President Trump's embrace of AI could be a political gift to Democrats. Instead, it's exposing a major split in the party.

Why it matters: As the tech industry aligns with the White House, Democrats are weighing whether to lean into a populist message aimed at protecting workers, challenging tech billionaires and pushing back on data centers — or embrace a more innovation-friendly approach.

Driving the news: In a letter shared first with Maria, House Minority Leader Hakeem Jeffries (D-N.Y.) is facing backlash from advocacy groups that say the leaders of a new House Democratic AI policy commission have deep ties to Big Tech.

• The co-chairs include Reps. Ted Lieu (D-Calif.), Josh Gottheimer (D-N.J.) and Valerie Foushee (D-N.C.), who met with Jeffries for the first time yesterday, a source familiar said.
• "Going into the 2026 midterms, Democrats can and must present a vision for AI policy that breaks with Trump's deregulatory vision," the Jan. 8 letter to Jeffries states.
• 11 groups signed the letter, including the Revolving Door Project, Center for Digital Democracy and the Climate and Community Institute.

Behind the scenes: An adviser to a House progressive told Maria that many Hill Democrats see AI and affordability as winning issues.

• The adviser pointed to Sen. Bernie Sanders' (I-Vt.) proposal for a moratorium on AI data centers and Congressional Progressive Caucus chair Greg Casar's (D-Texas) bill to combat algorithmic pricing as the types of proposals that Democrats could use to capitalize on voters' unease.

What they're saying: Lieu told Maria the new House commission is focused on getting a federal standard on AI regulation across the finish line on the Hill.

• "My argument now to the White House and some of those in the tech industry, is if you want it [AI regulation] coming from 17 states, or do you want it coming from Congress?"
• Foushee said the commission will focus on making sure "every American shares in the benefits of AI" and pointed to her work on civil rights and antitrust.

Jeffries also just picked presidential hopeful Rep. Ro Khanna (D-Calif.), who one advocacy source said "could be a big win for Nvidia," to be ranking member of the House China Select Committee.

• Khanna spokesperson Sarah Drory said he's been engaging with academics and labor leaders to ensure that AI benefits workers, and noted he has been criticized by tech leaders in his district.

Flashback: Railing on data centers proved to be a winning message during last year's elections for candidates such as New Jersey Gov.-elect Mikie Sherrill and Virginia Gov.-elect Abigail Spanberger.

• "Voters don't like subsidizing rich people. I think it's a pretty simple message," said the Revolving Door Project's Jeff Hauser.

The other side: "There might be a political upside to taking the Bernie Sanders road where we just condemn data centers but there's equal political risk to doing that, right? And just seeming as myopic and one-sided as Republicans are," said a House Democratic staffer who requested anonymity in order to speak freely.

Friction point: Some Democrats may also be fearful of hemorrhaging even more Silicon Valley support after the industry took a hard right, political consultants and advocates told Maria.

• Riki Parikh of the lobbying group Alliance for Secure AI Action said Democrats should look to centrists like his former boss Sen. Mark Warner (D-Va.) for the playbook to approach AI.
• Warner in his ad launching his reelection campaign zeroed in on AI, affordability and job concerns, while also telling voters "we can ensure that innovation gives everyone a fair shot at the American dream."

The bottom line: AI offers Democrats a clear political contrast with Republicans heading into the midterms, if they can get on the same page.

2026 will see rapid AI developments across the political, policy and legal spectrum.

From our perch in D.C. covering all things AI policy here, across the country and around the world, here are five things we're watching closely:

1. AI on the ballot: From data center buildouts to deals with China and new AI safety rules, AI issues with real implications for people's lives are set to motivate voters like never before.

• Most Republicans have placed themselves in the pro-innovation, limited-guardrails camp with President Trump, but cracks in that coalition are increasing. Meanwhile, Democrats are scrambling to find their AI message.
• The Trump-aligned tech industry is also staring down high-profile legal challenges, and the president's policies could be caught in legal battles.

2. The future of Trump's AI agenda: The president has signed a host of AI-related executive orders. Now the White House has to carry them out and enforce them.

• We'll be watching to see how the order aiming to hamstring state AI laws works in practice, which states will be targeted, and how it might further alienate GOP governors who want to regulate AI.
• Another executive order aims to fuel scientific R&D, and the administration is eager to figure out how AI energy demands can be met without hurting American's wallets.
• The administration will also call on industry early this year to submit proposals for its AI export program, according to the International Trade Administration.

Keep reading.

House China hawks are pressing ahead with efforts to prevent Beijing from accessing sensitive U.S. technology as the Trump administration green-lights chip sales.

Why it matters: Congress is looking to rein in President Trump on chip sales, even as most Republicans avoid public criticism.

Behind the scenes: Republicans are largely toeing the line publicly on the president's decision to allow AI chips to go to China, but that's masking growing unease privately, two sources familiar with the matter told Axios.

• "There were several Republicans and staff in both chambers that weren't happy about the sales," one source told Axios, citing conversations with Republican lawmakers.
• "On the House side I don't think I heard any support for the current policy from the administration on exporting chips."

Driving the news: Reps. Jefferson Shreve (R-Ind.) and Sydney Kamlager-Dove (D-Calif.) today will introduce legislation to strengthen staffing at the Department of Commerce's Bureau of Industry and Security, according to a press release shared first with Axios.

• The BIS STRENGTH Act would authorize Commerce to appoint 25 "highly qualified technical experts and offer competitive compensation, within existing federal pay limits, to attract and retain top-tier talent."

Keep reading.

New York officials are kicking off 2026 with new AI proposals and probes aimed at protecting consumers.

Why it matters: The action is coming shortly after New York Gov. Kathy Hochul (D) signed the RAISE Act, a major frontier AI model safety bill, into law late last year.

Hochul's new proposal for this year includes:

• Expanding age verification for platforms, including gaming.
• Requiring default settings on social media platforms for kids.
• Disabling certain AI chatbot features for kids.
• Making sure that parents can control or set limits on kids' financial transactions.

What they're saying: "These proposals will create a nation-leading standard that will ensure our kids' safety in online and real world environments where they spend time," Hochul said in a press release.

• The package, which draws on existing legislation and is part of Hochul's "State of the State" agenda, would have to clear the New York State Assembly and Senate.

The big picture: Hochul is a unique example of a governor looking to balance AI safety rules while welcoming AI development to her state.

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Sens. Todd Young (R-Ind.) and Maria Cantwell (D-Wash.) yesterday introduced legislation to reauthorize the National Quantum Initiative for five years.

Why it matters: The program is meant to boost quantum research and development — which experts say could lead to scientific breakthroughs and keep the U.S. globally competitive — but Congress let it expire in 2023.

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