Data center backlash could threaten US AI boom

Financial correspondent Lydia Moynihan discusses the ongoing debate regarding artificial intelligence data centers, as some states push for bans or restrictions on their construction during a segment of ‘The Ingraham Angle.’

Artificial intelligence (AI) seems to be everywhere these days. It’s in our conversations, news reports, and social media chatter. Interestingly, there appears to be a concerted effort among certain political figures and their media allies to raise alarms about AI, claiming it poses risks to jobs and could harm the environment. But when you see a united front among Democrats and liberal reporters on any issue, it certainly makes you wonder—what exactly are they so worried about?

The underlying motivation appears to be an effort by left-leaning voices to gain control over AI for their political advantage. Democratic strategist Jesse Ferguson succinctly articulated this: the struggle isn’t really whether to embrace or reject AI; it’s fundamentally about who gets to control it.

It seems that there’s an intention to manipulate public perception of AI as a means to install bureaucratic oversight that aligns with their agenda. Just think back to how tech companies acted as censors during the Biden administration; there is a desire among some Democrats to wield the same influence over AI, turning it into a tool for political gain.

But, to follow through on this, they first need to instill a sense of fear that would make you comfortable with government control over AI. And, naturally, they might not be sharing the full picture when it comes to the benefits of AI and data centers.

1. AI and data centers are reviving small towns

AI and data centers are playing a crucial role in revitalizing small towns that largely supported Trump—areas that had suffered economic decline, especially post-manufacturing offshoring.

Take Ellendale, North Dakota. This small town, with a population of roughly 1,000, was in dire straits until a data center moved in. Its school superintendent once said, “We were a dying little town.” But the arrival of the data center changed that narrative dramatically.

Job opportunities soared, tax revenues increased, and as a result, the town could renovate its roads, upgrade facilities for seniors, and much more. It’s not an isolated case. In Louisiana’s Richland Parish, where Trump enjoyed a significant electoral margin in 2024, the tax influx from a Meta data center enabled local teachers to receive bonuses of $50,000.

Then there’s Louisa County in rural Virginia, where data center jobs not only brought employment but also resulted in lowered taxes due to increased tax revenues. Quincy, Washington, witnessed a surge in investment from data centers that led to a new high school, a drop in poverty rates, and improvements in public services. Overall, data centers are providing substantial economic benefits that extend beyond their immediate impact.

2. Nobody is telling you the truth about water and utility bills

There’s a lot of misinformation surrounding water use and utility costs linked to data centers. Not only are electric companies quick to place blame, but figures like Rep. Alexandria Ocasio-Cortez have also contributed to the misrepresentations.

Cost increases in utilities began long before AI entered the mainstream, and President Trump’s Ratepayer Protection Plan seeks to ensure that AI companies contribute fairly, which should shield consumers from any unanticipated spikes in rates. In fact, recent data supports that data centers can even contribute to reduced electric bills for surrounding communities.

In Ellendale, for example, residents saw a decrease of $250 on their electricity bills attributed to the new data center. It’s hard to argue against a $250 savings, right?

The narrative surrounding water consumption by data centers has also been skewed. A bestselling book, “Empire of AI,” was found to contain multiple factual inaccuracies and overestimations regarding water use, and even major outlets like the Washington Post highlighted these flaws. Many data centers are transitioning to closed-loop cooling systems that minimize water usage significantly, effectively nullifying concerns about water consumption.

3. AI is helping the little guy most of all

For a long time, large corporations have had a clear advantage—they can invest in teams of professionals that small businesses simply cannot afford. However, AI is shifting the landscape, giving small companies access to advanced tools and resources they might have previously thought out of reach.

Russell Kaplan, the head of Cognition AI, believes we’re on the brink of a “small business explosion” due to AI advancements. And small business owners are echoing this sentiment; a Cash Flow Trend Report found that a majority are utilizing AI and seeing positive results.

Moreover, blue-collar workers are also benefiting from this AI revolution, often seeing better job opportunities and pay. Host Mike Rowe recently remarked on his podcast about a visit to a Texas data center, where he met young electricians making upwards of $240,000 annually. It turns out that everyone has something to gain from a robust and prosperous workforce—everyone, that is, except those who wish to keep the status quo.

As our world undergoes rapid changes, it’s worth pausing to reflect when someone tries to instill fear about the future of American AI development. Consider asking yourself: Who stands to benefit from this fear? What agenda are they pushing? And, crucially, are they being completely truthful?

Exploring the answers to these questions could provide valuable insights.