The Election Day Revolt That Threatens America’s AI Boom

The biggest names in America’s artificial-intelligence boom gathered at the San Francisco Opera House on election night for a show hosted by Nvidia CEO Jensen Huang.

They were there to see “The Marriage of Figaro.” But over wine and passed hors d’oeuvre, executives in tuxedos buzzed about an emerging threat to their industry, people in attendance said: election results were coming in overwhelmingly against the massive build-out of computing capacity that Silicon Valley is counting on to power its future.

By Wednesday morning, senior leaders at OpenAI were discussing whether the results meant the company would have to reset expectations regarding its data center capacity next year, according to a person familiar with the conversation.

Americans’ vote for candidates and ballot measures to ban or slow data center development could rein in AI’s rapid growth and become a big business problem for the companies on the edge of technological progress. It also threatens to hobble an AI boom powering the U.S. economy.

Tech companies were already struggling to secure enough computing power to meet growing demand for their products. If construction stalled, an already fragile situation could turn dire.

Voters backed Democratic candidates, from Ohio and Michigan to Texas and Georgia, who have been critical of data center construction and pledged to slow or pause their rollout. More than a dozen towns in Ohio voted to halt or restrict new development. Similar bans passed in towns in Kansas, Florida and California—a near universal rejection across dozens of measures that signals growing bipartisan opposition.

Texas Governor-elect Gina Hinojosa lamented during her campaign that the state had become a “wild west” for data center development. “It stops when I’m governor,” the Democrat said. She called for a pause on data center construction until the Texas state legislature can pass new regulations.

Texas, Georgia and Ohio account for more than 40% of all planned data center capacity in the U.S., according to investment bank Evercore ISI. OpenAI’s Stargate is under construction in Texas and it is planning another massive data center effort—Project Camellia—in Georgia. Meta is building a large data center in Texas and another dubbed Prometheus in Ohio.

Anthropic, which has signaled that it could spend up to $895.4 billion on computing power in coming years, warned investors last month in a securities filing of the risk of having “significant compute” in the U.S. and said moratoriums could delay or prevent the construction of facilities it needs.

The election results come against a backdrop of growing voter concern about AI over issues ranging from hacking and job losses to data centers’ strain on local power and water systems.

There were few concrete details from Democrats elected on promises of everything from outright bans to more scrutiny. But slowing the rapid growth of properties that house the hardware for AI systems could upend one of the main drivers of U.S. economic growth. A large number of projects already approved for construction will continue, offering another dose of growth and investment for the near term. Still some future projects, even some well into the planning stages, could be scrapped or at least delayed.

“This is going to probably elongate the timelines for the data-center build-outs,” Sequoia Capital partner Pat Grady said at the WSJ Tech conference Wednesday. “That’s probably the most tangible impact of what happened with the elections yesterday.”

AI investment is projected to account for 1.9% of gross domestic product this year, according to Goldman Sachs, the biggest share of economic growth for the build out of a new industry since the railroad boom in the 19th century. And 750,000 new jobs in the U.S. from 2023 through September were also tied to AI, according to LinkedIn estimates.

Shares of data-center companies extended a recent stretch of volatility Wednesday, with CoreWeave sliding nearly 10% and Applied Digital falling almost 7%. Investors had sold bonds tied to CoreWeave and other companies in the sector in recent weeks because of fears about higher interest rates and their debt levels. Many in the tech industry had also been bracing for data-center activity to slow down because of bipartisan backlash.

“Now with this blue wave I think it’ll slow down even more,” Brad Gerstner, a venture capitalist who invests in AI companies, said on the “All-In” tech podcast late Tuesday, adding that roughly 25% to 35% of next year’s data-center build-out in the U.S. could be at risk. “That’s why I think it will be really challenging for the AI infra trade,” he said, referring to shares of data-center companies.

SpaceX CEO Elon Musk poured nearly $500 million into the midterms, while others in the sector donated tens of millions of dollars to help elect candidates who are more open to data-center development.

“Data centers in space looking pretty appealing right now,” Musk said on X early Wednesday, referring to his idea of locating the facilities in orbit to avoid challenges building them on Earth. He resides in Texas and SpaceX is based there.

“The revolt against data centers was one of the top issues of the 2026 election,” said Rep. Greg Casar (D., Texas), a progressive who was re-elected and supports a nationwide moratorium on new data centers. Casar believes the anti-AI sentiment will define future elections. “In a few years we will look back on it as just the early tremor of a much bigger AI earthquake upending American politics.”

About 56% of voters nationally said data centers were a crucial or major factor in their picks for Congress, according to a national survey conducted by polling firm SSRS.

The data-center build-out has buoyed economic growth at a time when overall hiring has slowed and other economic sectors have stagnated. The boom has flooded many rural communities with investments and property-tax revenue. Tech companies have paid for new fire houses. In Richland Parish, La., tax revenue linked to Meta paid for $50,000 bonuses for public school teachers.

Tiffany O’Donnell, mayor of Cedar Rapids, Iowa, said at the WSJ Tech conference on Tuesday that two data centers under construction have been a boon to her city. They have attracted $8 billion in capital investments and tens of millions of community benefit dollars.

Still, the projects have come at a political cost. O’Donnell’s family and dog were threatened by a resident angry over the data centers. Detractors have given her the nickname “Tiffany O’Data Center.”

The largest data center building sites employ thousands of construction workers for years, though the facilities employ far fewer people once they are up and operating.

A decline in new data centers would likely slow down overall construction employment, at a time when building other types of commercial real estate, such as apartments and office buildings, is contracting.

“Data centers have been the primary driver of construction spending growth,” said Anirban Basu, chief economist at the Associated Builders and Contractors, a construction trade group. “One can imagine that the data center construction boom is going to really soften over the next couple of years.”

Several Democrats who scored big wins in the Senate including James Talarico of Texas, Michigan’s Abdul El-Sayed and Annie Andrews in South Carolina attacked their Republican opponents for supporting data centers and proposed new federal restrictions to curtail activity.

One political-action committee advocating for data center restrictions said it had wooed voters with an ad attacking David Sacks, the venture capitalist and White House AI adviser who has opposed AI regulations. The ad showed Sacks getting rich investing in AI while blocking regulations in his role advising the president.

Anti-data center ire also powered the vote in Alaska, where the Democratic candidate for Senate, Mary Peltola, criticized incumbent Republican Sen. Dan Sullivan’s eagerness to court AI firms. Peltola was leading in that race as of late Wednesday.

“I just tried to vote anti-data center for every single candidate,” said Wendi Deschamps, a Peltola voter and environmental scientist in Girdwood, Alaska, a small town surrounded by seven glaciers about 45 minutes from Anchorage.

Matt Sforza, a 35-year-old teacher in Sunbury, Ohio, said on Tuesday that he planned to vote for a local ban on big data centers. He worried about damage to the local water supply and other environmental hazards.

“I think we kind of need them, just to keep up with the demands of all the things they do,” said Sforza, who used to vote Republican but said he has swung Democrat in recent years. But it “feels like there might be a better way to do it than putting it right next to schools and people’s houses.”

The Sunbury ban passed in a landslide.