By America’s artificial-intelligence boom is running into an increasingly powerful obstacle: the people who have to live next to the infrastructure that makes it possible.
Growing public resistance to data centers is pushing politicians in several states to restrict, delay, or impose new conditions on projects that only recently were being welcomed as engines of investment and economic growth. Texas and New York have moved to halt or limit new facilities, while Pennsylvania is imposing tougher requirements on developers.
The backlash is real, writes The Daily Caller. So are many of the concerns driving it. But there is an enormous difference between forcing technology companies to bear the costs of the infrastructure they require and simply deciding America should stop building it.
President Donald Trump, increasingly isolated politically on the issue, is right about that distinction.
Texas Republican Gov. Greg Abbott made perhaps the most dramatic move in early August, ordering a sweeping pause affecting proposed data-center projects across the state.
“My directive has halted up to 1,800 data center projects. I established guidelines & guardrails to protect Texas communities,” Abbott wrote in a Wednesday social media post.
My directive has halted up to 1,800 data center projects.
I established guidelines & guardrails to protect Texas communities:
✔️Data centers must not take water needed by local communities,
✔️They must not take power needed by the Texas power grid,
✔️They must lower the cost…— Greg Abbott (@GregAbbott_TX) August 20, 2026
Abbott said data centers should not drain local water supplies, weaken the electric grid, or disrupt surrounding neighborhoods.
His administration argues the policy is not an attempt to drive the industry out of Texas, but to force developers to bear more of the costs created by their projects.
Andrew Mahaleris, Abbott’s press secretary, told the Daily Caller News Foundation: “What Governor Abbott is doing is working. The Governor established clear guidelines: Data centers must invest their own money, provide their own power, reuse their own water, ensure that the power grid is gaining power—not losing power because of their operations—and must not disturb neighborhoods. Data centers across the state have announced their full compliance with those standards, which provide guardrails that protect our communities.”
That approach contains an important principle: Texans should not be forced to subsidize some of the richest companies in the world.
But the moratorium itself has alarmed technology executives who fear that Texas, long considered one of the country’s most business-friendly states, is joining the growing political movement against the infrastructure necessary to power AI.
Coinbase co-founder and CEO Brian Armstrong responded critically on social media Thursday: “This is really unfortunate — I thought TX would be the last hold out against this ignorant thinking, and continue to be a place to build! Require them to bring their own power, and it’s a net positive all around.”
Coinbase moved its incorporation from Delaware to Texas in November 2025, with Armstrong praising the state’s “strong culture of celebrating builders who are growing our economy, creating prosperity for all” and its willingness to embrace cryptocurrency and other emerging industries.
Trump has been even more direct.
“I saw Texas the other day is sort of against data centers. I think it’s a mistake. I think they are tremendously important for the economics. This is, for Texas to say ‘no’ to data centers, is a mistake — in the sense that it could be bigger than oil. Data centers could be bigger than oil,” Trump said in a Punchbowl News interview published Aug. 7.
"You have communities that really want the data centers and, frankly, those are the smart communities," President Trump said Thursday while speaking at the Environmental Protection Agency on energy prices.
He said data center construction brings "tremendous numbers of jobs" with… pic.twitter.com/KQ6pUpsstq
— CBS News (@CBSNews) July 23, 2026
Trump’s position is politically risky. Opposition to data centers has spread across party lines, and Sen. Bernie Sanders is now attempting to turn that anger into a broader campaign against the AI buildout.
Sanders renewed his call Sunday for a national moratorium on AI data centers, pointing to polling showing that roughly three-quarters of Americans oppose having one built near them. The Vermont independent and Rep. Alexandria Ocasio-Cortez have already introduced legislation seeking a federal moratorium on new AI data centers.
Five months ago, AOC and I called for a moratorium on new AI data centers.
We were called “radical,” “crazy” and “extremists.”
Today, 75% of Americans agree and hundreds of candidates are responding.
The message is clear: We need a moratorium.
— Bernie Sanders (@BernieSanders) August 23, 2026
Sanders has framed the issue as larger than electricity or water use. Earlier this year, he argued that AI threatens jobs and could place too much power in the hands of technology companies, declaring: “We are rapidly creating technology that could surpass human intelligence, with enormous risks to jobs, society and humanity itself. AI must work for all of us, not just a handful of billionaires. That’s why I’m introducing a moratorium on new AI data centers.”
That is where legitimate concerns about data centers risk turning into something far more damaging: an attempt to stop technological development itself.
Noting that Americans would rather live by a nuclear power plant than a data center, investor and energy expert John Arnold offered a better response this week. Arnold argued that governors are justified in worrying about the effects of data centers, but that blanket moratoriums are bad policy. Instead, he called for firm rules governing power infrastructure, water, taxes, and benefits for surrounding communities so that the projects produce gains for both developers and residents.
Nearly 3 times as many people (44% vs 15%) say they'd support a nuclear power plant being built near where they live than a data center. That is insane. pic.twitter.com/RaBgCFjuep
— John Arnold (@johnarnold) August 20, 2026
It is a distinction policymakers would be wise to preserve.
Data centers should pay for the electricity infrastructure they require. They should not push the cost of new substations, transmission lines, or generation onto families who already live there. They should address water consumption and negotiate with communities over land use. And local governments should think carefully before handing enormous tax subsidies to companies already prepared to spend billions of dollars securing computing capacity.
None of that requires stopping the buildout.
In fact, Trump has already embraced part of that approach.
In July, his administration expanded its Ratepayer Protection Pledge, an initiative designed to prevent data-center development from raising household electricity bills by having the companies benefiting from the projects shoulder the costs of new generation and grid infrastructure. By July 23, the White House said 23 governors and at least 187 companies — including utilities and data-center developers — had joined the effort.
That is a far more promising response than a moratorium.
Texas does face a genuine electricity challenge. Abbott has said proposed data centers were projected to require “five times the amount of power that we have available.”
“This simply is not going to work,” he said.
Abbott also said the Texas Public Utility Commission contacted every operating or proposed data center seeking information about current and expected electricity usage but received responses from fewer than 10 percent.
The industry needs to do better.
The Data Coalition, a trade group representing data-center companies, said its members remain committed to “ensuring data centers are true partners in every Texas community where we operate, protecting residential ratepayers, strengthening grid reliability, and promoting responsible water stewardship.”
Oracle, which operates major artificial-intelligence infrastructure in Texas, has issued a similar pledge.
Texas is hardly alone in confronting the issue.
New York has moved to block construction of large data centers exceeding 50 megawatts, while Pennsylvania Democratic Gov. Josh Shapiro has imposed new requirements on developers seeking state support.
“My message to data center developers is clear: if you can’t agree to our strict requirements and get the community where you want to build to say ‘yes,’ you’re not going to have the Commonwealth’s support either,” Shapiro said. “These are some of the biggest companies in the world – they can afford to be good neighbors, follow the rules, and do this right.”
More than 530 counties and local governments nationwide have banned or restricted data-center construction, according to Heatmap. An August Heatmap survey conducted by Embold Research found that roughly 75 percent of registered voters strongly or somewhat opposed construction of a data center near their neighborhood, while just 15 percent supported it.
Robinson Meyer, Heatmap’s founding executive editor, called the change “a faster and deeper shift in American public opinion than I would have once thought possible on any issue.”
Politicians should pay attention to that anger. They should not mistake it for a mandate to surrender the future.
Artificial intelligence requires enormous computing power, and computing power requires physical infrastructure. The United States cannot simultaneously demand leadership in AI and refuse to build the facilities necessary to achieve it.
China is not going to halt its AI development because American voters dislike warehouses full of computer chips. Nor will artificial intelligence disappear because New York, Texas, or Congress declares a moratorium. The investment will simply move somewhere else.
Trump is right on the fundamental question. America should build.
The better response to the data-center backlash is not to pretend that communities have nothing to complain about. It is to make developers pay their own way, protect ratepayers, expand power generation and transmission, respect local property owners, and ensure that communities sharing the burden of technological growth also share in its benefits.
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