Trump is dismissing another affair scandal – there may be a $4.5trn reason why

An affair with a suspected Chinese intelligence asset would be enough to destabilise most chief executives. When the executive is Jensen Huang, founder of the $4.5trn (£3.6trn) company powering the global AI boom, Donald Trump is on hand with a reference: Huang is a “fine person” and an “honourable guy” who has done “an amazing job for our country”. Nvidia is investigating whether its CEO was targeted by Beijing, after he admitted to having an extramarital affair with Chinese businesswoman Alice Huang (no relation). Congressional Republicans want answers. Alice was formerly an executive at Megaspeed International, a Nvidia customer scrutinised by US authorities over suspicions that it helped China obtain advanced AI processors subject to export restrictions. US intelligence reportedly believes she was gathering information for Beijing, although China denies the allegation. There is no public evidence that Huang knew she was allegedly working for China, assisted an intelligence operation or disclosed sensitive information, and Nvidia says it has no reason to believe that secrets or US national security were compromised. Independent directors and outside lawyers will now determine whether the relationship created a security vulnerability and whether any information was obtained. Against that uncertain backdrop, Trump’s confidence in Huang is notable. He was reportedly briefed about the concerns roughly a year ago and chose not to act. When asked whether he regretted that decision, he said Huang probably had an explanation, should remain chief executive and could still accompany him to Asia. “He dealt with somebody, but, you know, so does everybody else,” Trump said. Jensen Huang is an influential adviser whose priorities are closely connected to Trump’s ambition for American AI dominance (Photo: Evan Vucci/Reuters) Read one way, it was a “boys will be boys” defence that reduced an alleged foreign intelligence operation to a successful man’s private indiscretion. Read another, Trump was refusing to join a rush to judgement against somebody who has not been accused of knowingly betraying his company or country – protecting Huang from premature condemnation. Either way, the economic implications are crucial for Trump. Nvidia’s processors underpin much of the AI industry, and Huang has been the company’s public face and principal strategist since co-founding it in 1993. Analysts say he has no obvious successor, and former Pimco chief executive Mohamed el-Erian described Nvidia as “systemically important for tech, markets and the economy”. Wall Street’s initial reaction illustrated the risk: Nvidia shares traded around 5 per cent lower shortly after Monday’s opening bell, briefly wiping roughly $220bn (£149bn) from its market value even as the wider US market strengthened. Trump appeared conscious of that vulnerability in the speed with which he moved from defending Huang to discussing the stock market. Whether this was deliberate or not, his intervention reassured investors that the White House does not want a leadership crisis at Nvidia. Huang is not simply a businessman whom Trump admires from afar. The President appointed him to the Council of Advisers on Science and Technology, travelled with him to China and accepted his argument that Nvidia should be allowed to sell some advanced processors there. Huang is an influential adviser whose priorities are closely connected to Trump’s ambition for American AI dominance. Defending him protects a political relationship, the stability of a strategically important company and a central part of the administration’s technology agenda. Alice Huang, right, a former executive at Megaspeed, is suspected of gathering information for Beijing (Photo: AFP) Personal loyalty and national economic interest point Trump in the same direction. His readiness to vouch for Huang also has precedent. Trump described former Fox News figures Bill O’Reilly and Roger Ailes as good people when they faced accusations of sexual misconduct, which they denied, and called Brett Kavanaugh an outstanding man during his Supreme Court confirmation battle. While the cases differ, Trump often responds to allegations against powerful male allies by invoking their careers and his assessment of their character. For Trump, professional success may be evidence that somebody deserves the benefit of the doubt. For critics, it appears to become a shield. Members of Trump’s party are proceeding with caution. Three Republican committee chairs have requested a closed-door briefing about the allegations and Nvidia’s protections against foreign espionage, recognising that the questions extend beyond a billionaire’s marriage to technology Washington has spent years trying to keep out of China’s hands. Huang may ultimately be cleared of any security failure. If he is, Trump will be able to say his instincts were right. If the inquiry discovers that sensitive information was compromised, his early reassurance will be harder to defend. For now, the response may reveal less about Huang’s guilt or innocence than about how Trump makes such judgements, combining personal trust, proven usefulness and the probable cost of bringing a powerful man down. With Huang, all three are unusually potent, which is why it remains difficult to tell where indulgence ends and economic calculation begins.