Imagine Google-founding era, except it was illegal for 1990's Stanford to research CS theory without a license, so they didn't. And later someone else founded it anyway, in a different country (which now became the world's preeminent tech center).
Let's put to a halt to these autoimmune attacks on our own civilization. This confusion that labels Western openness as a hazardous external substance.
For example, suppose the US makes it illegal to publicly distribute open weight models (maybe above a certain size) without a government license. What happens if someone sets up a website to distribute those models outside of US jurisdiction? It may well prosecute Americans it can demonstrate have uploaded models to that website, but will it also ban Americans from downloading from it? If you go back to the encryption export controls, the US banned encryption software from being exported from the US, but (unlike some other countries like France) it never tried to ban encryption software imports. And, it sounds like they are only thinking about banning public/"open" distribution, so once an institution downloads a model from outside the US, they may well be able to redistribute it internally without the ban applying.
Suppose the US bans distribution of open weight models above size N–how will that apply to fine-tunes? If you have LoRA on top of a model >N, but the LoRA itself is <N, does the ban apply to it? If the answer is "no", people in the US could still contribute to openly distributing improvements to models that they couldn't themselves openly distribute.