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Anthropic, Pentagon talks at standstill

Pentagon draws scrutiny with Anthropic threats, Defense Production Act

The Pentagon is threatening to use the Defense Production Act (DPA) against Anthropic amid a dispute over the company’s restrictions on its AI tools, in a move that many experts say is an unusual use of the measure.

© Richard Drew, Associated Press

The Defense Department (DOD) warned Anthropic on Tuesday that it could invoke the DPA, which gives the president broad authority to control domestic industries in the name of national defense, to use the AI firm’s tool on its own terms.

The threat marks an escalation in the feud between the two parties. Negotiations appear to be at a standstill, with the Pentagon giving Anthropic until Friday to comply with its terms or face a cancellation of a $200 million contract and risk being labeled a “supply chain risk” or confront the DPA.

“It’s the wrong purpose of the tool,” Mark Dalton, senior policy director for technology and innovation at the R Street Institute, told The Hill. “The DPA exists for a capacity reason, like it’s an industrial capacity policy, and to use it as leverage is, I think, irresponsible.”

Anthropic and the Pentagon have been locked in tense negotiations in recent weeks over the company’s AI usage policy, which bars its AI model Claude from being used to conduct mass surveillance or develop lethal autonomous weapons.

These two issues have become the company’s red lines in the dispute. A source familiar with negotiations told The Hill on Monday that Anthropic’s resistance stemmed from concerns that AI systems are not reliable enough to make life-or-death decisions and the technology significantly changes what is possible with domestic surveillance.

Meanwhile, the Pentagon has pushed for the company to accept language that allows for “all lawful uses.”

On Wednesday night, the DOD sent its last and final offer to Anthropic, asking the AI giant to allow the department to access Claude for “all lawful purposes,” a senior Pentagon official told The Hill on Thursday. CBS News reported earlier on the offer.

The Hill has reached out to Anthropic for comment.

Sean Parnell, chief Pentagon spokesperson, noted Thursday that the department 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.”

“Here’s what we’re asking: Allow the Pentagon to use Anthropic’s model for all lawful purposes,” he wrote in a post on social platform X.

“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.”

Check out the full report at TheHill.com.

Welcome to The Hill’s Technology newsletter, I’m Julia Shapero — tracking the latest moves from Capitol Hill to Silicon Valley.

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How policy will be impacting the tech sector now and in the future:

Anthropic says ‘virtually no progress’ on Pentagon AI talks as deadline looms

Anthropic said Thursday that “virtually no progress” had been made in the company’s talks with the Pentagon over the terms of use for its AI models ahead of a Friday afternoon deadline. The Department of Defense (DOD) delivered its last and final offer to the company on Wednesday night, asking the firm to allow the department to access its AI model Claude for “all lawful purposes.” It is unclear what changes the Pentagon has …

Burgum: Sanders data center moratorium would be like waving ‘surrender flag’ to China

Interior Secretary Doug Burgum on Thursday slammed Sen. Bernie Sanders’s (I-Vt.) proposal for a national moratorium on data centers, deeming the idea as an intentional “surrender” to China amid their rapid development of artificial intelligence. “A moratorium on data centers would — would be like, we might as well wave the surrender flag to China right now. I mean, it is, again — that’d be complete capitulation,” Burgum said …

Kalshi accuses MrBeast video editor of insider trading

An editor for the popular YouTube creator MrBeast has been fined and suspended by prediction market platform Kalshi over suspected insider trading.  The company’s disciplinary committee found that Artem Kaptur violated its policies when Kaptur placed bets in August and September related to the YouTube channel where he worked.  “Specifically, the Committee found reasonable cause to conclude Kaptur traded while employed …

News we’ve flagged from the intersection of tech and other topics:

eBay to lay off 800 staff (TechCrunch)

Prada layers winter jackets over light dresses at Milan show as Zuckerberg’s presence fuels smart glasses talk (Reuters)

Branch out with other reads on The Hill:

Instagram launches new tool alerting parents about suicide, self-harm searches

Instagram is launching a new tool that will alert parents if their teens repeatedly try to search for terms associated with suicide and self-harm on the platform. The tool, which will roll out in the U.S. and several other countries next week, will flag for parents if their children conduct multiple searches with phrases promoting suicide or self-harm or phrases that suggest they want to harm themselves, as well as terms like …

You’re all caught up. See you tomorrow! 

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