Federalism, AI, and the Environment

Trump’s efforts to overturn state laws are part of his effort to consolidate power and suppress opposition.

Trump’s Executive Order last Thursday on AI is a direct attack on state authority. The subject is different, but the thrust of the order is the same as his earlier attacks on state clean energy laws. Both orders call for a federal assault on state laws. Trump knows that states’ independent authority places a limit on his efforts to consolidate power and to impose his policies, including his anti-environmental energy dominance agenda.

To be sure, the AI order isn’t squarely aimed at environmental issues. The executive order calls for new legislation preempting state law, but says the legislation wouldn’t preempt “otherwise lawful State AI laws relating to …AI compute and data center infrastructure, other than generally applicable permitting reforms.” Still, that’s limited comfort. Note the “otherwise lawful” and “permit reform:” provisos, which cut back the scope for states to control the impacts of data centers. And this language applies only to potential legislative proposals, not to Trump’s order for DOJ lawsuits against state laws.

This litigation strategy is modeled on the earlier anti-clean energy order, “Protecting American Energy From State Overreach.” It directs DOJ to sue states over laws that discourage fossil fuels. The order directs the Attorney General to bring lawsuits against “State laws purporting to address ‘climate change’ or involving ‘environmental, social, and governance’ initiatives, ‘environmental justice,’ carbon or ‘greenhouse gas’ emissions, and funds to collect carbon penalties or carbon taxes.”

Both executive orders call for DOJ lawsuits based on federal preemption and interference with interstate commerce. It’s unclear how successful those lawsuits would be. Liberal judges are not likely to be favorable, and conservative judges often care about federalism. As usual with the Trump Administration, though, part of the point is intimidation rather than legal results.

Putting aside Trump’s particular agenda, there’s a deeper question: What role should the states be playing in these areas? There’s a clear argument for robust federal policymaking in these areas. Such federal policies might include restrictions on state regulation. But Congress hasn’t enacted such federal policies. Whetger Congress will eventually legislate about climate or AI is anyone’s guess, but it’s unlikely to happen soon.

In the meantime, there are good arguments for states to fill the regulatory gap. It is a strength of our system that states can experiment with solutions to emerging issues before the federal government tries to formulate its own policies. That state authority isn’t unlimited, but current legal doctrines give it broad scope.

As we all know, Congress now finds it extraordinarily difficult to pass laws on major issues. The executive branch, under the Supreme Court’s “major questions doctrine,” lacks the power to fill the gap. That leaves only the states to save us from paralysis when major new issues arise. That may not be ideal, but it’s better than nothing.

2 Replies to “Federalism, AI, and the Environment”

AI’s silent partner appears to be BigNuke,more specifically “little Nuke” in the form of SMRs (small modular reactors). A perspective from Texas: funding, “relaxed” regulation and several forms of non-conditional support for SMRs were approved in the TX Legislature’s 2025 session. At the same time NRC’s authority is existentially compromised; NRC rulemaking and permit approvals are delayed. (Several different SMR manufacturers create the need for specialized rules — this, while NRC’s resources are critically reduced. Robust state action — state authority — is essential in this frothy neo-nuke era.

AI says: Efforts to control global warming aren’t fully succeeding because it’s a massive, systemic issue facing huge hurdles: lack of political will & short-term economic focus, difficulty coordinating global action, misinformation, ingrained fossil fuel systems, the slow pace of change vs. urgent deadlines, and the complexity of Earth’s systems that keep warming even after emissions drop. We have solutions, but implementing them globally at scale (like shifting energy, transport, and industry) requires overcoming deep-seated economic, political, and behavioral barriers.

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