Trump, Stargate, DeepSeek: A new, more unpredictable era for AI?
Expert comment
jon.wallace
7 February 2025
As the AI summit in Paris approaches, the US administration is taking a comparatively brakes-off approach on AI regulation. Can the UK and EU forge a leadership role on AI safety?
2025 is already proving a whiplash year for leaps and investments in artificial intelligence. On 19 January, China announced an AI investment fund, viewed as a response to tightened US export controls on chips.
On 21 January, US President Donald Trump announced the Stargate Project, a company that he said would invest an unprecedented $500 billion in developing US AI infrastructure, backed by technology companies OpenAI and Oracle, Japanese bank SoftBank and the Emirati sovereign wealth fund, MGX.
The following week, Chinese DeepSeek’s low-cost, ‘low’-chip and open-source AI model with reasoning capabilities caused market chaos, after it became clear it posed a challenge to a US-based OpenAI rival, o3. Leading chipmaker NVIDIA lost $600 billion of market value when the markets opened on 27 January.
DeepSeek has disrupted assumptions about who gets to develop powerful AI, and reignited doubts about the effectiveness of stringent US chip export controls.
But beyond intensifying competition between the US and China, these events signal a tectonic shift in US tech governance, toward a concentration of private-sector power in technology development and agenda-setting, characterized by division and unpredictability.
This unpredictable new era represents a significant challenge for European policymakers – but there may be limited opportunities to demonstrate leadership, too.
Reversing course
On entering the Oval Office, President Trump torpedoed Biden-era approaches to regulating AI, revoking an executive order on safe and trustworthy AI that had been understood as the blueprint for the US approach to domestic and global risk-based AI governance. Trump also used executive authority to pause the so-called TikTok ban and issued a slew of other executive orders (many of which will be challenged in the courts). Predictability in US tech policy is suddenly at an all-time low.
Meanwhile, Stargate’s scale hints at the growing convergence of national security, infrastructure and Silicon Valley interests. OpenAI’s economic blueprint for American re-industrialization – seemingly a key shaper of Stargate – appears to wield exceptional influence. It calls for classified facilities for evaluating model security as well as new energy resources to cool data centres.
Trump’s announcement of a private company also circumvents legislative hurdles associated with developing a publicly funded project of that scale, particularly given the urgency of ramping up data centre capacity due to rising demand.
Internationally, this emerging order has caused major ripples. While Brussels clarifies new rules on AI and enforces its digital services package, US-based companies will be emboldened by their gilded status, and by Trump administration attacks against Brussels overregulation, such as Vice President Vance’s threats against NATO involvement if Europe doesn’t respect ‘free speech’.
Brief, brittle alliances?
Demands for Big Tech accountability had grown steadily in the past decade, with a wave of regulatory action and many companies publicly reinterpreting their roles in governance beyond technology.
This time last year, more than 20 technology companies pledged to tackle deceptive AI election content like deepfakes. Together, they promised to uphold the integrity of 2024’s elections and work together to improve public trust. The declaration was weak on publicly measurable, collaborative actions. But it painted an optimistic picture of rivals coming together to protect democracy from AI-enabled information threats.
This optimism is now a distant memory, with technology moguls vying for influence in a political order that pledges to dismantle guardrails on the deceptive and unsafe content they committed to tackling.
Onlookers may call this shift a ‘mask-off’ moment; others the natural manifestation of profit-driven opportunism and US fear of losing ground to China. Either way, it adds context to the striking image of technology moguls – some former Democratic Party donors – seated at Trump’s inauguration.
That apparent unity soon proved illusory. Stargate’s launch pointed to an initial buildout alliance including Arm, Microsoft and NVIDIA. Notably absent was Musk, who took to X to strongly criticize Stargate’s financial backing. In response, OpenAI’s CEO Sam Altman called for Musk to put US interests above those of his company. Microsoft CEO Satya Nadella noted that ‘all I know is I’m good for my $80 billion.’
Such public bickering may prove to be the tip of the iceberg. The policies and investments of some of the world’s biggest technology companies could increasingly be mediated by the moods of rival CEOs. The ‘united front’ presented at the inauguration likely falls short of genuine alliance, instead capturing temporary alignments of interests.
Winning the technology race with China appears to be one of these interests. But DeepSeek’s breakthrough model and its market impact signals China is both snapping at the heels of US competitors and potentially changing the strategic environment in which they operate.
The view from across the pond
For former President Joe Biden’s administration, the UK and EU were generally allies on AI governance. Despite tensions – with long-standing debates about Brussels stifling US companies – they shared risk-based approaches and actively participated in the emerging global governance architecture.
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