Harris and Trump Clash Over Tech Policy and AI Race in Presidential Debate

Kamala Harris attacks Donald Trump's tech trade plan during the debate: 'He basically sold us out' to China

Between spats over abortion, immigration, and cats, presidential candidates Kamala Harris and Donald Trump briefly detoured last night into a key tech policy debate: How to win global race for in artificial intelligence. In her pitch for how the U.S. should get ahead, Vice President Harris pointed out AI and quantum computing -- a still largely experimental technology -- as key industries. Meanwhile former President Trump argued that U.S. advanced chip production has dwindled since he left office, casting blame on the Biden administration, including Harris. The discussion, which lasted only a few seconds, came as both political parties focus on growing competition with China and the promise of AI. The U.S. and China are engaged in a back-and-forth of trade restrictions, and with the threat of China taking military action in Taiwan, the U.S. is looking to protect its own national and economic security by subsidizing domestic chipmaking. Like most of the world, the U.S. relies heavily on the Taiwanese manufacturer TSMC for semiconductors. On the debate stage, Harris accused Trump of letting China buy American chips that let it advance its military during his time in office. "He basically sold us out," Harris said. Any U.S. trade policy with China should focus on making sure America "wins the competition for the 21st century," she added. That means investing in U.S. technology and workers "to win the race on AI" and quantum computing, the vice president continued. While the Biden administration has expanded controls on the export of critical technologies to China since 2022, experts note that Trump started that trend back in 2019, when his administration banned sales to companies such as the Chinese smartphone maker Huawei. What the vice president was likely referencing were the loopholes in the Trump administration's blacklist of products, like limited restrictions on advanced chips and waivers for American companies looking to grow market share abroad. Trade with China has been increasingly restricted under the Biden administration, with new limitations added as recently as last week, with a particular eye to high-tech sectors. While important, "export controls are not a panacea," says David Sacks, fellow for Asia studies at the Council on Foreign Relations. Government subsidies and investment by U.S. companies also play a role in security and competitiveness, he said. During the debate, former President Trump countered that American manufacturers "hardly make chips anymore," echoing criticisms he made to Bloomberg Businessweek in June. Harris reportedly shook her head off-camera at this remark. In 2022, Biden signed the CHIPS and Science Act, which allocates around $50 billion to boost chip manufacturing in the U.S. The government has already allotted $6 billion for a TSMC factory in Phoenix, where work is now underway after some delay. Intel got $8.5 billion in CHIPS funding for projects in Arizona, New Mexico, Ohio, and Oregon, and Samsung got $6.4 billion to expand a manufacturing facility in Central Texas. "We are in the early innings of rebuilding our chip manufacturing capabilities," said Navin Girishankar, president of the economic security and technology department at the Center for Strategic and International Studies. The question going forward, he said, is how to strike the right balance of export controls and investments, like a CHIPS 2.0. And while Trump was correct last night that U.S. advanced chip manufacturing is still down, and that most chips are produced in Taiwan today, Sacks said this is largely due to private business decisions rather than policy. Once-dominant American companies like Intel increased profit margins by offshoring production, he said. And the biggest American name in chips today, by far, is Nvidia, which designs graphics processing units in Silicon Valley but also outsources chip manufacturing to TSMC. "That's the result of consistent decisions by U.S. companies that they didn't want to be involved in the foundry business," Sacks said.

Kamala Harris wants US to "win the race on AI and quantum computing" -- but Trump isn't so sure

In last night's Presidential debate, Vice President Kamala Harris said she wants to "win the race on AI and quantum computing." Expanding on her point, Harris stated her policy on China is to ensure the US "wins the competition for the 21st century" by investing in "American-based technology." She then turned her attention to former President Donald Trump, saying under his presidency, American chips were sold to China and used to modernize its military. In his rebuttal, Trump claimed China "bought their chips from Taiwan," and that, "We hardly make chips anymore because of philosophies like they have." Under his Presidency, one of Trump's key policies was to increase US exports to China to the tune of $200 billion over 2020 and 2021. While this goal was not met, one of the key exports that actually contributed somewhat towards it was the sale of semiconductors and their manufacturing equipment, which amounted to almost 25% of China's total goods import under Trump's import agreement. Trump also placed Huawei on a national security list, introduced sanctions to restrict the sale of the US semiconductors that could potentially be used in Huawei 5G base stations, and banned the purchase of Huawei equipment for use in network infrastructure alongside the UK and Australia. However, the restrictions did not prevent Huawei from purchasing semiconductors from companies headquartered outside of the US, such as Samsung - headquartered in South Korea - and the Taiwan Semiconductor Manufacturing Company (TSMC). Following the election of President Joe Biden, the CHIPS and Science Act was signed in August 2022 - a piece of legislation built from two bipartisan bills aimed at both boosting domestic tech research and semiconductor manufacturing on US soil. The CHIPS and Science act has so far set aside $280 billion in funding comprised of subsidies, investment tax credits, and other incentives that has resulted in a number of semiconductor manufacturers breaking ground on manufacturing and research plants in the US, with TSMC building a new factory in Arizona, and Intel investing in new sites in Arizona, New Mexico, Ohio and Oregon. Harsher sanctions were also introduced in October 2022, restricting US companies from exporting advanced semiconductors to China, along with further restrictions coming into effect to close export loopholes in 2023. The unfortunate downside of restricting exports to the second biggest economy in the world is that some US companies have lost a market that accounted for a significant portion of their revenue, and China has introduced export restrictions of its own to hamper US efforts to produce semiconductors domestically. While the CHIPS and Science Act and harsh export restrictions were signed into law by Biden, it provides a good foundation for the outlook on Harris' potential policy for China and how America "wins the competition for the 21st century."

Harris Attacks Trump on Chip Exports, Says U.S. Must 'Win the Race on A.I.'

Vice President Kamala Harris attacked former president Donald Trump over his administration's record on chip exports during Tuesday's presidential debate, arguing that Trump "ended up selling American chips to China to help them modernize their military." Harris advocated "investing in American based technology so that we win the race on AI, on quantum computing." Trump responded that Chinese