I. Overview of AI Policy Under President Trump’s First-Term Administration and Current U.S. AI Policy

As President  Trump began his second term on January 20, 2025, it is important to review the AI policies enacted during his first term. During his first term, President Trump signed an executive order to promote AI research and development while reducing barriers to technological advancement. President Trump has also expressed his intention to rescind the AI executive order introduced by the Biden administration, which established a comprehensive regulatory framework for artificial intelligence. To understand the trajectory of AI regulation under President Trump’s second-term administration, we must first explore the key elements of Biden’s AI executive order and compare them to President Trump's first-term initiatives.

1. The AI Executive Order of the Biden Administration 

On October 30, 2023, former President Biden enacted the "Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence (Executive Order 14110)." Key components of the Biden administration’s AI Executive Order 14110 are summarized below (for detailed insights, please refer to the BKL Newsletter dated July 19, 2024):
•    AI development companies are required to have their models, particularly those that might threaten U.S. security, health, or safety, undergo rigorous safety evaluations conducted by a government verification expert team, referred to as the AI red team. The results of these assessments must be submitted to the government.
•    The National Institute of Standards and Technology (NIST), alongside the Department of Commerce and the Department of Energy, is tasked with developing standards and evaluation measures to enhance AI safety.
•    The Department of Commerce is mandated to implement measures for applying watermarks to AI-generated content, such as images, in order to combat misinformation and identify fraudulent creations.
•    Companies involved in AI development must establish guidelines to prevent the illegal use of personal data during both the training and development phases of AI technologies.
•    Specific guidelines governing the use and procurement of AI technologies by the federal government are to be developed, ensuring that all AI applications adhere to established safety and ethical standards. 

2. AI Policy of President Trump’s First-Term Administration

The AI policy of President Trump’s first-term administration aimed to maintain the United States’ technological leadership and enhance national competitiveness. In February 2019, President Trump issued Executive Order 13859 to establish the "American AI Initiative." This initiative sough to eliminate unnecessary regulatory barriers to AI innovation, promote the adoption of advanced technologies like AI and machine learning, and accelerate innovation while safeguarding citizens' freedoms, privacy, American values, and the U.S. economy, and national security. The key points of this policy include:
•    Expanding research and development investment for AI technology innovation 
•    Securing computing infrastructure and data resources for AI R&D 
•    Conducting R&D for AI standards
•    Creating a supportive regulatory environment, fostering skilled talent, and promoting international cooperation 
•    Adopting a "light-touch approach" to remove barriers to AI development and encourage voluntary innovation in the private sector, thereby fostering innovation
•    Utilizing AI for national security and enhancing economic competitiveness
•    Prioritizing AI investment and R&D efforts by federal agencies 
•    Establishing a national AI research institute to create a hub for AI R&D, linking academia, industry, and government

II. The AI Policy Direction of President Trump’s Second-Term Administration 

The newly inaugurated President Trump second-term administration is poised to uphold a strong commitment to maintaining U.S. leadership in AI, a goal emphasized throughout his first term. During his re-election campaign, President Trump underscored AI policy as a pivotal issue, advocating for innovation and a competitive edge in AI technology. As a result, the new Trump administration is expected to shift away from the regulatory framework of the Biden administration, which aimed to mitigate the potential harms associated with the unchecked use of AI. Instead, the Trump administration is likely to adopt a market-oriented approach that emphasizes fostering innovation and countering the growing technological influence of China. Key anticipated AI policy directions for the President Trump second-term administration include:

1. Withdrawal of Biden Administration’s AI Executive Order 

First and foremost, President Trump is expected to rescind the Biden administration’s AI Executive Order. President Trump has criticized the order as "illegal censorship" and excessive regulation that stifles AI innovation, indicating his intention to repeal it.

However, since Biden's AI Executive Order incorporates elements from President Trump’s first-term policies and address the evolving the AI landscape shaped by newly emerged large language models (LLMs), a complete repeal may prove challenging. Instead, it is more probable that the order will be replaced with a new executive order that aligns with President Trump’s philosophy of regulatory relaxation and innovation of promotion. 

Specifically, matters related to AI research investment and the establishment of national AI research institutes, which began during President Trump’s first term and were maintained during Biden’s administration, are expected to continue. Additionally, cybersecurity guidelines and recommendations concerning national security, which are currently prioritized in President Trump’s policies, are anticipated to remain upheld in a second-term administration. While the nature, role, and mission of institutions such as national AI research institutes or AI safety research institutes may change due to shifts in leadership or oversight, the need for such institutions and AI support tools is expected to persist. 

2. “Make America First in AI”

President Trump has declared a campaign called "Make America First in AI," highlighting the significance of maintaining U.S. leadership in AI, especially in competition with China. He recognized AI as a crucial technology for enhancing national security and economic competitiveness. As a result, it is expected that his administration will adopt more aggressive policies to sustain an advantage over China. Specifically, the trade control measures implemented by the Biden administration, which restrict exports of high-performance AI chips on a company-by-company and country-by-country basis, are likely to be upheld in accordance with the "Make America First in AI" initiative.

In the future, the U.S. is expected to exert strong pressure on countries that find themselves positioned between the U.S. and China in the global AI competition. This strategy aims to secure American superiority from a national security standpoint while reinforcing U.S. leadership in international cooperation. Consequently, it will be necessary to prepare countermeasures in response to this evolving situation.

3. Overall Regulatory Relaxation

The Trump administration’s second-term emphasizes the importance of supporting AI development that is rooted in free speech and human prosperity through regulatory relaxation. The administration is expected to continue promoting the "light-touch approach" adopted during the first term, aiming to reduce regulatory burdens on AI innovation and increase investment in research and development. Vice President J.D. Vance and Andrew Ferguson, who has been nominated as the new head of the Federal Trade Commission (FTC), have both expressed their opposition to excessive AI regulations. They argue that such regulations could strengthen Big Tech monopolies and drive AI startups to relocate outside the U.S., ultimately undermining the country's technological competitiveness.

Furthermore, the Trump administration has committed to prohibiting AI-based censorship of U.S. citizens' free speech. It has also expressed plans to leverage AI as a tool for national security. As a result, active support at the national level is anticipated, including the expansion of key infrastructure for AI development. This encompasses the construction of data centers, increasing semiconductor production capacity, ensuring the development of nuclear energy, and expanding options for low-cost energy.

4. AI Ethics and Safety 

The Trump administration has not yet indicated its position on AI ethics and safety, leaving the future policy direction uncertain. However, given the administration’s broader focus on regulatory relaxation to support AI development and market expansion, it is likely to adopt a more flexible approach compared to  the Biden administration.

Some speculate that the Trump administration may introduce measures to address what is referred to as "Woke AI1," a term that describes AI systems trained with a left-leaning and progressive bias.

III. Implications 

There is significant global interest in AI regulation, and South Korea has passed the "Basic Act on AI Development and Establishment of Trust". Currently, subordinate laws, regulations, and related policies are being developed. In this context, changes in U.S. AI policy and trends during the Trump administration are critically important.
•    Intensified Competition with U.S. Companies 
If the U.S. adopts a more prominent "Make America First in AI" policy, government-supported U.S. companies are likely to gain a significant advantage in AI research, development, and commercialization. This could increase competitive pressure on domestic companies in the global market.
•    Opportunities for Strategic Alliances 
Conversely, if the U.S. government emphasizes cooperation with allied nations, Korean companies may gain opportunities for technology transfer, joint development, and expanded market access through partnerships with U.S. companies.
•    Reshaping the AI Supply Chain and Strengthening Korean Companies 
As the U.S. intensifies its AI containment policy toward China, stabilizing AI supply chains among allied nations will become increasingly important. Domestic AI semiconductor companies are expected to play a key role in this process, providing them with opportunities for technology development and an expanded global market share.
•    Increased Policy Pressure 
As U.S. government policies become more pronounced, Korean companies may face direct pressures to comply with U.S. AI regulations or technology standards. This could introduce additional costs or constraints in the technology development and commercialization processes. 
•    Potential for Unexpected Benefits through Technological Competition 
If domestic AI technology proves competitive on the global stage, analyses suggest that South Korean companies could gain unexpected benefits by adopting a neutral or cooperative stance on certain technologies or products amid intensified competition between the U.S. and China.

In light of these trends, Korean companies and the government must take proactive measures, both at the policy and industrial levels, to enhance AI technological competitiveness and assume a leading role in the U.S.-centric AI supply chain. This preparation should include measures to enhance international cooperation and systematically support the domestic AI ecosystem. Furthermore, it is crucial to continuously monitor future trends and proactively prepare for uncertainties and opportunities. At the corporate level, companies should establish their own AI responsibility strategies or compliance systems that address various global AI regulations, ensuring adherence while managing AI-related ethical and safety risks.
 

1. "Woke" is a newly coined term that means "awakened" or "aware." It is often used sarcastically among conservatives to describe those who overreact to issues related to political correctness.