Cassette Tapes and Private Copying Levy.
https://en.wikipedia.org/wiki/Private_copying_levy
Governments didn't ban tapes but taxed them and fed the proceeds back into the royalty system. An equivalent for books might be an LLM tax funding a negative tax rate for sold books e.g. earn $5 and the gov tops it up. Can't imagine how to ensure it was fair though.
Alternatively, might be an interesting math problem to calculate royalties for the training data used in each user request!
The last thing the world needs is more nonsensical copyright law and hand wavy regulation funded by entrenched interests.