Thursday, August 14, 2025

There’s a small problem with Trump’s export deal with Nvidia and AMD: The Constitution says it’s illegal

In today’s CEO Daily: Diane Brady on Nvidia and AMD’s export deal—which may be unconstitutional.
The big story: Trump meets Putin tomorrow, expectations are low.
The markets: Flat.
Plus: All the news and watercooler chat from Fortune.

Good morning. The U.S. government’s unprecedented 15% revenue-sharing agreement with Nvidia and AMD on Chinese chip sales could be coming to a company near you. U.S. Treasury Secretary Scott Bessent called it a “beta test” in a Bloomberg TV interview yesterday, adding, “we could see it in other industries over time.”

This comes at a time when new tariffs are bringing in enough money to slow the growth of America’s $37 trillion national debt, according to the Committee for a Responsible Federal Budget.

If, as Bessent argues, the White House chips deal passes muster because there are no national security concerns that necessitate export controls on these particular products, another issue remains: Article 1, Section 9, of the U.S. Constitution, otherwise known as “the export clause,” states plainly that “No Tax or Duty shall be laid on Articles exported from any State.”

When efforts to impose excise taxes have gone before the Supreme Court in the past, such as the United States v. IBM or the United States v. United States Shoe Corp., the Court ruled in favor of business. In the first instance, IBM successfully fought a tax on insurance for goods bound for export. In the second, the United States Shoe Corp. was spared a fee on exports going through U.S. ports.

In both instances, the Supreme Court cited the export clause as grounds to bar the government from collecting money on goods destined for sale abroad. But those decisions were rendered in 1996 and 1998, respectively. Today’s court could take a different stance, especially when it comes to the power of the Executive branch.

With Beijing and Washington weaponizing exports and policies around tariffs and export controls shifting on a daily basis, what’s next is unclear. I’m curious to get thoughts from business leaders on how the current policy environment is impacting their strategy for global growth. Send your thoughts to the email below and thanks for joining the conversation.

Contact CEO Daily via Diane Brady at diane.brady@fortune.com.

Top news

Trump warns Putin of “severe consequences” prior to Ukraine talks

The two leaders will meet in Alaska on Friday. Trump wants a ceasefire and warned Moscow of “very severe consequences” if he does not get one.

Putin has little to lose

Experts say the Russian leader will likely try to expand the talks by offering various trade deals to Trump and asking for sanctions to be lifted. Ukraine and Europe will not accept any kind of “swap” which results in Russia permanently occupying more Ukrainian territory, and Russia is unlikely to agree to retreat—making a ceasefire deal difficult. Some experts say Putin is skilled at manipulating Trump.

The president is unhappy with the media coverage so far

He posted on Truth Social: “Very unfair media is at work on my meeting with Putin. Constantly quoting fired losers and really dumb people like John Bolton, who just said that, even though the meeting is on American soil, ‘Putin has already won.’ What’s that all about? We are winning on EVERYTHING. … If I got Moscow and Leningrad free, as part of the deal with Russia, the Fake News would say that I made a bad deal!”

Bullish IPO soars

The crypto exchange’s stock popped 84% when it went public yesterday, and its stock was temporarily paused from trading. The expectation was for a rise of around 30%. The stock closed at $68, with a market cap of $10 billion.

Crypto is eating banks’ lending assets

Banks are rushing to offer stablecoins to consumers. Payments for those crypto tokens must be used to buy the bonds that keep the coins value pegged 1:1 with the dollar. That means deposited cash that would normally sit on the banks’ books and be available for loans is shrinking, the NY Times reports. “You don’t need a lot of deposit flight to really buckle the banks,” said Mike Cagney, head of the digital lender Figure.

AI search race

Perplexity rolled out its new Comet search engine to Pro users on Wednesday—here’s how it measures up against Google.

The benefits of AI keep not showing up

Companies are expected to spend $62 billion this year on AI, but 8 in 10 companies report “no significant bottom-line impact” from the new technology. In fact, 42% of companies dropped their AI efforts last year, according to S&P Global. The AI hype cycle may be entering “the trough of disillusionment,” the low point in the evolution of new tech that precedes a long, slow climb into actual productivity, according to research firm Gartner.

Goldman Sachs doubles down on tariff research

On Wednesday, Goldman Sachs economist David Mericle doubled down on the bank’s research that American consumers will bear the majority of tariff-related costs, following criticism of the bank from President Trump. “If the most recent tariffs, like the April tariff, follow the same pattern that we’ve seen with those earliest February tariffs, then eventually, by the fall, we estimate that consumers would bear about two-thirds of the cost,” Mericle explained to CNBC’s Squawk on the Street.