The Trump administration entered office promising to get government out of the AI industry's way. It hasn't worked out that way.

Why it matters: The White House says AI shouldn't be regulated, but it's shaping the industry through case-by-case interventions without clear rules, creating major uncertainty.

• What has emerged is a shadow AI policy, one that shapes the AI industry's future without ever spelling out the rules.

The big picture: The Trump administration has made opposition to AI regulation a cornerstone of its AI agenda, rescinding Biden-era requirements and arguing that excessive rules would slow innovation.

• Yet its light-touch, hands-off vision for AI has given way to an ad hoc system of company-specific interventions, voluntary frameworks and executive actions.
• Unlike traditional regulation, this influence operates outside of the formal rulemaking process, with few published standards and limited guidance for companies to help navigate the administration's expectations.

Friction point: It is supposed to be the role of Congress to make laws the administration then enforces.

• But despite recent efforts, including a bipartisan AI safety bill introduced in the House, Capitol Hill is frozen on AI as midterms loom, and the administration is taking the lead with executive action.

Without clear national AI rules set by Congress, the administration has focused on overriding state AI laws, the national security and cybersecurity implications of advanced AI models, the procurement of AI systems into the federal government and the economic impact of the biggest AI companies.

• Export controls, voluntary testing frameworks, and procurement guidelines are becoming the building blocks of the administration's shadow AI policy and a guide for how AI companies operate in the U.S.
• AI CEOs talked with Trump at the G7 summit yesterday about the possibility of what OpenAI's Chris Lehane described as a global forum for AI standards.

As Anthropic and the administration hash out whether export controls can be lifted on its latest models, other leading AI labs are working out how to comply with Trump's latest executive order, which established a voluntary framework for government review of some advanced AI models.

• The Anthropic situation also illustrates a central concern for the industry: uncertainty. Without clear rules, companies can find themselves navigating personalities and broader politics as much as policy.
• The General Services Administration is also considering a new rule around safeguarding data when LLMs process government information that would set certain privacy and security standards for companies wishing to contract with the government.

Zoom out: The administration's moves are not regulation in the sense of Europe's AI Act or the U.K.'s Online Safety Act. But because the U.S. is the home of the world's most advanced models, its decisions matter the most.

• At the G7 summit this week, the notion that other countries need to establish "tech sovereignty" so as to not rely on American companies loomed large.
• But foreign leaders also know they can't ignore the world's leading models and only rely on homegrown AI.

The bottom line: The Trump administration may not call it AI regulation, but its decisions are dictating the future of the technology around the world.

Like its AI policy, the Trump administration's AI team is taking shape on the fly.

Why it matters: Departures among key White House officials, combined with rapid advances in technology, are shaking up who's taking the lead on AI policy in the administration.

The big picture: Silicon Valley figures David Sacks and Sriram Krishnan have served as key architects of the administration's AI agenda. But with Sacks stepping back from day-to-day involvement and Krishnan preparing to leave, influence is shifting inside the White House to a broader group of officials and aides.

Here's who's running the show — for now.

Commerce Secretary Howard Lutnick. Lutnick's signature was on the letter that sparked the latest confrontation between Anthropic and the administration, ultimately leading to the takedown of the company's Fable and Mythos models.

• Last week, Lutnick imposed export controls on Anthropic, effectively creating a licensing regime that could eventually impact other AI labs.
• He is now leading meetings on the sidelines of the G7 to discuss expanding access to advanced AI models and standing next to President Trump during his summit press conference.
• While Lutnick brokers abroad, Chris Fall at Commerce's Center for AI Standards and Innovation has been holding technical meetings in D.C.

Zoom in: Lutnick was once said to be on the outs for going off message in TV interviews and not having a solid handle over his department's jurisdiction, sources familiar with the matter said.

• But last week's Anthropic fallout put him back in the game, and it's now Lutnick's moment.
• "He's fixing a problem. He's not being a problem. And he's doing a great job," said one senior administration official following the letter imposing export controls.

Treasury Secretary Scott Bessent. Bessent does not directly oversee AI testing. Yet he was the point of contact when Amazon raised concerns about Anthropic safety issues and was among the few Cabinet members flanking the president during a G7 press conference.

• Bessent is viewed as "the more reasonable actor" compared to Defense Secretary Pete Hegseth, who has been public about his disdain for the company, said one source familiar with the administration's thinking.
• "Bessent is trusted by the private sector and critical infrastructure operators as a sober actor," another source familiar said.

White House chief of staff Susie Wiles. Wiles, a veteran political strategist, has not typically been involved in day-to-day AI policy.

• But she was receptive to Bessent's concerns about how Anthropic's Mythos could impact the financial sector, helping to reopen lines of communication with the company.

National Economic Council's Ryan Baasch. Baasch is said to be the person carrying the torch inside the White House for Sacks and Krishnan.

• Sacks left earlier this year to join the President's Council of Advisors on Science and Technology and Krishnan plans to leave by the end of this month.
• Baasch has worked alongside the two advisers to influence AI policy on Capitol Hill and to push federal preemption of state AI laws.

Friction point: National Cyber Director Sean Cairncross is also holding technical meetings in Washington, but a clash with Bessent over the administration's AI response has deepened following the latest Anthropic dispute, sources familiar tell Axios.

• Cairncross believes that Treasury has become too involved, while Bessent and allies in the White House believe Cairncross has not met the moment with the necessary urgency.
• Cairncross' head of policy and senior adviser Thomas Lind plans to leave, further depleting the Trump administration of technical expertise.
• The Office of the National Cyber Director did not respond to a request for comment.

What they're saying: "The President's team, including Secretary Bessent and Sean Cairncross, is working closely together to strengthen America's cyber and national security, protect critical infrastructure, and ensure the United States remains the global leader in AI innovation," White House spokesperson Liz Huston said.

The bottom line: If personnel is policy, look to this latest cast of characters shaping a U.S. regulatory regime with global reach.

Marc Caputo contributed to this story.

The Trump administration has made exporting American AI a key part of its plans for global AI dominance, but ad hoc policy decisions around the most advanced AI are threatening that effort.

Why it matters: A flagship U.S. program designed to boost AI exports could be undermined by the very administration that created it.

• "The government's willingness to arbitrarily and abruptly remove America's best models from all foreign use shows that the strategy behind the AI Export Program is no longer relevant to decision makers in the U.S. government," Dean Ball, a former AI adviser in the Trump administration, told Ashley.

The big picture: The American AI exports program is a relatively new initiative that President Trump created in a July 2025 executive order.

• It's meant to bundle the infrastructure, tools and models into ready-to-deploy AI systems for allies and partners, and has been touted as a key part of the White House's AI policy goals, as we've previously reported.
• Those who are selected for the program will get expedited export control license reviews, prioritized access to U.S. federal credit programs, government-to-government advocacy abroad and dedicated interagency coordination.

What they're saying: A tech industry source told Axios that there are "downstream consequences" to using export controls as a means of enforcing tech policy, setting new precedents for future oversight and licensing of tech releases.

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