President Donald Trump is considering weaponising AI chips in trade wars so that the whole world will have to do as he says.
Trump, who has been told by the Supreme Court that his mercurial on-again, off-again tariffs, depending on his mood, are illegal, has come up with a wizard wheeze to do the same thing with AI. The cunning plan is to license every rack, leaving the US, with allies treated like US enemies.
The fight has been brewing since Nvidia and AMD started shipping monster compute, and Trump has been itching to put a gate on it.
President Joe Biden took a swing with the “AI Diffusion” act, sorting countries into tiers with different export rules. NVIDIA hated it, and plenty of the industry saw it as a threat, but Bloomberg says the Trump version could go further and faster.
Bloomberg claims the US is drafting rules that would choke exports to any country worldwide, including key allies. Under the idea being floated, Nvidia and AMD would need export licences for all hardware shipped out, with no exemptions currently planned.
The twist is that scrutiny would scale with compute power. Bloomberg says exports of up to 1,000 Nvidia GB300 racks, which it calls GPUs, could get a “fairly simple review.”
Bigger orders would trigger government-to-government involvement, with the host government expected to lead negotiations. The price of admission would be “security promises and matching investments in American AI.”
If this lands, it would put global AI infrastructure buildout at the mercy of US red tape. Data centre projects do not wait politely while licence forms bounce between desks; they just slip to whoever can ship on time.
There is no timeline yet for implementation, and no one is saying when the hammer will drop. If it does, it puts all US allies in the same boat as enemies, wondering what the point is.
It could end up with a true blanket block that will hammer US chipmakers’ overseas revenue and push allies to diversify faster. Allies cannot magic up a drop-in replacement for Nvidia overnight, but they do control other chokepoints and policy pain: semiconductor equipment coordination, materials, defence procurement, antitrust, digital regulation and trade diplomacy. Even the threat of that kind of retaliation is enough to bring the US back from a full “no chips for you” posture.
