Past precedent may help predict the incoming administration’s priorities regarding the security industry. For example, Trump rolled back over 100 Obama-era policies affecting environmental regulations, immigration, and the healthcare and labor sectors between 2017 and 2019.
During the fall 2024 election cycle, he indicated a desire to reduce the impact of the National Cybersecurity Strategy and CHIPS Act legislation. Some experts anticipate he will issue executive orders affecting AI regulation and federal and private-sector cybersecurity. Let’s take a closer look.
Deregulating AI
Between 2016 and 2020, Trump’s approach to AI regulation prioritized technological advancement with minimal government oversight. His 2019 executive order advocated for responsible AI development while specifically avoiding mandatory rules for private companies. Looking ahead, Trump has announced his intention to immediately rescind Biden’s EO on AI, eliminating the current requirements for AI companies to report on their activities and submit high-risk AI models for review.
While removing or significantly reducing oversight could drive increased innovation, generative AI models tend to “hallucinate” or “confabulate” and spew inaccurate information, leading to potential misinformation, biased outputs, and a lack of trust in the AI system.
Despite differences in equity and bias issues, both parties support maintaining US AI leadership, particularly given national security and competitiveness implications. Trump appears to view AI development primarily through the lens of competition with China, with tech industry allies indicating a willingness to collaborate on national security initiatives.
Regarding industry perspectives, several security and technology associations, including the Electronic Security Administration (ESA), Security Industry Association (SIA), and The Monitoring Association (TMA), have advocated for AI policy frameworks in Congress. These organizations have asked for balanced oversight to protect US interests while ensuring regulations don’t hamper technological progress.
Semiconductor export controls are expected to remain crucial in US AI strategy with a possible strengthening of restrictions on China’s access to advanced chips. Howard Lutnick’s nomination as Commerce Secretary could significantly influence AI policy direction, given the department’s oversight of key initiatives, including the AI Safety Institute, NST, CHIPS Act funding, and export controls.
US AI Safety Institute
While the future of the recently established AISI remains uncertain, it generally maintains Republican support as a symbol of US AI leadership. Bipartisan legislative efforts are underway in both chambers of Congress to provide statutory backing for the institute.
AI data centers
Environmental policy under EPA nominee Lee Zeldin may prioritize data center and energy infrastructure permitting to advance US AI capabilities. Trump has emphasized expanding electricity production capacity as essential for elevating the country’s AI leadership.
Dataflows and global digital governance
The Trump administration’s stance on global data governance remains undefined, with no recent relevant statements or appointments made. The Commerce Department’s Industry and Analysis team continues playing a vital role in maintaining open cross-border data flows, particularly with European partners, according to transition documents.
Relaxing national privacy regulations
A shift toward state-level privacy oversight may occur under Republican leadership, particularly given Trump’s preference for state authority over federal control. This stance could potentially slow momentum for comprehensive federal privacy legislation like the bipartisan American Data Privacy Protection Act (ADPPA), instead reinforcing the role of existing state-specific laws like the California Consumer Privacy Act (CCPA). An emphasis on state-based privacy frameworks in lieu of unified national standards aligns with historical Republican approaches to regulatory policy.
Relaxing business regulations
Republican leadership has also traditionally favored relaxed business regulations. This approach could support various business-friendly tax provisions proposed in H.R. 7024, including:
- Research and development expense deductions
- Full bonus depreciation allowances
- Modified EBITDA-based caps on business interest deductions
Industry experts anticipate that the 2025 tax policy changes will reflect Republican priorities. These could include maintaining or lowering the current 21% corporate tax rate, potentially restoring R&D tax credits, and reinstating complete cost write-offs for security facility improvements—policies that would benefit security companies of all sizes.
Under Republican influence, the FCC may adopt more business-friendly positions, affecting ongoing industry concerns such as the security sector’s opposition to proposed changes in the Lower 900 MHz Band frequency allocation, which is vital for various security and access control systems utilizing Z-wave and other RF communications.
Brendan Carr, the nominee for FCC chair, has outlined priorities for limiting Big Tech’s influence, enhancing national security, promoting economic growth, and improving agency governance. His positions include opposition to TikTok on national security grounds, support for removing net neutrality regulations, and advocacy for Section 230 reform of the Communications Decency Act.
Protecting sensitive data
The future of Biden’s February 2024 EO 4117, designed to protect Americans’ sensitive data and government information from foreign access, particularly from China, remains uncertain. The order’s implementing rules, proposed by the Department of Justice, may face revision or revocation.
Limiting the reach of Chinese tech firms
Trump’s current position on TikTok appears more nuanced than during his first term, with reports suggesting he may oppose a ban despite acknowledging the platform’s benefits and risks. His previous administration’s “Clean Network” initiative achieved several goals in limiting Chinese tech influence, including:
- Raising awareness of security risks from Chinese telecom companies in 5G networks
- Reforming Team Telecom to restrict Chinese access to US telecommunications
- Supporting enhanced foreign investment screening that reduced China-related transactions
Note that attempts to ban apps like WeChat and TikTok during his first administration failed. TikTok is currently appealing a ban set to take effect on January 19, 2025.
Regulating cybersecurity
The incoming administration could potentially reduce rather than expand cybersecurity regulations. Security experts predict a decrease in mandatory reporting requirements, including incident reporting protocols. According to Reuters reports, the newly planned Department of Government Efficiency, led by Elon Musk and Vivek Ramaswamy, will reduce regulations and reorganize federal agencies.
However, businesses will still need to navigate complex regulatory landscapes. While US federal oversight may decrease, companies must still comply with regulations levied by various international bodies, including the EU, Japan, and Australia, as well as individual US state requirements. This scenario creates a complex regulatory environment that organizations must manage carefully.
Neutralizing bad actors
The next administration’s cybersecurity focus appears to address threats from specific nation-states, particularly China, Iran, North Korea, and Russia. Jeff Le, VP of global government affairs and public policy at cybersecurity ratings company SecurityScorecard, said, “I do anticipate the US taking a more aggressive stance… [Incoming national security advisor Mike Waltz] has made a point to prioritize a more offensive role.”
Consider the Salt Typhoon telecom hack, which affected eight US telecommunications carriers. Between 2020 and 2024, other cyberattacks and ransomware attacks occurred, including those on Colonial Pipeline, JBS Foods, Microsoft Exchange, and SolarWinds. The Biden administration has championed greater regulation within the private sector; however, the Trump administration has already indicated little appetite for more regulation.
Legislative priorities of the ESA
ESA leadership anticipates that the new administration may affect its stance against the FTC’s negative option (click-to-cancel) rule, which the organization has challenged as creating excessive burdens for security and life safety companies. The ESA has formally contested this policy through an emergency petition to the US Court of Appeals. ESA representatives have criticized the FTC’s aggressive approach to consumer issues, particularly junk fees and similar consumer-focused initiatives under the Biden administration.
The evolving threat landscape, characterized by adversaries using cyber capabilities to gain political, economic, and military advantage over the US, necessitates the continued implementation of robust bipartisan cybersecurity and cyber defenses. It remains to be seen which policies the Trump administration will continue and which it will reject and reverse.
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