EMERGENCY POD: Jensen Out, MATCH Act In? With Dylan Patel

Jordan Schneider (0:01)

All right, hey Dylan, hey Jordan, thanks for joining. Did you guys hear? The CEO of the world's largest and most important company just resigned.

No.

Jordan Nanos (0:12)

Are you serious? Are you serious? Wait, what? What could possibly had led to that?

Jordan Schneider (0:17)

I mean, there's some allegations of some pretty serious conduct violations here. It was, apparently you can't sleep with your subordinates and change the policy assets and keep your job.

Jordan Nanos (0:30)

Wait, Jordan, I mean, we've got Elon, we've got Sergey, everyone in Silicon. Once you get to a trillion dollars, I think you're like legislated to start sleeping with your support nets. There must be something else.

Jordan Schneider (0:41)

I think the trillion dollar class might be fine, but once you get to five trillion, then you have problems with this sort of stuff.

Jordan Nanos (0:47)

Then woke 2 really starts coming after you.

Jordan Schneider (0:51)

Oh, my God. Yeah, we're rotating back.

Jordan Nanos (0:56)

So, yeah, this is truly a momentous day, momentous moment for the future of America, China and artificial intelligence, where Dylan somehow looks bored after all of this or just drained. I don't know, how are you processing it?

Dylan Patel (1:14)

Dude, I mean, I don't know. You're like, look up to some guy, this guy, and then like, you know, he does these things. It's not fun, you know? Look, there's a lot of things going on and a lot of things to contemplate. I think given we're ChinaTalk, we shouldn't even talk about the future of Nvidia. We should just talk about the future of open source and future of AI and China-U.S. relations.

I think like, you know, I've obviously been a hawk or a fucking bald eagle, as we said in a prior podcast, for quite some time. And, but at the same time, there's like, I'm worried this is going to be used as cover to pass really stupid laws.

And, you know, obviously, you know, Nvidia without Jensen is a much weaker company. Now, whether you think Nvidia's interests are that of the national interest of America is something that I think like, most people say yes, but I think some people in the audience would probably say no. I mean, it's pretty clear Nvidia's chips were ending up in China knowingly or not. It's probably just knowingly. But yeah, I mean, I think, I think, like, look, Jensen and Nvidia were the biggest defenders against not shipping chips to China, and now they are gone and out of play. So what regulations pass? You know, I hope this means the Match Act passes, right? That is far more important for US national interest than the RASA Act. RASA. RASA is a pretty dumb bill.

Lily (2:49)

Hi, everyone. ChinaTalk editor Lily here with some context. Remote Access Security Act, or RASA, would amend export control to clarify that remote access to US controlled chips counts as an export. This makes cloud rental subject to the same rules as shipping the chip itself.

RASA passed the House 269 votes to 22 in January of this year, but no Senate vote has been held or scheduled. A parallel Senate version is stuck in the banking committee, and no version of the current NDAA text includes RASA.

The Senate version of RASA directly targets, quote, foreign persons of concern, generally interpreted as China, Russia, Iran, North Korea, and companies whose ultimate parent is headquartered in one of those countries as well as entity list firms. As designed, RASA would cover only single customer clusters that are big enough to provide frontier training. This threshold is commerce's to set following consultation with chipmakers, AI labs, and cloud providers. RASA would not cover inference rentals, smaller allocations, API access, smuggled chips, or chips already in China. Perhaps most importantly, RASA does not ban anything itself. The text in the Senate says, quote, May, and the House text acts only if the secretary, quote, determines a serious risk. There is no deadline nor minimum in place here.

Likewise, commerce can choose whether to wind down existing leases or run them to term. These flexibilities should be viewed as a feature and not a bug. The bill settles the legal authority, adds material penalties, and sets up the entire system to survive a change of administration. RASA then gives commerce the tools to titrate access to rented chips as it deems appropriate.

Dylan Patel (4:22)

I think Biden-style diffusion controls should totally be done. But I think, again, if the US government doesn't pass this RASA, that's going to be a big issue. It's going to be really bad for American interest, probably, in the long term and short term, medium term. So yeah, I think this is the key aspects of it, right? And the other undertoning is like, you can't just ban everything because China can and will utilize the fact that their components are in every single Nvidia server and every single Google server and every single Amazon server, et cetera, et cetera, et cetera. You cannot get materials, you know, you cannot build these things without them. So there is a level of tit-for-tat here.