Imagine if, during World War II, there had been protests outside factories making tanks and airplanes, urging them to shut down. Picture, too, a time right before the Pearl Harbor attack when American industries were ramping up their production capabilities, and then, cities started to impose restrictions on new factories and shipyards, attempting to control what they could produce and where—unless it was conveniently close. A reasonable person in that era would likely have realized that only our enemies benefitted from such obstructionist behavior.
Fast forward to today, where we’re dealing with a different sort of conflict: an AI race with China. The two sides have fundamentally different aims in this technological landscape. Whereas U.S. companies, alongside the Trump administration, view AI as a means to enrich society and enhance individual freedom, China, in contrast, aims to utilize AI to impose greater control over its citizens while seeking to exert global dominance.
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Currently, the U.S. and China stand as the primary contenders in the AI domain, controlling approximately 90% of the world’s AI computational power. The U.S. holds a substantial 75% share, leaving China with about 15%. This is noteworthy. Yes, China is increasingly investing in critical AI applications and sees this technology as essential for military and strategic advantage. But the U.S. maintains a lead in generative AI and is quickly solidifying its presence in both industrial and military applications.
Yet, this potential is undermined by the current push against data centers. Across the U.S., around 78 local governments have enacted moratoriums or bans on new data centers. Although New York has set an official moratorium on new constructions, an additional 14 states are exploring similar restrictions, with some surprising inclusions like Florida, Oklahoma, and Georgia.
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If this trend gains traction and receives backing from major political parties, notably the Democratic Party, it could lead to permanent bans. That would leave China as the sole victor—much like a WWII ban on defense production would have favored Nazi Germany and Japan.
The stakes extend beyond mere economics. A ban in Georgia alone could result in the loss of about 552,000 jobs and around $850 million in tax revenue. Some would even argue that this threatens our freedom itself.
However, the rationale behind the ban is rooted in misunderstandings. For instance:
- Opponents claim that new data centers will hike electricity prices, but they could actually reduce prices by spreading costs over a larger customer base.
- Moreover, rather than consuming excessive potable water, many data centers operate with almost no water usage—96% of the time, some don’t use any at all. In fact, golf courses use significantly more water, totaling over 500 billion gallons annually nationwide compared to approximately 230 billion for data centers.
- Contrary to claims that local economies suffer, the construction of data centers tends to generate jobs. A study by the Brookings Institution found that local employment in construction can increase by 11% when a new data center is built, while jobs in related sectors like IT and telecommunications can rise by 22%, not to mention wages that increase by 3-4% for both existing and new employees.
This economic growth from data centers supporting AI will also lead to soaring tax revenues instead of straining public finances. Small businesses, not just tech giants, will reap benefits, allowing them to compete effectively in the marketplace, helping revive U.S. manufacturing.
Estimates suggest that the AI framework, underpinned by data centers, could add trillions to the U.S. economy, translating to a GDP growth increase between 1.5% to 3.7% annually.
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Yet there’s more at stake than just economic gains. Data centers that enable AI growth also play a crucial role in national security. From military applications, like the use of drones in combat zones—which has become evident in the Ukraine conflict—to cyber threat detection, analyzing intelligence, and organizing military logistics, AI enhances our defense capabilities. It also streamlines manufacturing, preparing us for potential confrontations with China.
Ultimately, the choices we make regarding data centers will significantly influence our future freedoms. It’s vital that we choose a path that benefits us and generations to follow—not that of a bureaucratic regime like the Chinese Communist Party.
