Zero One Strategies

February 24, 2025

President Trump signed a National Security Presidential Memorandum to protect U.S. national security through actions such as expanding restrictions on U.S. outbound investment to China in sensitive technologies, including AI and quantum. The SEC announced the creation of the Cyber and Emerging Technologies Unit to combat misconduct in the emerging technologies space. 

In Congress, focus this week is on national security, China, and fostering innovation. The House Energy and Commerce data privacy working group is seeking feedback on the role of data privacy and security standards in AI.

Read more below

Congress

Hearings

  • Last week
    • The House was in recess.
    • On February 20, the Senate Committee on Energy and Natural Resources held a hearing to Examine Research Security Risks Posed by Foreign Nationals from Countries of Risk Working at the Department of Energy’s National Laboratories and Necessary Mitigation Steps.
  • This week
    • On February 25, the House Financial Services Committee will hold a hearing on Examining Policies to Counter China.
    • On February 26, the House Small Business Committee will hold a hearing on Fostering American Innovation: Insights into SBIR (Small Business Innovation Research) and STTR (Small Business Technology Transfer) Programs.
    • On February 27, the Senate Banking Committee will hold a nominations hearing for CFPB, FHFA, and CEA.

Correspondence

  • Sens. Chris Van Hollen (D-MD), Cory Booker (D-NJ), Mark Kelly (D-AZ), and Tim Kaine (D-VA) wrote to the Federal Energy Regulatory Commission (FERC) to request the commissioners hold a technical conference to develop recommendations on energy supplies for data centers. (Letter)(Press release)

  • Rep. John Joyce (R-PA) submitted comments to FERC requesting consistent and timely guidance regarding the demand of electricity consumption and potential co-located data center projects. (Letter)

  • Sens. Ed Markey (D-MA), Jeff Merkley (D-OR) and Peter Welch (D-VT) wrote to Google CEO Sundar Pichai requesting information on Google’s rationale for revising its AI Principles, including removing the limitation on developing AI products for weapons or certain surveillance applications. (Letter)(Press release)

  • Sens. Ted Budd (R-NC), Tommy Tuberville (R-AL), Eric Schmitt (R-MO), and Mark Kelly (D-AZ) sent a letter to the Acting Chief Information Officer at the Department of Defense (DOD) requesting information from the Pentagon about how many of its employees have used their government devices to access DeepSeek and the associated potential cyber threats from the use of DeepSeek, as well as the practices being implemented to prevent cyber security risks. (Letter)(Press release)

  • Senate Intelligence Committee Chair Tom Cotton (R-AR) sent a letter to Office of Management and Budget Director Russell Vought asking to prohibit U.S. government agencies, departments, and employees from using DeepSeek and artificial intelligence tools developed in China. (Letter)(Press release)

Caucuses and Working Groups

  • House Energy and Commerce Chair Brett Guthrie (R-KY) and Rep. John Joyce (R-PA) issued a Request for Information (RFI) inviting stakeholders to share suggestions with the new data privacy working group. On AI, they ask, “Most state comprehensive data privacy and security laws regulate AI through ‘automated decision-making’ requirements. A growing number of states are also enacting—or are seeking to enact—additional AI-specific laws. These developments raise questions about the role of privacy and consumer protection standards in AI regulation and the impact on U.S. AI leadership. How should a federal comprehensive data privacy and security law account for state-level AI frameworks, including requirements related to automated decision-making?” (RFI)(Press release)

Trump Administration

White House

  • President Trump signed a National Security Presidential Memorandum (NSPM) on the Administration’s America First Investment Policy to promote foreign investment while protecting U.S. national security interests, including considering “new or expanded restrictions on U.S. outbound investment to China in sensitive technologies, including semiconductors, artificial intelligence, quantum, biotechnology, aerospace, and more, to stop American funds from supporting China’s Military-Civil Fusion (MCF) strategy.” (NSPM)(Fact sheet)

Securities and Exchange Commission (SEC)

  • The SEC announced the creation of the Cyber and Emerging Technologies Unit (CETU) to focus on combatting cyber-related misconduct and to protect retail investors from bad actors in the emerging technologies space. Priority areas include: fraud committed using emerging technologies, such as artificial intelligence and machine learning; use of social media, the dark web, or false websites to perpetrate fraud; hacking to obtain material nonpublic information; takeovers of retail brokerage accounts; fraud involving blockchain technology and crypto assets; regulated entities’ compliance with cybersecurity rules and regulations; and public issuer fraudulent disclosure relating to cybersecurity. (Press release)

Commerce Department

  • On March 18 – 20, the Bureau of Industry and Security will hold the 2025 Update Conference on Export Controls and Policy. (Press release) 
  • On March 10, the Bureau of Industry and Security holds a meeting of the Emerging Technology Technical Advisory Committee. (Federal Register)

Noteworthy Quotes and Events

ADMINISTRATION

Federal Reserve

  • In remarks before Georgetown University Law Center on Risks and Challenges for Bank Regulation and Supervision, Fed Vice Chair for Supervision Michael Barr spoke about assessing cyber and third party risk, saying about AI, “And advances in artificial intelligence are likely to give bad actors new tools for fraud and infiltration, while also providing banks with new tools to combat these attacks. Both banks and the Federal Reserve need to continue to invest in cyber resiliency.” (Remarks)

CONGRESS

  • Rep. Jay Obernolte (R-CA) said at the State of the Net conference that he plans to reintroduce the Creating Resources for Every American to Experiment with Artificial Intelligence (CREATE) Act that would codify the NAIRR, saying he is “trying to make it more clear to my colleagues that the vast majority of the compute and the data is going to be donated. What we’re providing is a federal framework for managing that. I think there was fear that taxpayer resources were going to be used to fund this compute, and that’s not necessary. We have such a huge outpouring of donations from industry who are also eager to see this get created.” (FedScoop)

  • Obernolte also said he supports the creation of a select committee on AI or task force to follow the work of the House Bipartisan AI Task Force, saying, “We just need to make sure that we have some kind of nucleus. I don’t know if it’s a working group or task force or a select committee, but I think it’s really important that we have a group of people who are focused on this task.” (FedScoop)

  • Sen. Cynthia Lummis (R-WY) addressed the Wyoming House of Representatives and the Wyoming Senate, saying, “Artificial intelligence is going to double the demand we have now for energy – and we don’t have enough baseload energy to meet that need. Well Wyoming does – we export about twelve times more energy than we consume. So, my office is working with AI companies to encourage them to bring their computing needs here and use our energy to produce the computer capacity to make the United States number one in AI – and keep it that way.” (Press release)

  • Rep. Julie Fedorchak (R-ND) addressed the North Dakota State House and Senate, saying, “AI requires vast computing power, which means it requires abundant, reliable, and affordable energy. North Dakota should lead these efforts. We have more gas in the Bakken than we can use. Let’s turn it into electricity, power AI computing at sites near the gas source, and make more room in our pipelines for additional gas production. This will grow our production, solve our gas challenge, create a new industry, and help America lead in AI. I’m leading a working group in the House to focus on the energy needs of AI.” (Press release)

  • Fedorchak tweeted, “’We’re going to be energy dominant like nobody else, and this doesn’t even discuss all of the electricity that we’re going to be producing for all of the AI plants.’ – POTUS just now when announcing the creation of the National Energy Dominance Council.  POTUS is absolutely right! The AI and Energy Working Group I launched yesterday aligns perfectly with NEDC’s focus on AI. Together, we’ll drive energy dominance, fortify our electric grid, and position America as the global leader in AI innovation.”

  • Sen. Tom Cotton (R-AR) tweeted, “Federal employees, departments, and agencies should not be using AI tools developed by our adversaries. DeepSeek should be banned from all U.S. government devices.”

  • Rep. Jay Obernolte (R-CA) tweeted, “AI is poised to transform industries like manufacturing, revolutionizing both efficiency and innovation. I hope our AI Task Force report provides a strong foundation to guide policy decisions that harness this technology while ensuring responsible implementation.”

  • Rep. Mark Green (R-TN) tweeted, “There is no question that the CCP will use AI technology to spread its malign influence and further oppress its people. We’ve got to do more to protect our sensitive technologies from the CCP’s abuse.”

  • Green also tweeted, “This is a major wakeup call. Using sensitive U.S. technology, China was able to create a new and powerful AI model that could be used to further oppress its own people and undermine the United States—this is unacceptable. My China Technology Transfer Control Act will help prevent this from happening again.”

  • Rep. Julie Fedorchak (R-ND) tweeted, “Energy security is national security—and it’s the foundation for lowering prices, increasing growth, and developing new technologies. One of the most significant national security challenges of our time is the race for AI. If we want to outpace China, we need policy that ensures American innovation is fueled at home.”

  • Sen. Josh Hawley (R-MO) tweeted, “Hawley Questions Trump DOJ Antitrust Nom On Breaking Up Big Tech, Defending Americans From Harmful AI “Why not open the courtroom doors against these technology companies . . . to allow normal Americans . . . to bring suits against them?”

  • Rep. Jay Obernolte (R-CA) tweeted, “At the Paris AI Summit, Vice President JD Vance emphasized the need for a balanced approach to AI—fostering innovation while ensuring security. Watch my interview on Fox News for more on the future of AI and America’s role in leading it!”

Highlights of the Week

  • The Digital Energy Council is hosting a webinar featuring Rep. Jay Obernolte (R-CA), Chair of the House Bipartisan AI Task Force.

What I’m Reading This Week

About Zero One Strategies

Zero One Strategies is a boutique government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

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