the application of AI to the law. This consists of using AI to aid legal activities. Lawyers tap into the latest AI to devise legal strategies, brainstorm to find creative legal arguments, draft court filings, and prepare for cases by having the AI pretend to be an able adversary. For my extensive coverage on AI for legal reasoning (AILR), see the link here.

The Current Situation Legally

In terms of the AI laws in the United States, they have not yet stood the test of time, meaning that we won’t really know how well they stand up until there are court cases that test these new laws. It is too early to know whether the laws will survive legal battles waged by AI makers and other contenders. Just because AI laws are enacted does not mean they are proper. All sorts of improper provisions and constitutionally contentious stipulations are undoubtedly buried within these shiny new AI laws.

Congress has repeatedly waded into establishing an overarching federal law that would encompass AI. So far, no dice. The efforts have ultimately faded from view. Thus, at this time, there isn’t an overarching federal law devoted to these controversial AI matters. The big question will be to what degree a sweeping federal law would impact the numerous state-level AI laws. The odds are that many state-level laws would run afoul of a federal mandate, and a tsunami of legal cases would arise as a tussle between federal and state law is undertaken. It surely will be a legal mess.

The crux is that there is intense and pervasive interest in using the law to govern AI. It is an abundantly burgeoning realm. AI companies would be wise to keep a close eye on what is happening in the hallways and byways of regulators and legislative bodies. I have repeatedly noted that a profitable specialty for budding lawyers is to consider concentrating on the exciting and dynamic field of AI and the law; see my predictions and suggestions at the link here.

Difficulties Aplenty

You can likely envision the challenges of the legal landscape governing AI.

Each state does its own thing. The AI laws in some states are poorly specified and legally ambiguous. States are also amending their AI laws that they previously thought were perfect. Other states that haven’t been enacting AI laws are opting to jump into the waters with both feet. They might borrow wording from other states, change it up, and put it into their legal books. Estimates suggest that there are well over 1,000 AI-related bills and laws that are in some form of consideration at the state level, ranging from pending status to actual enactment.

I’ve been extensively analyzing and explaining the disparate and at times conflicting state-level AI laws; see the link here. There are plenty of downsides to this situation. Plus, the matter is worsening. Public interest in AI laws is heightening. State-level lawmakers are becoming more familiar with AI and are joining the bandwagon on laws about AI. All told, a grand convergence is taking place toward a veritable tsunami of new AI laws across all 50 states.

Federal Floor, State Ceiling

Congress is faced with a rapidly growing myriad of state-level AI laws that will be nearly impossible to fit into a yet-to-be-devised comprehensive federal AI law. Conflicts are going to arise. Some areas of AI will be covered by some states, while other states are silent on those matters. Some states are already highly restrictive on some AI aspects, while other states are highly permissive on the same AI aspects. It is a scattergun jigsaw puzzle where the pieces do not fit together.

One belief is that perhaps Congress could focus on a classic regulatory model of a federal floor that is coupled with a state-level ceiling. A comprehensive federal AI law would establish a minimum regulatory base across all AI topics. States that happen to already have AI laws below that base would be expected to abide by the stipulated floor. Those states that are already above the floor are presumably good to continue. States with no AI laws in some of those base areas would now have a floor to rely upon.

This is a strategy that acknowledges the existing Byzantine arrangement of state-level AI laws. If Congress were to instead opt to preempt all those state-level AI laws, doing so would almost certainly generate tremendous hostility from the states, spurring lengthy court action. In theory, a well-shaped federal floor of AI laws would hopefully end up accommodating most of the states, by and large, plus provide the added flexibility that states could exceed the floor.

That doesn’t mean that the states will necessarily welcome or embrace such an approach. Some states will undoubtedly have grievances about whatever federal floor on AI laws is ultimately enacted. On the federal side, there are indubitably going to be concerns that some states’ AI laws go too far above the floor and exceed any reasonable semblance of a ceiling.

The crux is that either this approach will be a means of reaching across-the-board agreement or it will be rejected as a compromise that isn’t workable.

Grandfathering When Needed

An additional twist would be that the federal floor might be constructed to allow for a grandfathering of existing state-level AI laws that are below the stipulated floor. Thus, any state that had an existing AI law that was written such that it dropped below the federal floor, and the state was objecting to having to allow a federal floor that would essentially override their state-level AI laws, grandfathering might be permitted.

This would be an outright acknowledgment of such conflicts. The resolving angle would be that the state-level AI law prevails. A downside is that if the federal floor were construed as a safer or crucial level-setting aspect about AI, allowing those states with AI laws below the floor to continue unabated would be seen as flawed. Why allow a less-than option to continue when presumably it is insufficient, namely, it doesn’t even reach the minimum?

Preserving AI Elements As Preemptive

A contention underlying the AI floor and AI ceiling approach is that there are some elements of AI that some believe should be entirely regulated at the federal level. There should not be any state-based discretion. No floor, no ceiling. The AI element is exclusively in the hands of a comprehensive federal AI law.

For example, the regulation of frontier AI models is a realm that some believe should only be overseen by federal AI law. The argument is that frontier AI models are of such an existential risk that nothing other than stringent federal AI law would suffice. A floor would not be enough. States would have no specific say in the regulation of frontier AI models.

To learn more about why frontier AI models are thought to be a class of AI that deserves preemption, see my discussion at the link here.

National Goals Rather Than Federal AI Stipulations

Rather than a stipulated floor, another approach would be for a comprehensive federal AI law to lay out broad national goals regarding AI. The expectation would be that the states would seek to meet those national goals via the shaping of their state-level AI laws. This might include having to amend some of their existing AI laws.

A downside is that states could presumably decide not to fit within the national AI goals. Or a state might claim they are doing so, even though the federal level doesn’t see things that way. As such, some envision that a more rigorous avenue would be for states to provide their AI law drafts to the federal level and garner acceptance that the state-level AI law conforms to the national goals. Some liken this to the cooperative framework associated with the Clean Air Act.

Harmonization Of AI Laws

The messiness of having disparate state-level AI laws, even within the floor and ceiling approach, causes some to suggest that a harmonization of state-level AI laws should be undertaken. Whether this is plausible remains open to doubt, but it is something that is on the table for discussion.

In a harmonization approach, Congress would develop state-level AI law models or templates that the states could readily opt to adopt. Each area of AI would have a particular template. States would seemingly examine the templates and ascertain how close or far their existing AI laws extend from those junctures.

Over time, the states would be expected to match their existing AI laws to the templates. When a state devises new AI laws, it will begin with a suitable template. AI laws already on the books would be amended to more closely fit the respective template. The theory is that eventually, the states would look relatively similar in terms of the AI laws that they have all enacted.

AI Makers And State-Level AI Laws

An important reason to at least take into account a harmonization is that a conventional floor and ceiling approach is still going to include states having a great deal of variability associated with their AI laws. Since the AI legal aspects above the floor could be at any position, the states would likely vary significantly.

This confronts AI makers with a problem that they are already coping with, namely that they need to thread a needle and ensure that their AI conforms to the fifty states on a state-by-state basis. The federal floor and state-level ceiling don’t especially clean that up. The targets for the AI makers would still be wildly disparate.

National Safe Harbors For AI Makers

Of all the controversy involved in this, perhaps the most controversial proposition is that Congress could consider creating national safe harbors for AI makers. This would be part of the comprehensive federal AI law.

The national safe harbor would allow that if AI makers met the federal floor, the AI makers doing so would receive protection from certain forms of state AI law liabilities. The states would still be regulating AI. But the AI makers would not necessarily have to adjust their AI to meet the state-level above-floor differences. As long as the AI maker complied with the minimum, they would generally be considered legally protected.

States would likely find this blatantly out of line. Simply ensuring that the AI makers met the federal floor would be less than satisfying. Being handed an escape clause of having to accommodate state-specific above-floor AI laws would be viewed as untenable.

Layered National And State-Level AI Governance

There are many ways that this conundrum can be potentially tackled. It won’t be easy. It will be extremely challenging.

An overarching approach might consist of several layers, for example:

• Layer 1: Uniform national baseline on AI governance that is applicable throughout the U.S.
• Layer 2: Some federal AI regulations are reserved for uniquely national concerns, such as frontier AI models.
• Layer 3: State authority over sector-specific and localized AI uses, provided state AI laws do not fall below federal minimum protection (the floor) and do not exceed some identifiable ceiling.
• Layer 4: Ongoing harmonization of AI laws through shared technical standards, reciprocal recognition where appropriate, and a permanent federal-state AI governance coordination mechanism.

That last point suggests that a federal-state AI governance council might be arranged. This could be established by Congress as a permanent intergovernmental AI council. Members would consist of federal lawmakers, state lawmakers, AI scientists and policy experts, and the like.

A final thought for now. The inventor of the famous Rubik’s Cube, Erno Rubik, made this pointed remark: “If you are curious, you’ll find the puzzles around you. If you are determined, you will solve them.” Now that you’ve been introduced to the puzzle of AI laws in the U.S., it is vital that we all become determined to solve the puzzle. The Rubik’s Cube has 43 quintillion possible configurations. Solving the AI laws puzzle doesn’t have quite that many moving parts, though perhaps it surely seems like it.