Michael Kratsios, President Trump's chief science and technology adviser, spent last week at Davos selling a vision of American AI supremacy built on light regulation, aggressive exports, and federal research cuts. The cognitive dissonance is remarkable: He's simultaneously championing the "Genesis Mission" as the largest marshaling of federal scientific resources since Apollo while defending a budget that slashes scientific funding by 22%.
This isn't strategy. It's incoherence dressed up as innovation policy.
Kratsios didn't mince words about Europe's approach to AI governance. The EU AI Act, which imposes varying requirements on AI companies based on risk level, is "an absolute disaster," he told NBC News. His mission at Davos: convince European tech ministers to abandon regulatory frameworks in favor of America's "light-touch approach."
"There's been an A-B test for decades on how you lead in technology, and it's very obvious what the recipe is," Kratsios said, positioning deregulation as the proven path to technological leadership.
Except the A-B test he's describing is ahistorical nonsense. American technological dominance in the 20th century was built on massive federal investment in basic research, not the absence of regulation. The internet, GPS, touchscreens, and the fundamental algorithms underlying modern AI all emerged from government-funded research programs. The Apollo mission Kratsios invokes as inspiration for Genesis Mission? That was government spending at a scale he's currently helping dismantle.
The EU AI Act isn't perfect, but it attempts to address a legitimate question: Should companies like OpenAI, Google, and Anthropic face any accountability when their "foundational models" present "systemic risks to society"? Kratsios's answer appears to be: No, and anyone who asks is stifling innovation.
Kratsios revealed new details about the American AI Export Program, designed to make it "as easy as possible for countries around the world to buy our stack and import our stack." The Development Finance Corporation and Export Import Bank will provide financing mechanisms for countries to purchase American AI hardware and software.
"We have the very best chips, we have the very best models, we have the very best AI applications," he declared, positioning this as a counterweight to China's growing influence in global AI diffusion.
This is where the contradictions become impossible to ignore. Kratsios wants to export American AI as a geopolitical tool while simultaneously arguing that regulation—the kind that might ensure exported AI systems are safe, accountable, or aligned with stated values—is burdensome red tape that hinders innovation.
What exactly are we exporting? Technical capabilities without governance frameworks? The freedom to deploy AI systems with minimal oversight? If America's competitive advantage is the absence of regulation, we're not selling innovation. We're selling risk externalization at scale.
Perhaps the most brazen aspect of Kratsios's Davos performance was celebrating federal AI investment while defending catastrophic cuts to the scientific infrastructure that makes AI research possible.
Trump's budget proposes a 22% cut to scientific funding overall, including a $325 million reduction to the National Institute of Standards and Technology—the agency housing critical efforts to evaluate and assess how leading AI models function. Kratsios himself called NIST's work "a tremendous unlock to private sector adoption of AI."
So we're cutting funding to the agency that evaluates AI safety while launching the "largest marshaling of federal scientific resources since Apollo"?
Kratsios attempted to square this circle by noting that 70% of R&D spending comes from the private sector, suggesting federal cuts won't matter much in the larger ecosystem. This is economic illiteracy masquerading as policy. Private sector R&D concentrates on near-term commercial applications. Federal funding supports basic research with longer time horizons and higher uncertainty—precisely the research that enables breakthrough innovations decades later.
Cutting federal science funding while claiming to champion AI leadership is like burning your seed corn and declaring you're investing in agriculture.
Kratsios also previewed plans for a "uniform Federal policy framework" that would override state-level AI regulations, echoing concerns from Silicon Valley venture capitalists like Marc Andreessen that "a patchwork of AI laws" hurts startups.
This is a fascinating argument coming from an administration that generally champions states' rights and opposes federal overreach. Apparently, federalism is sacred unless California or New York try to regulate AI, at which point uniform federal standards become essential.
The real concern isn't regulatory inconsistency harming small companies. It's that states like California and New York have passed substantive AI safety requirements, and tech companies would prefer a weaker federal framework that preempts stronger state laws.
Kratsios frames this as protecting "little tech and startups," but he worked at Scale AI—a company that received $14.3 billion from Meta—before returning to government. His definition of "little tech" may differ from most people's.
Kratsios is selling a coherent narrative about American AI leadership, but the underlying policy is internally contradictory:
If you're making strategic decisions about AI adoption, vendor selection, or regulatory compliance, don't build plans around this administration's stated priorities. The gap between rhetoric and resource allocation is too wide to trust.
What we're watching is the construction of a policy framework that maximizes near-term commercial freedom for AI companies while minimizing accountability, safety evaluation, and the long-term research investment that creates durable technological advantage.
That's not a recipe for American AI dominance. It's a recipe for faster deployment of less-scrutinized systems with unknown long-term consequences—wrapped in the language of innovation and patriotism.
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