I don't understand the point being made
"Google Translate will prevent wars by enabling cultural understanding.
But machine translation isn't a cultural exchange, only able to convey the most-basic of meanings even when it works."
1) The way you describe it, Schmidt doesn't seem to have said that Google Translate is cultural exchange, just that it enables it. You seem to be making a point of contradicting a point that hasn't been made.
2) Is there a missing word or words between "exchange" and "only"? The first half of the sentence doesn't seem to flow into the second.
Or have I totally misunderstood?