Why Everyone Is Talking About Chokepoints

**Dina Temple Rustin** (0:00)
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**Ravi Agrawal** (0:32)
Hi, I'm Ravi Agrawal, Foreign Policy's Editor-in-Chief. This is FP Live.
The word chokepoint is increasingly becoming common when we discuss world affairs. Think of the Strait of Hormuz. It's a type of geographic chokepoint because so many commodities pass through it. When Iran chose to shut it down, it had a massive global effect. But there are also economic chokepoints, such as access to the dollar banking system, or material chokepoints, such as China's monopoly over rare earths. The control of, or the ability to, attack these pressure points is the most important new arena of conflict today. This week, I'm joined by Eddie Fishman, the author of the book Chokepoints.
That is coming up. There is one more vulnerability that's been on my mind this week, and this one affects every single one of us, America's big bet on AI. We've talked about this before on the show, but that focused on whether we are in a bubble. There's another angle to this, a growing fear that Beijing's open-source AI models are undermining Washington's closed models, which cost a lot more money to develop. Here's my read on things. You'll remember the headlines around DeepSeek last year. That was the Chinese startup that dropped an open-source AI model that rivaled cutting-edge offerings from open AI. It stunned the United States. Something similar happened last month when Moonshot AI, another Chinese AI company, released Kimi K3 and claimed that it outperformed most other models on the market. Kimi was immediately hailed as a new deep-seek moment. Here's why this is particularly worrying for the United States. China is not spending untold sums of money on AI or data centers. It doesn't even have access to the very highest-end chips. The United States, on the other hand, is pouring everything into AI. Estimates vary, but anywhere from a third to half of all of US GDP growth can now be attributed to AI-related expenditure. That means a disproportionate amount of business investment in the United States is on AI.
40% of the stock market is now AI-related. More than 80% of the gains in stocks this year come from AI stocks. The US economy is becoming one big bet on AI. You and I, all of us, are invested in this whether we know it or not.
As the political scientist Graham Allison pointed out in FP this week, all of this investment would be one thing if the United States were miles ahead. But the release of models like Kimi is a reminder that instead of being a year ahead, the United States may just be weeks ahead. And the amount of spending to maintain even this small lead is crushing. A lot of US spending on AI today is based on debt. The spending is often justified as necessary to be the first to reach so-called AGI, or artificial general intelligence. But as Graham points out, shouldn't US policymakers stop to wonder why China's model is so radically different?
A good way to think about this is how we see Apple and Android, the smartphone operating systems. Apple is closed, Android is open-source, and others can add on to it with their own apps. No surprise most of the world chooses to use Android. It's cheaper, it's more convenient. What if the AI race plays out similarly, with China's open-weight models gaining more prominence, even if the US ones are slightly better or a few weeks ahead of the curve?
If this was just a car race, perhaps none of this would matter. But one reason why stock markets have seemed nervous of late is that this is now a race in which the leader, the United States, is borrowing money like there's no tomorrow and betting the house on winning. At the very least, it's worth a bigger national discussion about whether it's the right bet or even the right race.
Okay, on to this week's featured interview. The biggest stories of the last few years, whether it's COVID, Russia's war on Ukraine, US-China trade tensions, or the current Iran war, all have at least one key element in common. Countries are looking to exploit each other's economic weaknesses and safeguard their own interests. My guest today has written a terrific book about this. Edward Fishman is the author of Chokepoints, American Power in the Age of Economic Warfare. He's a senior fellow at the Council on Foreign Relations. He's also served in a variety of roles, including building some of the sanctions we'll talk about today at the State Department, the Pentagon, and the Treasury Department. Let's dive in.