David Sacks, President Donald Trump’s special advisor for AI and crypto, stressed the need for the United States to win the AI race during remarks on Tuesday and warned that the “repercussions would be significant” if it fails to do so.
Speaking at the AWS Summit in Washington, D.C., on June 10, Sacks said the policy directive President Trump gave him during his first week in office was that “the United States has to win the AI race.”
When it comes to the race itself, Sacks said that the United States’ biggest competitor is China. “There’s no other nation that can really compete with us in terms of the building blocks of AI,” he explained while flagging areas such as talent, innovation, power generation, and chips, among others.
“I do think that if we were to lose the AI race, the repercussions would be significant,” Sacks said. “I mean, this is going to have a major impact on our economy. It’s their potential dual-use applications. So, it would have a big impact on military.”
“If the U.S. were to lose the AI race, it would alter the balance of power in the world in a very unfavorable way,” he added. “This is something we have to take very seriously.”
So, how does the United States win the AI race? Sacks said he likes to think about the race in terms of three components. The first, he said, is the need to out-innovate the competition.
“You can’t just regulate your way through the AI race. We have to out-innovate the competition. We have to win on innovation,” Sacks said. “Our companies, our founders, they have to be more innovative than our counterparts.”
Sacks explained that much of the innovation in the United States is done through the private sector, saying, “So, number one is, we gotta let the private sector cook.”
The second component, according to Sacks, is the need for the United States to build out the most AI infrastructure.
“We need to have the most compute and we ideally want there to be a large compute differential between the United States and China,” Sacks said. “It’s really about permitting and power generation.”
Sacks noted that this is the one area where he sees China having an advantage. For instance, he said the U.S. power grid has been “more or less flat” for the last decade while China has doubled the size of its grid.
“We have to address that. And fortunately, this administration is very committed to … power generation. You know, drill baby drill, and we’ve got to, build baby build.”
The third and final component, Sacks said, is building out the largest AI ecosystem.
“We have to build out partnerships, and I think this is a mentality that feels very native to Silicon Valley … I think it’s a more difficult thing for Washington to kind of wrap its head around,” Sacks said. “I think the mentality of Washington and regulators is to restrict and to control, whereas the mentality of Silicon Valley is to be a little bit more open and have people adopt your technology.”
As an example, Sacks pointed to the AI diffusion rule – which the Trump administration recently rescinded. The Biden-era rule would have curbed the export of advanced AI chips and drew criticism from industry executives who argued the rule would have derailed AI progress and stifled technology innovation in America.
A spokesperson from the Commerce Department’s Bureau of Industry and Security told MeriTalk the rule was “overly complex, overly bureaucratic, and would stymie American innovation.”
Sacks echoed a similar mindset on Tuesday, saying, “It created this huge global regulatory regime restricting the diffusion of compute, basically of chips.”
“Diffusion was really seen as a dirty word … but diffusion, again, is how technology companies win,” Sacks said. “So, I think we need to have an approach that balances the need for security – we don’t want our advanced semiconductors going to our global adversaries – but we also have to care about market share.”
“We want our technology to become the standard. And again, you can measure that in terms of market share,” he said. “So, if five years from now, if you look around the world and you see that American technology is, say, 80 percent of global compute, that’s winning in my view. That means that we won.”