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Today on TAP from the American Prospect. Ideas. Politics. Power.

DECEMBER 22, 2025

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KUTTNER ON TAP

Trump loses GOP support on China policy

Add Republican objections to Trump’s China capitulations to the growing realm of defections from leaders of his own party.

Donald Trump is wrecking so much with his blend of impulsivity and personal graft and vanity that it is sometimes hard to distinguish the consequential from the incidental. Far more important than his plastering his name everywhere is Trump’s incoherent China policy, where he keeps raising and lowering tariffs to no strategic purpose while at the same time giving away crown jewels or finding a way to sell them.

Earlier this month, there was widespread outrage in the defense community when Trump reversed policy and allowed Nvidia to sell the H200 in China, its second most advanced artificial intelligence chip. Seven Democratic senators, led by Elizabeth Warren of Massachusetts, sent Commerce Secretary Howard Lutnick a letter warning that “the President’s dangerous decision to give away crucial national security controls represents a significant departure from longstanding bipartisan efforts to ensure that U.S. technology does not turbocharge China’s military and technological capabilities.”

The decision to allow the sale followed months of courtship and flattery of Trump by Nvidia CEO Jensen Huang. Nvidia used a brand-new tech conference in D.C. to lavish praise on Trump, and Huang gave generously to Trump’s ballroom project and has claimed that Trump is ushering in a new Industrial Revolution (his words) with AI. The H200 decision came right after an Oval Office meeting between Huang and Trump.

Previously, top cabinet officials, including Secretary of State Marco Rubio and U.S. Trade Representative Jamieson Greer had successfully blocked sale of a less powerful Nvidia AI chip.

In line with Trump’s habit of asking private companies to pay tribute, Nvidia will kick back 25 percent “revenue share” of the value of its China sales to the U.S. government. This doesn’t go directly into Trump’s pocket. But in the great favor bank, Trump will find ways to cash in this favor to Huang for his personal enrichment.

Now, however, Congress has pushed back big-time. In the annual defense authorization bill that Trump has just signed into law, a broad bipartisan coalition inserted provisions codifying a 2023 Biden executive order requiring national-security screening of outbound U.S. capital investment in China. In past years, U.S. venture capital firms have supplied a lot of the funds for AI development in China. Funds managed by Vanguard, BlackRock, and Fidelity have major investments in China’s marquee tech company, Alibaba.

The authorization bill does not reverse the Nvidia chip approval, but it sends a shot across Trump’s bow and signals more willingness of Republicans to defect from automatic support for Trump. In supporting the new restrictions, Republican Sen. John Cornyn of Texas warned, “Every dollar invested in China by a United States investor into a Chinese company is a dollar that’s going toward the potential production of weapons and technology that one day may be used to kill Americans.” Congress needs to go further and ban sweetheart deals like the Nvidia waiver.

Meanwhile, Trump is pulling back on technologies where China increasingly dominates, such as EVs and renewable energy. His treatment of the Caribbean as an American lake and Ukraine as part of greater Russia is a virtual invitation for China to invade Taiwan.

While Trump is obsessed with Venezuela as a national-security threat and imposes vanity tariffs on friendly nations like Canada that fall short of his standards of genuflection, militarily and commercially he is letting China clean America’s clock.