Lots of people still see it in exactly this way. The fact that Palantir IPO'd and is a magnet for investors doesn't contradict this. Palantir always had a reputation for champagne and surveillance.
I also agree with his premise. There is really no gray area working for defense tech in the US. In my opinion people have a rather lopsided view of that. You would rarely find any other nation that where defense tech companies are turned away from job fairs. Kinda ridiculous.
(Also, there are plenty of reasons why the American defense industry is both quanitatively and qualitatively different from those of other nations, e.g. France, Sweden – i.e. its disproportionate involvement with arms sales, its involvement with defense boondoggles and the opportunity cost, etc. Regardless of the grays, when the system is black, entire countries are painted black.)