Trump

The platforms cash in their chips with Trump

From Meta to Nvidia, tech CEOs are paying the president to get the outcomes they want — and it's working

Casey Newton

Apr 10, 2025 — 14 min read

(Amanda Jones / Unsplash)

On Monday, the Federal Trade Commission’s landmark antitrust lawsuit against Meta is scheduled to go to trial in Washington, DC. The lawsuit, which was filed during the first Trump Administration, alleges that Meta’s acquisitions of Instagram and WhatsApp were illegal and should be undone. While a breakup is seen as unlikely, it remains a significant threat to Meta’s business.

Under normal circumstances, we would expect this trial to be determined by what happens in the courtroom. But as the chaos that has unfolded in the financial markets over tariffs this week has shown, circumstances in Washington these days are anything but normal.

What if, instead of the courtroom, Meta’s fate was decided in the White House? Meta has been working to ensure that is the case since shortly after Trump won a second term. CEO Mark Zuckerberg has spent time with the president at Mar-a-Lago and cohosted a reception for his inaugural. The company donated $1 million to the inauguration, and spent another $25 million to settle a baseless lawsuit that Trump filed in 2021 in response to Meta suspending his account in the wake of his attempt to overthrow the government.

Meanwhile, Trump fired the two Democratic FTC commissioners, who surely would have opposed any effort to bring the trial to a premature end. That appears to be illegal, but they won’t be restored to their positions unless a court rules in their favor.

Last summer, Trump was musing openly about putting Zuckerberg into prison. But once the payments began to roll in, the president’s treatment of Meta improved substantially. In February, Trump warned that he would implement tariffs partially in retaliation for European fines against US tech companies including Meta, saying that America had become a victim of “overseas extortion and unfair fines and penalties.” “They’re suing Google, they’re suing Facebook, they’re suing all of these companies, and they’re taking billions of dollars out of American companies,” Trump said last month.

These sentiments, which match Zuckerberg’s public comments, have had the desired effect. In March, the Financial Times reported that the European Union planned to levy lower-than-expected fines in an effort to avoid Trump’s wrath. (On the other hand, the EU is now readying new digital taxes against Meta and other US tech companies in retaliation for Trump’s now-paused tariffs.)

Zuckerberg’s former growth chief at Facebook, Chamath Palihapitiya, helpfully explained the current dynamic in a podcast discussion posted on X this week.

“I was a megadonor to the Democrats,” said Palihapitiya, now himself a billionaire and the founder of Social Capital. “I couldn't get a phone call returned from the White House to save my life … The Trump administration is totally different. There's not a single person there you can't get on the phone and talk to.”

When Zuckerberg calls on Trump to force a quick settlement of the FTC case, will the president answer?

A year ago, it seemed unthinkable. Today it seems much less so.

II.

Most people’s attention this week has been justly fixed on Trump’s tariffs, which briefly cratered the stock market based on the administration’s disastrous misunderstanding of the global economy. After the stock exchanges began to plunge, the president declared a 90-day pause on tariffs higher than 10 percent. (The exception is China, where he increased tariffs even higher, to 145 percent.)

The tariffs shocked even close observers of Trump, who had expected them to be smaller and more considered. They surely galled the oligarchs who lined up to support Trump after the election even more: this was not the laissez-faire corporate tax cutter of the first administration, but something more misinformed and deranged. (To be clear, this more erratic version of Trump was visible to anyone who watched him give a campaign speech last year, but the billionaires chose to see what they wanted to see.)

But I want to highlight one particular story from the period leading up to the tariffs, which highlights the way that the open corruption of Trump’s pay-to-play Washington has undermined the administration’s own agenda.

If there is any current of thought in Trump’s policies that has remained relatively stable from one administration to the next, it’s a hawkish stance toward China. In his first term, Trump began to place tariffs on Chinese goods and put Chinese companies including Huawei on a trade blacklist. That blacklist, which eventually grew to include DJI and ZTE, originated over fears that the technology posed national security risks to the United States. (Imagine if Huawei had installed a backdoor in the nation’s 5G infrastructure to enable Chinese spying, for example.)

Over time, though, the blacklist came to serve an additional purpose: preventing China from getting access to the technology necessary to build advanced artificial intelligence. In December 2020, at the end of Trump’s first term, he added an important Chinese semiconductor manufacturer named SMIC to the US entity list, preventing US companies from selling advanced chipmaking technology to it.

Biden dramatically expanded those export controls beginning in 2022; he added to them in each of the next two years. The administration stated explicitly that the goal was to prevent China from building advanced AI systems for military use.

Judging from comments that Trump and Vice President J.D. Vance have made in recent months, the Trump administration understands very little about AI and the national security risks that it poses to the United States. What the administration knows is that it wants to “win,” and that to “win” means to beat China in building highly capable systems. On his first day in office, Trump issued a memorandum endorsing Biden’s export controls and instructing the secretaries of State and Commerce to expand them.

III.

Then last week, at a cost of $1 million, Nvidia CEO Jensen Huang visited Mar-a-Lago for dinner. Since January, the Trump administration has been considering whether to place further restrictions on which chips Nvidia can sell to China.

In particular, Trump officials have been discussing whether to restrict the sale of the H20.

The H20 is a modified version of Nvidia’s higher-end chips designed to comply with the export controls introduced during the Biden Administration. The idea was to hamper Chinese AI labs’ ability to compete with top American companies.

Then DeepSeek happened. The Chinese company released its high-quality, low-cost open source R1 models, and demand for the H20 exploded. Earlier this month, The Information reported that Chinese firms had placed at least $16 billion in orders for the H20, hoping to capitalize on its ability to train and run AI systems. And around the same time, the Trump administration began to consider adding the H20 to the list of chips that Nvidia can’t sell in China.

This put Huang in a dilemma. If he could manufacture the chips and ship them to China before export controls went into effect, his firm would generate another $16 billion in revenue. On the other hand, if the ban came down before the chips were ready, he would have to find a new buyer.

With so many billions on the line then, it only made sense to spend a single million for the chance to make his case directly — and so he did.

Here are Emily Feng and Bobby Allyn at NPR:

Following the Mar-a-Lago dinner, the White House reversed course on H20 chips, putting the plan for additional restrictions on hold, according to two sources with knowledge of the plan who were not authorized to speak publicly.

The planned American export controls on the H20 had been in the works for months, according to the two sources, and were ready to be implemented as soon as this week.

The change of course from the White House came after Nvidia promised the Trump administration new U.S. investments in AI data centers, according to one of the sources.

For the moment, then, it seems as if Huang’s million dollars were well spent.

IV.

Perhaps Trump will reverse course here yet again. After all, he reverses course so often in these matters that it almost comes as a surprise when he doesn’t.

But imagine that he stays the course, and what that might mean.

By now it isn’t news that Trump is inconsistent. Increasingly, it isn’t even news that his policies can be bought and paid for. CEOs from Zuckerberg to Huang have eagerly embraced Trump’s policy paywall. There’s a seductive simplicity to the whole thing, if you’re willing to hold your nose.

But it should continue to surprise us just how willing Trump is to undermine himself. It’s a shock to see such a self-styled China hawk slapping the country with the largest tariffs in decades on one hand, while slipping them the chips necessary to build high-end AI systems on the other. And while the H20 seems unlikely to be decisive in China’s ability to catch up to US progress in AI development, the way that Chinese companies are clamoring for it in the wake of DeepSeek’s success suggests it remains extremely valuable.

An openly corrupt president was always going to pose national security risks of one sort or another. The rapid development of powerful AI systems only makes those risks more significant. As Trump and his lieutenants continue to pat themselves on the back for taking such an aggressive stance toward China, we should remember just how easily the president was reportedly persuaded to give the country exactly what it wants.

On the podcast this week: We once again tear up a segment we recorded on Wednesday to bring you an even fresher one about tariffs recorded today. Then, star forecaster Daniel Kokotaljo joins us to discuss his new prediction for how the world might end: AI-2027.com. (A highly recommended weekend read.) Finally, Kevin and I discuss Meta's Llama drama.

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