The encrypted message blinked on the screen: “H200 delivery confirmed.” Somewhere in Washington, a senator slammed his fist on the table, while an AI entrepreneur in Davos muttered darkly about repeating past mistakes. The future of AI dominance is far from certain, and the battle lines are being drawn in the halls of power.
Washington is divided on AI, yet again.
At the center of the clash is AI chip exports. Last month, the previous administration allowed Nvidia to sell its H200 chips to China. The chips are less advanced than Nvidia’s latest offerings for the American market, but they are still potent enough to be used in American industry. They are also more advanced than the previously allowed China-special H20 chips, which Beijing wasn’t exactly celebrating.
The move was considered a win-win by some. The U.S. government would take 25% of Nvidia’s China sales, Chinese AI companies would get access to better chips than before, and Nvidia could finally see sales rise in one of its biggest markets.
Nvidia CEO Jensen Huang spent the past few months trying to convince government officials to get behind this deal. While some in D.C. worried that sending Nvidia chips to power Chinese AI innovation would not only cause the U.S. to lose ground in the AI race but would also jeopardize national security, Huang argued the opposite. He has claimed that as long as the Chinese AI industry stays dependent on Nvidia’s infrastructure, the U.S. will continue to have the upper hand.
Although he may have convinced some, like figures in the previous administration, it seems Congress is not entirely on board. And they are demanding to be heard.
“Should Congress have oversight when selling missiles to other countries? Yes, the same should be said for chips,” Republican Florida Rep. Brian Mast said in a House Foreign Affairs Committee hearing last week.
“Nvidia has made such good chips that if they were sold freely, the CCP would likely overtake us in the AI arms race,” Mast, who is also the Chairman of the committee, said. “These chips, they’re not just kids playing video games on an Xbox, playing war games. They affect real wars, real weapons, real war power, and they will be a part of bringing about real casualties.”
Last month, following the H200 announcement, Mast introduced the AI Overwatch Act, a bill that gives both the House Foreign Affairs Committee and the Senate Banking Committee the authority to block AI chips export licenses to China and other countries that are deemed to be adversaries.
On Wednesday, the House Foreign Affairs Committee voted to advance the bill, and it now faces a full House vote. Although the bill got overwhelming support in the Committee, it’s unclear if it will pass Congress. Similar bills trying to restrict chip exports have failed, like the GAIN AI Act, which also drew considerable ire from Nvidia.
Political Flashpoints Over AI Exports
Imagine watching a chess game where one player is secretly swapping pieces with better ones. That’s the level of concern some have about AI chip exports.
The bill is proving to be polarizing not just in Washington politics but also within certain political circles itself. Despite Mast also aligning with figures from the previous administration, the bill has gotten quite a rise out of other prominent voices, chief among them being a key advisor on AI.
Last week, a prominent voice confirmed a post on X claiming that the AI Overwatch Act’s aim was to “take away authority as Commander in Chief and undermine the agenda.” The post also claimed that the bill was secretly orchestrated by figures associated with previous administrations and Anthropic CEO Dario Amodei.
Another voice also took to X to express outrage against the bill, calling it “pro-China sabotage disguised as oversight.” Mast, in return, accused of repeating “NVIDIA’s lobbying talking points to sell chips to China.”
Will Congress Approve the AI Overwatch Act?
The AI Overwatch Act now faces a full House vote, but its future is uncertain. Similar measures aimed at restricting chip exports have stumbled before, facing opposition from various quarters, including tech companies like Nvidia.
Anthropic CEO Amodei, for his part, is openly at odds with his company’s strategic partner Nvidia, and thinks allowing Nvidia chips to enter China is “crazy” and “a mistake.”
“It’s a bit like selling nuclear weapons and [bragging that] Boeing made the casings,” Amodei told the World Economic Forum in Davos on Tuesday, per TechCrunch.
What’s the Argument for AI Chip Exports to China?
The core argument from figures like Nvidia’s Jensen Huang centers on maintaining influence. The idea is that by allowing China to remain reliant on American chip infrastructure, the U.S. retains a degree of control and oversight. It’s a strategy of interdependence, rather than outright denial.
Amodei’s words must not have angered Huang that much, as he took the stage in Davos on Wednesday and spoke very highly of Anthropic’s AI assistant Claude.
How Do AI Chips Affect National Security?
AI chips are the engines driving advancements in numerous fields, including military technology. Control over these chips translates to an advantage in developing AI-powered weapons systems, intelligence gathering, and cybersecurity. The concern is that unrestricted access to these chips could accelerate China’s military modernization and potentially shift the global balance of power.
The debate around AI chip exports is a high-stakes game. It’s a political tug-of-war with global implications, and raises a crucial question: are we sacrificing long-term security for short-term economic gains?