Everyone is playing hardball. No one wants to be IBM in an IBM-Microsoft dance.
But this is kind of like banning GPU exports to China. It will encourage them to develop their own technology. Yes, it will take them longer, but in the long-run China will be more successful with their own GPU tech.
So now you know why Trump is called "川建国 (Chuan Jianguo)" in China — literally "Trump who builds China" — because he really is building China and making it better (just kidding).
ITAR: SpaceX is strictly barred by US federal law from hiring non-US persons for aerospace engineering.
National Security Scrutiny: xAI operates under increasing US export and tech-transfer controls regarding China.
Scale: A private company's recruiting budget cannot compete with the sovereign industrial capacity and state-backed talent pipeline of an entire nation.
But this is kind of like banning GPU exports to China. It will encourage them to develop their own technology. Yes, it will take them longer, but in the long-run China will be more successful with their own GPU tech.
The same could be true of SpaceX/xAI