Latest news with #Trump-negotiated
Los Angeles Times
2 days ago
- Business
- Los Angeles Times
Trump's deal with Nvidia puts our national security on sale to the highest bidder
One thing that can be said about Donald Trump's transactional approach to policy-making is that, as destructive as it might be to our economic health, it gives business leaders clear options to get what they want out of the White House. The latest case-in-point are the deals struck by chipmakers Nvidia and AMD to secure licenses to export their products to China. The White House named the price — 15% of their revenues from such sales — and the companies assented willingly. Never mind that the exports originally had been banned — by the Biden administration and Trump himself — because of national security concerns. Never mind that the U.S. constitution explicitly prohibits charging any tax or duty on exports. Never mind that a stack of U.S. laws, including the Export Control Reform Act of 2018, which Trump signed, don't provide a pay-to-play escape clause from export restrictions. Never mind that the exports may strengthen the domestic industry and even its military of China, a country that has been the consistent target of Trump trade policies. Despite all that, Trump treated the deals as a win for the U.S. Explaining his side of the conversation when Nvidia asked for relief from the export ban, he related, 'I said, 'If I'm going to do that, I want you to pay us as a country something, because I'm giving you a release.'' Under the circumstances, it shouldn't be surprising that some trade professionals and investors see something corrupt in the arrangements. Among them is Christopher Padilla, an export control official under George W. Bush, who told the Washington Post: 'Export controls are in place to protect national security, not raise revenue for the government. This arrangement seems like bribery or blackmail, or both.'' Nvidia, as it happens, has a written anti-corruption policy stating, 'We do not tolerate bribery or corruption in our business.' The policy bars 'promising, offering, providing, or authorizing the provision of money or anything of value ... to obtain, retain, or direct regulatory approvals, contracts, business, or other benefits.' When I asked Nvidia about the deal, the company referred me to the sole comment it has made in response to questions about it: 'We follow rules the U.S. government sets for our participation in worldwide markets.' AMD didn't respond to my request for comment. These deals are unprecedented; as the Financial Times observed, citing trade experts, 'no US company has ever agreed to pay a portion of their revenues to obtain export licenses.' There's no question that Nvidia lobbied ferociously for a lifting of the export ban. The company made a $1-million contribution to Trump's inaugural committee. Its CEO, Jensen Huang, met directly with Trump to discuss the ban; media reports say that Trump initially demanded a 20% fee, but Huang negotiated it down to 15%. As has been the case with other Trump-negotiated trade deals, the details of this one are murky in the extreme. The terms haven't been reduced to writing. Indeed, White House spokeswoman Karoline Leavitt said Tuesday that its 'legality ... is still being ironed out by the Department of Commerce,' with an eye toward replicating it with other companies. Among the questions is how the fee would be paid, and how the money would be spent. Still, what's known has caused concern for export regulators, experts and legislators. 'Export controls are a frontline defense in protecting our national security,' tweeted Rep. John Moolenaar (R-Mich.), chair of the House select committee on the Chinese Communist Party, 'and we should not set a precedent that incentivizes the Government to grant licenses to sell China technology that will enhance its AI capabilities.' The effect of this deal on other companies also raises the hackles of economists and trade experts. 'Other American semiconductor companies like Qualcomm and Intel may say, 'If we develop this cutting-edge chip and the government decides that it has some national security interest in that chip, we might have some of our revenue taken away as well,'' says Kyle Handley, a trade economist at UC San Diego, 'so they may decide not to do the R&D investments and the innovation and hire the workers to develop those things.' The revenue payback 'will certainly have a chilling effect,' Handley told me, because the government fee 'might make the initial investment appear uneconomical.' That's especially so if the administration tries to apply the arrangement to industries such as software or pharmaceuticals. The export charge could become a particular burden on startups — Nvidia plainly has enough money to pay the fee, but many other innovative companies wouldn't. Whether or how the export tax can be stopped is an open question. For one thing, it's unclear who would have standing to bring a lawsuit to stop it. Nvidia and AMD have accepted the deal, so they presumably wouldn't file a case. Companies that fear the imposition of export fees on their own products might have to wait until they could show concrete damage to their own interests in order to bring a case in federal court. As long as manufacturers such as Nvidia are willing to bow to Trump's demands, he may have a clear field. If a legal challenge does emerge, the administration has tried to characterize the export fee as something other than a tax in order to circumvent the constitutional prohibition. Nvidia developed the H20 chip at the heart of its deal specifically to address an export ban the Biden administration imposed on the company's sales to China in 2023. The Chinese government, however, isn't enamored of the chip. Chinese regulators have been pressuring domestic companies to avoid the chips out of cybersecurity concerns, including suspicion that the chips could contain hidden code that could subject them to outside control. (Nvidia has denied that the chips contain any such back-door exposure.) The chips also are outmoded for some AI applications compared to the company's top-of-the-line Blackwell series, which are still subject to a U.S. export ban. As my colleague Queenie Wong reported, Trump seems to think that he and Nvidia's Huang had put something over on the Chinese. Trump called the H20 chip 'obsolete' and said Huang was 'selling a essentially old chip.' But others say the H20s may yet be preferable to Chinese-designed chips for Chinese firms, although Chinese products are consistently improving. 'The H20 is a potent accelerator of China's frontier AI capabilities, not an outdated AI chip,' as 20 former government trade officials told Commerce Secretary Howard Lutnick, who oversees trade policy, in a July 28 letter. 'If the U.S. backs off of export controls to China, we believe that China's next generation of frontier AI will be built on the backs of the H20,' the officials wrote. The chip 'will not simply power consumer products or factory logistics; they will enable autonomous weapons systems, intelligence surveillance platforms, and rapid advances in battlefield decision-making.' How the export deal may affect Nvidia's top or bottom lines is murky, though its immediate effect doesn't seem all that significant. In May, the company announced a $4.5-billion writedown of unsold H20 inventories in the first quarter ended April 27 because of the U.S. ban on H20 sales. But it still recorded $23.3 billion in operating profit for the quarter on sale of $44.1 billion. For its last full fiscal year ended Jan. 26, Nvidia reported a pre-tax profit of $84 billion profit on sales of $130.5 billion. In stock market terms, Nvidia is the world's most valuable company, with a market value of $4.4 trillion; its price-earnings multiple is a robust 58.4. With a gain in share price so far this year of nearly 35%, it's one of a handful of AI-related companies that has kept the market buoyant despite investor concerns about a developing economic slowdown due in part to Trump's trade policies. But the company is looking ahead to further incursions into the China market over the long term. 'The China market is about $50 billion a year,' Huang told Taiwan-based technology strategist Ben Thompson in May, bemoaning the need to leave behind 'the profits that go with that, the scale that goes with that, the ecosystem building that goes with that' while the export ban was in place. So it made sense to allow Nvidia to extract revenue and profits from the cross-border trade. China is sure to power ahead on AI technology with or without Nvidia's chips, Huang said — 'anybody who thought that one chess move to somehow ban China from H20s would somehow cut off their ability to do AI is deeply uninformed.'
Egypt Independent
25-05-2025
- Politics
- Egypt Independent
New intelligence suggests Israel is preparing possible strike on Iranian nuclear facilities, US officials say
CNN — The US has obtained new intelligence suggesting that Israel is making preparations to strike Iranian nuclear facilities, even as the Trump administration has been The US has obtained new intelligence suggesting that Israel is making preparations to strike Iranian nuclear facilities, even as the Trump administration has been pursuing a diplomatic deal with Tehran, multiple US officials familiar with the latest intelligence told CNN. Such a strike would be a brazen break with President Donald Trump, US officials said. It could also risk tipping off a broader regional conflict in the Middle East — something the US has sought to avoid since the war in Gaza inflamed tensions beginning in 2023. Officials caution it's not clear that Israeli leaders have made a final decision, and that in fact, there is deep disagreement within the US government about the likelihood that Israel will ultimately act. Whether and how Israel strikes will likely depend on what it thinks of the US negotiations with Tehran over its nuclear program. But 'the chance of an Israeli strike on an Iranian nuclear facility has gone up significantly in recent months,' said another person familiar with US intelligence on the issue. 'And the prospect of a Trump-negotiated US-Iran deal that doesn't remove all of Iran's uranium makes the chance of a strike more likely.' The heightened worries stem not only from public and private messaging from senior Israeli officials that it is considering such a move, but also from intercepted Israeli communications and observations of Israeli military movements that could suggest an imminent strike, multiple sources familiar with the intelligence said. Among the military preparations the US has observed are the movement of air munitions and the completion of an air exercise, two of the sources said. But those same indicators could also simply be Israel trying to pressure Iran to abandon key tenets of its nuclear program by signaling the consequences if it doesn't — underscoring the ever-shifting complexities the White House is navigating. CNN has asked the National Security Council and the Israeli prime minister's office for comment. The Israeli Embassy in Washington did not comment. Trump has publicly threatened military action against Iran if his administration's efforts to negotiate a new nuclear deal to limit or eliminate Tehran's nuclear program fail. But Trump also set a limit on how long the US would engage in diplomatic efforts. In a letter to Iran's Supreme Leader Ayatollah Ali Khamenei in mid-March, Trump set a 60-day deadline for those efforts to succeed, according to a source familiar with the communication. It has now been more than 60 days since that letter was delivered, and 38 days since the first round ofv talks began. A senior Western diplomat who met with the president earlier this month said that Trump communicated that the US would give those negotiations only weeks to succeed before resorting to military strikes. But for now, the White House policy is one of diplomacy. That has put Israel 'between a rock and a hard place,' said Jonathan Panikoff, a former senior intelligence official specializing in the region. Prime Minister Benjamin Netanyahu is under pressure both to avoid a US-Iran deal that Israel doesn't view as satisfactory, while also not alienating Trump — who has already broken with the Israeli prime minister on key security issues in the region. 'At the end of the day, the Israeli decision-making is going to be predicated on US policy determinations and actions, and what agreements President Trump does or does not come to with Iran,' Panikoff said, who added that he did not believe Netanyahu would be willing to risk entirely fracturing the US relationship by launching a strike without at least tacit US approval. Iran at its weakest in decades Iran is in its weakest military position in decades, after Israel bombed its missile production facilities and air defenses in October, combined with an economy weakened by sanctions and Israel's decimation of its most powerful regional proxies. Israel, US officials say, sees a window of opportunity. The US is stepping up intelligence collection to be prepared to assist if Israeli leaders decide to strike, one senior US official told CNN. But a source familiar with the Trump administration's thinking told CNN the US is unlikely to help Israel carry out strikes on Iranian nuclear sites at this moment, short of some major provocation by Tehran. Israel does not have the capacity to destroy Iran's nuclear program without American assistance, including midair refueling and the bombs required to penetrate the facilities deep underground, a need that is also reflected in previous US intelligence reports, according to a source familiar with the matter. An Israeli source told CNN that Israel would be prepared to carry out military action on its own if the US were to negotiate what this source described as a 'bad deal' with Iran that Israel cannot accept. 'I think it's more likely they strike to try and get the deal to fall apart if they think Trump is going to settle for a 'bad deal,'' said the other person familiar with US intelligence. 'The Israelis have not been shy about signaling that to us … both publicly and privately.' A US intelligence assessment from February suggested Israel could use either military aircraft or long-range missiles to capitalize on Iran's degraded air defense capabilities, CNN previously reported. But the same assessment also described how such strikes would only minimally set the Iranian nuclear program back and wouldn't be a cure-all. 'It's a real challenge for Netanyahu,' Panikoff said. For now, the US talks with Iran are stuck on a demand that Tehran not enrich uranium, a process which can enable weaponization, but which is also necessary to produce nuclear power for civilian purposes. Special envoy Steve Witkoff, who is leading the US delegation, told ABC News over the weekend that Washington 'cannot allow even 1% of an enrichment capability' under an agreement. 'We've delivered a proposal to the Iranians that we think addresses some of this without disrespecting them,' he said. Khamenei said on Tuesday that he does not expect negotiations with the United States over Tehran's nuclear program to 'reach a conclusion,' calling the US demand that Iran not enrich uranium a 'big mistake.' Iran insists it has a right to enrich under the United Nations' Treaty on Nuclear Non-Proliferation and says it will not relinquish that right under any circumstances. Another round of talks may take place in Europe this week, according to Witkoff. Both the US and Iran have put proposals on the table, but after more than a month of the talks facilitated by Oman, there is no current US proposal with Trump's sign-off, sources said. US intelligence agencies in February issued warnings that Israel will likely attempt to strike facilities key to Iran's nuclear program this year, CNN previously reported. It has 'consistently been the Israeli position that the military option is the only option to stopping Iran's military nuclear program,' one US official noted. CNN's Kylie Atwood, Zachary Cohen, Alex Marquardt and Oren Liebermann contributed to this report.
Sky News AU
22-05-2025
- Politics
- Sky News AU
Israel preparing to strike Iran's nuclear facilities, even as Donald Trump tries to negotiate deal: report
Israel is preparing for a possible strike on Iran's nuclear facilities, despite the Trump administration's efforts to forge a diplomatic deal with Tehran, according to new report that cites American intel officials. Intercepted messages between Israeli officials as well as observations of Israeli military movements have led the US to believe such an attack could be imminent, officials in US intelligence told CNN. 'The chance of an Israeli strike on an Iranian nuclear facility has gone up significantly in recent months. And the prospect of a Trump-negotiated US-Iran deal that doesn't remove all of Iran's uranium makes the chance of a strike more likely,' a source familiar with US intelligence said. Air munitions movements and the completion of air exercises by Israel's forces are among the signs of a possible strike on the Islamic Republic, CNN reports. Such a strike risks triggering a broader regional conflict in the Middle East, experts have warned. President Trump has publicly threatened Tehran with military action if a new nuclear deal with the US falls through, while also setting limits on how long the US would continue its diplomatic efforts. The president gave Supreme Leader Ayatollah Ali Khamenei a 60-day deadline in a letter sent in mid-March, a source told CNN. It has now been more than 60 days since the letter was delivered and 38 days since the first round of talks began. Israel feels it has been left 'between a rock and a hard place' by the diplomatic stalemate, former senior intelligence official Jonathan Panikoff told CNN. Israeli Prime Minister Benjamin Netanyahu is under pressure to not alienate his country's greatest ally, the United States, while also avoiding a US-Iran deal his country sees as a letdown. 'At the end of the day, the Israeli decision-making is going to be predicated on US policy determinations and actions, and what agreements President Trump does or does not come to with Iran,' Panikoff said. Israel is unlikely to launch a strike without at least tacit US approval, he added. 'I think it's more likely they strike to try and get the deal to fall apart if they think Trump is going to settle for a 'bad deal'. The Israelis have not been shy about signaling that to us, both publicly and privately,' an intelligence source told CNN. In October, Israel bombed Iran's missile production facilities and air defenses, leaving the regime the weakest it has been since it came to power in the 1979 Islamic Revolution, the son of the Iranian shah, Crown Prince Reza Pahlavi, told The Post in a sit-down interview in New York this month. Israeli officials have talked up the possibility of further strikes on Iran in recent months, calling the Tehran regime an 'existential threat' to Israel. 'Iran is more exposed than ever to strikes on its nuclear facilities. We have the opportunity to achieve our most important goal — to thwart and eliminate the existential threat to the State of Israel,' Israel's Defense Minister, Israel Katz, wrote on X last November. Originally published as Israel preparing to strike Iran's nuclear facilities, even as Donald Trump tries to negotiate deal: report
New York Post
21-05-2025
- Politics
- New York Post
Israel preparing to strike Iran's nuclear facilities, even as Trump tries to negotiate deal: report
Israel is preparing for a possible strike on Iran's nuclear facilities, despite the Trump administration's efforts to forge a diplomatic deal with Tehran, according to new US intelligence. Intercepted messages between Israeli officials as well as observations of Israeli military movements have led the US to believe such an attack could be imminent, officials in US intelligence told CNN. 'The chance of an Israeli strike on an Iranian nuclear facility has gone up significantly in recent months. And the prospect of a Trump-negotiated US-Iran deal that doesn't remove all of Iran's uranium makes the chance of a strike more likely,' a source familiar with US intelligence said. Advertisement 4 Israeli Prime Minister Benjamin Netanyahu speaks during the annual ceremony at the eve of Israel. via REUTERS 4 Iranian supreme leader, Supreme Leader Ayatollah Ali Khamenei speaks during a meeting with teachers, in Tehran. AP 4 Iran's President Masoud Pezeshkian visits Iran's nuclear achievements exhibition in Tehran, Iran April 9, 2025 via REUTERS Air munitions movements and the completion of air exercises by Israel's forces are among the signs of a possible strike on the Islamic Republic, CNN reports. Advertisement 4 Photo released on Nov. 5, 2019, by the Atomic Energy Organization of Iran shows centrifuge machines in the Natanz uranium enrichment facility in central Iran. AP Such a strike risks triggering a broader regional conflict in the Middle East, experts have warned. This is a breaking story. Please check back for more updates.
Daily Mirror
21-05-2025
- Politics
- Daily Mirror
Israel 'preparing strikes on nuclear sites' and could spark huge Middle East war
Israel is believed to be planning a strike on Iranian nuclear facilities at the same time as Donald Trump is attempting to negotiate a peaceful solution with Tehran Israel is reportedly making plans to strike Iranian nuclear facilities, according to intelligence obtained by the United States. Donald Trump has been seeking a diplomatic deal with Tehran over its nuclear programme and so an attack by Israel would likely raise tensions between Israel and the US as well as risking a wider regional conflict in the Middle East. The Trump administration has also been seeking to bring an end to the fighting in Gaza through negotiations in the region. New intelligence revealing proposals for a strike on Iranian nuclear facilities has been reported by CNN, who have cited several US officials. But at the same time it emphasised no final decision had been made on an attack, and it is thought this may depend on how well talks go between the US and Tehran over its nuclear programme. And there wasn't positive news yesterday as Iran's supreme leader pushed back against US criticism of the country's nuclear programme, saying Tehran won't seek permission from anyone to enrich uranium and calling American statements 'nonsense'. 'They say, 'We won't allow Iran to enrich uranium.' That's way out of line,' Ayatollah Ali Khamenei said during a memorial for late President Ebrahim Raisi, who died in a helicopter crash last year. 'No one in Iran is waiting for their permission. The Islamic Republic has its own policies and direction — and it will stick to them.' Khamenei's remarks came as indirect talks between Iran and the US reportedly continue, though he expressed doubt about their outcome. 'Yes, indirect negotiations were held during Raisi's time too, just like now,' he said. 'But they didn't go anywhere — and we don't expect much from the current ones either. Who knows what will happen.' His comments reflect Tehran's growing frustration with the stalled nuclear discussions, as well as the broader tensions that have defined US-Iran relations in recent years. Foreign Ministry spokesman Esmaeil Baghaei told the state-run IRNA news agency that 'no definitive decision has been made about the next round of negotiations', adding that 'the Islamic Republic of Iran is reviewing the matter while considering the US side's contradictory and constantly changing positions.' IRNA also reported that Kazem Gharibabadi, the deputy foreign minister, said Tehran had received a proposal regarding the next round of indirect talks with Washington and was currently reviewing it. And so news that Israel could launch an attack further complicates the situation. Another person familiar with US intelligence on the issue told CNN: 'The chance of an Israeli strike on an Iranian nuclear facility has gone up significantly in recent months. And the prospect of a Trump-negotiated US-Iran deal that doesn't remove all of Iran's uranium makes the chance of a strike more likely.' Concern in the US comes not only from public and private messaging between senior Israeli officials that the country is considering such a move, but also from intercepted Israeli communications and observations of Israeli military movements suggesting an imminent strike. And among the military preparations the US has observed are the movement of air munitions and the completion of an air exercise, two of the sources also told CNN, but there is a possibility that these manoeuvres have been designed as a threat to Iran over potential consequences if a nuclear deal is not reached.
