It’s been a busy couple of weeks in the world of semiconductors and AI…
In response to President Trump’s decision to allow sales of H200 chips to China, I’ve spent a lot of time talking about compute dynamics, for example in interviews with PBS Newshour and NPR. As I argued in testimony to the Senate Committee on Foreign Relations last week, AI progress requires computing power, brain power, and electrical power. Computing is where the U.S. has a commanding lead, as this recent IFP piece shows.
So if H200s flow to China in large volumes, it could be a very big deal, leveling the AI playing field. This is why it has sparked more pushback—including from some unexpected corners of Silicon Valley.
In the Washington Post, I explored the shifting politics of export controls.
It’s been a dizzying year for debate about semiconductors and artificial intelligence in Washington: presidential tweets, summits with world leaders, CEO dinners at the White House, hirings and firings of senior personnel. The latest twist: President Donald Trump’s decision to allow sales of Nvidia H200 chips to China.
Two dynamics are interesting. First, how bipartisan the support for continued chip restrictions has been:
The Senate version of the provision was introduced by Sen. Jim Banks (Indiana), a MAGA legislator close to the president, and later passed as a part of the upper chamber’s version of the NDAA. As Banks explained recently on Steve Bannon’s “War Room” podcast, “The Gain AI Act is simply an America First amendment.” A coalition of influential voices on the right, from think tank leader Oren Cass to former deputy national security adviser Matt Pottinger, urged Congress to pass the legislation. It’s assembled an ideologically broad coalition in Congress, winning support from left-wing senators like Sen. Elizabeth Warren (Massachusetts), too.
In the last two days, since the H200 news, I haven’t been surprised to see democrats criticizing Trump. More interesting is that Republican Senators like Josh Hawley and Lindsey Graham have been critical, too.
Second, parts of Silicon Valley have come out in favor of chip restrictions—for the first time in the export control debate.
Trump has justified chip sales by highlighting the 25 percent fee he plans to charge on the export of AI chips. However, big tech firms often charge even higher margins when they sell cloud-based AI services. The more business Chinese cloud and AI firms win while deploying American chips, the lower the profits of the rest of America’s tech ecosystem.
America’s leading chip firms want looser rules, but U.S. AI giants, who benefit from weaker Chinese competitors, have powerful political voices, too. On top of a bipartisan Congressional consensus, now a significant share of America’s AI industry is coming to realize that selling advanced chips to China threatens not only national security, but also their business.
Check out the full piece here.