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US Divided on Responding to China's AI Models
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US Divided on Responding to China's AI Models

The Trump administration finds itself divided on how to tackle China’s rise in AI technology. Senior officials are pushing for stringent measures against Chinese labs using US models to train their own, a practice known as distillation. However, the Commerce Department argues that such restrictions would be difficult to enforce. The debate centers around Anthropic's allegations of a significant distillation attack and Moonshot's Kimi K3 model developed by distilling Claude Fable 5. Treasury Secretary has labeled this activity as IP theft and hinted at potential sanctions. This internal conflict highlights the growing policy challenges surrounding AI, especially with the emergence of open weight models from China that lack safeguards against hacking government systems.

Jul 22, 2026 · 3 min read
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