A Million Jobs, and No Political Cover

Loudoun County, Virginia, gets 40% of its budget from data centers and projects $1.3 billion in tax revenue from them next year ^[1]. On September 15, its Board of Supervisors votes on whether to stop building them. One supervisor put the contradiction plainly.

People understood that the data centers were the reason we were building schools and keeping taxes low and those kinds of things. — Buddy Rizer

The economic case is not losing because it is wrong. AI infrastructure spending has created roughly a million American jobs ^[2]. In Richland Parish, Louisiana, a Meta project pushed average weekly wages up 61% ^[3]. Vertiv, which builds the power and cooling equipment data centers run on, has seen its stock double in a year ^[4]. The numbers are real. They are also not buying political protection. The industry's answer to the physical costs driving the backlash has settled into three moves. Deny them. Sam Altman dismissed water concerns as not holding up to scrutiny, comparing 38,000 ChatGPT queries to a single California almond; PolitiFact rated the claim Mostly False ^[5]. Blame someone else. Investor Gavin Baker alleged the opposition is funded by the Chinese Communist Party, a claim researchers found no evidence to support ^[6]. Dismiss the voters. Tommy Tuberville calls the criticism fake news, and Dave McCormick says opposition is just misinformation ^[7].

I think the benefits far, far exceed any of the detriments. — Representative McCormick

The backlash is moving faster than any in recent memory. Candidates of both parties have spent over $45 million on ads targeting data centers since January, split almost evenly between them ^[8]. Port Washington, Wisconsin passed the first municipal referendum restricting data center development, 66.4% to 33.6% ^[9]. Ohio has a constitutional amendment to ban large data centers on the November ballot ^[10]. Abdul El-Sayed won Michigan's Democratic Senate primary running on curbing the boom.

People really effing hate data centers. — Abdul El-Sayed

Opposition to data centers near homes rose from 28% to 41% in six months, a speed one pollster called rare in an era of static partisan attitudes. The backlash does not stop construction. It concentrates it. Jim Cramer calls it a godsend for the hyperscalers: Amazon, Google, Microsoft, and Meta can absorb the regulatory costs and compensate communities, while smaller speculative developers get priced out of land, labor, and power.

They're the biggest beneficiaries, because they can afford to compensate local communities and get their warehouses full of servers built. — Jim Cramer

The economic dividend and the political liability are both growing. The liability is growing faster, because the scale of construction is itself the provocation.