Why “Beating China” in AI brings its own risks

The Biden administration this week introduced new export restrictions aimed at doing just that Control the progress of AI worldwide and ultimately prevent the most advanced AI from falling into the hands of China. The rule is just the latest in a series of measures taken by Donald Trump and Joe Biden to keep Chinese AI in check.

With prominent AI personalities, including OpenAIs Sam Altman and anthropics Dario Amodei If the Trump administration warns about the need to “beat China in AI,” this could well lead to further escalation.

Paul Triolo is a partner at DGA Group, a global consulting firm, a member of the Council of Foreign Relations and a senior advisor to the University of Pennsylvania Penn Project on the future of U.S.-China relations. Alvin Graylin is an entrepreneur who previously led the China business of Taiwanese electronics company HPC. Together they have tracked China’s AI industry and the impact of US sanctions. In an email exchange, Triolo and Graylin discussed the latest sanctions, Silicon Valley rhetoric, and the dangers of viewing global AI as a zero-sum game.

This interview has been edited for clarity and brevity.

What do you think of the new one? AI propagation rule from the US government this week aimed at restricting China’s access to AI?

Paul Triolo: In general, it focuses on high performance computing clusters. The rule also imposes controls on proprietary model weights for the most advanced “frontier” models, but it is unclear how performance levels are determined, and most open-weighted (freely shared) AI models are used by users, including large AI companies , optimized and improved in China.

The complex rules and unclear compliance requirements create significant uncertainty in the long-term plans of medium and large US and Western hyperscalers.

For hyperscalers like Google, Microsoft, AWS and Oracle, the rule raises critical issues, including slower or more complex international expansion, new compliance and legal costs, impacts on global research and development, and uncertain enforcement requirements.

How have previous actions, including sanctions imposed by the first Trump administration, affected the AI industry there?

Paul Triolo: US export controls have slowed China, but at a high level the sanctions have focused the Chinese government’s will and efforts to become more self-reliant. It has invested tens of billions to help local players catch up technologically or expand capabilities in core areas, leading to significant changes in the semiconductor industry and its ability to support the advanced hardware needed to develop breakthrough AI models.

Chinese AI developers have become very good at leveraging outdated AI hardware from Western companies and gradually incorporating domestic alternatives into their development process. Chinese companies will continue to innovate across the AI hardware and software stack, although not at the same pace as their Western counterparts.

Why do you think so many in Silicon Valley are now talking about the need to “beat” China in AI?

Paul Triolo: There is a growing connection between conservative venture capitalists, based primarily in Silicon Valley, and technology companies whose business models are based on hyping the threat from China. This is a worrying combination that combines the threat of China, personal gain and opposition to the regulation of advanced AI. In addition, the competition between the US and China in the field of AI is portrayed as a zero-sum game, which is particularly dangerous.