Brushing off concerns about the dangers of artificial intelligence, President Donald Trump on Wednesday announced a set of policies to encourage American private-sector investment in AI.
The move reflects growing bipartisan concern in the United States that China is rapidly eroding America’s lead in artificial intelligence development and application. Beijing’s stated goal is to become the world leader in AI by 2030.
In a major speech to industry leaders and lawmakers in Washington, the president laid out an action plan that would loosen regulation, expand the infrastructure for the energy-hungry industry, and boost exports of the U.S. technology.
Why We Wrote This
Under President Trump’s new plan, America’s gear in the AI race has shifted from cautious to bold. Promoting unchecked investment over safeguards is a response to bipartisan concerns that China is eroding America’s AI dominance.
“America must once again be a country where innovators are rewarded with a green light, not strangled with red tape,” Mr. Trump said in remarks at an Energy and Innovation Summit.
Mr. Trump’s other AI-related initiatives remain controversial, such as eliminating the Biden administration’s AI safeguards as well as banning diversity and inclusion language from the models themselves. He also sided with the companies and against publishers and artists who want to be compensated for AI systems scanning their material.
AI advantages in the balance
Still, the threat from China strikes a chord among many AI executives and U.S. policymakers alike. The technology could offer major military, economic, and geopolitical advantages to whatever nation dominates the AI arena.
“AI built in democracies will lead to better technology for all of humanity. AI built in authoritarian nations will … be inescapably intertwined and imbued with authoritarianism,” Jack Clark, cofounder and head of policy at Anthropic, told the House Select Committee on China last month. “We must take decisive action to ensure America prevails,” said Mr. Clark, whose safety and research company builds large-scale AI systems.
“Artificial intelligence controlled by foreign adversaries poses a direct threat to our national security, our data, and our government operations,” said Democratic Rep. Raja Krishnamoorthi of Illinois in a press release last month announcing a new bill banning federal agencies from using Chinese AI. The bill has won bipartisan support in both the House and the Senate.
To those worried about China’s advances, the trends are disturbing. China dominates the competition for patents, receiving 7 in 10 of the world’s AI patents in 2023, according to Stanford University’s AI Index Report, released in April.
It also leads all nations in AI scientific articles, publishing nearly a quarter of the world’s research papers compared with less than 1 in 10 in the U.S. China has also narrowed the performance gap of its AI models, turning a double-digit percentage deficit in 2023 on some major benchmarks to near-parity with U.S. models in 2024, according to the Stanford report.
Early this year, a Chinese AI company called DeepSeek caused a sensation by releasing a model nearly matching U.S. models in performance but using far less computing power and at a fraction of the cost. Share prices of major U.S. AI companies briefly plunged on Wall Street before eventually restarting their march toward record territory.
A new tool at work, and at home
These super-performing models – called Large Language Models – offer the promise that huge computers can approximate human reasoning and learning. Optimists look forward to those LLMs boosting everything from work productivity to quality of home life. But many worry that “smart” computers will soon out-think humanity and, possibly, control it.
Mr. Trump is leaning into the optimists’ camp, removing some export barriers on U.S. chip and other technology exports, including to China to a limited degree, under intense lobbying from the U.S. AI industry. The companies worried about lost sales abroad and Chinese AI inroads into global markets. The president also wants to eliminate state laws that might impede AI development and innovation, another major win for the industry.
The move against state legislation is controversial, even among Republicans. Earlier this month, the GOP-controlled Congress tried but failed to pass a similar measure as part of the nation’s new tax and spending bill. The other priority set by the administration is to eliminate from American LLMs “woke” speech, such as diversity and inclusion language, which it argues represents a liberal bias in the technology.
By loosening restrictions on AI companies, Mr. Trump hopes to supercharge private investment in American AI. Those investments offer a distinct advantage for domestically based AI companies. While U.S. and Chinese government AI spending is relatively close, the American private sector is investing nearly 12 times more than its Chinese counterpart: $109 billion last year versus $9.3 billion, according to the Stanford report.
There are other reasons America may retain its AI lead. While U.S. researchers can’t match the quantity of Chinese research articles, they produce more of the highly cited ones, a mark of quality. The entrepreneurial nature and individualism of American culture may also help in the AI innovation competition with less-open China.
The race with China
After spending nearly a month in mainland China in June, visiting some of its leading AI companies and its top institutes, Columbia business professor Michael Morris says he has grown a lot less worried about Chinese AI ascendance. “I think the AI industry is way ahead in the U.S., and it’s because of the kind of society that we have that allows for this kind of wild innovation.”
The tension between seeking to win a technology race and trying to protect against AI’s existential threats is playing out across the world. The Stanford Index report found that international cooperation on AI governance intensified in 2024, with a large number of organizations releasing frameworks for responsible AI principles.
Those organizations include the United Nations and member nations of the Organization for Economic Co-operation and Development, the European Union, and the African Union.
But this year, the focus of most nations is shifting more toward the “AI race” mentality, according to a new report by the Atlantic Council, a nonpartisan, Washington-based think tank. Some researchers argue that the race is not a sprint but a marathon.
And winning it may not depend on who has the best technology, but how broadly its populace adopts it, Jack Shanahan, an adjunct senior fellow at the Center for a New American Security and a retired Air Force lieutenant general, wrote in an analysis this week. “Countries that learn how to bridge the gap between invention and widespread societal adoption will reap the most crucial benefits in the long term.”
