They don't have nearly enough compute to be competitive on pretraining and distillation is exponentially cheaper.
It's literally the same tactic they do in every industry. Steal top IP, gov funding, ban the company they stole from domestically while driving cost to zero, try to kill the original IP creators.
They are actively in the process of doing this with Tesla as we speak. And are in the phase of pushing them out domestically and trying to destroy tesla marketshare globally.
They have obvious skills and add a lot of value while doing this but US could stop all of this by simply stopping their supply.
AI providers like openAI or Anthropic are already on the hook for OFAC compliance, so if any terrorist group is proven to access their APIs they can face huge fines.
The same game played out in the crypto space. Local models like local wallets can't be regulated.
Accessing foreign services can't be controlled.
But regulated companies are fully liable for any use of their tools by terrorist organizations.
This is not about the citizens, it's about the companies protecting themselves.