A Neoliberal Origin Story

FASA was enacted into law one year after Vice President Al Gore announced his Reinventing Government Initiative – a proposal to revamp the government through deregulation, more private investment in community development, and other pro-market economic initiatives. Neoliberalism was a key tenant of the Clinton administration, and FASA further promoted the outsourcing of public goods and services to private industry by mandating that the government buy commercially available off-the-shelf products before ordering customized goods. FASA has generally been viewed as a bipartisan success in cracking down on the once rampant price gouging of the government by contractors selling physical goods like hammers. However, the law has been woefully inadequate in preventing contractors selling intangible products, like digital services and informational technology platforms, from engaging in behavior that promotes vendor lock-in – a situation in which the government is essentially bound to a contractor. 

The “Mother Of All Venture Capital” 

In 2015, the Department of the Army decided that its Distributed Common Ground System-Army (DCGS-A) – the Army’s primary system for processing and sharing multi-sensor intelligence, surveillance, and reconnaissance to the entire Joint Command System – needed an upgrade. The Army issued a request for proposal (RFP) soliciting bids for a contractor to develop the second increment of the DCGS-A, but Palantir Technologies Inc. challenged the terms of the RFP by submitting a bid protest to the Government Accountability Office (GAO) – the government agency in charge of reviewing all bid protests concerning RFPs. Palantir alleged that the Army violated FASA by failing to conduct adequate market research on existing commercial platforms that could potentially fulfill the Army’s needs – including Palantir’s very own platform. However, the GAO denied Palantir’s bid protest, holding that the Army demonstrated sufficient consideration of commercially available products. 

Palantir subsequently brought suit in the United States Court of Federal Claims. 22 years after its enactment, FASA became the basis for this lawsuit brought by Palantir against the Army. Palantir argued that the Army failed to give “[p]reference for acquisition of commercial items” when the government solicited bids from contractors to overhaul the DCGS-A. At first glance, Palantir’s lawsuit seemed to concern an innocuous procedural question: whether the Army’s request for proposal complied with statutory provisions codified by FASA in Title 10 of the United States Code – the code that outlines the role of the United States Armed Forces. However, the more subtle and consequential question at issue concerned whether the Army could continue developing its intelligence platform internally, or if it would have to acquire an external, already existing, and commercially available platform. The federal judge ultimately held that the Army failed to satisfactorily review commercially available options before publishing the RFP. As a remedy, the judge permanently enjoined the Army from issuing a contract award under that RFP, granting Palantir another chance to compete for the contract.

One might wonder, why would Palantir try so hard to win a federal contract – going as far as suing the agency it hoped to one day win a contract award from? At a valuation of $759 billion in 2023, government contracting was an industry so brimming with profit opportunities that Palantir likely decided it would be worth the fight for even a small slice of the government’s pie. According to Paul Bracken, Professor of Management and Political Science at Yale University, the Department of Defense is referred to as the “mother of all venture capital firms” by many in Silicon Valley and Washington D.C. Defense contracts are extremely appealing to private industry players who view them as “free money… with very little strings” because companies get to “own the technology when they get done with [the DoD contract].” Not only do contractors receive a recurring source of revenue from subscriptions the government pays to continue using their products, but they also retain all ownership and control over their products.

Image by Sophia Leswing.

Vendor Lock-In

Since its 2016 lawsuit, Palantir has been particularly successful at winning government contracts. In 2018, the Army decided to invest in Palantir’s Vantage platform to serve as its core software system. In December 2024, Palantir announced the Army was extending its agreement through 2028 with an available ceiling of over $618 million. The Army is now reliant on Palantir’s continued service-providing because it does not own the company’s proprietary system. Instead of procuring a contractor to develop an internal data system owned by the federal government, the Army is beholden to Palantir and their “pay to play” licensing system. 

According to Nasdaq – the second largest stock exchange in the world by market capitalization – Palantir’s recurring revenue model based on subscriptions is especially attractive to investors because, “Once Palantir gains a customer, it can reap the rewards for years.” What happens if the Army decides it no longer wants to use Palantir’s Vantage platform? The Army ends up right back where it was in 2016 – confronted with its initial problem of having no decent internally owned and managed intelligence platform. Though Palantir describes Vantage as an “interoperable and extensible” platform that prevents “[vendor] lock-in typically seen in traditional software products,” the time and effort required to switch to what might be a better platform are often reason enough for a government agency to remain with the existing contractor’s product.

The Arrogance Of Technological Solutionism

If the federal government is “the mother of all venture capital firms,” then why does it not invest in itself? Perhaps the answer is that neoliberal government is imbued with a certain level of self-disdain – why invest in public services when the private sector can do the same things faster, cheaper, and generally better than we can? The government’s contempt for itself enables the private sector to inflate its competence and abilities. In a recent episode of Tech Won’t Save Us, the podcast’s host Paris Marx interviewed a former employee at the United States Digital Services (USDS) who goes by the pseudonym Milo. Milo explained a common pattern that he witnessed during his time at USDS: people in the private sector switching to public sector work arrive with a naive arrogance, only to discover that the problem they believed was readily solvable was in fact significantly more complex. The following has been edited for concision:

“In a lot of cases, you join USDS and think, I’m gonna solve this problem or work on this thing that government hasn’t fixed before. Then you get to whatever agency you’re detailed to and start talking to the people there who then show you the four times prior that someone has come and said we’re gonna solve this problem. And you look at it and go, so people have been trying to fix these problems, people have been trying to address these inefficiencies or these challenges in government. It’s not for lack of trying, it’s just sometimes it’s lack of coordination, it’s lack of money, it’s not the right time, it’s all kinds of different challenges [that] come up.”

Milo’s own experience – watching individuals confidently embark on solving a government problem only to return with a new sense of humility after witnessing the intricacies of the issue – is illustrative of Elon Musk’s own sense of superiority that only he and his Department of Government Efficiency (DOGE) team can “fix” the federal government. For example, Musk’s oft-mentioned complaints about the Social Security Administration (SSA) sending benefits to deceased individuals fails to acknowledge the many tedious ways in which the SSA finds out that someone has died. Noting how difficult it is for the SSA to receive a death record, Milo explained:

“The reason it’s difficult to know if someone has actually died is because in most states death records are actually created by the county coroner or county medical examiner. When someone dies, the county coroner fills out the paperwork, and then maybe it’s actual physical paperwork that gets mailed to the state. Sometimes it’s an electronic record. Sometimes the coroner literally saves a PDF to a ZIP drive, or a USB drive, and mails that into the state. And then someone has to manually transcribe that, and then they have to manually send that into SSA, and into IRS, and into all of the other places. That’s not the fault of the Social Security Administration, that’s just the cost of getting the information – that’s just the way it’s been set up.”

Elaborating on his frustrations with people who are not government employees oversimplifying government issues, Milo noted:

“Are there ways to fix that with technology? Absolutely. Would people at USDS love to fix that? Absolutely. But maybe the money doesn’t exist because we haven’t had a freaking budget passed by Congress in what feels like a hundred years… so there’s no way for an agency to actually do planning. There’s no way for them to actually think about improvements. Maybe there’s not a single agency that controls this that can actually mandate it. These are kinds of things that could be solved if there is political will and an interest in doing it.”

Gutting The Government

Milo is just one of over 56,000 (as of April 14, 2025) federal government employees terminated by President Trump since he began his second term in January 2025. Frustration has grown amongst many civil servants who have felt Musk’s scorn simply for the fact that they are government employees. Musk even went as far as re-sharing a post on social media stating, “Stalin, Hitler and Mao didn’t murder millions of people. Their public sector workers did.”

In February 2025, Musk announced that the entire 18F office had been “deleted.” Though not inconsistent with his outspoken detestation of public sector workers, his decision was nonetheless dramatic and tragic. 18F was an in-house technology consulting service within the General Services Administration that deployed teams of designers, software engineers, strategists, and product managers to other government agencies facing technology problems. More so than most other government offices, 18F specifically recruited Silicon Valley talent to help modernize technology in the government. Former 18F employees hailed from large technology corporations such as Microsoft and Lockheed Martin, and a number of smaller technology firms such as New Relic, Fearless, and Blink UX.

“Are there ways to fix that with technology? Absolutely. Would people at USDS love to fix that? Absolutely. But maybe the money doesn’t exist because we haven’t had a freaking budget passed by Congress in what feels like a hundred years… so there’s no way for an agency to actually do planning.

One might think that the heavy cross-pollination between Silicon Valley and 18F employees would give the office more grace with Musk’s “move fast, break things” approach to structural change. However, the fact that 18F workers had the technical expertise to assess the merits of a contractor’s proposal for a technological solution to a government problem was precisely the reason why it was not spared. 1

8F’s team was able to differentiate a contractor offering a solution that in practice would lock-in the government to that vendor’s services in perpetuity from a contractor offering a solution that would help facilitate the government’s own self-sufficiency.

18F prevented technology companies from receiving what would have been bloated government contracts, which is great if one wants to use government money to maximize public benefit, but bad for people seeking to maximize profits through government contracts – such as Elon Musk.

18F’s successful track record – including creating the Internal Revenue Service’s (IRS) free online tax filing tool known as Direct File, developing a user-friendly online platform for submitting civil rights complaints to the Department of Justice, and making one secure sign-on platform (Login.gov) to access multiple government services – proved that technical expertise and innovation did not have to live and die by the traditional playbook of Silicon Valley. When starting new projects, 18F by default used “free and open source software,” which enabled active involvement from community members to conduct ongoing peer review and continuous feedback for improvements to 18F’s code.

Unlike proprietary software, which is owned by a single entity who profits from selling use licenses, 18F’s open source code is free and dedicated to the public domain. Anyone is able to access and use 18F’s code freely, thereby eliminating the additional time and cost burdens that otherwise would have been required to replicate their work.

The former 18F government agency logo overlaid onto a film photograph taken by Sophia Leswing.

The Silicon Valley Playbook

18F as a public source of technological innovation stood in stark contrast to the for-profit agenda of most tech companies today. 18F helped to effectively modernize government technology while protecting the government’s institutional integrity because the office was able to separate contractors seeking to lock-in the government from contractors actually trying to help the government build their own systems and develop self-sufficiency over time. With 18F no longer in existence as an important check on bad actors looking to milk the federal government’s procurement money, FASA and its lack of guardrails can once again be exploited by contractors hoping to trap the government into using their services in perpetuity. 

In an interview I had with Randy Hart, former Acquisition Lead at 18F, Hart argued that FASA permits – and perhaps even incentivizes – businesses to game the procurement system by developing a product that on its face seems to meet the criteria of a “commercially available off-the-shelf” product, but in reality requires much modification and reconfiguration to meet the government’s needs. A similar gaming of the system is prevalent in Silicon Valley where venture-backed startups give away a few things gratis or for cheap initially, lock in the consumer, and then raise the price. Venture-backed startups are able to underprice competitors because the external financial support they receive removes the necessity to become profitable quickly. Without the pressure of short-term profit-maximization, these startups are able to focus their efforts on maximizing users, squeezing out competitors, and solidifying market dominance with the power to set the price and quality of products in the market. 

Consider Uber Technologies Inc. – a company founded in 2009 that did not see its first profit until 2023 because its business model was premised on becoming a monopoly. With the backing of Silicon Valley money, Uber and Lyft consistently underpriced independent taxi drivers, thereby taking away their ability to compete. Much reporting has been done on the injuries these rideshare giants have wrought on individual drivers including the inability to pay off staggering medallion debt, likely leading six New York City taxi drivers to committ suicide in just seven months. Discussions of antitrust and monopoly power can at times feel abstract and removed from daily life, but the death of these six yellow taxi drivers are a stark reminder of the harms created by a market dominated by a few companies with little to no competition.   

Silicon Valley uses the same playbook on the federal government. A 2024 investigation by ProPublica revealed that under the Biden Administration, Microsoft provided the federal government with free cybersecurity upgrades valued at $150 million, with the specific intent of making the government dependent on their products. ProPublica even quoted two former Microsoft sales leaders who compared the effort to lock the government into paying user subscription fees year after year “to a drug dealer hooking a user with free samples.” 

Now, under the Trump Administration, a similar pattern is unfolding. In March 2025, Elon Musk “donated” Starlink terminals – satellite internet service panels – to the White House, the GSA, and the Federal Aviation Administration (FAA). Musk touted that the 4,000 Starlink terminals were sent to the FAA “at NO COST to the taxpayer” – yet another rhetorical move disguising a self-serving profit motive as a charitable donation. 

A Techno-Nationalist View On Public Service

The outsized influence of Elon Musk and other tech moguls in American politics and government today raises the question: What does a world run by Silicon Valley leaders look like in the long term? Alexander C. Karp, Co-Founder and Chief Executive Officer of Palantir, offers one possible vision in his book: The Technological Republic: Hard Power, Soft Belief, and the Future of the West. Karp envisions an America run by an elite technocratic engineering class who “reconstruct[s]…a technological republic” through “the rebuilding of an ownership society” – despite the fact that his company’s business model is predicated on making customers subscribe to use Palantir’s proprietary software without ever actually acquiring ownership rights or control over the products. 

Further emphasizing the importance of ownership culture in society, Karp celebrates the “communally owned” structures of Silicon Valley companies – though, the extent of this imagined community is the granting of stock options and equity to employees. The shock-value of tech compensation packages are used as a tool by management to placate employees and keep them from rocking the company boat. In 2018, over three thousand Google employees urged the company not to renew a contract with the U.S. Department of Defense on Project Maven – an effort to deploy machine learning to autonomously identify military targets from video and photographs. Similarly, in 2019, a group of Microsoft employees denounced their company leadership’s decision to contract with the U.S. Army. Referencing these acts of collective action by workers at Google and Microsoft, Karp quickly dismisses the employees as ungrateful, unpatriotic, and elite young engineers with a naive ideological purity made possible only by the “safety and comfort” afforded by the “American project.” Tech workers who fight for a say in what they work on are too often met with disdain and readily ignored by leadership because it disrupts business as usual where profit is king. 

The outsized influence of Elon Musk and other tech moguls in American politics and government today raises the question: What does a world run by Silicon Valley leaders look like in the long term?

Though working for defense technology companies was once frowned upon, as demonstrated by the #NoTechForICE campaign that students from over 25 universities participated in around 2019, reporting by Jasmine Sun in The San Francisco Standard revealed a culture shift on college campuses in 2025 towards viewing defense tech jobs as highly coveted. In Sun’s aptly titled article, “Stanford students used to chase jobs at Meta and Google. Now they want to work on defense,” Sun quotes a Stanford student reflecting on her change of heart about the defense industry: “In great power politics, people die. Often more impulsive, less pragmatic men make those decisions, and as a well-educated woman, I’d rather be in the room.” 

For companies like Palantir who profit off of surveillance regimes, armed conflict, and systematic mass killings, accepting the premise that a certain amount of state sponsored death is unavoidable is a necessary requirement to keep business going.

This line of thinking is consistent with Karp’s techno-nationalist logic that takes people dying as an inevitability. For companies like Palantir who profit off of surveillance regimes, armed conflict, and systematic mass killings, accepting the premise that a certain amount of state sponsored death is unavoidable is a necessary requirement to keep business going. Anyone who questions whether human casualties are a necessary part of our world order are pejoratively labeled idealists who do not understand the nuance of international conflict and whose criticisms are therefore not worthy of consideration.

Image by Sophia Leswing.

No Magic Bullets 

On April 15, 2025, President Trump signed an executive order – “Ensuring Commercial, Cost-Effective Solutions in Federal Contracts” – that reaffirmed the importance of FASA and listed additional measures to ensure even greater government efforts to acquire commercially available goods. In the executive order’s accompanying fact sheet, the Trump administration noted that “with respect to IT procurement, a 2019 report found that the Federal government could have saved an estimated $345 billion over the last 25 years if it had abided by FASA and purchased more commercial off-the-shelf IT solutions, rather than building systems from scratch.” No attribution or citation was provided for this 2019 report, but independent journalism revealed the commissioner of the report to be the Alliance for Digital Innovation – a trade group led by executives from commercial technology companies such as Palantir, Google Cloud, and Amazon Web Services. 

“Government ownership and understanding are the most important things for efficiency’s sake. Just thinking you’re going to buy the next magic bullet is not going to work. All it’s going to do – that magic bullet – is hold you hostage for the next 10 years. And if that magic bullet you bought also has bad intentions, then it’s even worse.”

Lawmakers never know the exact effects a piece of legislation will have on society until it is actually enacted. With FASA, President Clinton thought he was solving a pressing national issue of overpriced physical goods which, to his credit, FASA did actually help tackle. However, President Clinton was unaware of the impacts FASA would have on the procurement processes for intangible products like digital services. At least after buying a physical good – however overpriced it might be – the government owns that object. Whereas under FASA, the government is often forced to procure intangible goods like technological systems through recurring subscriptions leading to a dependence on private industry that satisfies short term needs without accumulating long lasting benefits such as government self-sufficiency and public ownership.

At the end of my conversation with Randy Hart, who joined 18F in 2015 because he was inspired by the agency’s commitment to doing government tech differently, he cautioned against the commercial panacea suggested by FASA and emphasized the importance of in-house government talent and knowledge: 

“Government ownership and understanding are the most important things for efficiency’s sake. Just thinking you’re going to buy the next magic bullet is not going to work. All it’s going to do – that magic bullet – is hold you hostage for the next 10 years. And if that magic bullet you bought also has bad intentions, then it’s even worse.”

In one fell swoop, the Trump administration eliminated 18F and the institutional knowledge offered by its 85 employees including Hart – a civil servant with over 22 years of public service alone – a gaping loss for which there is no commercial replacement.