The Operating System
How one company became the infrastructure the government can't turn off.
Palantir’s federal contract obligations doubled in a single year — from $541 million in FY2024 to $970.5 million in FY2025. A ten-year, $10 billion framework with the U.S. Army. A $1.3 billion ceiling on the Maven Smart System, the AI platform Palantir describes as generating roughly a thousand targeting recommendations per hour across more than twenty thousand military users. And a $29.9 million task order called ImmigrationOS — part of a contract family exceeding $145 million — which tracks immigrants in near-real-time using passport data, Social Security records, IRS filings, license plates, and facial recognition.
These are not line items. This is an installation.
There’s another tool worth knowing: ELITE, Palantir’s neighborhood-level deportation mapping system. ELITE aggregates data feeds from HHS, Medicaid records, USCIS databases, and Thomson Reuters CLEAR to map deportable populations by geographic area, according to 404 Media’s investigation of the platform. ImmigrationOS finds individuals. ELITE maps populations. Together they form a complete AI-powered surveillance stack — and they feed directly into a profit engine. Palantir’s targeting produces ICE arrests. ICE arrests produce GEO Group revenue at $150 to $245 per person per day. GEO’s CEO told investors the company is holding the “highest level of ICE population we’ve ever had.” The data infrastructure feeds the profit infrastructure. That pipeline doesn’t appear in Palantir’s earnings calls. But it’s in the contracts, and the per-diem invoices are in GEO’s SEC filings.
And now the surveillance turns inward. On May 1, the Department of Agriculture awarded Palantir a $3.9 million contract to build a tool that tracks federal workers’ return to the office, according to USAspending disclosures first reported by the American Prospect. The contract can grow to $13.3 million. The Department of Veterans Affairs is seeking a similar system across 311 locations. Union officials say the Social Security Administration is a third agency implementing Palantir-powered worker surveillance — the same SSA that shed 7,000 employees amid DOGE-driven restructuring last year, according to AFGE officials. OMB Director Russell Vought said in October that he wanted federal workers to be “traumatically affected” by his policies. Palantir is building the tool that delivers the trauma. Alex Karp is billing the government $3.9 million for the privilege.
When Karp and co-author Nicholas Zamiska published The Technological Republic in February 2025, they argued that Western technology companies had a moral obligation to serve their governments — that Silicon Valley’s reluctance to work with the military and intelligence community was a civilizational failure. In April, Palantir distilled it to 22 points on X. Thirty-two million views. What the book and the manifesto described as obligation, the earnings call describes as revenue. Palantir reported $1.63 billion in first-quarter 2026 revenue — an 85% increase, the fastest growth rate since the company went public. U.S. government revenue alone: $687 million, up 84% year-over-year. The moral argument was the brochure. The contracts were the close.
Palantir’s SEC filings state plainly: “We intend to capture an even greater share of U.S. federal government spending on software systems.” Analysts describe the company as becoming the “AI operating system” for state power. That phrase — operating system — is architecture, not metaphor. An operating system is the layer everything else runs on. The layer you can’t see. The layer you can’t remove without shutting everything down.
This is where the Powell Memo meets the algorithm. The original playbook was institutional — capture the courts, the regulatory agencies, the universities, the media. Palantir represents something different. Not capture of institutions, but replacement of institutional judgment with computational infrastructure. The analyst doesn’t make the call; the platform makes the recommendation and the analyst confirms. The procurement officer doesn’t evaluate the bid; the system scores it. The intelligence community doesn’t synthesize the data; the software does. You don’t need to capture an institution if you can become the infrastructure it depends on. Karp and Thiel built the company to be exactly that.
And notice what isn’t in any of these contracts: accountability architecture. No public audit requirements for algorithmic decision-making. No independent review of how AI recommendations shape military targeting, immigration enforcement, or the surveillance of the government’s own employees. The contracts are classified or proprietary. The code is proprietary. The training data is proprietary. More than a billion dollars in public money flowing into a system the public cannot inspect — and the company’s Class F founder voting trust guarantees Karp, Thiel, and co-founder Stephen Cohen up to 49.999% of total voting power regardless of how many shares they sell. They built the architecture to be unremovable — from the inside, structurally; from the outside, operationally.
It’s not just Palantir. The same investor network — Founders Fund, 8VC, a16z — has positioned itself across every node of the government money flow. Palantir and Anduril build the surveillance and targeting systems. GEO Group receives the bodies those systems produce. Erebor, a new bank co-founded by Joe Lonsdale and Palmer Luckey and chartered specifically for defense-tech and AI clients, handles the financial infrastructure. Ramp — backed by Founders Fund, Thrive Capital, and 8VC — is pursuing a pilot of the $39.7-billion-a-year federal purchasing card after securing at least four private meetings with GSA officials, according to ProPublica. The same portfolio funds the tools that find people, the facilities that hold them, the banking rails that move the money, and now the surveillance systems that monitor the government’s own employees. You don’t need to own the government. You need to become the platform the government cannot function without. Then the government works for you.
Palantir’s stock closed Friday at $135.90. It trades at more than 150 times trailing earnings. Wall Street doesn’t price ideology. It prices inevitability.
Sources: "Palantir Gets an Initial $3.9 Million to Spy on Federal Workers at the USDA, Social Security, and VA," Whitney Curry Wimbish, The American Prospect, May 18, 2026. "'ELITE': The Palantir App ICE Uses to Find Neighborhoods to Raid," 404 Media, January 15, 2026. Palantir Technologies Inc., Form 10-Q, Q1 2026 (SEC filing, May 4, 2026). Palantir Technologies Inc., Proxy Statement / Form DEF 14A, April 2026 (Class F voting structure, executive compensation). "Trump Team Eyes Thiel-Backed Firm Ramp for $700B Payments Program," ProPublica, April 17, 2025. USAspending.gov, USDA-Palantir contract disclosure, May 2026. GEO Group Inc., Q4 2025 Earnings Call Transcript (per-diem rates, detainee population). The Technological Republic, Alex Karp and Nicholas Zamiska, Crown Currency, February 2025. "Palantir's 22-Point Manifesto Goes Viral," Fortune, April 22, 2026. Federal workforce departure data, Pew Research Center, March 2026. Russell Vought remarks on federal workforce, The Guardian, October 2025.
Margin Notes is a feature of Architect, mapping the machinery of American capture in real time. New annotations published regularly.