SAN JOSE, CALIFORNIA - MARCH 18: Nvidia CEO Jensen Huang delivers a keynote address during the Nvidia GTC Artificial Intelligence Conference at SAP Center on March 18, 2024 in San Jose, California. The developer conference is expected to highlight new chip, software, and AI processor technology. (Photo by Justin Sullivan/Getty Images)

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If only members of the U.S. political class were to spend more time in China. If so, the American and Chinese people could perhaps be spared a lot of foolish policy.

Everywhere you look there’s an Apple Store, a Nike Store, McDonald’s, KFCs, Starbucks, and seemingly every other American brand. To produce is to express a desire to consume, and the Chinese are producing feverishly to get all things American.

Notable about Chinese reverence for American products is that it very much extends to technology. It’s not just that Apple sells a fifth of its iPhones in China, it’s that a fast-rising Chinese technology sector is populated with individuals who think the world of the American technology behind products and services. This has long included Nvidia, and its chips that have been so instrumental in what has been a transformational Artificial Intelligence (AI) leap.

Unfortunately, politicians well outside the proverbial arena don’t view foreign production as excitedly as those inside the arena do. All too often they view trade as war, as opposed to what it always and everywhere is: mutual enhancement.

The trade as war theory has sadly informed the rise of AI, along with the infrastructure that has made it possible. With AI seen by politicians as the next big thing, they began to institute rules meant to limit export of the most advanced products lest one country get a leg up on another in AI. The thinking was erroneous.

That’s because the beauty of trade is that when free, it’s as though every corporation is headquartered next door. Better yet, free trade means the greatest minds get to divide up work on the way to much greater and much faster productive leaps. Alas, logic has largely taken a backseat in the AI discussion.

Traveling back in time to October of 2022, the Biden administration began to foist export controls on Nvidia. The aim was to keep the San Jose, CA-based corporation’s most advanced chips from reaching China. “National security” was the excuse for this vandalization of economics, a vandalization that played into the hands of the Chinese Communist Party (CCP).

While Chinese technologists yet again revered U.S. chips, and Nvidia’s in particular, the CCP embraced the autarky so popular inside governments whereby it wanted Chinese tech companies to buy from Chinese producers. Which is why the Biden administration’s export controls were a gift for the CCP.

It’s not just Shenzhen-based Huawei that has made great leaps in chip technology. As Bloomberg recently reported, China’s semiconductor stocks are surging alongside soaring investment. Huawei is leading the charge as the report indicated, having recently “unveiled a new chipmaking method that could allow cutting-edge processors to be made more cheaply — reminiscent of DeepSeek’s revolutionary AI model launch.”

About the great strides being made in China, it’s not in and of itself a bad thing, particularly if markets are reopened so that American and Chinese genius can peacefully collaborate over working against each other. It’s worth adding that profits are the ultimate lure for competition either way, which means Nvidia’s achievements ensured more competition from within China and the U.S. (see Cerebras) with or without export controls.

Still, what a waste. And that’s not just a comment about sales. Instead, it’s a comment that trade is yet again mutually enriching. Which means we’ll never know just how much further along AI advance in China and the U.S. would be now if politics hadn’t gotten in the way of brilliant minds dividing up work in an economically confused past.