A New Political Landscape for AI

Following recent election results, a wave of candidates campaigned on holding AI companies accountable to the American public. The industry now faces the prospect of increased regulation and significant hurdles for infrastructure development.

Industry Response and Private Concerns

AI companies are facing a new threat from lawmakers who campaigned on tech oversight. While major CEOs have remained largely silent, private discussions indicate concerns regarding compute capacity constraints and the potential for moving data center construction projects to international locations.

The Data Center Backlash

AI companies are facing a new threat from lawmakers who campaigned on tech oversight.

Publicly, most major AI company CEOs have remained silent. OpenAI and Anthropic did not provide comments; Elon Musk’s call on X to vote “red” for the midterms vanished after results poured in.

Privately, CEOs have discussed significant compute capacity constraints, with some considering moving data center construction abroad. AI executives are reportedly nervous about the results, while some incoming leaders have promised to call CEOs to testify.

Tuesday’s results were described as a “total repudiation” of the AI field by experts, noting that AI touches every aspect of people’s lives, from job applications to electricity bills, and that voters are tired of lacking agency in the conversation.

The bipartisan backlash against data center construction is a tangible manifestation of this sentiment. 43 out of 44 local data center moratoria on Tuesday’s ballots passed. In Texas, governor-elect Gina Hinojosa plans to issue a moratorium on all data center approvals until laws are passed to protect residents.

“Data centers were clearly on the ballot,” said Guru Sethupathy, GM of AI governance at Optro.

Residents are concerned about noise pollution, electricity bill rate hikes, and more. When polled, 76 percent of voters opposed data centers in their communities.

“The data center backlash is one of the most bipartisan political issues I’ve ever seen,” said Shaunna Thomas of the Guardrails Alliance.

“Data centers are an entry point to looking at this broader corporate accountability lens,” said Kyle Jacobs-Morse of The Tech Oversight Project, noting that campaigns in states like Texas, Georgia, and Ohio prioritized issues like spillover costs for local residents.

“I do think we’ll hear more questions about who benefits from and who pays for AI, especially as it pertains to infrastructure,” said François Ajenstat, CEO of Golden Analytics.

Experts suggest the results have ended attempts to bar state-level AI restrictions, with expectations for more “tech accountability bills” moving forward.

While OpenAI has begun calling its data centers “compute campuses,” midterm results suggest that a significant portion of American voters are not swayed by these rebranding efforts.

“I don’t think it was working, and I think the prospect of it working is extremely low after the election,” Thomas said.

“The Trump idiosyncrasies around some of this stuff… they did not play well at the ballot box,” Jacobs-Morse said.

Some industry observers suggest the results could help prevent an AI bubble. Katie Barr, CEO of Glen Echo Group, described the results as a reckoning on affordability, jobs, safety, and community agency.

Analysts at Yorkville Ives & Co. noted that while tech investors should prepare for hurdles in legislation and a slowdown in data center construction, there could be a “slight positive” in avoiding an AI bubble.

Future Regulatory Outlook

There will likely be a reckoning on AI safety. Some legislation is already being considered, such as a bill to ban superintelligence introduced by Sen. Bernie Sanders and Rep. Greg Casar.

While some have dismissed AI safety concerns, Adam Kovacevich of Chamber of Progress expects safety legislation to continue to gain momentum in blue states.

“There’s a lot of open questions about where democrats go next on tech policy,” Kovacevich said.