PayPal Mafia Takes Over U.S. Government, Filling Vacant Public Positions with AI

Musk's xAI launches government AI model

After ousting 260,000 public servants with DOGE

Will their own government AI fill the vacancies?

Peter Thiel's Palantir also expands government collaboration

US Democrats: "Trump will surveil citizens"

Elon Musk's artificial intelligence (AI) startup xAI released its government agency AI model on the 14th (local time). Analysts suggest that this move aims to replace the large number of U.S. federal employees laid off through the Department of Government Efficiency (DOGE) with AI.

xAI announced on its website that it is offering advanced AI services for the U.S. government called ‘Grok for Government.’ Grok for Government is a service based on state-of-the-art AI models such as Grok 4, released by xAI on the 9th. According to xAI, it provides a wide range of functions, including daily services like report summarization as well as research in security, healthcare, and basic science, along with engineering capabilities.

Additionally, xAI stated that U.S. government agencies will now be able to purchase its products through the General Services Administration (GSA). The GSA, which oversees federal procurement, remarked, “Various agencies are reviewing multiple AI solutions, and we welcome all American companies and models that meet our requirements.”

Musk, who recently led the Department of Government Efficiency (DOGE), has repeatedly insisted that “AI should replace public servants.” According to Reuters, between last December and this April, 260,000 federal employees departed the government through layoffs, voluntary resignations, or early retirements following DOGE’s activities. Foreign media view the launch of xAI’s government AI model as the execution of Musk’s vision to fill the vacancies left by public employees with AI.

Peter Thiel's AI company, Palantir, known as part of the 'PayPal Mafia' alongside Musk, is also expanding its role in government under the Trump administration. In 2019, during Trump's first term, Palantir signed its first major $800 million (about ₩1.1 trillion) contract with the U.S. Army, and has since increased its cooperation with defense and intelligence agencies. Recently, even agencies such as law enforcement, immigration authorities, and the CDC have entrusted Palantir with data management, raising concerns about potential privacy violations. On the 17th of last month, eight Democratic lawmakers, including Alexandria Ocasio-Cortez, sent a letter to Alex Karp, CEO of Palantir, warning that “If massive databases are built and shared with or accessed by federal agencies, it could lead to a 'surveillance nightmare,' making it easier for the Trump administration to monitor and target Americans.”

Silicon Valley = Kim Inyeob, Special Correspondent inside@hankyung.com