Advocates Warn Against Ted Cruz's Industry-Friendly 'Sandbox' for AI

US Senate Commerce Committee Chair Ted Cruz on Wednesday unveiled a legislative framework for artificial intelligence, including a bill to create a "regulatory sandbox," which the Texas Republican said is part of President Donald Trump's AI Action Plan.

The Strengthening Artificial intelligence Normalization and Diffusion By Oversight and eXperimentation (SANDBOX) Act "gives AI developers space to test and launch new AI technologies without being held back by outdated or inflexible federal rules," Cruz's office said in a statement.

While his office celebrated support for the bill from "notable organizations in the tech space like the Abundance Institute, U.S. Chamber of Commerce, and the Information Technology Council," the consumer watchdog group Public Citizen swiftly sounded the alarm over the industry-friendly proposal.

"Public safety should never be made optional, but that's exactly what the SANDBOX Act does," said Public Citizen Big Tech accountability advocate J.B. Branch. "Companies that build untested, unsafe AI tools could get hall passes from the very rules designed to protect the public. It guts basic consumer protections, lets companies skirt accountability, and treats Americans as test subjects."

"It's unconscionable to risk the American public's safety to enrich AI companies that are already collectively worth trillions."

"The mantra in Silicon Valley is 'move fast and break things,' and that's exactly what Big Tech will do with a green light to override the laws and regulations they don't want to follow," Branch warned. "AI corporate executives see the opportunity to deploy all sorts of unregulated and untested products that can threaten our children's safety, consumers' privacy, and American democracy."

"It's unconscionable to risk the American public's safety to enrich AI companies that are already collectively worth trillions," he added. "The sob stories of AI companies being 'held back' by regulation are simply not true, and the record company valuations show it. Lawmakers should stand with the public, not corporate lobbyists, and slam the brakes on this reckless proposal. Congress should focus on legislation that delivers real accountability, transparency, and consumer protection in the age of AI."

Brendan Steinhauser, CEO of the Alliance for Secure AI, was similarly critical of Cruz's legislation on Wednesday.

"Ideally, Big Tech companies and frontier labs would make safety a top priority and work to prevent harm to Americans. However, we have seen again and again that they have not done so. The SANDBOX Act removes much-needed oversight as Big Tech refuses to remain transparent with the public about the risks of advanced AI," he said. "This raises many questions about who can enter the so-called 'regulatory sandbox' and why. We hope that we will get answers to these questions in the coming days."

Passing the SANDBOX Act, plus streamlining AI infrastructure permitting and opening up federal datasets to AI model training, is just the first pillar of Cruz's five-part framework. Part two focuses on combating government censorship. The third section is about countering "burdensome" state and foreign AI regulations. Pillar four calls for protecting Americans from scams and fraud, as well as safeguarding US schoolchildren. The fifth prong is about bioethical considerations and AI-driven eugenics.

In the absence of federal regulation, states have acted on AI. As Reuters detailed Wednesday:

Several states have criminalized the use of AI to generate sexually explicit images of individuals without their consent. California prohibits unauthorized deepfakes in political advertising and requires healthcare providers to notify patients when they are interacting with an AI and not a human.

Colorado passed a law last year aimed at preventing AI discrimination in employment, housing, banking, and other consequential consumer decisions. The tech industry has lobbied for changes to the law, and the state legislature recently pushed forward its implementation to mid-2026.

In July, ahead of the introduction of Trump's plan, over 90 groups focused on consumer protection, economic and environmental justice, labor, and more collectively called for an AI blueprint that "delivers on public well-being, shared prosperity, a sustainable future, and security for all."

Branch, whose group is part of that coalition, said at the time that "AI is already harming workers, consumers, and communities—and instead of enforcing guardrails, this administration is gutting oversight."

He said the defeat earlier this summer of a Senate measure that would have prevented state-level regulation of AI for a decade sent a clear message from the public: "No more handouts for Trump's tech bro buddies."

"We need rules and accountability," Branch said, "not a Silicon Valley free-for-all."