[ExI] Trump Is Doubling Down on His Disastrous A.I. Chip Policy

[spike at rainier66.com]

From: John Clark <johnkclark at gmail.com> 
Sent: Friday, 19 December, 2025 4:27 AM
To: spike at rainier66.com
Cc: ExI chat list <extropy-chat at lists.extropy.org>
Subject: Re: [ExI] Trump Is Doubling Down on His Disastrous A.I. Chip Policy

 

On Thu, Dec 18, 2025 at 3:22 PM <spike at rainier66.com <mailto:spike at rainier66.com> > wrote:

 

> The paradox in selling advanced Nvidia processors to a future enemy is that it can be seen as the US answer to China’s overbuilt rare earth refinery capability in a way.  

 

>…Rare Earths are important but advanced AI chips are a much MUCH more strategic resource. And He Who Must Not Be Named has just thrown that huge advantage away. Although I must admit that his decision to do it has benefited me personally because I own Nvidia stock….

 

Hold your Nvidia John.  By selling the advanced chips to China, it works towards preserving Nvidia’s dominance in the market.  

 

> That the USA can produce more advanced processors at a lower cost than China is known.  

 

>…Actually the USA, and Nvidia in particular, design and pay for the manufacture of those advanced chips but they are manufactured in Taiwan…

 

How well we know.  The capability of manufacturing advanced chips is easier than designing the chips.  This delicate balance of having advanced chips designed here and manufactured in Taiwan is maintaining a delicate balance and preventing the USA and China from engaging in nuclear war.

 

>… I'm pretty sure if China where to invade Taiwan the huge but delicate chip fabrication plants on that island would no longer be functional, and even if they were there would be very few people still around who knew how to operate them…

 

The fleeing Taiwanese would destroy the machines on the way out the door.  It is a lot easier to wreck that machinery than it is to build it.

 

>… If that were to happen it would hurt both the USA and China and the entire world, but it would hurt the US more than it hurt China, so they might figure it would still be a worthwhile endeavor because it would give China time to catch up in the AI race…

 

That depends on how many Taiwanese processor designers get out of Taiwan ahead of the attack.  It feels like we have a lot of them already.  More are arriving constantly.  They get fast-tracked to citizenship.

 

> If the USA sells them to China, they can of course use them in their weapons development, but… they are less likely to develop their own advanced microprocessors.  

 

>…I've heard of that theory. Jensen Huang, the head of Nvidia, has been pushing it very hard. But I don't buy it…

 

You already did.  You bought the stock and your state voted to elect the guy who established the doctrine of selling Nvidia products to China.

 

>…China is never going to be comfortable being dependent on an economic and potentially military adversary for something as strategically important as cutting edge AI chips…

 

Agree, and the USA won’t go for that either.

 

>…So regardless of what the US does, sell the chips to China or refuse to do so, China is going to use all the resources at its disposal (which is quite a lot) to develop their own completely internal advanced chip manufacturing supply chain, and in fact they've already started to do so…

 

Of this I have no doubt you are correct.  We are in an arms race once again.  

 

>…Speaking of Jensen Huang, he's a fascinating character, I recently read two books about him that I enthusiastically recommend, "The Thinking Machine" by Stephen Witt and "The Nvidia Way" by Tae Kim. Jensen Huang, an immigrant to the USA, started Nvidia in 1993 with almost no money, virtually pocket change, and has been the company's only CEO, and he has managed to grow it so fast that today Nvidia is the richest corporation on planet earth…

 

Is that cool or what?  The local Denny’s where the deal was signed has a shrine made up to him.  They still use it as a working table.  Geeks can come there, worship as they devour their super slam breakfast.

 

> Selling a tool of this power to your own enemy seems wrong, but in a way it might be just the thing.  

 

>…Would you have said that if Joe Biden had made the decision to sell advanced AI chips to China instead of He Who Must Not Be Named?  

 

John K Clark

 

Ja I think it is the right thing to do, regardless of who did it.  The arms race proceeds.  I am a free-trade guy, even though I recognized it is a two-edged sword.  Free trade is shutting out so many people from the housing market in Jensen Huang’s neighborhood, the children who grew up here cannot afford a home in their own home town.  Most of them would be lucky if they can ever afford to live where they started life.  Chinese and Taiwanese businesses buy the homes as an overseas office.  As with your Nvidia stock, that housing situation is great for those of us who bought into the housing market around the time Nvidia started over at the local Denny’s.  But for our own children, adios amigos.  Unless they bought Tesla at 10, which a lot of locals did.

 

In the long run, there is no point in fighting it: money still rules the world.  Money is power, always has been, always will be.  Political notions are an illusion, or a way of pretending otherwise, that money doesn’t rule the world.  The truth: money does whatever it wants, and it does rule the world.

 

spike

 

 

 

 

 

 

 

 

 

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