China, Trump’s 100% Russia Tariff, and the U.S. Lead in AI (From The Joe Piscopo Show)

China, Trump’s 100% Russia Tariff and the U.S. Lead in AI

President Donald J. Trump’s plan to slap 100% tariffs on Russia’s customers if there is no Ukraine deal by early September will hit China.  It’s a policy move reverberating through the U.S. AI race with China, as well.  Guest host Wall Street financier Liz Peek dove into the subject with me on The Joe Piscopo Show, giving New York City’s morning drive-time audience a look at what Peek called Trump’s “three-dimensional chess” with China.  NVIDIA, the secret to the U.S. lead in AI, weapons for Ukraine, and a possible China trip by President Trump?  It’s all in our discussion, here in the full clip and highlights below. 

Peek: Is China likely to take this sitting down? I mean, it does seem as though Trump is playing three-dimensional chess all the time.  Was the announcement that NVIDIA could start exporting high-end chips to China part of an understanding with China, that yeah, OK, we’re going to sanction the heck out of Russian oil, but in exchange, to soften the blow, we’re going to send you these high-end technologies?

Grant: It is 3-dimensional chess, and Trump is definitely playing carrot and stick.  With the NVIDIA chips, remember China has a chip that’s almost as good as the H100.  (Commerce Secretary Howard Lutnick calls the NVIDIA H20 “the 4^th best chip.”)  But the U.S. leads in AI partly because of the chips, but mainly because of the whole AI infrastructure: the data centers, the power to go with them, and the expansion plans of our tech leaders.  That’s what we have to keep up, and they need the right regulatory environment for U.S. businesses.  They need to be able to build AI processing centers overseas and to beat China in the global race for AI.  It’s a global race for AI.  So Trump is doing the global race against China for AI, and he’s also threatening sanctions, because China needs to say to Putin: knock it off.  Do a deal.  Russia is a vassal state of China.  Is that what Putin is looking for long-term?  This will make him think about it.

Peek: I hope that if President Trump goes to China, it is very clearly President Trump’s decision, and he’s the guy, he’s the alpha male in the room. I know this sounds kind of stupid, but in China, all that makes a great deal of difference, and Xi Jinping, from what I understand, is under a tremendous amount of political pressure now. We hope it’s an enormous amount of political pressure, because he’s such a bad guy. Do you agree with that, and what do you think President Trump would hope to get out of such a meeting?

Grant: I think Xi is scrambling.  Hey, I have horses.  President Trump is definitely the alpha male, especially after that B-2 strike on Iran.   So if he goes to China, he goes as the global alpha male.  As to the tariffs, he’s done a lot of tariff action with China.  He understands the real contours of the global AI race and what U.S. companies really need to keep our lead and prevent China from even getting a toehold in global AI. Oh yeah, I trust Trump to go to Beijing, for sure.

Peek: It’s interesting you’re talking about AI and China, because to me, one of the great advantages the United States has right now is we have power.  Thankfully, under this administration, we are embracing not just fossil fuel but also nuclear. I don’t know about you but the idea that in a blink we were finally we were ready and willing to reopen Three Mile 3 mile island which for those of us who were around at the time is really an astonishing turn around on nuclear power and the China doesn’t have that I mean China has obviously the power they need but they’re still burning coal like crazy.  How can they be a major competitor in AI if they don’t have power centers?  

Grant: We can do nuclear now because the reactor design is so much more sophisticated than the Three Mile Island days.  The way to keep China down is to keep them from having global market share.  If our companies want to go build AI processing centers around the world, they need the export freedom to do that. They’re not exporting chips – they’re building their own factories in places like Finland, etc.  That is going to keep the U.S. ahead, by partnerships that keep global market share.  That means other countries won’t turn to China as an alternative.  That’s why I love those deals with Saudi Arabia and the UAE, where the U.S. companies will invest in AI.  The business regulatory environment and unleashing American business to go conquer the world with AI data centers? That’s what’s really going to lock China out.  We’ve lost it in everything from cars to shipbuilding to solar panels. We see what happens when China dominates the tech sector.  They cannot have AI. 

Peek: Trump is very excited that NATO is paying for weapons going to NATO.  What is our capacity to ramp up?

Grant: You’re right, we have to deliver, and we have to make sure that our U.S. companies are able to ramp up and deliver on this production and get rid of any remaining paperwork in the Washington, DC bureaucracy that holds this stuff up.  Trump needs to just use the Executive Order process to sweep away any impediments for NATO partners in restocking.

Peek: Invoking the Defense Authorization Act?

Grant: Oh, too slow.  Trump’s done one Executive Order, and he needs to just do another one that basically says you can sell all the Patriots you need to NATO members, etc.  Some of that’s already in place, but there’s some smaller things as well.  How do you maintain and sustain the Abrams tanks? There’s a lot of stuff he just needs to sweep away, to make sure there’s not regulation standing in the way of ramping up.  And we do need to invest more, to make sure we can continue to produce our high-end missiles like Patriot, like the Standard Missile family that was so useful against Iran’s attacks; I could go on, but you get the picture.