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USA Business Watch – Insightful News on Economy, Finance, Politics & Industry
Home » Department of Defense to designate humans as supply chain risk
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Department of Defense to designate humans as supply chain risk

Bussiness InsightsBy Bussiness InsightsFebruary 28, 2026No Comments3 Mins Read
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In a post on Truth Social, President Trump directed federal agencies to stop using all Anthropic products following a public dispute between the company and the Department of Defense. The president granted a six-month phase-out period for departments using the product, but stressed that Anthropic is no longer welcome as a federal contractor.

“We don’t need it and we don’t want it. We will never do business with them again,” the president said in the post.

Notably, the President’s post does not mention plans to designate Anthropic as a supply chain risk, as previously mentioned as a result. However, a subsequent tweet from Secretary of Defense Pete Hegseth justified this threat.

“In conjunction with the President’s direction to the federal government to cease all use of Anthropic’s technology, I am directing the Department of the Army to designate Anthropic as a supply chain risk to national security,” Secretary Hegseth said. “Effective immediately, any contractor, supplier, or partner doing business with the U.S. military may not engage in any commercial activity with Anthropic.”

The Pentagon’s dispute centers on Anthropic’s refusal to allow its AI models to be used for domestic mass surveillance or to power fully autonomous weapons, which Secretary Hegseth found to be unduly restrictive.

CEO Dario Amodei reiterated his position in a public post on Thursday, refusing to compromise on these two points.

“It is my strong desire to continue to serve the Department of Defense and our warfighters, subject to the two requested safety measures,” Amodei wrote at the time. “If the Department chooses to offboard Anthropic, we will work to avoid disruption to ongoing military programs, operations, or other critical missions and allow for a smooth transition to another provider.”

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OpenAI expressed support for Anthropic’s decision. According to the BBC, CEO Sam Altman sent a memo to staff on Thursday saying they share the same “red lines” and that OpenAI-related defense contracts also reject uses “that are illegal or not suitable for cloud deployment, such as domestic surveillance or autonomous attack weapons.”

OpenAI co-founder Ilya Sutskeva, who made his falling out with Altman very public in November 2023 and subsequently co-founded his own AI company, also joined the conversation on Friday, writing to X:

In the future, there will be many more difficult situations of this kind. It will therefore be important for relevant leaders to rise to the occasion and for fierce competitors to put aside their differences. I’m glad I was able to do that today. ”

Anthropic, OpenAI, and Google each received contract awards from the U.S. Department of Defense last July. Some Google employees have expressed support for Anthropic, but Google and its parent company have not yet commented.



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