The Supreme Court’s Trump v. Slaughter decision has narrowed options for U.S. AI governance by weakening the case for an independent federal AI regulator insulated from presidential removal power, according to Daniel Wilf-Townsend of Georgetown University Law Center. The decision overruled a New Deal-era precedent and held that the president may fire a federal trade commissioner to advance policy priorities despite a law limiting such removals, leaving AI regulation advocates to choose between direct federal agency control and third-party regulatory systems with private auditors or verification bodies.

Wilf-Townsend argues that third-party AI regulation was already gaining support because government agencies often struggle to hire scarce technical talent at competitive salaries and move quickly through multiyear rulemaking cycles. Proposed models include independent auditors assessing companies’ own safety and security claims, auditors checking compliance with government standards, opt-in systems tied to liability limits, mandatory audits, “regulatory markets,” and government-funded auditors. The article also notes risks: Esther Duflo and co-authors found in Gujarat that firm-selected and firm-paid auditors systematically underreported pollution, while third-party credit rating agencies contributed to the financial crisis of 2008.

Recent state laws show the approach is moving into policy. Illinois became the first state to require annual independent third-party audits of frontier AI developers’ safety practices after Governor JB Pritzker signed legislation this week. Connecticut’s new AI law creates a pilot program for state-approved independent verification organizations to assess AI systems.

The article says 2026 federal actions involving Anthropic strengthened the political-insulation argument. In late February, after Anthropic refused certain Department of Defense contract terms, Defense Secretary Pete Hegseth designated Anthropic a supply chain risk and announced that no company doing business with the U.S. military could “conduct any commercial activity with Anthropic”; a federal court later enjoined the moves. In mid-June, three days after Anthropic launched Fable 5 and Mythos 5 and after two months of limited release and government briefings, Commerce Secretary Howard Lutnick ordered Anthropic to suspend access to those models by any foreign national anywhere in the world, effectively forcing Anthropic to cut off access entirely.

Wilf-Townsend says those actions were troubling because they were unilateral, opaque, delivered without published standards, and appeared concentrated on one company even though competitors may have been similarly situated. The article contrasts that situation with the bipartisan Blumenthal-Hawley framework, which had proposed a licensing regime run by an “independent oversight body,” an idea industry leaders endorsed before Congress in 2023.

Third-party regulators would not remove the need for executive-branch national security reviews, the article says, and absolute independence is neither possible nor desirable because public accountability still matters. But auditors working under longer contracts, licenses, grants, or formal termination processes could create a buffer against sudden executive intervention. Independent organizations could also supply technical testing and public context when government claims about AI model safety are hard for Congress, civil society experts, or voters to evaluate.

The article concludes that third-party regulation still depends on design quality. A poorly built third-party regime could be worse than a well-structured public agency, but Trump v. Slaughter may push AI governance toward systems that diffuse power to private regulators while keeping ultimate oversight in a federal agency.

The Supreme Court’s Trump v. Slaughter decision has narrowed options for U.S. AI governance by weakening the case for an independent federal AI regulator insulated from presidential removal power, according to Daniel Wilf-Townsend of Georgetown University Law Center. The decision overruled a New Deal-era precedent and held that the president may fire a federal trade commissioner to advance policy priorities despite a law limiting such removals, leaving AI regulation advocates to choose between direct federal agency control and third-party regulatory systems with private auditors or verification bodies.

Wilf-Townsend argues that third-party AI regulation was already gaining support because government agencies often struggle to hire scarce technical talent at competitive salaries and move quickly through multiyear rulemaking cycles. Proposed models include independent auditors assessing companies’ own safety and security claims, auditors checking compliance with government standards, opt-in systems tied to liability limits, mandatory audits, “regulatory markets,” and government-funded auditors. The article also notes risks: Esther Duflo and co-authors found in Gujarat that firm-selected and firm-paid auditors systematically underreported pollution, while third-party credit rating agencies contributed to the financial crisis of 2008.

Recent state laws show the approach is moving into policy. Illinois became the first state to require annual independent third-party audits of frontier AI developers’ safety practices after Governor JB Pritzker signed legislation this week. Connecticut’s new AI law creates a pilot program for state-approved independent verification organizations to assess AI systems.

The article says 2026 federal actions involving Anthropic strengthened the political-insulation argument. In late February, after Anthropic refused certain Department of Defense contract terms, Defense Secretary Pete Hegseth designated Anthropic a supply chain risk and announced that no company doing business with the U.S. military could “conduct any commercial activity with Anthropic”; a federal court later enjoined the moves. In mid-June, three days after Anthropic launched Fable 5 and Mythos 5 and after two months of limited release and government briefings, Commerce Secretary Howard Lutnick ordered Anthropic to suspend access to those models by any foreign national anywhere in the world, effectively forcing Anthropic to cut off access entirely.

Wilf-Townsend says those actions were troubling because they were unilateral, opaque, delivered without published standards, and appeared concentrated on one company even though competitors may have been similarly situated. The article contrasts that situation with the bipartisan Blumenthal-Hawley framework, which had proposed a licensing regime run by an “independent oversight body,” an idea industry leaders endorsed before Congress in 2023.

Third-party regulators would not remove the need for executive-branch national security reviews, the article says, and absolute independence is neither possible nor desirable because public accountability still matters. But auditors working under longer contracts, licenses, grants, or formal termination processes could create a buffer against sudden executive intervention. Independent organizations could also supply technical testing and public context when government claims about AI model safety are hard for Congress, civil society experts, or voters to evaluate.

The article concludes that third-party regulation still depends on design quality. A poorly built third-party regime could be worse than a well-structured public agency, but Trump v. Slaughter may push AI governance toward systems that diffuse power to private regulators while keeping ultimate oversight in a federal agency.