# How the American Executive Could Control AI Companies > Source: > Published: 2026-08-14 15:43:23+00:00 Some of the most notable American AI policies to date have been enacted by unilateral executive branch action. Consider the Department of Defense’s spat with Anthropic, and the resulting [threats](https://www.npr.org/2026/02/24/nx-s1-5725327/pentagon-anthropic-hegseth-safety) from Pete Hegseth to invoke the Defense Production Act (DPA) against them. Or the fleeting export controls on Claude Fable/Mythos 5, manifested as a vaguely worded, threatening [letter](https://www.bloomberg.com/news/articles/2026-06-16/read-the-lutnick-letter-that-led-anthropic-to-disable-mythos) from Howard Lutnick, which [might not have been legally sound](https://x.com/alasdairpr/status/2067052688508899577) but were effective anyway. The executive branch of the United States government has numerous powers that can be used to unilaterally control AI companies. We think the US executive is likely to remain heavily involved in AI governance, because the national security and foreign policy narratives about AI that empower the executive will endure. Additionally, if AI progresses very quickly, the executive will be further emboldened because it is particularly quick to respond and often entrusted with crisis management. In instances where the executive acts beyond its lawful powers, we think checks from Congress and the courts will be unreliable in restraining the executive. In this post, we: Our aim in writing this is to illustrate the specifics of American executive dominance: in which domains the executive *is* powerful, where certain ambiguities and possibilities for constraint lie, and where they *can’t* act alone. *Thank you to* *Alex Mallen, Buck Shlegeris, Nick Marsh, Jackson Sipple, and Cody Rushing for feedback on earlier drafts.* Presidential authority over domestic AI companies operates at the level of the goods and intellectual property produced and assets held by these companies. To exert control at this layer, the president could: Which options are most likely to be successfully used for AI? The executive is very likely to succeed in prioritizing contracts for models, hardware, and infrastructure. Prioritized contracts are extremely common. The DoD [issues](https://www.congress.gov/118/meeting/house/117274/witnesses/HHRG-118-BA10-Wstate-RozmanKendlerT-20240508.pdf) an estimated 300,000 priority-rated (DO and DX ratings) contracts per year. While the number of top-priority (DX-rated) contracts is much smaller, there are no functional restrictions or caps on assigning this rating besides requiring approval from the Secretary of Defense. Conversely, presidential authorities to force new contracts or allocate critical domestic materials are much more ambiguous. We generally see the resolution of ambiguities as context-dependent. While some presidents operate with more restraint, others might see ambiguities opportunistically and work to exploit them. A crisis scenario that requires urgent response (e.g. a large cyberattack on US infrastructure) likely prompts the executive to test ambiguous mechanisms. This would also bolster public-interest and national security narratives that executive authority is empowered by. We are uncertain how and if this ambiguity will be resolved, but we think it’s moderately likely the limits of executive authority will be tested in the near future.[[1]](#fneknv979kue) Prioritized contracts could have two notable spillover effects: Finally, we think the DPA’s information authorities and the Invention Secrecy Act are *presently* less likely to be used for two reasons: Overall, we think the executive’s powers to redirect resources and command the rapid acquisition of products are highly relevant to influencing AI companies and related service providers. These powers could be used to consolidate AI production within one champion company, or get access to advanced AI technology that companies hesitate to sell. However, the outer limits of these powers remain uncertain. Given broad foreign affairs powers, the president has various authorities that directly target transactions involving a foreign entity. Using these powers often affects domestic companies too. To control foreign transactions, the president could: Beyond simply disrupting foreign AI development and supply chains, many of these actions have effects at the domestic and product level. For example, the Mythos and Fable export controls didn’t technically ban Anthropic from producing or deploying either model. However, deemed export laws meant foreign nationals within the US were also subject to export controls (though in what way was unclear, because the export controls were never litigated). Anthropic removed access anyway, achieving the same effect as a ban on these models. Doing a direct ban would require Congress to pass legislation, but “deemed export” rules may continue to work as an executive-only path equivalent to administering a ban. These maneuvers are useful in the instance that the executive wants to disrupt the productive capacity of American AI companies, whether for reasons of safety or belligerence. We think it is very likely that the executive uses these powers to fulfill AI governance objectives through the market. If the domestic mechanisms in the previous section are blocked or frustrated, the collateral effects of governing international transactions serve as an alternative pathway to controlling US AI companies. The executive could threaten the use of any of the mechanisms specified above to coerce companies into changing their actions in domains it can’t directly control. When contract negotiations between Anthropic and the Department of Defense (DoD) broke down, Pete Hegseth [threatened](https://www.npr.org/2026/02/24/nx-s1-5725327/pentagon-anthropic-hegseth-safety) to designate Anthropic as a supply chain risk and invoke the DPA to override Anthropic’s red lines on autonomous weapons (despite, as previously discussed, this threat’s questionable credibility). Similar threats might be used to coerce compliance with other standards. These threats are credible if the executive can legally follow through on the threat. For many potential goals, like changing corporate policy, the executive could lawfully make a threat and use a national-security pretext to justify actions that follow through on it. As we analyze later, courts are generally deferential to such pretexts. The executive can’t use its authorities to coerce individuals to give up constitutional rights or retaliate against the exercise of constitutional rights (even if those authorities are lawful in a vacuum). Threats leveraged against a company’s exercise of constitutional rights would therefore not be credible. For example, the executive can’t use threats to obtain private property, which is protected in the Fifth Amendment. SCOTUS held in *Koontz v. St. Johns River Water Management District *that officials can't use permitting leverage to extract concessions bearing no essential nexus or rough proportionality to the impacts of the proposed use, including when the demand is for money and when the permit is denied outright. However, unless companies sue the executive for unlawful actions, courts can’t intervene. Even when a company is confident it would win in court, relief might not be granted quickly, so the immediate cost of executive retaliation might be enough to make it give in. The Trump administration filed executive orders revoking security clearances and terminating contracts with law firms [accused](https://www.ibanet.org/US-presidency-Trump-administration-maintains-chilling-effect-with-defence-of-executive-orders-targeting-law-firms) of targeting administration officials and using DEI policies to enable discriminatory hiring processes. While some firms [went to court](https://firstamendment.mtsu.edu/article/perkins-coie-v-u-s-department-of-justice-2025/), Paul, Weiss instead [struck a deal](https://www.politico.com/news/2025/06/29/paul-weiss-brad-karp-trump-fallout-00420354) with the administration. Similarly, the Trump administration withheld Biden-era investment until Intel agreed to give the government a [9.9% share](https://www.pbs.org/newshour/politics/what-economic-and-policy-experts-think-about-the-u-s-governments-stake-in-intel). It’s hard to predict if this threat would be effective in coercing companies. During a fast takeoff, the leading AI company might be vital to the US’s national security strategies, which could make the president unwilling to follow through with destructive actions. But it’s plausible the president could compel at least minor changes in corporate policy. If multiple AI companies have comparable products, then threats are more credible, since the US government has alternative suppliers for security-critical AI technologies. In this section, we describe how Congressional and judicial checks on executive power work, and why they might be weak at a structural or legal level. However, the actual effect of checks and constraints is often contingent on circumstance: the individual voting behaviour of Congress members, or the particular circuit that takes a court case. This means we cannot state that any check will certainly work or certainly fail. We are overall pessimistic about the efficacy of these constraints. In this post, we’ve identified areas where the president or executive is *not* authorized to act. However, we acknowledge that courts are limited in their capacity—and possibly their incentives—to constrain unlawful presidential actions. We are ultimately uncertain and somewhat pessimistic about the ability of judicial checks to stop unlawful executive actions. We think that national security narratives related to AI are likely to create a degree of judicial permissiveness with regard to unilateral executive action. Courts do not intervene on their own initiative: a case must reach them with evidence of demonstrable or impending harm. If affected parties don’t challenge actions, even if they are overtly illegal, courts cannot act. Further, Congress has power over the court’s jurisdiction: it can [pass legislation that restricts judicial review](https://books.google.ca/books?id=0KpYkm9SJvAC&pg=PA442&redir_esc=y#v=onepage&q&f=false) of certain federal executive or legislative actions. While mechanisms like injunctions can be used by courts to pause actions while their lawfulness is being adjudicated, they must be persuaded to do so. Especially in matters regarding AI, it is unclear whether injunctions will be enacted against a government body. The “national interest” has been invoked by the executive to justify everything from starting wars to using [the DPA for baby formula](https://www.politico.com/news/2022/05/18/biden-invokes-defense-production-act-to-increase-supply-of-u-s-infant-formula-00033618). Actions framed by the executive as in the national interest, or critical for matters of national security, are generally granted broad leeway by the courts. The[ June 2026 Executive Order states](https://www.whitehouse.gov/presidential-actions/2026/06/promoting-advanced-artificial-intelligence-innovation-and-security/) frames its “America First cybersecurity effort” as one that “enhances both our national security and our global AI dominance.” National security narratives about AI mean the executive is empowered to govern AI, including by the courts themselves. AI-related national security efforts operate in the domain of foreign policy: export controls, military accumulation, and suspicion of foreign entities. At the same time, the executive blurs the distinction between internal and foreign affairs by asserting that certain domestic policies act in service of national security interests. This logic has [already been used by the Justice Department](https://www.nytimes.com/2026/06/16/climate/xai-musk-mississippi-grok-turbine-lawsuit-naacp.html), when it intervened to argue in favour of throwing out a case against xAI’s Colossus 2 natural gas turbines in federal court. Courts have given the executive substantial leeway during true national crises. During World War I, the executive was allowed to egregiously violate free speech protections. SCOTUS upheld race-based internment based on a fabricated military-necessity justification in World War II. If AI progress poses an existential risk to the US, it is plausible courts will uphold unconstitutional actions or avoid ruling on the merits of a case, as they did during the American Civil War with habeas c*orpus *cases like *Ex parte Vallandigham*. Beyond national security, courts can actively empower the executive—[recent SCOTUS rulings](https://www.economist.com/united-states/2026/06/29/the-supreme-court-has-handed-donald-trump-yet-more-power) explicitly delegate more power to the president alone. Lastly, the executive might ignore or slow-walk court rulings. Since courts don’t have an independent enforcement arm, there is little recourse if their rulings are disregarded. Already, the Trump administration has [repeatedly defied](https://www.theguardian.com/us-news/2026/may/02/judiciary-trump-administration-separation-of-powers) lower court rulings on immigration with little consequence. SCOTUS rulings will probably carry more political weight than lower courts, but the executive might still find ways to stall enforcing these rulings, as they did with [Kilmar Abrego Garcia](https://en.wikipedia.org/wiki/Deportation_of_Kilmar_Abrego_Garcia). There are two relevant sets of constraints Congress holds: over government spending, and over the legislation that ultimately delegates the executive its power. Congress controls government finances, and could refuse to fund executive decisions. Individual committees draft spending bills to determine program and project funding. Still, many forms of executive action, like implementing export controls or prioritizing contracts, don’t require restrictively large sums of money, and are financed through an agency’s standard operating budget. For example, the DoD already has designated DPA Title III funds [that it regularly uses](https://www.war.gov/News/Releases/Release/Article/4534935/department-of-war-invests-16m-for-45nm-silicon-on-insulator-qualification/). In the last five fiscal years (2020-2025) DPA Title III funds totaled a modest $4.4 billion USD, though the [DoD is seeking an increase](https://comptroller.war.gov/Portals/45/Documents/defbudget/FY2027/FY2027_Budget_Request_Overview_Book.pdf) to approximately $30 billion for the 2027 fiscal year. Contracts and export controls might not produce the executive’s desired amount of influence or outcomes. One way of gaining a lot of control over AI, then, is directly taking over an AI company; this requires Congressional approval. Authority related nationalization requires a delegating act from Congress (like for[ airport security in 2001](https://www.congress.gov/bill/107th-congress/senate-bill/1447)). These are typically specific. They can permit the seizure of property for a particular project or narrow scope of projects, like how the Department of Homeland Security only has eminent domain authority when relevant to border infrastructure and building facilities. The executive doesn’t have the authority to unilaterally nationalize an AI company or take similar actions, like replacing its board or forcibly taking a controlling equity stake. The government is constitutionally obligated to offer just compensation under the Fifth Amendment. Determining “fair market value” for appropriated property can involve the courts if the company is dissatisfied with the government’s offer. Here, it could likely be difficult to establish “fair market value” for newer, less tangible goods like model weights. The lack of precedent means it is more likely for these appropriation attempts to manifest as disputes in court. The high likelihood of other branches of government being drawn into matters of AI-related appropriation means it is difficult for the executive to act unilaterally in appropriating or nationalizing AI. Another limiting factor is the sheer cost of doing so. AI company acquisitions would likely cost in the magnitude of hundreds of billions, if not trillions. While smaller appropriations of a portion of a company’s assets (e.g. a data center site through eminent domain) or purchasing equity is possible, full ownership may present such a cost that Congress refuses to approve this action. Ultimately, if Congress repurposes or approves additional government funds, this could enable strategies such as majority ownership or direct appropriation of American AI companies. Because Congress delegates power to the executive through legislation, they can amend these delegations. They can pass legislation to modify or retract delegations of executive power. They can also choose not to renew delegations of power that require it, such as declared national emergencies or the Defense Production Act.[[3]](#fna3qgmqoz7q) Legislative authority sits squarely in Congress and [cannot](https://www.law.cornell.edu/wex/nondelegation_doctrine) formally be delegated to the executive (although the nondelegation doctrine is rarely enforced). While the executive has the ability to create regulations, these are bound by legislation, which regulation merely serves to implement. This means that the president has very little authority to unilaterally regulate the general operations of American AI companies by, for example, requiring some safety-minded intervention in model development. While some regulatory bodies like the Securities and Exchange Commission might be able to control specific parts of the AI industry by applying existing legislation (e.g. antitrust and investor disclosure rules), these bodies don’t have the authority to enact slowdowns or mandate development practices. Congress could delegate authority over AI regulation (e.g. to enact an AI pause) to the executive, but this would require new legislation. For example, Congress could create an AI regulation agency. These constraints have various failure modes. Amending delegations often requires a presidential signature; overriding a presidential veto requires a supermajority that is difficult to reach. Since[ INS v. Chadha](https://www.congress.gov/crs-product/R48965), Congress cannot unilaterally veto executive actions, even by intentionally designing legislation to give themselves a veto. Congress may also act too slowly to effectively curtail executive power if AI moves very quickly. Beyond the question of capability, it is unclear if Congress will even be incentivized to constrain the executive. Even if concerns about AI are currently bipartisan, there is no coherent bipartisan stance on AI. Finally, in the case where Congress passes laws regulating AI companies, enforcement still rests with the executive. The president can also intentionally fail to properly enforce legislation they find disagreeable, like Trump did[ with the TikTok ban](https://www.cbc.ca/news/world/trump-ban-laws-enforce-presidents-tiktok-1.7437433). Statutes grant the executive a broad range of authorities, and there are legitimate grey areas where a sufficiently motivated executive is likely to find additional ground. In a genuine crisis, the executive might gain significantly more power. Inter-branch checks require intervention that acts against the president’s agenda—historically, courts and Congress have deferred to the president, even when it seems that constitutional rights have been violated. The executive might be able to take actions far broader than what legislation permits and we’ve predicted. As of now, however, there are only specific domains where the executive can act unilaterally. Inter-branch involvement in spending control acts as a large structural constraint. Regardless, we think these domains grant the executive a wide array of powers over American AI companies in particular. The executive powers described here cannot substitute for the legislative authority required to implement safety-minded regulation that is most needed in preempting and mitigating catastrophic risks from AI. Strategies that advocate for the use of powers like the DPA or IEEPA should seriously reflect on how their use increases the permissibility and likelihood of executive power concentration. Executive power is a particularly concerning source of power concentration that can happen quickly and quietly. Mechanisms like getting out the vote and strategically highlighting candidates like Alex Bores are less likely to combat this risk. Over the course of writing this article, SCOTUS [overturned](https://www.dlapiper.com/en/insights/publications/2026/07/supreme-court-overrules-humphreys-executor-upholds-federal-reserve-independence) a landmark case that limited presidential power over the executive bureaucracy. The Senate [confirmed](https://www.nytimes.com/2026/08/08/us/politics/blanche-attorney-general-doj-trump-power.html) Todd Blanche as Attorney General. He served as the president’s defense lawyer and as acting Attorney General publicly defended Trump's right to direct investigations into his political opponents. The stage is being set—we think it is important to highlight legal ambiguities and push for their clear resolution in ways that uphold a fair balance of governing power. The Trump administration designated Anthropic as a supply chain risk, and this is now being [deliberated](https://www.courthousenews.com/wp-content/uploads/2026/03/anthropic-supply-chain-risk-lawsuit.pdf) in court. Anthropic’s request for an injunction was [denied](https://www.politico.com/news/2026/04/08/d-c-circuit-rejects-anthropic-plea-to-pause-supply-chain-risk-label-00864880), but the case is ongoing; how this case resolves will have substantial consequences for whether the executive has this lever to pull (or threaten to pull, etc.) or not. “[SEC. 705. (a)](https://govtrackus.s3.amazonaws.com/legislink/pdf/stat/64/STATUTE-64-Pg798b.pdf) The President shall be entitled, while this Act is in effect and for a period of two years thereafter, by regulation, subpoena, or otherwise, to obtain such information from, require such reports and the keeping of such records by, make such inspection of the books, records, and other writings, premises or property of, and take the sworn testimony of, any person* as may be necessary or appropriate, in his discretion, to the enforcement or the administration of this Act and the regulations or orders issued thereunder.*” (emphasis added) The DPA has sunset clauses attached, which means that Congress must vote to authorize the renewal of the DPA periodically. As of 22 July 2026, the House has voted to extend the DPA through 2031 (via amending the National Defense Authorization Act). This authorization has not passed into law yet. Proposed [changes](https://www.congress.gov/bill/119th-congress/house-bill/7688/text) to the DPA including redelegation of authority away from the President are summarized [here](https://docs.google.com/document/d/1kYPnkI_HuTLBHIImo0kwW1M3iSMHmDEP8aqZ06IyoI4/edit?tab=t.0). The DPA has sunset clauses attached, which means that Congress must vote to authorize the renewal of the DPA periodically. As of July 22nd, the House has voted to extend the DPA through 2031 (via amending the National Defense Authorization Act). This authorization has not passed into law yet. No changes have been proposed to the DPA itself. The Trump administration designated Anthropic as a supply chain risk, and this is now being [deliberated](https://www.courthousenews.com/wp-content/uploads/2026/03/anthropic-supply-chain-risk-lawsuit.pdf) in court. Anthropic’s request for an injunction was [denied](https://www.politico.com/news/2026/04/08/d-c-circuit-rejects-anthropic-plea-to-pause-supply-chain-risk-label-00864880), but the case is ongoing; how this case resolves will have substantial consequences for whether the executive has a lever to pull (or threaten to pull, etc.) or not. The implications of this ambiguity are contingent on a variety of factors. While some Presidents act with more restraint, others might see ambiguities opportunistically. Congress could be sufficiently empowered to clarify Title I in September 2026, when the DPA must be renewed. If a plaintiff successfully brings a case to court, it is unclear how any given court would rule, nor if they would grant an injunction while proceedings occur. Factors like heightened national security and defense concerns relating to AI may make a wide array of public interest arguments available to those arguing in favour of ensuring Title I applies to new *and* existing contracts. As of now, it is uncertain how and if this will be resolved.