Republicans press Lutnick on AI chip policy

The Hill

13 hours ago

A group of House Republicans pressed Commerce Secretary Howard Lutnick on Thursday to quickly nail down the administration's policy on artificial intelligence (AI) chip exports after rescinding the Biden administration's framework.
Eight GOP lawmakers, led by Rep. Mark Alford (R-Mo.), urged the administration to provide a 'stable exporting structure' to replace former President Biden's AI diffusion rule.
'This rule would have helped China win the AI race, and replacing this rule quickly will provide American innovators a stable environment to compete and win,' they wrote in Thursday's letter, first reported by Semafor.
The Trump administration rescinded the AI diffusion rule in May. The rule, unveiled in the final days of Biden's presidency, placed caps on chip sales to most countries around the world. Only 18 U.S. allies and partners were exempted from the restrictions.
The diffusion rule faced sharp pushback from the semiconductor industry, with major players like Nvidia slamming it as 'misguided.'
The Commerce Department pulled the rule shortly before it was set to go into effect, arguing it would 'have stifled American innovation and saddled companies with burdensome new regulatory requirements.'
Alford and his GOP colleagues agreed with the administration's assessment, while pushing for a new framework with know-your-customer and security controls.
'We can only win the AI race with Communist China if we are wisely limiting our foreign adversary's opportunities to develop frontier AI and enabling American companies to compete quickly in the global marketplace,' they added. 'Both prongs are important and the balance between them are crucial.'
'America is winning the AI race, but the competition has been hard fought and will continue to be,' the lawmakers continued. 'Steps must be taken quickly since investments happening now will create the world's tech ecosystem for decades to come.'
The letter comes after the Trump administration walked back curbs on some Nvidia chip sales to China last week. Nvidia announced last Monday that it was filing applications to sell its H20 chips after receiving assurances from the U.S. government that its licenses would be granted.
The chipmaker revealed earlier this year that the administration was implementing new licensing requirements that would limit its ability to sell the chips in China.
The reversal prompted pushback from at least one key Republican lawmaker, Rep. John Moolenaar (R-Mich.), chair of the House Select Committee on the Chinese Communist Party.
He raised concerns in a letter to Lutnick on Friday, arguing that the move would boost China's AI capabilities.