🇺🇸 Allies under AI
1. Key Themes
AI as the New Currency of Geopolitical Alliance
The Trump administration has fundamentally reframed what it means to be a U.S. ally — shifting from shared values and security interests to AI capability alignment and energy policy.
"For decades, shared values and security interests have underpinned alliances with Europe and other partners around the world. Under Trump, that's no longer enough."
"As AI becomes central to economic and military power, frontier AI models, chips and infrastructure are turning into new instruments of American influence."
U.S. AI Export Controls Creating a Fragmented, Ad Hoc Licensing Regime
Rather than a coherent policy framework, the administration's restrictions are generating regulatory uncertainty both domestically and for allies — ironically mirroring the kind of regulatory friction it criticized the EU for.
"The president now finds himself behind an ad hoc licensing regime that's creating its own regulatory uncertainty, both domestically and abroad."
"OpenAI's GPT-5.6 was forced into a staggered rollout last month due to government concerns."
Allies Pivoting to "Build Around" U.S. Restrictions
U.S. partners are not simply waiting for access — they are actively strategizing to operate without frontier U.S. models where necessary, signaling a long-term structural shift in global AI development.
"The conclusion that governments are coming to is: We'll be part of Pax Silica, yes. We'll work with the U.S. ecosystem where we can. We'll build around what we can't." — A.J. Bhadelia, Cohere
Presidential Consolidation of Independent Regulatory Agencies
The Supreme Court's overturning of Humphrey's Executor eliminates the independence of the FTC and similar agencies, concentrating regulatory power over AI, tech competition, and consumer protection directly in the White House.
"The FTC is now under stronger presidential control — with no more opportunity for partisan dissent — following the Supreme Court's decision that President Trump can fire its members."
"Any realistic chance the agency in charge of consumer protection, kids' online safety, tech competition and fighting deceptive and unfair practices will have any Democrats during this administration is effectively gone."
AI Political Spending Is Becoming a Contested Battlefield
The emergence of well-funded AI safeguards advocacy groups signals that the political fight over AI regulation is escalating, with both pro-regulation and pro-industry forces deploying significant capital.
"The fundraising suggests that political spending around AI regulation is becoming even more competitive, potentially blunting the influence of pro-AI super PACs."
Public First Action "said this week it has raised more than $80 million to date, including $20 million in the last 10 days."
2. Contrarian Perspectives
The U.S. "Deregulation" Stance Has Produced Its Own Regulatory Burden
The consensus view is that the Trump administration is broadly anti-regulation on AI. The reality is more complicated: by restricting frontier model access through export controls and ad hoc licensing, the administration has created a de facto regulatory regime that may be more disruptive than the EU's structured approach.
"The U.S. was quick to rebuke the EU's focus on safety over innovation with Trump entering his second term laser-focused on deregulation. But the president now finds himself behind an ad hoc licensing regime that's creating its own regulatory uncertainty, both domestically and abroad."
U.S. Allies Are Not Passive Recipients — They Are Quietly Hedging
The conventional framing is that allies are scrambling for U.S. AI access. In fact, allied governments are proactively designing strategies that reduce dependence on U.S. frontier models — a potentially durable decoupling dynamic.
"We'll be part of Pax Silica, yes. We'll work with the U.S. ecosystem where we can. We'll build around what we can't." — A.J. Bhadelia, Cohere
The EU stated: "our sovereign legislation is not up for negotiation." — Thomas Regnier, European Commission
Anthropic May Be Quietly Stepping Back from AI Safeguards Advocacy
Despite being a founding donor to Public First Action, Anthropic has not made additional contributions — a notable signal given the organization's $80M fundraising momentum and Anthropic's simultaneous deepening cooperation with the Trump administration via Project Glasswing.
"Anthropic has not donated more money to Public First since its initial $20 million donation, a person familiar with the matter told Axios."
3. Companies Identified
Anthropic
- Description: Frontier AI lab, maker of Claude models including Fable and Mythos
- Why mentioned: Central actor in Project Glasswing, cooperating with the Trump administration on controlled model access; also an early donor to AI safeguards group Public First Action, though not contributing further
- Quotes: "With export controls on Fable and Mythos lifted on Tuesday, Anthropic and the Trump administration are continuing Project Glasswing efforts, which the company previously said would give access to Mythos to 150 more organizations across more than 15 countries."
- Description: Frontier AI lab, maker of GPT model series
- Why mentioned: Its GPT-5.6 model was subject to a government-mandated staggered rollout, illustrating how export control/licensing friction affects even leading U.S. AI companies
- Quotes: "OpenAI's GPT-5.6 was forced into a staggered rollout last month due to government concerns."
- Description: Defense and intelligence-focused data analytics and AI company
- Why mentioned: CEO Alex Karp issued a "scathing critique" of U.S. AI labs, signaling that major AI labs are "no longer viewed as untouchable"
- Quotes: "Palantir CEO Alex Karp's scathing critique yesterday shows U.S. AI labs are no longer viewed as untouchable."
- Description: Enterprise AI company with a focus on government and global markets
- Why mentioned: Its head of global government affairs articulated the strategic response allies are taking to U.S. AI restrictions
- Quotes: "We'll be part of Pax Silica, yes. We'll work with the U.S. ecosystem where we can. We'll build around what we can't." — A.J. Bhadelia, Cohere
Public First Action
- Description: AI safeguards advocacy group operating various PACs
- Why mentioned: Raised $80M to date (including $20M in 10 days), positioning itself as a major counterweight to pro-AI industry super PACs in the political spending landscape
- Quotes: "The fundraising suggests that political spending around AI regulation is becoming even more competitive, potentially blunting the influence of pro-AI super PACs."
- Description: Cloud and AI infrastructure provider (newsletter sponsor)
- Why mentioned: Sponsor mention highlights government AI deployment; Arlington County uses Amazon Connect to triage 911 calls; AWS serves 15,000+ government customers
- Quotes: "Amazon Connect allows our staff to focus on emergencies while providing faster service." — Jacob Saur, Arlington County
4. People Identified
Alex Karp
- Description: CEO of Palantir
- Why mentioned: Issued a public critique of U.S. AI labs, reflecting a shift in how frontier AI companies are perceived and treated
- Quotes: Referenced as delivering a "scathing critique" showing "U.S. AI labs are no longer viewed as untouchable"
A.J. Bhadelia
- Description: Head of Global Government Affairs and External Affairs, Cohere
- Why mentioned: Articulated the allied-government consensus strategy for navigating U.S. AI restrictions
- Quotes: "The conclusion that governments are coming to is: We'll be part of Pax Silica, yes. We'll work with the U.S. ecosystem where we can. We'll build around what we can't."
- Description: European Commission spokesperson
- Why mentioned: Publicly stated EU's position on U.S. AI model access negotiations and red lines
- Quotes: "But we have one clear line — which is that our sovereign legislation is not up for negotiation."
- Description: UAE Assistant Foreign Minister for Advanced Science and Technology
- Why mentioned: Voiced the perspective of a key U.S. partner in the Gulf on the importance of inclusion in AI governance frameworks
- Quotes: "It's very important that trusted partners and strategic partners are included in the process — synchronized and we're applying similar standards in controlling such technologies, rather than having something that gets imposed."
Rebecca Slaughter
- Description: Democratic FTC Commissioner
- Why mentioned: Fired by Trump; her case led to the Supreme Court ruling overturning Humphrey's Executor
- Quotes: "It's not just about having bipartisan commissioners. It's also about having commissioners who are insulated from political interference in these very important economic watchdog decisions — because what we want them to do is serve as watchdogs, as Congress intended, not as lap dogs of the president."
JD Vance
- Description: U.S. Vice President
- Why mentioned: His Paris AI Summit speech set the adversarial tone with the EU that now shapes U.S. AI alliance policy
- Quotes: "Vice President JD Vance's speech last year at the Paris AI Summit set the stage for a confrontational relationship with the European Union."
5. Operating Insights
If You're Selling AI to Governments Outside the U.S., Emphasize "Sovereignty-Compatible" Architecture
Allied governments are explicitly designing strategies to "build around" U.S. restrictions. Companies (like Cohere) that can offer frontier-adjacent AI without U.S. export control entanglements are structurally advantaged in international government procurement. The EU's insistence that "sovereign legislation is not up for negotiation" signals that regulatory compatibility, not just capability, will be a procurement criterion.
The FTC's Proposed Federal Preemption of State AI Laws Is the Most Actionable Near-Term Regulatory Development
The FTC's proposed policy statement arguing it can preempt conflicting state AI law is open for public comment through July 31. For operators navigating a patchwork of state AI regulations, this is a direct opportunity to shape a potential consolidating regulatory framework — or prepare for its passage.
"The FTC yesterday proposed a policy statement arguing that the FTC Act can preempt state law 'to the extent it conflicts with a federal regulatory scheme,' part of the Trump administration's effort to override some state AI laws."
6. Overlooked Insights
"Pax Silica" Is Quietly Becoming a Key Strategic Framework
Mentioned only briefly, Pax Silica — described as a "U.S.-led effort to secure AI supply chains and critical minerals" — is already attracting signatories from the EU and European governments. This framework may become the primary vehicle through which allies cooperate with the U.S. on AI infrastructure even as they're excluded from frontier model access. Investors in critical minerals, chip supply chains, and AI infrastructure should track it closely.
"Just last week, the EU and several European governments signed onto Pax Silica, the U.S.-led effort to secure AI supply chains and critical minerals, even as the White House restricts their access to frontier AI models."
Commerce Department Retains Unilateral Power to Revoke Model Access
The restoration of access to Fable and Mythos comes with a significant caveat that received minimal emphasis: the Commerce Department can pull it back at any time. This creates a persistent, unresolved overhang for any enterprise or government building on these models.
"Commerce retains the power to pull back access when it deems appropriate."