All you need to know about Trump and his export license extortion racket

Here’s the way the mob used to run their protection rackets in Greenwich Village. A guy in a suit would show up at a laundry or a deli or a bodega. He’d say, nice little business you got here. It’d be a shame if something happened to it.

The next day, another guy in a suit would show up at the neighborhood businesses that had been visited the day before, and he’d say, you give me a small cut of your business, and I’ll protect you from the threats you’ve been getting.

How did the second guy know that the businesses had been threatened? Because the two guys in suits worked for the same boss, who could usually be found at a table in his “social club” at Sullivan and Third Streets. The boss was Vincent “The Chin” Gigante. He ran the South Village. If you wanted to do business in his neighborhood, you paid protection. In the bars, the mob, in the person of a representative from Cold Coin Industries, would show up and say, it’s terrible that your customers have to go down the street in the snow in the winter for a pack of cigarettes. We’ll be glad to put in a cigarette machine for you. If the bar owner turned down the offer, there would be a big fight at the bar a couple of nights later, and all the backbar bottles, the high-end liquor, would be broken, along with whatever mirrors and pictures that might be on the wall. The next time the guy showed up from Gold Coin Industries, the bar owner would be glad to accept the mob’s cigarette machine. Woe be unto the bar owner who took an advance from the Gold Coin guy to pay a bill for back payroll taxes. The guy in the suit would soon darken the bar’s door, and the owner would be paying a percentage of his take every week to the guy in the suit.

That’s what Trump is doing with Nvidia and Advance Micro Devices. He’s running a protection racket. It’s terrible you can’t get that license to export those AI chips to China. Must be terrible for business. How does 20 percent sound? Trump didn’t actually put it that way. At a press availability at the White House after visiting with Nvidia CEO Jensen Huang two days before, Trump told reporters exactly what he had said to Huang about exporting AI chips to China: “I said, If I’m going to do that, I want you to pay us as a country something because I’m giving you a release.”

Sounds like a man in a suit talking to a bodega owner in the ‘hood, doesn’t it?

Huang somehow found it within him to counter with an offer of 15 percent, which amazingly Trump accepted. Two days later, Nvidia was suddenly granted the export license they had been waiting for, the lack of which had cost them $2.3 billion in sales to China during the time they had been denied the necessary export license. “White House officials confirmed the deal also applied to AMD, which makes its own version of the AI chips, known in the industry as Graphics Processing Units,” the New York Times reported this week. The Times went on to report that “legal experts pointed out they appear to conflict with the U.S. Constitution, which explicitly bans government from taxing exports.”

Also on Monday, Trump met with Intel CEO Lip-Bu Tan, whose firing he had called for only days before. After the meeting, Trump suddenly and inexplicably changed his tune, telling reporters that their discussion had been “a very interesting one,” and praised the “success and rise” of the Intel chief as “an amazing story.” The suggested firing of Lip-Bu Tan was gone in a poof.

We’ll never find out what went on between Trump and Lip-Bu Tan during their meeting. At least we know the percentage Trump extorted from Nvidia and AMD, but that is where our knowledge ends. We have no idea how the percentage amounts with Nvidia and AMD will be calculated, how the payments will be made, or where the money will go. The most interesting and mysterious sentence in the Times report is this one: “The Commerce Department did not respond to questions about how the administration will collect payments or where those payments will go.”

There have been multiple statements from defense experts about the national security concerns of selling high-tech AI chips to China at a time when U.S. and Chinese warships are regularly facing off in the South China Sea, and China is known to be assisting Russia in its war of aggression against Ukraine.

All of that is potentially important to the security of our nation, but what’s really interesting is our inability to follow the money that will flow from these gigantic deals. Trump’s big bullshit bill loosened the already weak controls on the movement of cryptocurrency through U.S. and international markets. You want to talk about opaque? We have no vision into movement of payments when they are made in Bitcoin or other forms of cyber money. The fact that since Trump was inaugurated, he and his family have set up their own crypto exchange, through which cyber money is typically moved, gives us a hint at what could be going on behind the scenes of Trump’s in-the-clear extortion of payoffs from chip makers in return for export licenses to sell to China.

So far as I can tell, Trump set himself two goals when he set out to retake the White House: to make as much money as he possibly can from the presidency and to be awarded the Nobel Peace Prize.

We can only wonder what kind of protection racket he could be running in Oslo. I would say that we should watch the White House visitor logs for signs of Norwegian visitors, but then, Trump ordered that visitor logs will no longer be kept by his administration.

He has surrounded the White House with armed federal agents and National Guard soldiers, and we have no idea what is going on in there, just as we will have no idea what is said when he meets with Putin in Alaska tomorrow. I have read that lifting sanctions on Russian exports of rare metals will be on the table. You have to wonder what those percentages will be.