00:00The Senate Committee on Commerce, Science, and Transportation has called to order.
00:04Welcome to our witnesses. Thank you for joining us this morning.
00:07In the last two years, AI has brought the United States and the world to a critical inflection point.
00:17AI may be a technology as transformative as the Internet, or even more so.
00:23It has unleashed a new global industrial revolution with the potential to unlock opportunities that improve our quality of life, create jobs, and stimulate economic growth.
00:37The country that leads in AI will shape the 21st century global order.
00:45As a matter of economic security, as a matter of national security, America has to beat China in the AI race.
00:57China has made AI central to its national strategy, and China aims to lead the world in AI by 2030,
01:07investing heavily in AI adoption across industries like manufacturing and defense.
01:13In this race, the United States is facing a fork in the road.
01:19Do we go down the path that embraces our history of entrepreneurial freedom and technological innovation,
01:27or do we adopt the command and control policies of Europe?
01:32I would suggest that Congress draw on the lessons we can learn from the dawn of the Internet.
01:39In the early 1990s, Washington embraced the Internet and explicitly adopted a style of regulation that was intentionally and decisively light-touch.
01:56Congress chose to deregulate under the Telecommunications Act of 1996,
02:00while President Clinton pursued tariff agreements and treaties that protected America's intellectual property and technological exports.
02:11Further, in 1998, Congress enacted a 10-year Internet tax moratorium
02:18so that state laws wouldn't balkanize and stymie the promise of e-commerce.
02:25The results of these decisions were extraordinary.
02:28I made a lot of money.
02:30By 2000, the United States has recorded five straight years of historic highs in productivity gains and investment growth.
02:41Hundreds of thousands of new jobs were created, and the United States became a top tech exporter
02:48with massive sums of private investment pouring into the U.S. digital economy.
02:53By contrast, EU countries pursued a series of heavy-handed regulations that proved enormously costly.
03:02In 1993, the United States and Europe had economies virtually identical in size.
03:11Today, the American economy is more than 50 percent larger than Europe's.
03:21The drivers of that are tech and the shale revolution.
03:27Those two comprise virtually the entirety of that massive growth over Europe.
03:34According to one EU Commission report, only 6 percent of global AI startup funding
03:41flows to EU firms, 6 percent.
03:43That is one-tenth of the amount that is going to American companies.
03:49The report directly blames this yawning chasm on the EU's nasty regulatory approach.
03:59And yet, the Biden administration, for inexplicable reasons, tried to align AI policy
04:06with the EU to adopt their failed policies.
04:10President Biden's sweeping AI executive order, the longest executive order in American history,
04:16cast AI as dangerous and opaque, laying the groundwork for audits, for risk assessments,
04:24and regulatory certifications.
04:27Biden's approach inspired similar efforts in state legislatures across the country,
04:33threatening to burden startups, developers, and AI users with heavy compliance costs.
04:41Some of my colleagues suggest that a friendlier version of the Biden approach makes sense.
04:47They want a testing regime to guard against AI, quote, discrimination,
04:52and have government agencies provide, quote, guidance documents, seemingly something out of Orwell,
05:01that will usher in what they call best practices.
05:06As if AI engineers lack the intelligence to responsibly build AI without the bureaucrats.
05:13Many in the industry, foolishly, have supported such paternalism.
05:22Harmful regulations take many forms.
05:25Biden's misguided midnight AI diffusion rule on chips and model weights would have crippled
05:31American tech companies' ability to sell AI to the world.
05:35The Biden plan would have handed over key markets to China.
05:40We should want foreign countries, particularly our allies, to buy American.
05:48I vocally opposed this rule for months, and indeed the ranking member and I together
05:53urged the Biden administration not to adopt it.
05:57And I'm very pleased that President Trump has now confirmed he plans to rescind it.
06:02All of this busybody bureaucracy, whether Biden's industrial policy on chip exports or industry
06:11and regulator-approved guidance documents, is a wolf in sheep's clothing.
06:19To lead an AI, the United States cannot allow regulation, even the supposedly benign kind,
06:26to choke innovation or adoption.
06:28American dominance in AI depends on two factors, innovation and adoption.
06:37Innovation drives breakthroughs in global competitiveness.
06:40Adoption ensures that these tools empower American workers and businesses, enabling the United States
06:48to become the world's leading adopter and exporter of AI.
06:52Thankfully, President Trump has largely reversed Biden's misguided AI agenda.
06:59In fact, I think AI was a sleeper issue in this last elections.
07:04Americans wanted to see President Trump and Republicans, and indeed all senators,
07:10champion AI policies focused on innovation and adoption.
07:16The contrast has been astounding. This year, there have been over $1 trillion of new AI projects,
07:27including major investments in Texas like the CoreWeave Data Center in Plano and the $500
07:32billion project Stargate in Abilene by OpenAI and Oracle and others.
07:37The President of the United States will allow Congress to work alongside the President, just as
07:46Congress did with President Clinton. We need to advance legislation that promotes long-term AI
07:52growth and innovation. That's why I will soon release a new bill that creates a regulatory sandbox for AI,
08:00modeled on the approach taken by Congress and President Clinton at the dawn of the Internet,
08:08that will remove barriers to AI adoption, prevent needless state over-regulation, and allow the AI supply
08:16chain to rapidly grow here in the United States. That's how we'll accelerate economic growth, secure U.S.
08:22dominance in AI, and beat China.
Comments