After a major victory in the midterms, Democrats call for tightening the expansion of AI: "A nationwide suspension order for data centers should be implemented now"
CNBC
1h ago
Ai Focus
After the mid-term elections in the United States, several Democrats publicly called for restrictions on the construction of data centers related to AI, stating that approvals should be suspended and local community decision-making power should be strengthened. Affected by these concerns, stocks related to AI infrastructure declined after the elections, with chip stocks experiencing some of the largest drops.
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After a major victory in the midterms on Tuesday, some Democrats have begun to signal their desire to impose restrictions on the expansion of artificial intelligence, particularly in data center construction.

Vermont Senator Bernie Sanders mentioned in a post on the X platform that during the referendums held across the United States on Tuesday, voters in some areas approved restrictions on data centers. Sanders, who voted alongside Democrats, stated that the message to political leaders is clear enough.

"A national data center suspension order should be implemented now,"He wrote in the post.Americans do not want large tech oligarchs to destroy the environment, drain jobs, and threaten the future of humanity.

In another post on platform X, Yasmin Ansari, a Democratic federal representative from Arizona, wrote that for the Democrats, who hold the majority of seats in the House of Representatives, suspending the development of AI should become one of the top priorities on the first day of their tenure. Gregg Cassar, a Democratic federal representative from Texas and chairman of the Congressional Progressive Caucus, shared this post and wrote:"Yes!"

According to the CNBC voter survey, 56% of voters stated that AI and data centers are key or important factors in their voting decisions. Among these voters, 65% indicated that they cast their votes for Democratic congressional candidates.

Stocks related to the expansion of artificial intelligence fell slightly on Wednesday after the election results were announced, but selling pressure intensified on Thursday as investors feared that a Democratic victory could have a practical impact on data center construction. Chip stocks led the decline. iShares Semiconductors ETF ( SOXX ) tumbled nearly 9% on Tuesday. NVIDIA fell 8%, while Supermicro Semiconductor dropped more than 14%.

Democrats who came from behind in key races on Tuesday also specifically criticized large technology companies and data centers.

On Tuesday, Annie Andrews, a Democrat from South Carolina, managed to flip a Senate seat in that state. During her campaign, she launched a website where she referred to her opponent, Senator Daryn Graham, as..."Data Center Darlin'"Mandatory requirements:

In his victory speech on Tuesday, Andrews stated that voters chose a South Carolina where,"Decisions regarding the community are made by the people who live in it, not by billionaires from Washington D.C. or data center companies."

Ohio Democrat Sherrod Brown will return to the Senate after defeating incumbent Republican Senator Jon Hesterd on Tuesday. In his victory speech, he stated:"I don't work for data centers."

Democratic governors also criticized data centers in their victory speeches. In August of this year, Josh Shapiro, the governor of Pennsylvania, signed an executive order to slow down the development of data centers. He stated that large tech companies should not decide the future of residents."On the contrary, the people of our local communities should have the final say,"He said.

Perhaps the most important state for data center expansion is Texas. According to data from Wells Fargo, this state accounts for 27% of the planned data center capacity.

The Democrat, Gina Inohosa, who defeated the incumbent Republican Governor Greg Abbott, did not directly mention data centers in her victory speech, despite this issue playing a key role in her campaign.

In a video she posted on platform X at the end of October, she stated:"When I am governor, I will issue a suspension order, a ban, to suspend all data center approvals until the state legislature passes a law to protect the people of Texas."She also said,"This is about a struggle. Will Texas ultimately be a state built by the people and for the people, or will it become a world belonging to billionaires, with us merely living within it? Data centers are part of this struggle."

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