Trump Goes Haywire on AI Regulation After China Agrees to Major Trade Deal

American president Donald Trump and Chinese president Xi Jinping have finally resolved a months-long trade dispute revolving around the rare earth metals vital to developing artificial intelligence. It's a resolution that makes it all the more bizarre that the US President is opening the floodgates for an AI arms race with China.

Following Trump's baffling "Liberation Day" tariffs back in April, Chinese lawmakers moved to cut the flow of rare earth metals into the US. China has a near-global monopoly on rare earth minerals — which are critical for building high-tech products like wind turbines and computer chips — giving Beijing a huge asset at the bargaining table.

That all changed on Thursday, when Commerce Secretary Howard Lutnick announced "they’re going to deliver rare earths to us," adding that "we’ll take down our countermeasures" in kind. The deal, which was signed on Tuesday, is one of 10 that the Trump administration made with global trade partners following the much-maligned tariffs.

With all the trade progress, one might expect the White House to ease down on its aggressive stance with China — at least until the minerals start flowing again.

Instead, that's the exact opposite of what happened. Just a day after Lutnick announced a deal had been signed, news broke that Trump is on the cusp of signing executive actions which would dramatically escalate the so-called "AI arms race" with China. Per CNBC, the moves encompass four major plans.

The first is a deregulatory measure which would make it easier for AI companies to suck power from civilian power grids. Companies like Elon Musk's xAI have turned to noxious outdoor generators to fuel their power hungry data-centers, as regulators and energy officials assess short- and long-term impacts on surrounding communities. This would seemingly fast-track that process, giving tech companies federal approval to latch onto grids immediately, consequences be damned.

The executive order would also approve the sale of federal land to tech companies — building off of a broader strategy that involves privatizing federally protected wild land — helping them set up their noisy and hazardous data centers without having to worry about pesky local governments.

Other measures include rolling out an "AI action plan" to inform the public, as well as a propaganda drive to push the narrative that the US is locked in a life-or-death arms race with China, according to CNBC's anonymous sources.

This is all done under the pretext that we are, in fact, locked in a new cold war — a fiction that has more to do with preventing free-market competition with China than with any sort of genuine international threat.

With US leaders set on rehashing the nuclear arms race, AI industry reporter Garrison Lovely sums it up well: "Only one superpower has a government commission publicly calling for a militarized race to build superintelligent AI, and it’s not China."

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