The thing is nobody is saying the government is bad for not renewing the contract. Like it or not, that's definitely the administration's prerogative.

What we're seeing here is that when a vendor declines to change the terms of its contractual agreement for ethical reasons, the government publicly attacks it.

Perhaps for ethical reasons but a stated reason by Anthrophic is technical. "But today, frontier AI systems are simply not reliable enough to power fully autonomous weapons."

With the other stated reason being legal. "To the extent that such surveillance is currently legal, this is only because the law has not yet caught up with the rapidly growing capabilities of AI."

I don't think we should lessen Anthrophic's stance from technical/legal to ethical. Just as we shouldn't describe what the department of war is doing as "not renewing a contract".