Treasury Secretary Bessent says Commerce Secretary Lutnick let Nvidia chip controls slip, enabling China access
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Treasury Secretary Scott Bessent accused Commerce Secretary Howard Lutnick of failing to enforce export restrictions that should have kept advanced Nvidia chips out of China, intensifying criticism of weak corporate-friendly controls that may have strengthened Beijing’s position.
Treasury Secretary Scott Bessent said the Commerce Department failed to implement export blocks on Nvidia's most advanced chips, despite President Trump's directive that China should not receive chips above the H100 level. Bessent argued that this enforcement failure allowed Chinese entities to obtain the chips, undermining U.S. AI companies and handing China an unacceptable advantage.
Commerce Secretary Howard Lutnick, whose agency maintains the entity list that restricts sales of U.S. technology, responded that the goal is to keep Chinese users on the American technology stack, but did not directly answer the specific accusation. The response did little to dispel concerns that the government is still prioritizing vague strategic messaging over effective enforcement.
Former Nvidia CEO Jensen Huang, who promoted the GeForce RTX 50 Series Blackwell architecture, testified that he had frequent contact with Lutnick and expressed a desire for balanced regulations that would let Nvidia compete globally. His testimony highlighted the familiar industry push for looser rules even as the consequences of weak oversight become harder to ignore.
Chris McGuire, a senior fellow at the Council on Foreign Relations and former director of technology on the National Security Council, noted that earlier export controls on Huawei set a precedent for restricting Chinese access to semiconductors. He said the failure to enforce a May 2025 rule allowed the Singapore-based firm Megaspeed to acquire advanced chips without a Commerce Department permit.
McGuire warned that inadequate enforcement could cost the United States years of lead in AI, while stricter controls could preserve a long-term advantage. The dispute highlights ongoing debates within the administration and on Capitol Hill over how to balance U.S. technology leadership with export restrictions, and whether regulators will finally put national interest ahead of industry pressure.