Editor's note: In recent years, the military industry structure of the United States is quietly changing - with the financial support of the U.S. Department of Defense Advanced Research Projects Agency (DARPA), the U.S. Central Intelligence Agency (CIA) and other departments, a group of "new military industry" companies that were originally positioned as technology startups are breaking the pattern of traditional military giants such as Thor Technology and Lockheed Martin monopolizing the U.S. military orders. Representatives of these "new military-industrial" companies include Palantir, Anduril Industries, an intelligent border defense system company, and Musk's Space Exploration Technology (SpaceX), head of the US Department of Government Efficiency, etc. They are also called "defense unicorns." While these companies continue to earn profits from US military orders, they are also building a huge network of relationships through the military, government and business "revolving doors" to ensure that government orders can be continuously obtained for many years in the future, so as to penetrate deeper into the US government system.

  "Half of the revenue comes from government contracts"

  In the past, retired U.S. military officers and senior Pentagon officials often turned to traditional large weapons manufacturers such as Lockheed Martin and Boeing, according to the New York Times. In recent years, a new way of playing "revolving doors" is worth paying attention to - officials have transformed into venture capitalists, and the venture capital companies they are heading to have injected billions of dollars into Silicon Valley's "new military" startups and are pushing the government to invest more money. According to reports, this trend means that a new "revolving door" connecting the US Department of Defense and military contracting business has taken shape. As venture capitalists, these former officials make profits in part from the success of their support startups, earning profitable military contracts, or pushing startups to go public, thus bringing greater benefits to early-stage investors.

  Palantiel Company is a typical representative of the above-mentioned "new military industry" enterprises. The company currently mainly provides intelligence and defense tools for the U.S. Department of Defense and intelligence services. It was founded in 2003 by Peter Thiel, founder of Paypal, and others. Co-founder Alex Karp is the company's current CEO.

  An investigation report released by the US "Technology Transparency Project" (TTP) in February disclosed that Palantier has close ties with many key figures in this U.S. administration - Thiel is a key figure in promoting Trump's choice of Vance as his deputy. He also held a grand party for him before Trump's inauguration, "consolidating his position as a Washington power figure"; another Palantier co-founder Joe Lonsdale is an early donor to the "American Political Action Committee", which mainly supports Trump's presidential campaign.

  Looking back at the story of Palantiel's early days, Forbes magazine reported that in 2005, In-Q-Tel (IQT), a venture capital fund under the CIA, became an early supporter of Palantiel, investing $2 million in it, and CIA was also the company's only client in the next three years. Thiel, who is also a venture capitalist, invested his own $30 million in the company. Since then, Palantier has made its mark in the fields of intelligence analysis, counter-terrorism, and even the saying that it is "the company that helped find bin Laden" has been widely circulated. In recent years, Palantiel has made efforts in the field of artificial intelligence (AI) weapons, providing Ukraine with many AI tools for intelligence collection, target identification and strategic planning.

  "Palantier is ready to significantly increase his arms sales in the United States during Trump's tenure, but at the same time it has been laying the foundation for deeper penetration of Washington," the TTP concluded in the report. US technology media TechCrunch disclosed in 2015 that Palantier's customers have spread across the U.S. government, including at least 12 major customers including the CIA, Department of Homeland Security, National Security Agency, FBI, CDC, Marine Corps, Air Force, and Special Operations Command.

  According to Fortune magazine in February this year, Palantiel's stock has soared 585% since the beginning of last year, which is inseparable from its "stable relationship" with the U.S. government, because about half of Palantiel's revenue comes from government contracts. According to reports, Palantiel has obtained government contracts both during the Democratic Party and during the Republican Party’s rule. During Trump's first term in 2020, Palantier received about $1 billion in government contracts, mainly providing technical support to the U.S. Department of Homeland Security and Customs and Border Protection, using biometrics and non-public databases to track and monitor immigration. The relevant technical support was also extended during Biden's presidency.

  Personnel flow + heavy money lobbying + academic research

  Palantier is inseparable from the "revolving door" mechanism between it and the US government. According to a TTP investigation, Palantiel's recruitment of former administration officials is very wide, including veterans from the White House, the Department of Defense, the CIA and Congress, who are all able to help Palantiel penetrate deep into the U.S. defense department. Some of these former officials were once staff members during Trump's first term, at least one was a "veteran" during the term of former U.S. President Obama, and there were technical and policy experts who worked for the government during the Democratic and Republican administration.

  For example, Wendy Anderson, who joined Palantier as senior vice president of federal and national security in 2020, held a series of senior positions during the Obama administration, including deputy chief of staff for the Secretary of Defense and chief of staff for the Secretary of Commerce. For example, Matthew Tepin, a senior adviser to Palantier and former U.S. Army officer, served as director of China for the White House National Security Council during Trump's first term. Since joining Palantier in 2019, he has repeatedly claimed that the United States and China are in a "Cold War" state, and has repeatedly used the "China threat theory" to advocate that the United States should significantly increase its defense spending.

  It is understood that many of Palantier's employees are "hawkish" towards China like Matthew Teppin, who declared that the US Department of Defense should buy more AI products from private companies like Palantier to "fight against China." Even Peter Thiel himself is famous for his anti-China stance.

  While Palantiel recruits former government officials, the US government is also absorbing Palantiel's employees into relevant departments. For example, US government chief information officer Gregory Babachia was once the head of the intelligence and investigation department of Palantier; Trump also nominated Jacob Herberg, senior adviser to Palantier, as the State Department's deputy secretary of state responsible for economic growth, energy and environment at the end of last year.

  The TTP investigation also found that Palantier not only has close ties with the government in terms of personnel, but also spends a lot of money to strengthen his lobbying efforts in Washington, which mainly focuses on issues such as defense and other government spending bills and AI regulation. Data shows that in 2024, Palantiel spent nearly $5.8 million on lobbying, compared with just over $1 million in 2016. In some quarters, Palantier's lobbying spending has even approached the level of some of the largest defense contractors in the United States, such as in the fourth quarter of 2023, Palantier spent nearly $2.6 million on lobbying, surpassing Northrop Grumman ($2.1 million) and comparable to Raytheon Technologies ($2.7 million).

  The report shows that Palantiel used the funds to hire more than seven external lobby companies, whose lobbyists have worked for bipartisan lawmakers and the Congressional committee that oversees military and government spending. According to the Capitol Hill newspaper, Palantier hired the lobbying company Miller Strategy to lobby on defense policies and grants, and the company's founder Jeff Miller was one of Trump's largest fundraising lobbyists in the U.S. election last year.

  In addition to lobbying, Palantiel also promoted his "AI+Defense" related agenda through "independent academic research". In 2023, the Palantiel Foundation for Defense Policy and International Affairs was established. According to the foundation's official website, this is a non-party organization that is "committed to promoting national security through academic and technological research, supporting emerging technologies and policy development." In May 2024, the foundation collaborated with the US Foreign Policy magazine to hold the first Atlantic and Pacific Forum to discuss the impact of AI on defense policy and future wars.

  "The boundaries between Silicon Valley and the Pentagon are blurred"

  "A batch of new companies, born in Silicon Valley, may be integrated into its disruptive spirit, and began to challenge old companies and compete for the generous Pentagon awards." The American National magazine website recently published an article saying that over the past few decades, the five major military giants in the United States (Lockheed Martin, Raytheon Technology, Boeing, Northrop Grumman and General Dynamics) have won most of the Pentagon's contracts. However, in April last year, the Air Force abandoned Boeing, Lockheed Martin and Northrop Grumman in favor of two other less-known drone manufacturers responsible for building their proposed collaborative combat aircraft prototypes. This project is one of the most expensive new projects in the Pentagon, and the two "newcomers" selected are Andurier Industries and General Atomic Aerospace Systems.

  Andurier was founded in 2017. The company focuses on AI and robotics technology, and its main products include drone systems and anti-UAV systems, autonomous surveillance systems, etc. Andurier's founder Palmer Lach is famous for founding Oculus VR, a virtual reality (VR) headset company in 2012, which was acquired by Facebook about two years later. In 2017, Rachi was rumored to have been fired by Facebook for "supporting Trump", but both sides denied this statement. According to investment company Sacra, Andurier's revenue reached US$1 billion in 2024, a year-on-year increase of 138%, mainly due to the growth of government contracts it received - Andurier's new government contracts in 2024 are worth more than US$1.5 billion and US$675 million in 2023.

  Anduril not only received support from Thiel himself, but also almost replicated Palantiel's operating model. According to a report by TTP, Anduril and Palantiel announced a partnership in December last year, and the two companies are jointly bidding for government contracts with SpaceX, ChatGPT's parent company OpenAI, Saronik Technology and other companies.

  It is worth noting that in June last year, the U.S. Department of Defense Security Cooperation Agency announced US$360 million in arms sales orders to Taiwan, of which US$300 million were distributed to Andurier. The Chinese Foreign Ministry then issued an announcement, deciding to impose sanctions on six American companies, including Andurier, and related executives. In January this year, the Ministry of Commerce included Andurier Company on the export control list and the list of unreliable entities.

  Saronik Technology, an unmanned surface ship research and development company established in 2022, also announced a partnership with Palantiel last month on the capabilities of the United States' independent naval capabilities. In October last year, the company launched its third autonomous surface ship to support the so-called "Replicant Project" of the U.S. Department of Defense plans to intervene in the Taiwan Strait issue. In December last year, China decided to take a series of countermeasures against Saronik Technology and related senior management personnel. On April 4 this year, the Ministry of Commerce of China announced that it would include 16 U.S. entities on the export control list, including Saronik Technology.

  On March 11, Trump nominated Andurill executive Michael Obadal as deputy secretary of the U.S. Army, becoming a controversial incident in the United States' "military and business revolving door". The nomination sparked debate on the impact of private defense contractors on U.S. military policy, the Guardian reported. Critics warn that such appointments have the potential to place corporate interests above national security and could bias procurement decisions and strategic priorities toward profit-driven agendas. As the line between Silicon Valley and the Pentagon becomes blurred, “the risks faced by U.S. defense has never been so high.”

  In an interview with the Global Times, Lu Xiang, an expert on the American issues of the Chinese Academy of Social Sciences, said that the rise of "new military-industrial" enterprises such as Palantier means the further enhancement of the right-wing forces in the US military industry, and also represents a new military-industrial force in the United States. However, these so-called "new military industry" companies are still relatively immature. For example, inlaying AI into the command system requires a lot of tests to verify its security. It is far from enough to use AI to control the military field at present. So whether for the United States itself or the international community, the rise of these companies and controlling military orders through "revolving doors" will increase many unpredictable risks.

[Editor in charge: Wang Jinzhi]