Who Controls AI?

**Nathaniel Whittemore** (0:00)
Today on the AI Daily Brief, we are discussing a question that is extremely easy to ask and much more difficult to answer. Who controls AI? The AI Daily Brief is a daily podcast and video about the most important news and discussions in AI.
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Door to door, it ended up being about 55 hours, and that didn't include the 7 hours that it took me to go drop off the rental car and pick up our old car, which was sitting at the airport parking lot. In any case, because of that, I had to miss Wednesday's show, not something that I do very lightly. And so as a makeup, I had slated to do an extra show over the weekend on the day that I'm usually off. As it turns out, this was a pretty opportune week to have that slot open, because my goodness, as Ron Burgundy would say, boy, that escalated quickly. I'm referring, of course, to the skirmish-turned-all-out war between Anthropic and the Pentagon that came to a crescendo and ahead on Friday night. The TLDR of what happened is that not only did the Trump administration decide to decline to work with Anthropic, they are attacking them in ways that go far beyond just declining to do business with them. Now for the necessary background and to get caught up with the story from where we left it, we actually have to go back to Thursday when Anthropic CEO Dario Amodei released a statement about the dispute. Earlier in the week, you'll remember, Defense Secretary Pete Hegseth had given Amodei an ultimatum, remove terms of use limits by Friday or be blacklisted from the entire military supply chain. Anthropic's red lines were that CLAWD should not be used for domestic surveillance of Americans or for powering autonomous weapons. Their stated view was that CLAWD is not reliable enough to power autonomous weaponry and that AI surveillance is undemocratic and, perhaps more pertinently, has underdeveloped legal safeguards. The White House's position, meanwhile, was that a technology company should not be dictating how the US government uses that technology and should be fine accepting terminology that allows the US government to use it for all legal uses. Dario's post from Thursday begins, I believe deeply in the existential importance of using AI to defend the United States and other democracies and to defeat our autocratic adversaries. And it is worth noting here, especially if and as this conversation gets caught up in broader partisan talking points, historically speaking, Anthropic has been more vocal about things like China not having access to advanced technology than some of their peers. Whereas some of the other AI companies have been either fine with or actively lobbying for the ability to sell into China, think specifically around NVIDIA and advanced chips, Amodei and Anthropic have been consistent that they think that is a very, very bad idea. Point being, at least based on the history, Anthropic is not a pacifist organization. Now in the blog post, Amodei continued, Anthropic understands that the Department of War, not private companies, make military decisions. We've never raised objections to particular military operations, nor attempted to limit use of our technology in an ad hoc manner. However, in a narrow set of cases, we believe AI can undermine rather than defend democratic values. Some uses are also simply outside the bounds of what today's technology can safely and reliably do. Two such use cases have never been included in our contracts with the Department of War, and we believe they should not be included now. He then restates Anthropic's objections to mass domestic surveillance and fully autonomous weapons. Now, when it comes to those exceptions, he says, To our knowledge, those two exceptions have not been a barrier to accelerating the adoption and use of our models within our armed forces to date. Then, in one of the spicier sections, he writes, The Department of War has stated they will only contract with AI companies who accede to any lawful use and remove safeguards in the cases mentioned above. They have threatened to remove us from their systems if we maintain these safeguards. They have also threatened to designate us as a supply chain risk, a label reserved for US adversaries never before applied to an American company, and to invoke the Defense Production Act to force the safeguards removal. These latter two threats are inherently contradictory. One label says has a security risk, the other labels clawed as essential to national security. Regardless, he says, these threats do not change our position. We cannot in good conscience accede to their request. Now, it is very clear that this public statement did not make Anthropic any friends in the White House. Assistant to the Secretary of War for Public Affairs, Sean Parnell, was diplomatic but clear, The Department of War has no interest in using AI to conduct mass surveillance of Americans, which is illegal. Nor do we want to use AI to develop autonomous weapons that operate without human involvement. This narrative is fake and being peddled by leftists in the media. Here's what we are asking. Allow the Pentagon to use Anthropic's model for all lawful purposes. This is a simple, common-sense request that will prevent Anthropic from jeopardizing critical military operations and potentially putting our warfighters at risk. We will not let any company dictate the terms regarding how we make operational decisions. They have until 5 o 1 p.m. on Friday to decide. Otherwise, we will terminate our partnership with Anthropic and deem them a supply chain risk for the Department of War. Former Uber official and Undersecretary of War for Research and Engineering, Emile Michael, was not so diplomatic. He wrote, It's a shame that Dario Amodei is a liar and has a god complex. He wants nothing more than to try to personally control the US military and is okay putting our nation's safety at risk. The Department of War will always adhere to the law, but not bend to whims for any one for-profit tech company. Now, coming into Friday, it seemed like the Court of Public Opinion was sort of leaning in Anthropics' favor. More than 200 Google and OpenAI staff signed a petition that supported Anthropics' red lines, which you can find at notdivided.org, and you even saw a bunch of comments like this one on that post from Sean Parnell. Hi Sean, just FYI, nobody believes this and it comes off as ingenuine. I'm generally a conservative leaning voter. I'm also pretty tech-forward. I am wildly against this. Reminder that the entire tech lobby flipped on Biden for the exact same reason in May 2024 So that's where we were heading into Friday morning. Now outside of the substance of the argument, it was pretty weird to a lot of folks that it was being had so publicly. As quoted by Axios Senator Tom Tillis said, Why the hell are we having this discussion in public? Why isn't this occurring in a boardroom or in the secretary's office? I mean, this is sophomoric. So that's where we were heading into Friday morning. In the morning, it seemed like at least OpenAI was lining up alongside their AI peers, or at least, as CNBC put it, trying to help de-escalate the situation. Late on Thursday night, in a memo to his team, OpenAI CEO Sam Altman said, We have long believed that AI should not be used for mass surveillance or autonomous lethal weapons and that humans should remain in the loop for high stakes automated decisions. These are our main red lines. In an interview on Friday morning with CNBC, Altman said, For all the differences I have with Anthropic, I mostly trust them as a company, and I think they really do care about safety, and I've been happy that they've been supporting our warfighters. I'm not sure where this is going to go. And while a lot of folks on social media were excited that Altman seemed to be lining up alongside Anthropic, OpenAI was clearly having conversations with the DoD at the same time. He indeed said explicitly in that memo that they were exploring whether they could deploy their models in classified environments in a way that, in his words, fit with their principles. That was the state of things until 3.47 in the afternoon Eastern time, when President Trump took to Truth Social to write, in all caps, The United States of America will never allow a radical left woke company to dictate how our great military fights and wins wars. That decision belongs to your Commander-in-Chief and the tremendous leaders I appoint to run our military. The left-wing nutjobs at Anthropic have made a disastrous mistake trying to strong-arm the Department of War and force them to obey their terms of service instead of our Constitution. Their selfishness is putting American lives at risk, our troops in danger, and our national security in jeopardy. Therefore, I am directing every federal agency in the United States government to immediately cease all use of Anthropic's technology. We don't need it, we don't want it, and we will not do business with them again. There will be a six-month phaseout period for agencies like the Department of War who are using Anthropic's products at various levels. Anthropic better get their act together and be helpful during this phaseout period, or I will use the full power of the presidency to make them comply, with major civil and criminal consequences to follow. We will decide the fate of our country, not some out-of-control radical left AI company run by people who have no idea what the real world is all about. Thank you for your attention to this matter. Make America great again. Defense Secretary or a Secretary of War or whatever the heck you want to call him at this point, like Pete Hegseth chimed in. This week, Anthropic delivered a master class in arrogance and betrayal, as well as a textbook case on how not to do business with the United States government or the Pentagon. Our position is never wavered and will never waver. The Department of War must have full, unrestricted access to Anthropic's models for every lawful purpose in defense of the Republic. Instead, Anthropic and its CEO Dario Amodei have chosen duplicity. Cloaked in the sanctimonious rhetoric of effective altruism, they have attempted to strong-arm the United States military into submission, a cowardly act of corporate virtue signaling that places Silicon Valley ideology above American lives. The terms of service of Anthropic's defective altruism will never outweigh the safety, the readiness or the lives of American troops on the battlefield. Their true objective is unmistakable, to seize veto power over the operational decisions of the United States military. That is unacceptable. As President Trump stated on Truth Social, the Commander-in-Chief and the American people alone will determine the destiny of our armed forces, not unelected tech executives. Anthropic's stance is fundamentally incompatible with American principles. Their relationship with the United States Armed Forces and the Federal Government has therefore been permanently altered. In conjunction with the President's directive for the Federal Government to cease all use of Anthropic's technology, I am directing the Department of War to designate Anthropic a supply chain risk to national security. Effective immediately, no contractor, supplier, or partner that does business with the United States military may conduct any commercial activity with Anthropic. Anthropic will continue to provide the Department of War its services for a period of no more than six months to allow for a seamless transition to a better and more patriotic service. America's warfighters will never be held hostage by the ideological whims of big tech. This decision is final. Immediately the lawyers jumped in to start figuring out what the heck the implications of all this were. Senior research fellow Charlie Bullock wrote, Hegseth claims that this declaration that no Pentagon contractor or supplier can do business with Anthropic is effective immediately, which seems absolutely insane. Under 10 USC 3252, which is almost certainly the authority Hegseth has to rely on here, there are multiple requirements that DOW has to fulfill before the SCR declaration becomes effective. They have to complete a risk assessment, they have to make a written determination that declaring Anthropica supply chain risk is necessary for national security, and that there's no less intrusive way to address the risk, and they have to notify Congress. It's possible the DOW has already done some of that behind the scenes, quick work if so, but it's hard to believe that they fulfilled e.g. the Congressional Notice requirement in the time between 5 p.m. Eastern and Hegseth tweeting. In all likelihood, it's just not true that the declaration is effective immediately as Hegseth claims. Prinz writes, To put a finer point on what just happened, Hegseth Post says that no contractor, supplier, or partner that does business with the United States military may conduct any commercial activity with Anthropic. Anthropic serves its models through the cloud. Its primary partner is AWS, but it also serves its models through Google Cloud and Azure. All of Amazon, Microsoft, and Google do business with the US military. If we take Hegseth Post literally, Anthropic should now find itself unable to serve its models via any of these providers. This is what Dan Primack from Axios wanted to know as well. He tweeted, Practically speaking, does this mean Amazon, NVIDIA, etc. can't do any business with DoD? What about Palantir? Dean Ball, who to be clear was integral in writing Trump's policy on AI, wrote, NVIDIA, Amazon, Google will all have to divest from Anthropic if Hegseth gets his way. This is simply attempted corporate murder. I could not possibly recommend investing in American AI to any investor. I could not possibly recommend starting an AI company in the United States. A little bit after that, Anthropic dropped a response statement that mostly sought to assure customers that they could just chill for now. They noted that so far all of their information is coming from the same sources all our information, which is social media. Anthropic writes, We have not yet received direct communication from the Department of War or the White House on the status of our negotiations. They of course promised to challenge any supply chain risk designation in court. The business section was titled What This Means for Our Customers, in which they write, Secretary Hegseth has implied this designation would restrict anyone who does business with the military from doing business with Anthropic. Legally, a supply chain risk designation can only extend to the use of Claude as part of Department of War contracts. It cannot affect how contractors use Claude to serve other customers. In practice, this means if you are an individual customer or hold a commercial contract with Anthropic, your access to Claude through our API, Claude AI or any of our products is completely unaffected. If you are a Department of War contractor, this designation, if formally adopted, would only affect your use of Claude on Department of War contract work. Your use for any other purpose is unaffected. Now, unfortunately, I'm sure Anthropic knows, as anyone who has studied either of the operation choke points over the last decade, that when it comes to government's exerting pressure on private sector companies to not work with other private sector companies, you need as a little push in an implication for those companies to ditch the offending vendor. A few minutes later, and by the way, this is all happening within the span of an hour or two. Fortune magazine Sharon Goldman wrote, Sam Altman told OpenAI employees at an all hands meeting on Friday afternoon that a potential agreement is emerging with the Department of War or to use the startups' AI models and tools according to a source present at the meeting and a summary of the meeting seen by Fortune. The contract has not yet been signed. According to Goldman, Altman said the government is willing to let OpenAI build their own safety stack, that is the layered system of technical policy and human controls that sit between a powerful AI model and real world use, and that if the model refuses to do a task, then the government would not force OpenAI to make it do that task. A few hours later, Sam Altman confirmed that a deal had gotten done. He tweeted, We reached an agreement with the Department of War to deploy our models in their classified network. In all of our interactions, the DOW displayed a deep respect for safety and a desire to partner to achieve the best possible outcome. AI safety and wide distribution of benefits are the core of our mission. Two of our most important safety principles are prohibitions on domestic mass surveillance and human responsibility for the use of force, including for autonomous weapon systems. The DOW agrees with these principles, reflects them in law and policy, and we put them into our agreement. We will also build technical safeguards to ensure our models behave as they should, which the DOW also wanted. We will deploy forward deployed engineers to help with our models and to ensure their safety, we will deploy on cloud networks only. We are asking the DOW to offer these same terms to all AI companies, which in our opinion we think everyone should be willing to accept. We have expressed our strong desire to see things de-escalate away from legal and governmental actions and towards reasonable agreements. We remain committed to serve all of humanity as best we can. The world is a complicated, messy, and sometimes dangerous place.