United States of Palantir: Peter Thiel’s Baby is Exploding Under Trump

Since President Trump’s return to power in January, Elon Musk has perhaps been the one “tech bro” outsider most synonymous with the second iteration of the administration—at least before their very public falling out over the Big Beautiful Bill in recent weeks, which Musk has dubbed an “abomination.”

Despite the deluge of headlines and X posts generated by Musk in the first few months of the new administration, another entity has been even more ubiquitous than the Tesla founder and could prove the most consequential of the organizations closely associated with the White House when all is said and done: Palantir.

The data-mining giant famously shares its name with the mythical all-seeing stones from fantasy writer J.R.R. Tolkien’s Middle Earth. And whether intended or not, the Elvish interpretation of “palantír”—“Seeing Stones”—has provided the Denver-based firm not just with an interesting origin story, but a fitting metaphor as it becomes increasingly embedded inside government systems.

Co-founded by Peter Thiel and Alexander Karp, Palantir received $2 million in funding in 2005 from venture capital firm In-Q-Tel, widely regarded as the CIA’s investment arm. It now has a market cap of around $328 billion.

While Palantir’s data analytics and AI tools are now deployed across the federal government—and even in local cities for so-called “predictive policing” efforts—it has yet to earn the distinction of being the biggest government contractor (Lockheed Martin holds that title). However, it may well find its way to the top of the list, given that data analytics has become a goldmine both domestically and as a tool of war.

As The Guardian ominously put it: “Using the most sophisticated data mining, Palantir can predict the future, seconds or years before it happens.”

From CIA-Funded Startup to Wall Street Giant

As news emerged earlier this year of Palantir’s role in Trump’s plan to streamline American citizens’ data across federal agencies, the company’s government contracts have come into sharper focus. The New York Times reported that the firm has received more than $113 million in federal government funding since Trump returned to office.

But its influence predates the Trump administration, earning contracts with seemingly the entire alphabet soup of government agencies: the CIA, NSA, FBI, CDC, ICE, IRS, HHS. It has also profited handsomely from the U.S. military-industrial complex, where its Maven software is deployed across the Army, Navy, Air Force, Marines, and Space Force.

And there’s reportedly much more to come.

As Trump’s so-called Big Beautiful Bill—a massive transfer of wealth to the richest among us—wound its way through the legislative process, Reuters reported that Palantir was among the “frontrunners” to win the bid for a domestic missile defense system, in partnership with Musk’s SpaceX and Anduril, a drone company. The bill, passed by Congress and signed into law by Trump last week, provided $25 billion toward the project, which is estimated to cost $175 billion.

The Big Beautiful Windfall

The BBB provides yet more opportunities for Palantir to cash in.

Page 118 of the law has Palantir’s name written all over it:

• “$145,000,000 for the development of artificial intelligence to enable one-way attack unmanned aerial systems and naval systems”
• “$250,000,000 for the development of the Test Resource Management Center digital test environment”
• “$250,000,000 for the advancement of the artificial intelligence ecosystem”
• “$250,000,000 for the expansion of Cyber Command artificial intelligence lines of effort”
• “$1,000,000,000 for the expansion of programs to accelerate the procurement and fielding of innovative technologies”

And there are the line items related to border security, which include more than $6 billion for “new non-intrusive inspection equipment and associated civil works, including artificial intelligence, machine learning, and other innovative technologies, as well as other mission support, to combat the entry or exit of illicit narcotics at ports of entry and along the southwest, northern, and maritime borders.”

The company’s rise has sparked a wave of criticism from across the political spectrum, especially among civil liberties advocates and anti-war voices. Palantir has pushed back amid concerns over its systems being used across government agencies, claiming it doesn’t engage in surveillance of Americans.

In one notable exchange, the podcaster Theo Von shared his concerns about Palantir’s role with Vice President J.D. Vance, who counts Thiel as one of his biggest donors (and also happens to be a “big ‘Lord of the Rings’ guy”), during a recent interview. In a separate episode featuring Rep. Ro Khanna, one of the few progressives willing to appear on right-leaning media platforms, Von expressed skepticism of Palantir’s rare public pushback: “If they have an overall database, they’re going to know everything.”

In response, Khanna criticized how Palantir’s sweeping government data analytics program could be leveraged, using a hypothetical scenario of a comedian’s uneven earnings, which he said the algorithm may interpret as someone engaging in tax evasion: “We don’t know with Palantir what their algorithm is targeting. Are they targeting ordinary people who have incomes that are variable? Or are they targeting the billionaires who are evading taxes? It’s just a black box. We don’t know what data of your friends or my friends is being collected.”

Many of Khanna’s colleagues, including Sen. Ron Wyden, a Democrat from Oregon, and Rep. Alexandria Ocasio-Cortez, signed a letter calling for greater transparency over Palantir’s domestic program:

“The unprecedented possibility of a searchable, ‘mega-database’ of tax returns and other data that will potentially be shared with or accessed by other federal agencies is a surveillance nightmare that raises a host of legal concerns, not least that it will make it significantly easier for Donald Trump’s Administration to spy on and target his growing list of enemies and other Americans,” it reads.

‘The Scouring of the Shire’: Insiders Sound the Alarm

Even former Palantir employees have spoken out in recent months, with 13 of them putting their names to a letter poignantly titled “The Scouring of the Shire,” in which they criticized the company for “normalizing authoritarianism.”

“Palantir Technologies’ platform grants immense power to its users, helping control the data, decisions, and outcomes that determine the future of governments, businesses, and institutions—and by extension, all of us,” the former employees wrote. “Early Palantirians understood the ethical weight of building these technologies. A Code of Conduct was crafted to uphold democracy, preserve the spirit of free scientific inquiry, and ensure responsible AI development. Guardrails were set to prevent discrimination, disinformation, and abuses of power. These principles have now been violated, and are rapidly being dismantled at Palantir Technologies and across Silicon Valley.”

“Big Tech, including Palantir, is increasingly complicit, normalizing authoritarianism under the guise of a ‘revolution’ led by oligarchs,” they added. “We must resist this trend.”

Notably, Palantir’s technology, including a relatively new AI system, has also been used by Israel amid its genocide in Gaza—a partnership that began with great fanfare in the early months of the siege in Gaza, and around the time that the International Court of Justice began hearing South Africa’s genocide case against Israel.

“Both parties have mutually agreed to harness Palantir’s advanced technology in support of war-related missions,” Palantir Executive Vice President Josh Harris told Bloomberg. “This strategic partnership aims to significantly aid the Israeli Ministry of Defense in addressing the current situation in Israel.”

While millions of Americans have just started grappling with how the BBB will impact their lives—from the loss of healthcare and elimination of social programs to other negative ramifications—firms like Palantir are in line for a massive taxpayer-funded boon. Just as it predicted, perhaps.

Image Source

• Voice of America, Public domain, via Wikimedia Commons. Changes were made.