US lawmakers, former officials slam Trump’s use of AI chip controls as China trade leverage
Two senior Democratic lawmakers accused the Trump administration of undermining US national security by using semiconductor export controls as leverage in trade talks with China, while a group of former national security officials separately warned that resuming AI chip exports to Beijing ‘represents a strategic misstep’ endangering American military superiority.
Representatives Raja Krishnamoorthi and Gregory Meeks sent a letter to Commerce Secretary Howard Lutnick condemning the administration’s reversal of restrictions on NVIDIA’s H20 artificial intelligence chips to China just three months after imposing them for national security reasons.
‘Using these tools as leverage in commercial negotiations with an authoritarian competitor undermines their core purpose: safeguarding U.S. national security,’ the lawmakers wrote. ‘This approach risks eroding the credibility of our export controls regime, blurs the line between economic and security priorities, and sends a dangerous signal that critical guardrails are up for negotiation.’
The criticism follows public statements by senior Trump officials, including Lutnick and Treasury Secretary Scott Bessent, describing the chip restrictions as negotiation tools in trade talks with China.
‘When the Bureau of Industry and Security placed restrictions on NVIDIA’s H20 chips in April, the Administration made clear it was doing so because those chips were contributing to Beijing’s development of artificial intelligence (AI) capabilities that were harmful to the national security of the United States,’ the lawmakers said. ‘Why then are we removing those controls three months later?’
The two lawmakers highlighted apparent contradictions with sworn congressional testimony, noting that when Commerce Under Secretary Jeffrey Kessler testified before the House Foreign Affairs Committee in June, he firmly denied that export controls were being used to bolster trade negotiation leverage, stating that ‘when we impose controls, it’s based on an assessment of what would promote national security and foreign policy interests’.
‘The statements by both you and Secretary Bessent earlier this month about using the H20 restrictions as a “negotiating chip” contradict Kessler’s sworn testimony and highlight the extent to which the Administration has repeatedly misled the American people and put our national security at risk,’ the lawmakers wrote.
A separate letter from 20 former senior national security officials and policy experts warned that the H20 chip is ‘a potent accelerator of China’s frontier AI capabilities, not an outdated AI chip’. The group, led by former Deputy National Security Advisor Matt Pottinger and including former Pentagon and intelligence officials, argued that the chip ‘outperforms even the H100, an AI chip this administration has restricted access to due to its advanced capabilities’.
They noted that Chinese firms have placed $16 billion in orders for H20 chips, saying that has further strained global supplies at a time when NVIDIA’s latest ‘Blackwell’ series is sold out until Q4 2025. ‘Every H20 chip shipped to China requires scarce resources that could have been allocated to producing AI chips for U.S. developers,’ they warned.
‘As policymakers and professionals with a background in national security policy, we believe this move represents a strategic misstep that endangers the United States’ economic and military edge in artificial intelligence,’ the letter said, referring to the administration’s reversal on H20 chips.
The national security experts warned that the chips would inevitably support China’s military modernisation under Beijing’s ‘Military-Civil Fusion’ strategy.
‘Chips optimized for AI inference will not simply power consumer products or factory logistics; they will enable autonomous weapons systems, intelligence surveillance platforms, and rapid advances in battlefield decision-making,’ the former officials wrote. ‘The line between optimizing an online marketplace and optimizing military logistics does not exist in the Chinese system.’
Both letters warned that the policy reversal could damage multilateral export control efforts and cooperation with allies. ‘This policy reversal is likely to create confusion among both allies and competitors, and may even be interpreted as a weakening of U.S. resolve on other key issues,’ the experts wrote.
The Democratic lawmakers concluded that they ‘no longer have confidence that the rigorous, evidence-based interagency process to administer controls that Congress stipulated under the Export Controls Reform Act of 2018 is being followed by the Administration’.
https://ari.us/wp-content/uploads/2025/07/Letter-to-Secretary-Lutnick-on-H20-restrictions.pdf
