The Trump administration has few good options to slow China's AI rise, especially while trying to avoid more rare earth restrictions, ahead of US-China AI talks
Washington’s China AI policy has already pulled in opposite directions: officials considered loosening a Biden-era country-tier chip rule while Chinese officials pressed for relaxed HBM export controls. At the same time, restrictions on Nvidia, AMD and Intel sales were reported to risk strengthening Huawei’s position.
The administration’s hands-off domestic AI posture is intended to preserve the US lead, with AI safety a confirmed priority ahead of the Trump-Xi summit. The policy problem is therefore not only how to constrain Chinese compute, but how to do so without intensifying pressure on supply-chain chokepoints.
First-order effects
US negotiators enter the prospective AI talks with chip-export controls constrained by the risk that further rare-earth restrictions could raise costs or disrupt inputs for US industry.
Nvidia, AMD and Intel face continued uncertainty over China-facing AI-chip rules as Washington weighs strategic leverage against the commercial and supply-chain costs of escalation.
Second-order effects
Keeping tighter chip curbs in place reinforces the opening for Huawei identified in prior coverage, while loosening HBM controls would reduce one of Washington’s most direct constraints on Chinese AI infrastructure.
Rare earth exposure gives Beijing leverage beyond model and chip access, making AI bargaining inseparable from the physical supply chains behind computing hardware.
Third-order effects
If this trade-off persists, US-China AI competition will be governed less by unilateral export rules and more by negotiated management of mutually costly technology and materials chokepoints.
AI safety diplomacy may become a parallel channel to commercial controls, but its influence will depend on whether both governments can separate safety cooperation from compute-access bargaining.
The trend: AI competition is becoming a contest over linked compute, hardware-materials supply chains, and diplomatic leverage rather than chip controls alone.
China's AI ecosystem is extraordinarily complicated, and we're at a critical juncture in the U.S.-China AI relationship. If you read or listen to one thing amid the next Trump-Xi summit, debates over the pace of frontier AI development, and the increasingly complex geopolitics of…
This is what they used to be called. It's what they should be called again. I polled my followers about what to call them and they liked the old name: supercompute it is!
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@chamath Agree. Grt to see these guys ideating in real time on the best path forward. Need to pragmatically balance safety concerns w speed, free markets & maximum competition. ⚖️🤖
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Certainly a better solution than the 20 year prison sentence from the Bernie bunch... But what will be the motivation for the gatekeeping club to review the open source models? The analogy to peer review is not reassuring.
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