Bessent blasts Lutnick over Nvidia chip leak to China as enforcement failures raise alarms
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Treasury Secretary Scott Bessent said Commerce Secretary Howard Lutnick failed to enforce export restrictions that were meant to block advanced Nvidia chips from reaching China, fueling criticism that weak enforcement is undermining U.S. security and advantage.
Treasury Secretary Scott Bessent said the Commerce Department did not implement export blocks on Nvidia's most advanced chips, contrary to President Trump's directive that China should not receive chips above the H100 level. Bessent argued that the lapse allowed Chinese entities to obtain the chips, harming U.S. AI companies and giving China an advantage that Washington should never have permitted.
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 address the specific accusation. For critics, that kind of answer is exactly the kind of talk that sounds reassuring while dodging the core problem: whether the rules are actually being enforced.
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 comments reflected the persistent pressure from major tech players to preserve access and flexibility, even when national-security concerns point in the opposite direction.
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 the government will choose discipline over drift before more damage is done.