Tuesday briefing: Palantir’s rise – and why so many oppose its role in the British state

In today’s newsletter: Its software is used from health services to militaries. But controversies and criticism of the $375bn company are leading some to ask if Palantir is too powerfulGood morning. The Peter Mandelson story keeps unfolding. Peter Walker explains here what is in the latest release of documents, and Henry Dyer takes a look at the key papers missing from the latest disclosures. But today we are covering another major story – Palantir.Few companies attract controversy more than Palantir. Since the pandemic, the US data analytics company has grown voraciously, using its AI-driven software to make sense of intractable datasets for customers around the world. For the NHS, it analyses patient records; for the US military, it’s focused on targets in Iran. Palantir’s products are widely used, with the business now worth $375bn.Its rise has been noisy and contentious. Founded in 2003 by US tech billionaire and Trump ally Peter Thiel in the wake of 9/11, the firm’s eclectic list of clients includes the Israeli military, the NHS and US Immigration and Customs Enforcement (ICE). Earlier this year, Palantir’s co-founder and CEO Alex Karp published a much-maligned manifesto that implied certain cultures are inferior to others.Today on First Edition, I spoke with Guardian technology and AI reporter Aisha Down about Palantir’s rise – and why a growing number of people are criticising the company. First, the headlines.UK politics | Peter Mandelson was receiving sensitive security briefings about the Foreign Office’s work, and was in discussions with the head of MI6, before he had completed the developed vetting process, documents reveal.Ukraine | Russian air raids on major Ukrainian centres including Kyiv, Dnipro and Kharkiv killed at least five people and wounded dozens by early morning on Tuesday, authorities said.Environment | More than a million jobs, higher wages, nearly half a trillion pounds in investment in the pipeline – the UK’s green economy is powering ahead, according to research by the country’s leading business organisation.US news | Donald Trump is reconsidering whether to keep pressing for a $1.8bn fund to compensate his allies, a person familiar with his thinking said, as the justice department paused the program to comply with a court order.UK news | Sir Alan Bates has said that the schemes set up to compensate post office operators over the Horizon IT scandal have been an “utter disaster” and that the government should not be involved in running them.In the Lord of the Rings lore, a “palantír” is a magical seeing stone used to communicate and monitor distant lands. These crystal balls are used to deceive and dominate in Middle-earth. It is from these fantasy novels that the tech company takes its name, one of a number of firms founded by Thiel with titles inspired by the trilogy.JRR Tolkien had an intense suspicion of all things tech, but his impact on Silicon Valley is vast – many of its most influential founders revere his work alongside Thiel, including Elon Musk, Jeff Bezos and Napster co-founder Sean Parker, who had a Lord of the Rings-inspired wedding. To Tolkien, machines symbolised the desire for power over others. There are obvious echoes of his fears in the arguments of Palantir’s critics.From police forces to health care systems, armies to airlines, Palantir has clients globally, spanning government agencies and private companies. In its own words, Palantir powers “real-time, AI-driven decisions” in “critical government and commercial enterprises in the west from the factory floors to the front lines”. The National Health Service, the UK’s Ministry of Defence and several constabularies have contracts with Palantir, worth a total of £600m.Last month, London mayor Sadiq Khan blocked a £50m deal between Palantir and the Metropolitan police, having previously stated Londoners wanted public money going companies that “share the values of our city”.‘A larger moral panic’Palantir’s listing on the US stock market in 2020 saw its value increase by more than 1,500%, as excitement about artificial intelligence and widespread adoption by government agencies globally radically sped up its growth.All this has attracted criticism. In the days before it was listed, Amnesty International released a report raising serious concerns about Palantir’s human rights record, citing Palantir’s work with ICE.There is widespread opposition to the company’s growing reach in the British state. Earlier this year, almost a quarter of a million people called on ministers to break contracts with Palantir via two petitions. “Our NHS and other public services shouldn’t be cutting deals with a private company that helps armies kill people,” one read. Palantir says that its software is only used to process data in line with customer instructions and doing otherwise would be illegal.But that has not been good enough for some. Martin Wrigley MP voiced unease this week about a contract between the Financial Conduct Authority and Palantir. “My concern is the FCA is doing very significant investigations into sensitive data using a foreign-controlled company that could be advised to pass data across to the US government,” said Wrigley. “In the days of Donald Trump, control means whatever Trump thinks it means.”“In the Trump era, the UK and others have woken up to the idea that a lot of sovereign infrastructure and government data depend on US tech companies,” says Aisha. “While it is unproven, there is a sense that Trump could use US laws to subpoena and get UK sovereign data. The controversy around Palantir is part of a larger moral panic, but the company itself has been courting it.”‘Completely anti-woke’Controversies surrounding Palantir are often sparked by its CEO, Alex Karp. In an earnings call last year, he declared his company is the first to be completely anti-woke, and he has been an outspoken supporter of the Israeli military during the war in Gaza, while voicing support for AI weaponry.The 58-year-old insists that there is a moral element to his company’s work. The son of an African American artist and a Jewish paediatrician, Karp says he was brought up by progressive parents, but argues that the west has become too self-flagellating about its dominance.Karp says that his company’s main opponents, unusually for a data-processing company, do not come from business but are political. “The woke left and the woke right wake up every day figuring out how they can hurt Palantir, and if they get into power, they’ll hurt Palantir,” Karp said in an interview last year.Earlier this year, scrutiny of the company was turbocharged by its 22-point manifesto, posted on X. “It came out of nowhere – they didn’t need to do it,” says Aisha. “It was based on Karp’s book, The Technological Republic, that envisions a marriage between big tech and government. It was argued that Silicon Valley should build weapons of war and build police capability. It also implied that the west was superior to other civilisations.”Fears of influenceMany Palantir critics are particularly concerned about the company’s access to sensitive information. Last month, the Financial Times reported that NHS England has given Palantir and other contractors access to patient data before it had been anonymised as part of a £330m NHS contract.Some fear that this commercial relationship opens the door to data-sharing that a future Reform UK administration might use in an immigration clampdown. A briefing by the health justice charity Medact said the “highly interoperable nature” of Palantir’s software could enable “data-driven abuses of state power”, including ICE-style raids. Palantir said it had no intention of using data in this way and would be in breach of contract if it did so.Aisha says that public attention on the company is driven by a growing mistrust of big tech. “The fears around the Palantir contract highlight people’s insecurity around what tech will be used to do,” she says. “It’s not like Palantir is unique in allowing its capabilities to be used for things that might make us morally unsettled. In the UK especially, it seems that this issue really speaks to people’s deepest fears about tech, their personal data and how it’s used.”Overvalued and vulnerable to the competition?Despite the growing noise around Palantir, Aisha cautions against fully buying into the controversy. The investor Michael Burry, made famous by The Big Short, has taken out a short position against Palantir, warning that the company is massively overvalued and vulnerable to competition. Karp has pushed back hard against Burry’s thesis. But Aisha says that others are also asking whether the hype around Palantir matches reality.“Part of this is security theatre,” suggests Aisha. “If you are courting all of this political noise, it could be to avoid the question as to whether your technology is actually useful. I think that’s the question they are more afraid of.”This episode of the Today in Focus podcast is a bracing listen from Alaina Demopoulos on how the trad-wife movement acts as a shopfront for far-right politics. Libby BrooksThe simple act of reading a book has become devilishly difficult in the era of distraction. Ioan Marc Jones explores whether we can retrain our brains to read again. PatrickI had a Marilyn Monroe photobook as a girl, and was fascinated by her long before I could put together questions about women’s bodies and celebrity culture. So I really enjoyed this thoughtful interview with the man behind the camera at her final photoshoot. LibbyNature is quick to return if you allow it. Just three years into a rewilding scheme on a former dairy farm in east Somerset, the project has seen an explosion in bird life, butterflies and small mammals. PatrickAs a Scot readying myself for the inevitable joy and pain of the World Cup, Suzanne Wrack’s meditation on the wider meaning of Arsenal’s weekend celebrations chimed with me. LibbyTennis | Aryna Sabalenka beat Naomi Osaka in the first women’s night match at the French Open since 2023, marching into the quarter-finals with a hard-fought 7-5, 6-3 win.Football | Southampton’s head coach, Tonda Eckert, initiated the practice of spying on opponents, according to new documents which also show that an intern tasked with recording rival training sessions was assured the “manager loved it”.Boxing | Anthony Joshua has stressed that rather than coming to terms with his own grief after the car accident in which two of his closest friends died last December, his primary focus has been on helping their parents.“Mandelson files reveal security briefings before vetting passed”, is the Guardian’s top headline today. The i Paper says “Mandelson files reveal how the PM’s authority crumbled”, the Mail writes “Labour’s poisonous puppet master and a £1million cover-up” and the Mirror asks “What is left to hide?”.The Times, also on revelations from the Mandelson files, runs “Labour ‘only asks who can be taxed to pay benefits’”, the Telegraph takes a similar line with “‘Every meeting I have is: Who can we tax to pay benefits to others?’” and the Express also runs the same quote. The Sun’s take is “The welfare party” and Metro writes “Mandy: hire me, you will not regret it!”On a different topic, the FT splashes “Anthropic tests Wall St appetite for AI labs by filing for $1trn-plus listing”.‘Sit back and relax’: Trump insists Iran deal close despite strikesAs Israel threatens to bomb Beirut and the US and Iran trade missile strikes, Donald Trump insists it will ‘all work out well in the end’ and urges his critics to ‘sit back and relax’. So are we any closer to a deal? Lucy Hough speaks to diplomatic editor Patrick Wintour.A bit of good news to remind you that the world’s not all badRock art in a cave in south Wales has been confirmed as the UK’s oldest cave art, almost a century after the Guardian’s original report about it was dismissed.One can only imagine the original reporter posthumously air-punching after technological advances allowed the research team exploring the Bacon Hole cave in the limestone cliffs of south Gower to date the red-painted stripes, whose initial discovery was reported in the Guardian in 1912. But further examination cast doubt on the authenticity of the painting, and in 1928 experts decided it was nothing more than evidence of mineral seepage.Latest dating techniques, however, now suggest the panel is 17,100 years old, making it the oldest example of Palaeolithic art north-western Europe. It remains to be seen whether our Corrections and Clarifications editors take up the matter.Sign up here for a weekly roundup of The Upside, sent to you every SundayAnd finally, the Guardian’s puzzles are here to keep you entertained throughout the day. Until tomorrow.Quick crosswordCryptic crosswordWordiply