President Donald Trump was slammed by The Washington Post editorial board on Monday afternoon over his new deal that orders chipmaker Nvidia to pay 15 percent of its revenue from exports to China.
"The deal that Nvidia CEO Jensen Huang hammered out with President Donald Trump in the Oval Office Wednesday might be good for his shareholders," wrote the board. "But it’s bad for America."
Aside from the fact that this scheme is completely unconstitutional under the Exports Clause, it's a deal that sets a disturbing precedent, the board argued.
"It’s not intrinsically bad that Trump wants to collect more revenue, at a time when the government is spending so much more than it takes in. But this doesn’t seem to be his main motive for making Nvidia and AMD pay for their export licenses," they wrote. The bigger issue is that "The reason the U.S. government previously blocked chip exports to China was national security. Obviously, drawing a few extra billion dollars of tax revenue from chip makers does not mitigate the risks of transferring advanced technology. Trump only undermines international trust that the United States will hold firm when it imposes export controls."
What this means, the board continued, is that "Trump’s side deal is best viewed as inappropriate state intervention in the U.S. economy."
"Word has gone out that CEOs can kiss the president’s ring by offering to give him something he wants and in return be exempted from whatever policy threatens to damage their business," the board said. "In this way, companies deepen their dependence on government and on Trump personally."
In other words, it's yet another situation in which Trump is forcing private companies to bend to his will — much like the long string of settlements he forced with media companies over stories he didn't like.
"Government has never been good at allocating private capital or picking winners and losers in the marketplace," the board concluded. "Even trying to do so makes companies overly dependent on the White House. And it makes the U.S. economy less vibrant."