Trump Moves to Strip States of Tech Regulation Power, California Pushes Back
President Trump called on Congress to establish a unified federal framework for technology regulation that would override state-level laws, escalating a long-running conflict with California over digital policy. The push comes as California's gubernatorial race has elevated tech regulation to a central campaign issue, with candidate Tom Steyer advocating for strict safety audits and fees on data processing — positions backed by his brother Jim Steyer, CEO of the influential nonprofit Common Sense Media.
Background
The battle over who regulates American technology companies has intensified as states have moved to fill the vacuum left by congressional inaction. California has been the most aggressive, passing laws on data privacy, children's online safety, and platform accountability that have effectively set national standards because companies find it impractical to operate under different rules in different states. Texas, Florida, and New York have passed their own tech regulations, creating a patchwork that the industry argues is unworkable.
Trump's push for federal preemption revives a proposal that stalled in Congress in 2025. The tech industry has long preferred a single national standard over a mosaic of state laws, arguing that compliance costs for 50 different regulatory regimes would stifle innovation and disadvantage US companies against Chinese competitors who operate under a unified national framework.
Key Developments
Trump's call to Congress came as California's legislative session advanced two bills representing a compromise between tech companies and child safety advocates. The bills, which have received backing from major platforms, would establish new safety standards for technology products accessible to minors, including requirements for age verification and platform design changes to reduce harmful interactions. Common Sense Media's Jim Steyer has pushed for more aggressive measures, including fees on data processing that would fund worker retraining programs.
Tom Steyer, running for California governor, has made tech regulation a centerpiece of his campaign, calling for mandatory safety audits of social media platforms and stricter liability for companies whose products cause demonstrable harm to children. His position puts him at odds with the tech industry's preferred federal preemption approach and with Trump's push to centralize regulatory authority in Washington.
The cybersecurity dimension of the debate has also sharpened. Google issued a warning about a sophisticated phishing campaign by a group identified as UNC6692, which uses fake Microsoft Teams notifications to steal enterprise credentials. Itron, a supplier of smart meter devices to 7,700 utility providers globally, disclosed it had remediated a cyberattack that occurred on April 13. These incidents have added urgency to calls for clearer federal cybersecurity standards.
Why Americans Should Care
The outcome of the federal-versus-state regulatory battle will determine the rules governing how tech companies collect data on residents of every state. For parents in Texas, Florida, and Ohio — states that have passed their own children's online safety laws — federal preemption could weaken protections that their state legislatures enacted. For small businesses in North Carolina and Georgia that rely on digital advertising platforms, a unified federal standard could reduce compliance costs and create more predictable operating conditions.
California's approach matters beyond its borders because the state's 39 million residents represent the largest single consumer market in the country. When California sets a standard, companies typically apply it nationally rather than maintain separate product versions. If federal preemption passes, it would effectively strip California of its de facto role as the nation's tech regulator — a shift with profound implications for consumer privacy protections across all 50 states.
Why It Matters
The federal preemption debate mirrors a pattern that has played out in financial regulation, environmental policy, and pharmaceutical safety: industries facing state-level regulation lobby for federal standards that are typically less stringent than the most aggressive state laws. The 2010 Dodd-Frank Act preempted some state banking regulations; the result was a national standard that consumer advocates argued was weaker than what New York and California had enacted. The tech industry's preference for federal preemption follows the same logic. Internationally, the European Union's approach offers a contrasting model — the General Data Protection Regulation and the Digital Services Act set binding standards that member states cannot weaken, creating a floor rather than a ceiling. The US debate is essentially about whether to adopt a floor model or a ceiling model, with enormous consequences for consumer rights and corporate liability. The stakes are particularly high for children's online safety, where California's Age-Appropriate Design Code has already forced platform redesigns that benefit minors nationwide.
What's Next
The two California bills advancing through the state legislature are expected to reach Governor Gavin Newsom's desk by July. Congressional leaders have not yet scheduled hearings on Trump's federal preemption proposal, and it faces significant opposition from Democratic senators who represent states with strong consumer protection laws. The California gubernatorial primary is scheduled for June, making tech regulation a live campaign issue through the summer.
Sources: ABC 33/40; CalMatters; DMARC Report
