President Donald Trump’s latest legislative effort, the One Big Beautiful Bill Act, has ignited fierce debate with a sweeping provision that halts state control over artificial intelligence for a decade.

The Christian Post reported that the bill, which passed the House of Representatives last month, places a 10-year moratorium on state and local governments enacting laws that limit or regulate the development or deployment of artificial intelligence systems.

Known as H.R.1, the legislation constitutes a major federal assertion over artificial intelligence policies nationwide. Section 43201 of the bill bars any state or local government from enforcing laws that restrict AI systems or automated decision tools until 2035. Exceptions are only granted for state laws that support federal policies or facilitate AI usage.

Controversy Over State Autonomy and Privacy

The measure has drawn sharp criticism from opponents who argue that it curtails state rights and removes essential checks on the rapidly advancing technology. Republican Rep. Marjorie Taylor Greene of Georgia denounced the provision, claiming she learned of it only after voting.

“I am adamantly OPPOSED to this,” Greene stated on the social media platform X. She called on the Senate to eliminate the section that prevents states from acting independently on AI regulation. Greene cited concerns over the unknown trajectory of AI capabilities in the coming decade.

Only two Republicans—Reps. Thomas Massie of Kentucky and Warren Davidson of Ohio voted against the bill in the House. While supporters argue that a patchwork of state regulations could hinder innovation, critics worry the law enables unchecked expansion of AI technology.

Federal Spending and the Rise of Palantir

Separate from the preemption of state laws, the bill also directs $500 million in federal funding to the Department of Commerce over the next nine years to modernize its information systems using artificial intelligence. These updates are aimed at enhancing cybersecurity and efficiency in federal agencies.

Palantir Technologies, a Denver-based government contractor known for building data and AI platforms, is expected to be a major beneficiary. The company’s Foundry and Gotham systems are already deployed across several federal departments, including Health and Human Services and Homeland Security.

In 2025 alone, Palantir secured more than $113 million in contracts from various federal departments. In May, it was awarded another $795 million agreement from the Department of Defense, deepening its ties to U.S. government operations.

Executive Action and Leadership Ties Raise Flags

The bill follows a controversial executive order President Trump issued in March 2025, directing federal agencies to enhance data-sharing capabilities. This directive has intensified concerns about surveillance and the centralization of sensitive data under AI-deployed mechanisms.

Peter Thiel, co-founder of Palantir and a longtime ally of Trump, is reportedly involved in executing parts of the executive order. The move has fueled speculation about conflicts of interest and the deepening bond between Big Tech and federal power brokers.

As Palantir negotiates additional contracts with agencies such as the IRS and Social Security Administration, concern continues to escalate about how much influence a single tech firm could wield over public services and private data.

Internal Dissent from Former Palantir Employees

In a rare public rebuke, 13 former Palantir staffers released an open letter criticizing their former employer’s involvement with the Trump administration. The letter described the erosion of ethical boundaries in decision-making processes at Palantir and in Silicon Valley more broadly.

Warning of authoritarian leanings, the former employees accused the company of contributing to a political agenda “under the guise of a technological revolution led by oligarchs.” They invoked comparisons to fiction, referencing surveillance stones from “The Lord of the Rings” to describe Palantir’s AI tools.

They expressed alarm that Palantir’s platforms are being used by multiple federal agencies with insufficient oversight or transparency to the public.

Call for Action as Senate Review Looms

As the Senate prepares to evaluate H.R.1, a growing number of lawmakers and privacy advocates are urging revisions, particularly to the language that blocks state-level governance of AI. Critics argue that states should retain the right to protect residents from potential AI misuse and overreach.

Supporters maintain that a unified approach will avoid inconsistency that could slow down America’s AI dominance on the global stage. However, with rapid advances in machine learning and data analytics, opponents stress the importance of maintaining localized oversight mechanisms.

What remains to be seen is whether the Senate will heed calls to amend the bill or whether the sweeping federal control over AI regulation will remain intact for the next decade.