Whatever else can be said about the second Trump administration, it is always teaching me about parts of the Constitution I had forgotten were even in there.

Case in point: Article I, Section 9, Clause 5 states that “No Tax or Duty shall be laid on Articles exported from any State.” This is known as the export clause, not to be confused with the import-export clause (Article I, Section 10, Clause 2). The Supreme Court has repeatedly held, most recently in 1996’s US v. IBM, that this clause bans Congress and the states from imposing taxes on goods exported from one state to another or from the US to foreign countries.

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I found myself reading US v. IBM after President Donald Trump announced an innovative new deal with chipmakers Nvidia and AMD. They can now export certain previously restricted chips to China but have to pay a 15 percent tax to the federal government on the proceeds. Now, I’m not a lawyer, but several people who are lawyers, like former National Security Council official Peter Harrell, immediately interpreted this as a clearly unconstitutional export tax (and as illegal under the 2018 Export Control Reform Act, to boot).

At this point, there’s something kind of sad and impotent about complaining that something Trump is doing is illegal and unconstitutional. It feels like yelling at the refs that the Harlem Globetrotters aren’t playing fair; of course they aren’t, no one cares. The refs are unlikely to step in here, either. The parties with the standing to sue and block the export taxes are Nvidia and AMD, and they’ve already agreed to go along with it.

Maybe the best we can do is understand why this happened and what it means for the future of AI.

A brief history of the 2025 chip war

While AMD is included in the deal, for all practical purposes, the AI chips in question are being made by Nvidia — and the main one in question is the H20.

As I explained last month, the H20 is entirely the product of US export controls........

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