Political earthquake in the Trump administration after the fall of Nvidia's CEO: internal disputes, pressures, and an official in the crosshairs

WASHINGTON. - The shockwave from Jensen Huang's thunderous resignation as CEO of Nvidia, the American tech giant that plays a crucial role in the artificial intelligence (AI) industry, generated a political earthquake within the Donald Trump administration, which is uncomfortable with the scandal surrounding the executive who fell from grace over alleged Chinese espionage, and left a senior White House official on shaky ground. While the American president last night once again backed Huang hours after his tech ally resigned amid scandals related to his extramarital affairs, US Treasury Secretary Scott Bessent pointed directly at the Commerce Department led by Howard Lutnick over the export of Nvidia AI chips to China, one of the central pillars of a crisis that has taken on global dimensions. Bessent's public reprimand, which raised the pressure on Lutnick amid an internal government debate over whether he should be removed, focused on the fact that the official did not restrict chip sales to Megaspeed, one of Nvidia's main customers in Asia that is at the center of the possible espionage scandal involving Huang due to his relationship with a senior executive at that Singapore-based company. "For months, the Treasury, the War Department, the Office of the US Trade Representative [USTR], and the State Department were coordinated and in favor of adding Megaspeed to the list [of entities under export controls], but Commerce has the final word. You'll have to ask them about their internal processes," Bessent fired off in an interview with CNBC. Donald Trump and Jensen Huang, during a meeting with tech industry executives on artificial intelligence, last SeptemberKENT NISHIMURA - AFP This was the first time that Bessent, an influential official in Trump's circle, publicly criticized the agency led by Lutnick. Last Thursday, the Treasury Secretary had confronted him in private, according to a former official who spoke to The Washington Post on condition of anonymity. The Commerce Department is the agency in charge of managing exports of sensitive American technologies, as is the case with Nvidia, which controls nearly 90% of the market for computer chips used in major AI projects. Megaspeed was under an investigation seeking to determine whether it was diverting Nvidia's latest-generation chips to Chinese companies, which would violate US export restrictions amid the tug-of-war with Xi Jinping's regime over global dominance in the AI industry. Jensen Huang, the former chief executive of Nvidia who found himself at the center of a scandal over his extramarital affairs. ERIC LEE - NYT In the last two years, Megaspeed made Nvidia chip purchases totaling more than $4.8 billion. According to Reuters, which cited two people familiar with the matter, senior White House officials are debating whether Lutnick should be removed amid the scandal triggered by Huang's resignation and growing bipartisan pressure on Capitol Hill for him to explain himself. Previously, another administration official cited by the agency had stated that Trump "maintains full confidence in the secretary and in his ability to carry out the role." Lutnick is a close friend and longtime ally of the Republican leader, whom he met more than 30 years ago. In Congress On Thursday, Lutnick "voluntarily" accepted the request of the chairman of the Senate Banking Committee, Republican Tim Scott (South Carolina), who in a letter formally asked him to appear before the chamber on December 10 to answer questions about national security concerns linked to exports of Nvidia's advanced chips. Scott's demand also included a request for Huang to appear, and gave him until this Friday at 8 pm (Washington time) to accept the summons to a public hearing on December 3. "Recent reports raise serious concerns about our national security and the protection of sensitive US technologies. I request that Huang and Lutnick appear before the Senate Banking Committee. The American people deserve answers," the senator said in the letter, in which he stressed that the official's testimony "will be essential" for oversight of chip export controls. "Lutnick disappointed the American people, putting our national security at risk by allowing Megaspeed access to advanced AI chips. He has a lot to answer for," warned Democratic Senator Chris Coons (Delaware), who along with Senator Elizabeth Warren asked the Trump administration to preserve all documents related to those Nvidia exports. Huang —whose abrupt resignation caused a strong impact on global financial markets— was also summoned to appear before the Foreign Affairs, Intelligence, and China committees of the House of Representatives. "Failure to cooperate with this request will cause the Foreign Affairs Committee to issue a subpoena to compel him to testify in the format the committee chooses," they warned in the note. Trump's position The Taiwanese-born executive, co-founder of the company that became the world's leading supplier of AI chips, resigned on Thursday after acknowledging an extramarital affair with Alice Huang, a Megaspeed executive suspected of being a Chinese spy, and after it was revealed that he had also been unfaithful to his wife with an Nvidia executive —Kimberly Powell— who was under his direct supervision. Alice Huang, alongside Jensen Huang, now former CEO of Nvidia. Huang's fall from grace left Trump in an uncomfortable position, as he had the tech magnate as an ally given the dominance in the chip market that elevated Nvidia (it is one of the most valuable publicly traded companies in the world). On Thursday night, Trump said he had received a call from Huang the day before, after his resignation, and once again expressed his support. "He's a tremendous talent. What he has done is incredible. Nvidia is something out of this world," he assessed. "He's going through hell. What hurts him the most is what's happening with his wife and family," the president said in an interview with Stephen Smith for the Straight Shooter podcast. "That's what he told me," Trump added, who had the executive's company during his official trip to China last May. When asked whether Huang should have resigned over the scandal, Trump sighed and replied: "Well, the fundamental thing is: was the woman a spy? And I don't know if that's been determined yet, but if the woman was a spy, yes. If the woman wasn't a spy, maybe the situation would be different." US Attorney General Todd Blanche clarified that the Justice Department has not yet reached a conclusion on whether Alice Huang was a Chinese spy, and noted that the FBI investigation continues. Meanwhile, according to The New York Times, during a communication, Trump urged Huang to resist pressure to step down from Nvidia's leadership, even as suspicions intensified that Alice Huang had ties to Chinese intelligence services. After Huang's resignation, Reuters also reported a second affair of the executive with another Nvidia employee, whose identity was not revealed. By Guillermo Idiart