Category: Data centers
Big Tech’s AI boom hits voters hard — and Democrats pounce
Wouldn’t it be a bitter irony if Republicans lost the midterms — maybe even in conservative red states — because Democrats outmaneuvered them on the dangers of the AI data-center boom? The left now warns voters about land seizures, rising electric bills, water shortages, and Big Tech’s unchecked power. Meanwhile, Republicans stay quiet as Trump himself champions the very agenda voters increasingly fear.
During the Biden years, Republicans attacked Big Tech censorship, digital surveillance, Agenda 2030 land-grabs, and the artificial online culture reshaping young Americans. Every one of those concerns now intersects with the data-center explosion — energy demands, land use, power monopolies, and the rise of generative AI — but the political right barely whispers about it.
Republicans can channel AI toward focused, beneficial uses and away from a dystopian model that erodes civic life. Voters already want that shift.
Democrats don’t make that mistake. They see a potent electoral weapon.
Georgia hadn’t elected a Democrat statewide since 2006. Yet Democrat Peter Hubbard defeated a Republican incumbent on the Public Service Commission by 26 points by hammering “sweetheart deals” GOP officials granted hyperscale data centers. Voters in the state face repeated rate hikes linked to the massive energy demands of Big Tech facilities.
“The number-one issue was affordability,” Hubbard told Wired. “But a very close second was data centers and the concern around them just sucking up the water, the electricity, the land — and not really paying any taxes.”
He wasn’t exaggerating. In 2022, Georgia’s Republican legislature passed a sales-tax exemption for data centers. In 2024, a bipartisan bill attempted to halt those tax breaks, but Gov. Brian Kemp (R) vetoed it. Voters noticed — and punished the GOP for it.
Georgia now surpasses northern Virginia in hyperscale growth. Atlanta’s data-center inventory rose 222% in two years, with more than 2,150 megawatts of new construction under way. It’s no mystery why Democrats flipped two PSC seats in blowouts.
Republicans lost because they defended crony capitalism that inflated energy bills, devoured land, and fed an AI industry conservatives once warned about. If Kamala Harris had pushed the data-center agenda as aggressively as Trump now does, Republicans would be in open revolt. But Trump’s support silences the conservative grassroots and leaves Democrats free to define the issue.
Virginia tells the same story. Democrat John McAuliff flipped a GOP seat by attacking Big Tech’s land-grab and the rising utility costs tied to data-center expansion. He blasted his opponent for profiting while family farms vanished under the footprint of hyperscale development. He became the first Democrat in 30 years to carry the district.
At the statewide level, Democrat Abigail Spanberger won the governor’s office by arguing that AI data centers must pay their “fair share” of soaring energy costs. She framed the issue as a fight to protect families from Big Tech’s strain on the grid.
New Jersey voters heard similar warnings as they faced a 22% electric rate increase. Democrat Mikie Sherrill defeated Republican Jack Ciattarelli by double digits after blaming part of the spike on hyperscale energy demand. She pledged to declare a state of emergency to halt increases and require data centers to fund grid upgrades.
This pattern repeats in reliably red states.
Indiana saw dozens of new hyperscale proposals, yet not a single Republican official pushed back. Ordinary citizens blocked one of Google’s planned rezonings near Indianapolis. Liberal groups — like Citizens Action Coalition — filled the leadership vacuum and demanded a moratorium on new data centers, calling it a fight against “big tech oligarchs that are calling all the shots at every single level of government.”
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Kyle Grillot/Bloomberg via Getty Images
Republican leaders, meanwhile, worked to ban states from regulating AI at all. This summer they attempted to insert a sweeping prohibition into the budget reconciliation bill that would bar states from regulating data-center siting or AI content for 10 years. House Majority Leader Steve Scalise (R-La.) now seeks to attach the same language to the FY 2026 defense authorization act. President Trump backs the provision.
Instead of ceding the issue to the left, Republicans should correct course. They can channel AI toward focused, beneficial uses and away from a dystopian model that erodes civic life. Voters already want that shift. A new University of Maryland poll found residents believe — by a 2-1 margin — that AI will harm society more than it helps. More than 80% expressed deep concern about declining face-to-face interaction, the erosion of education and critical thinking, and job displacement fueled by AI.
Capital expenditures cannot sustain the current pace of expansion, and public patience with Big Tech’s demands is running out. The political party that recognizes these realities first will earn the credit. Right now, the party that once defended property rights, community values, and human-centered technology is getting lapped by the party that partnered with Big Tech oligarchs to censor Americans during COVID.
Republicans still have time to lead. But they won’t win a fight they refuse to join.
When the AI bubble bursts, guess who pays?
For months, Silicon Valley insisted the artificial-intelligence boom wasn’t another government-fueled bubble. Now the same companies are begging Washington for “help” while pretending it isn’t a bailout.
Any technology that truly meets consumer demand doesn’t need taxpayer favors to survive and thrive — least of all trillion-dollar corporations. Yet the entire AI buildout depends on subsidies, tax breaks, and cheap credit. The push to cover America’s landscape with power-hungry data centers has never been viable in a free market. And the industry knows it.
The AI bubble isn’t about innovation — it’s about insulation. The same elites who inflated the market with easy money are now preparing to dump the risk on taxpayers.
Last week, OpenAI chief financial officer Sarah Friar let the truth slip. In a CNBC interview, she admitted the company needs a “backstop” — a government-supported guarantee — to secure the massive loans propping up its data-center empire.
“We’re looking for an ecosystem of banks, private equity, maybe even governmental … the ways governments can come to bear,” Friar said. When asked whether that meant a federal subsidy, she added, “The guarantee that allows the financing to happen … that can drop the cost of financing, increase the loan-to-value … an equity portion for some federal backstop. Exactly, and I think we’re seeing that. I think the U.S. government in particular has been incredibly forward-leaning.”
Translation: OpenAI’s debt-to-revenue ratio looks like a Ponzi scheme, and the government is already “forward-leaning” in keeping it afloat. Oracle — one of OpenAI’s key partners — carries a debt-to-equity ratio of 453%. Both companies want to privatize profits and socialize losses.
After public backlash, Friar tried to walk it back, claiming “backstop” was the wrong word. Then on LinkedIn, she used different words to describe the same thing: “American strength in technology will come from building real industrial capacity, which requires the private sector and government playing their part.”
When government “plays its part,” taxpayers pay the bill. Yet no one remembers the federal government “doing its part” for Apple or Motorola when the smartphone revolution took off — because those products sold just fine without subsidies.
The denials keep coming
OpenAI CEO Sam Altman quickly followed with a 1,500-word denial: “We do not have or want government guarantees for OpenAI datacenters.” Then he conceded they’re seeking loan guarantees for infrastructure — just not for software.
That distinction exposes the scam. Software revolutions scale cheaply. Data-center revolutions depend on state-sponsored power, water, and land. If this industry were self-sustaining, Trump wouldn’t need to tout Stargate — his administration’s marquee AI-infrastructure initiative — as a national project. Federal involvement is baked in, from subsidized energy to public land giveaways.
Altman’s own words confirm it. In an October interview with podcaster Tyler Cowen, released a day before his denial, Altman said, “When something gets sufficiently huge … the federal government is kind of the insurer of last resort.” He wasn’t talking about nuclear policy — he meant the financial side.
The coming crash
Anyone paying attention can see the rot. Nvidia, OpenAI, Oracle, and Meta are all entangled in a debt-driven accounting loop that would make Enron blush. This speculative bubble is inflating not because AI is transforming productivity, but because Wall Street and Washington are colluding to prop up stock prices and GDP growth.
When the crash comes — and it will — Washington will step in, exactly as it did with the banks in 2008 and the automakers in 2009. The “insurer of last resort” is already on standby.
The smoking gun
A leaked 11-page letter from OpenAI to the White House makes the scheme explicit. In the October 27 document addressed to the Office of Science and Technology Policy, Christopher Lehane, OpenAI’s chief global affairs officer, urged the government to provide “grants, cost-sharing agreements, loans, or loan guarantees” to help build America’s AI industrial base — all “to compete with China.”
Altman can tweet denials all he wants — his own company’s correspondence tells a different story. The pitch mirrors China’s state-capitalist model, except Beijing at least owns its industrial output. In America’s version, taxpayers absorb the risk while private firms pocket the reward.
RELATED: Stop feeding Big Tech and start feeding Americans again
Credit: Photo by Mario Tama/Getty Images
Meanwhile, the data-center race is driving up electricity and water costs nationwide. The United States is building roughly 10 times as many hyper-scale data centers as China — and footing the bill through inflated utility rates and public subsidies.
Privatized profits, socialized losses
When investor Brad Gerstner recently asked Altman how a company with $13 billion in revenue could possibly afford $1.4 trillion in commitments, Altman sneered, “Happy to find a buyer for your shares.” He can afford that arrogance because he knows who the buyer of last resort will be: the federal government.
The AI bubble isn’t about innovation — it’s about insulation. The same elites who inflated the market with easy money are now preparing to dump the risk on taxpayers.
And when the collapse comes, they’ll call it “national security.”
