Palantir's Karp Calls for AI Nationalization as Pentagon CTO Pushes Back

Palantir CEO Alex Karp and the Pentagon's top technology official staked out opposing positions on AI governance this week, with Karp calling for nationalization of AI labs and Department of Defense Chief Technology Officer Emil Michael arguing the government should stay out of the industry entirely.

Karp, speaking on CNBC's "Squawk on the Street" on Thursday, argued that artificial intelligence requires enforceable rules and that developers must bear direct legal responsibility for what they build.

"You have to find a way to set reasonable guidelines that are enforced, but you can't do it," Karp told CNBC. "The first line of defense is you're liable for your own actions."

He went further, suggesting that nationalization of AI labs may become necessary — framing it as an inevitability driven by legal exposure rather than ideology. "The view that I believe they have is, these businesses have to be nationalized because if you don't nationalize it every single one of my clients is going to sue," Karp said. He also called for both civil and criminal liabilities for tech builders "not being responsible."

Michael, appearing on the same program Wednesday, drew a sharply different line. When asked about the prospect of partial government ownership of AI companies, he said, "I hope not," and added, "We don't want government to get in the middle."

Michael also signaled opposition to expanded regulatory oversight, framing the debate as a tension between pre-regulation — which he associated with European-style policy — and a model that holds companies accountable for safe, aligned products before release. He noted existing Federal Trade Commission statutes and suggested developers could voluntarily pause certain capabilities while working through safety questions.

The exchange reflects a widening fissure within Washington and the technology industry over how — and whether — to constrain rapidly advancing AI systems. Anthropic CEO Dario Amodei called over the weekend for a slowdown in frontier AI development. OpenAI on Wednesday disclosed six new instances of "unexpected or concerning" model behavior within the last six months. A breach at Hugging Face has also fueled debate about AI security practices.

President Donald Trump has dismissed concerns about AI risks as a "hoax," a position echoed by Nvidia CEO Jensen Huang and Meta Platforms CEO Mark Zuckerberg, who wrote on X this week that AI labs failing to "focus on alignment will fall behind."

Michael acknowledged that the Hugging Face breach was "concerning" but questioned whether regulation would have prevented it. He also characterized some advocates for AI caution as promoters of "extinction, death-cult-like philosophies" engaged in a "coordinated campaign to scare people to make irrational decisions that benefit some of these incumbents."

On Capitol Hill, Sen. Richard Blumenthal, D-Conn., told CNBC this week that the U.S. is on the "verge of losing control completely" over AI and called for an "objective review" process before new models are released publicly. Lawmakers have also advanced legislation that would require AI labs to build so-called kill switches — mechanisms to shut down systems that behave in unintended ways. A bill to that effect has been introduced in the House, though similar efforts have encountered resistance in the Senate.

Karp's "We need to get serious" remark, delivered Thursday, underscores the urgency some industry figures are attaching to a policy debate that, for now, remains without a clear legislative path forward. With the administration resistant to new rules and Congress divided, the gap between those calling for binding guardrails and those favoring voluntary accountability shows little sign of narrowing.