GLOBAL POLICY

Trump's chip tariff carveouts expose industrial policy hypocrisy

Trump announced 100% tariffs on semiconductor imports yesterday while simultaneously exempting every major company already building US facilities. The policy amounts to punishment for firms without existing American manufacturing commitments rather than genuine reshoring incentives.

"If you're building in the United States of America, there's no charge," Trump declared during Apple's $100 billion investment announcement. South Korea immediately confirmed Samsung and SK Hynix would face no tariffs due to their existing US commitments.

The exemption list reads like a who's who of global semiconductor leaders:

• TSMC: $165 billion Arizona expansion with six fabs planned

• Samsung: $45 billion Texas investment for two chip plants

• SK Hynix: $3.87 billion Indiana packaging facility

• Apple: Committed to sourcing Samsung chips from Texas plants

Chinese companies like SMIC appear to be the primary targets, lacking any material US manufacturing presence. This creates a policy that's more about geopolitical punishment than economic restructuring.

TSMC has warned the administration that tariffs could actually undermine US chip manufacturing by raising costs for complementary components needed alongside advanced processors. The company argues that cutting-edge semiconductors require integration with various legacy chips to function properly.

The semiconductor industry has already announced over $600 billion in US projects since 2020, suggesting market forces and existing Biden-era incentives were already driving reshoring. Trump previously threatened to scrap the $52.7 billion CHIPS Act while claiming credit for TSMC's expansion plans.

This policy reveals the fundamental incoherence of Trump's trade strategy. By exempting every company that matters, the tariffs become theatrical rather than transformative. The administration essentially rewards firms for decisions they'd already made while creating uncertainty for the broader supply chain.

More problematic is the precedent this sets for industrial policy. Rather than creating consistent incentives for domestic production, Trump's approach amounts to deal-making with individual companies based on their ability to generate favorable headlines. This undermines predictable policy frameworks that businesses need for long-term investment decisions.

The real winners aren't American manufacturers but established multinationals capable of playing the exemption game. Small and medium-sized companies lacking the resources for massive US investments face the full tariff burden, potentially consolidating market power among existing giants.

Trump's chip tariffs exemplify policy-by-press-conference governance—maximizing political impact while minimizing economic substance.

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TALENT WARS

Microsoft's DeepMind raid exposes Silicon Valley's talent desperation

Mustafa Suleyman built DeepMind, sold it to Google, and now systematically dismantles his former creation. Microsoft's AI chief has recruited 24 DeepMind employees in six months, including Amar Subramanya, who spent 16 years building Google's Gemini before joining Microsoft as Corporate Vice President in July.

Suleyman personally calls recruits, selling Microsoft AI's 800-person operation as nimbler than DeepMind's 6,000-employee bureaucracy. His conquests include:

• Adam Sadovsky: Distinguished engineer with 18 years at Google

• Sonal Gupta: Engineering lead now working on Copilot integration

• Jonas Rothfuss: Research scientist who joined Microsoft AI in May

• Tim Frank: Product manager focused on consumer AI applications

Most strategically, Suleyman hired Marco Tagliasacchi and Zalán Borsos, the duo behind Google's "Audio Overviews" podcasting tool, to anchor Microsoft's new Zurich office. He also recruited Dominic King and Christopher Kelly to build Microsoft's AI health unit, which claims diagnostic accuracy four times better than human doctors.

Court documents reveal ChatGPT has 600 million monthly users versus Gemini's 400 million, making each defection strategically crucial. Microsoft laid off 9,000 employees while committing over $30 billion to AI infrastructure this quarter.

Three senators have called for antitrust scrutiny of these tactics. The irony: Suleyman was placed on administrative leave from DeepMind in 2019 for allegedly bullying employees before departing for Google, then Inflection, then Microsoft's $650 million "reverse acqui-hire."

In AI, intellectual property walks out the door with its creators.

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LLMs

Trump partners with Perplexity to implement AI search

Trump Media launched "Truth Search AI" on Truth Social Wednesday, powered by Perplexity — the same company accused of systematic content theft by Forbes, New York Times, and Wired.

"We're proud to partner with Perplexity to launch our public Beta testing," said CEO Devin Nunes, promising the feature would strengthen the "Patriot Economy." The search engine currently operates on Truth Social's web version, with mobile apps planned soon.

Perplexity's choice proves particularly ironic. Trump Media's stated mission involves "ending Big Tech's assault on free speech," yet Perplexity's investors include Jeff Bezos and Nvidia — quintessential Big Tech players. More damaging: Perplexity faces mounting accusations of stealing the very content Trump claims to protect.

Recent controversies include:

• Forbes accused Perplexity of plagiarizing its paywalled articles with minimal attribution

• Cloudflare documented systematic robots.txt violations, using stealth crawlers disguised as Chrome browsers

• Wired reported Perplexity plagiarized the very article criticizing its scraping practices

Perplexity launched a revenue-sharing program with select publishers in July after plagiarism backlash, but continues bypassing website blocks according to Cloudflare.

How does a platform claiming to fight content theft align with a company systematically accused of content theft? Trump's "Truth" search may deliver answers, but they'll likely be built on stolen foundations.

LINKS

• OpenAI-backed Chai raises $70m for AI-driven drug discovery

• US issues exemption for self-driving Zoox vehicles, closes probe

• Google Gemini adds AI tutoring, heating up the fight for student users

• Google’s AI coding agent Jules is now out of beta

• OpenAI offers ChatGPT for $1/year to US government workers

• Inside the US Government's unpublished report on AI safety

• OpenAI led a funding round for a startup that will put an AI agent inside Microsoft Excel

• Grok Imagine: Short animated video clips with spicy mode

• Lindy 3.0: Prompt‑to‑agent builder with cloud desktop

• Oss-GPT: OpenAI’s first release of two open-source models since 2019

• Gemini Storybook: Custom-illustrated 10‑page stories with narration

• Gladly: Senior AI Engineer 

• Weave: AI Engineer

• Glean: Account Based Marketing Manager

• Cohere: Product Manager, Human Data

GAMES

POLL RESULTS

Is OpenAI's open-weight release a masterstroke or mistake?

• Genius move — expands OpenAI's reach and sets standards (37%)

• Risky — invites misuse and empowers rivals (8%)

• Smart trade-off — freedom fuels innovation (26%)

• Doesn't matter — open-weight won’t replace APIs (12%)

• Too early to tell (17%)