Much already has been written about Palantir Technologies’ abrupt and troubling announcement on X last week it was exiting Colorado. 

The high-profile artificial intelligence and software company, co-founded by tech and venture capital VIP Peter Thiel, had moved its headquarters from Palo Alto, Calif., to Denver only six years ago. Now, it will decamp for Miami, leaving Colorado’s business and political leaders with jitters over what the move might mean.

Make no mistake, it’s an alarming development in more ways than one. 

Palantir’s departure is, of course, an economic blow in its own right. That’s abundantly clear in an analysis released Tuesday by Colorado’s Common Sense Institute. The institute’s report calculated the direct costs of the company’s relocation of its highly paid, high-tech staff of 724: a loss of 544 people from Colorado; $106 million a year in gross domestic product; $178 million a year in economic output, and $107 million a year in income. 

But what should grab the attention of Colorado’s elected leaders in particular are the potential implications for our state that extend well beyond the loss of Palantir itself. Common Sense Institute’s analysis reflected tellingly on that, too.

“The direct impacts of immediate employment loss are substantial, given the high pay scale of the company itself and the executive positions lost. However, they do not account for Palantir’s potential to damage Colorado’s reputation within the technology sector,” the report states.

“The departure of Colorado’s most highly valued public company…could compromise the national reputation that the state cultivated over the last 15 years,” the report continues. “High-profile companies’ exits from one state to another may engender a less favorable reputation, particularly when they accuse state policy of creating a hostile business climate.”

The report also notes, “In an investor filing, Palantir cited proposed Colorado AI policy as a reason for its exit.”

Indeed, that major stumble on artificial intelligence regulation by our state’s legislature — among many recently enacted laws that chill Colorado’s ability to create jobs — stands out as a singular blunder.

The legislature’s bungled 2024 attempt at one of the first AI regulations in the nation — purportedly to regulate “algorithmic discrimination” — was supposed to take effect Feb. 1. But lawmakers came under fire — even from Gov. Jared Polis, who had signed the sweeping regulation into law — for its likely impact on our state’s ability to attract AI investment. Polis has stated it would be better to leave it to Congress to come up with any regulatory framework for the development and use of AI technology so it could be uniformly applied nationwide.

Lawmakers relented only a bit, moving off the implementation date of the law to June 30. In the meantime, talks are supposed to continue among the legislature, the governor’s office and leaders in the state’s tech sector. Repeated attempts to modify the legislation or to start over have been rebuffed by hard-liners in the legislature.

Even before its implementation, the law’s mere presence on Colorado statute books is having the predicted effect. The fact Palantir included it in its calculus for leaving should set off warning bells for our state’s policymakers.

As The Gazette reported last week, publicly traded Palantir’s most recent risk report for shareholders filed with the federal Securities and Exchange Commission compared Colorado’s “state-level oversight” to the European Union’s Artificial Intelligence Act. 

The report states, “Compliance with such obligations may be difficult, onerous, and costly, and could adversely affect our business, reputation, financial condition, results of operations, and growth prospects.”

Our legislature is undermining Colorado’s ability to attract leading-edge tech investment. Owing to a host of other laws, lawmakers are doing the same to our ability to attract business investment in general. 

After only six years, Palantir evidently had enough. It’s another wake-up call for Colorado.