Why the US-China AI race needs Elon Musk

In June, following SpaceX’s listing, Musk became the world’s first trillionaire — a remarkable milestone, but one that crystallised two deeply uncomfortable realities for the future of AI. 

The first concerns the staggering concentration of wealth and influence among a handful of tech's uber-rich. Musk’s fortune is not just a personal achievement; it reflects the widening gap between those who shape the digital economy and everyone else. The second is even more consequential. The same small circle of immensely wealthy technology leaders is increasingly driving the development of artificial intelligence (AI). 

As AI reshapes economies, politics and daily life, its direction should not be determined by a privileged few without broader public accountability. Yet the ultimate fate of AI will not be decided in Silicon Valley alone. China’s technology sector is aggressively closing the frontier gap. Just two weeks ago, Moonshot AI’s rollout of the Kimi K3 model stunned global tech hubs by matching — or outperforming — premier American systems in raw coding and processing power.

AI contest could place dangerous tech in wrong hands

Predictably, this rapid catch-up has caused Washington to double down on zero-sum geopolitical framing. At a recent US congressional hearing, Senator Jim Banks warned that no competition matters more to America’s future than staying ahead of China. He said, “The nation that leads in AI will set the terms of the world’s economy and command the high ground in military power.”

This intensifying US-China rivalry introduces existential perils. One is the accelerating development of AI for military purposes, with the potential to inflict unprecedented destruction. More troubling, however, is the possibility that such American and Chinese technologies could fall into the hands of rogue states or non-state actors.

While public anxiety is frequently fixated on the hypothetical sci-fi threat of “rogue AI” turning on humanity, the far more pressing risk is fragmented, unregulated proliferation. If Washington and Beijing refuse to establish baseline guardrails, the structural breakdown of global AI safety becomes inevitable.

In May, following Trump’s visit to Beijing, the two countries agreed to hold talks on establishing guardrails for AI.  Yet Washington continues to send mixed signals. In June, House Foreign Affairs Committee chairman Brian Mast framed the US-China competition in starkly zero-sum terms, describing the US as the “superhero” and China as the “supervillain”.

Meanwhile, at the recent World AI Conference in Shanghai, President Xi argued that no single nation should monopolise AI and pledged that China would help Global South countries to bridge the AI divide.

US unsure of China as a competitor or partner for AI

As Beijing positions itself as a champion of international AI cooperation, the US remains caught between viewing China as a strategic competitor and recognising it as an indispensable partner in AI governance.

Compared to their strictly supervised Chinese counterparts, US tech giants wield extraordinary economic and political influence. Elon Musk’s Starlink, for example, has evolved into a global communications network with capabilities resembling those traditionally associated with nation-states.

Musk’s ambitions extend beyond the earth, with his vision of making humanity a multi-planetary species. Yet he is also a controversial political figure, presenting himself as a defender of Western civilisation and reportedly supporting right-wing movements in Europe.

He is not alone. Figures such as Peter Thiel and Alex Karp have fused ideology, statecraft and national security in their worldviews. This faction increasingly frames AI as central to competition with China and has pushed for a tougher US stance. 

Speaking at the Hudson Institute, Karp, the CEO of Palantir, laid the stakes bare: “There are only two cultures that are going to win... It’s going to be us or China.” He argued that unless the US remained “the dominant technological culture in the world,” the values Americans cherish would not endure. The growing influence of these hawkish tech tycoons grants them a powerful role in shaping not only technology, but also the geopolitical landscape of AI.

More voices like Musk’s may be needed

Not all US technology leaders, however, have adopted such a hardline view of China. Elon Musk has generally favoured pragmatic engagement over confrontation, arguing that cooperation is essential in areas of shared interest. At the same time, SpaceX has reportedly sought to exclude Chinese nationals and Chinese-made components from parts of its supply chain, reflecting growing national security concerns. Even so, Musk’s broader approach to China has remained one of engagement rather than confrontation. Consistent with that stance, he swiftly dismissed as “absurdly fake news” a report that Tesla executives had been instructed to prepare for a separation of the company’s China business ahead of a potential merger with SpaceX.

That may ultimately prove to be his greatest significance. As the risks associated with AI become increasingly intertwined with US-China relations, influential voices advocating engagement rather than decoupling could play an important stabilising role.

To be sure, Musk remains deeply polarising. His politics have alienated many, and his immense wealth raises legitimate concerns about the concentration of power in Big Tech. Yet his unique position also gives him unusual leverage. As the head of xAI and SpaceX, he commands influence in Washington, while Tesla’s vast manufacturing presence in Shanghai has given him rare access to China’s senior leadership. Few business leaders enjoy comparable credibility in both capitals.

In an era where formal diplomatic channels are paralysed by mutual suspicion, a trillionaire with skin in both games might be the only actor capable of convincing both superpowers that when it comes to rogue AI — and, more pressingly, rogue states — cooperation is not a weakness — it is a matter of mutual survival.

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