Trump Could Find New US AI Chip Controls 'Really Appealing,' Researcher Says

“This is a really strong anti-China policy. This is a really strong build-in-America policy,” Gregory Allen, a former Pentagon official who now leads the Wadhwani AI Center at the Center for Strategic and International Studies, said of the new export controls. “You can see how the Trump administration would latch on to this as really appealing.”

The new controls, released this week and scheduled to take effect during the next administration, place new license restrictions and volume caps on exports of advanced AI chips to most countries while imposing more stringent controls on shipments to China and other arms-embargoed countries (see 2501130026).

Several technology companies and industry groups have criticized the controls and said they plan to raise the issue with the Trump team. But Allen, speaking on The AI Policy Podcast hosted by CSIS, noted that several incoming Trump officials and advisers have advocated for stronger export controls against China, especially secretary of state nominee Marco Rubio.

During his time as a Florida senator, Rubio criticized the Biden administration’s previous AI-related chip rules for not being strong enough and containing loopholes, Allen said. In September, for example, Rubio said BIS was failing to stop flows of advanced computing chips to China and called on the agency to adopt a “blanket” presumption of denial license review policy for any shipment of critical technology to any entity in China (see 2409030029).

Rubio now will play a “very important part of the interagency process setting export control policy,” Allen said.

He also pointed to Mike Waltz, a former congressman and Trump's selection to be national security adviser (see 2411120031), who also has called for tightening export restrictions on AI technologies destined to China (see 2306050037). Waltz is “a strong China hawk [who is] really skeptical of China's tech industry in so many different ways,” Allen said. “And so you can see how he would also find this policy attractive.”

Allen also suggested the Trump administration will align with the broader goal of the new BIS rule, which is meant to incentivize companies to keep their most advanced AI-related technology in America or among a list of 18 close allies. “The Trump administration has said that they know this big AI infrastructure build-out is going to happen,” he said, “and they want it to happen in America.”

The rule’s introduction of the Universal Validated End User (UVEU) concept could help accomplish that goal. In order for a company to be approved as a UVEU -- which would allow it to more quickly obtain advanced semiconductors to build data centers in certain countries outside the U.S. -- the company would face certain restrictions on where it can house or transfer its AI computing power. One condition would require UVEUs to house at least 50% of their total AI computing capability within the U.S.

“That is basically saying, build in America, which is exactly what the Trump administration has been saying they want to happen when it comes to this big AI infrastructure boom,” Allen said.

Biden National Security Adviser Jake Sullivan also has said he expects the Trump administration to maintain the controls. "Obviously it’s going to be up to them how they want to proceed, and they may have internal debates the same way we had internal debates about exactly how to calibrate the rule,” Sullivan said in a Jan. 13 interview with Bloomberg. “But I would be surprised sitting here today if, after 120 days, they looked at the landscape as we’ve looked at it, and said, ‘You know, we really don’t need this at all.’"

Allen noted Trump could face pushback from some members of Congress fighting for fewer business guardrails. Sen. Ted Cruz, R-Texas, said last week that the rule will “crush American semiconductor leadership” and “cripple innovation.” Cruz said he plans to “consider every tool, including the Congressional Review Act, to hold the executive branch accountable and ensure that American industry remains strong, competitive, and free from unnecessary overreach.”

“He's coming out loudly in opposition to this policy,” Allen said. “He's going to try and mobilize opposition to this policy in the Trump administration.”

Allen also touched on the tech industry’s criticism of the new controls, which he said has been focused less on the rule’s substance and more on the Biden administration’s rulemaking timeline. Several trade groups, including the Semiconductor Industry Association and the National Foreign Trade Council, said the rule was rushed and lacked input from U.S. companies.

“A lot of the industry pushback was not about the policy,” Allen said. “It was about the process.”

Even major American chipmaker Nvidia, who Allen said is “of course going to hate this policy” because it places limits on where the firm can sell its chips, is unlikely to face much financial hardship. He said there is significant demand for Nvidia chips outside of China. “Nvidia's revenue is going to skyrocket,” he said.

Allen also noted that the Nvidia press statement this week, which said the new BIS restrictions risked placing global AI progress in “jeopardy,” hasn’t aligned with recent financial projections by the company’s investor relations team, suggesting the company isn’t too worried about the new controls.

“The bank analysts who cover their stock, they have not said that this policy is going to lead to one dollar of decreased revenue,” Allen said. “And when you tell stuff to the Securities and Exchange Commission, that's under oath.”

Allen said the BIS policy is designed “not to decrease Nvidia's sales, but to shift Nvidia's sales. This giant global AI infrastructure build-out, this policy, wants to make sure that the bulk of that build-out takes place in the United States, and takes place in countries that the United States can trust.”