The White House and Congress are working on a package deal that would exchange new restrictions on online expression for federal preemption of state and local AI regulations, according to a policy analysis published June 17, 2026 by the James Madison Institute's Center for Technology and Innovation. The report, authored by policy analyst Turner Loesel, warns that the proposed bargain would impose "real and immediate cost on how Americans can express themselves online" in return for only narrow, still-undefined relief from state AI laws. High-ranking Trump administration officials held meetings last Monday to gauge support for the deal, which would bundle kids' online safety and digital likeness bills in exchange for limited federal preemption of certain state AI regulations.

Senator Marsha Blackburn is leading negotiations with the White House to shape the final package, which currently includes her Kids Online Safety Act (KOSA), the App Store Accountability Act (ASAA), and the NO FAKES Act. In return, the administration would receive what Blackburn's office calls "subject-matter" preemption—blocking states from regulating only the specific topics covered in the package rather than AI regulations broadly. Kids' safety organizations present at Monday's meeting are also pushing to add Senator Josh Hawley's GUARD Act to the deal. The Trump administration has repeatedly tried and failed to secure relief from state AI regulations since last June, making the offer tempting despite its costs. The substantive details of how expansive or narrow the federal preemption would be remain unknown to the public.

According to the report, KOSA would require online platforms to "exercise reasonable care" in design features to prevent harms to minors including anxiety, depression, or eating disorders, likely forcing platforms to suppress, demote, or age-gate protected speech. The App Store Accountability Act would mandate age verification for every single user and parental consent before minors can download any application or install major updates, forcing "every adult to prove their identity to reach lawful content." The NO FAKES Act would create a federal property right in voice and likeness with a notice-and-takedown regime that platforms would be "incentivized to delete first and ask questions later," the report states. The GUARD Act would explicitly require every user of AI companion chatbots to verify their age using government-issued ID or personal banking data, barring adults unwilling to sacrifice privacy from using AI tools.

The report argues these bills grant government agencies broad, undefined authority that threatens constitutional rights. KOSA leaves "design features" that cause anxiety or compulsive usage undefined, allowing the FTC to "limit speech the government identifies as politically unfavorable in violation of platforms and users' First Amendment rights." The ASAA draws no distinction based on app content or risk, subjecting weather apps and Bible-reading apps to the same verification regime as gambling apps. Users bearing the legal burden and expense to restore content erroneously taken down under NO FAKES would chill free expression online, while the GUARD Act's age verification requirements mirror laws that have "failed to overcome constitutional scrutiny in the past." The report concludes that families already have a growing array of parental controls from companies including Apple, Google, Meta, and OpenAI, positioning parents far better than Washington policymakers to determine what fits their child's needs.

The report recommends Congress and the administration refuse the bargain and argues that if these bills can stand on their own merits, they should be brought forward independently rather than being tied to the administration's AI preemption priorities. The current negotiations force policymakers to divert from what's best to protect kids online, instead reaching for proposals that would erode user privacy and free expression for narrow, undefined AI relief. The report characterizes any preemption won on these terms as a "Pyrrhic victory, paid for with Americans' freedom to speak online."