China’s AI models have Trump’s AI world at war with itself

This story originally appeared in The Algorithm, our weekly newsletter on AI. To get stories like this in your inbox first, sign up here . Over the weekend, several current and former advisors to President Donald Trump on AI publicly lobbed insults at the country’s leading AI companies. David Sacks, the president’s AI and crypto “czar” until March, branded Anthropic’s models as “lobotomized” and “woke.” Emil Michael, a top Pentagon official, called OpenAI’s new head of strategic futures a “supreme village idiot.” It began because no one can agree on what to do about Kimi, a free, open source model that Chinese AI company Moonshot launched last week. It appears to rival the intelligence of models from OpenAI and Anthropic, which are very much not free. Kimi and other Chinese models like it pose a real problem for Trump. And they’re dividing the top AI strategists in his orbit into factions. Every time a new smart, free model from China like Kimi gets released, US companies see less reason to fork out money to access models from Anthropic or OpenAI. Given that enthusiasm for these and other AI companies is driving an outsized share of economic growth, China’s AI models create both economic and political problems for the president. They are “a threat for an administration that really doesn’t want more economic bad news,” Anton Leicht, a fellow at the Carnegie Endowment, wrote on X. They’ve already rattled US stocks . What is Trump to do? First, consider that this is all happening just a week after New York imposed the country’s first state ban on new data centers. There is growing distrust of AI companies, and I imagine a not-insignificant share of Americans would have little sympathy for OpenAI or Anthropic as they fend off cheaper competitors, and would say it’s not the government’s job to protect their interests. On this point, they’d see a sliver of agreement (and really just a sliver) with David Sacks, who on July 19 criticized top AI companies that “want the gove