Rethinking a Deal With the Devil
State officials and elected leaders who once championed tax exemption deals with the executives of companies like Amazon, Google and Meta for the development of data centers in their states are now having second thoughts — and some states are taking steps toward making those deals a thing of the past.
It’s a sign that elected officials are belatedly taking notice of voters’ fears about data centers, unregulated AI advancement and the broader agenda of the tech industry. Rampant construction of new data centers around the U.S. has prompted panic about spikes in the cost of electricity, drained water supplies, pollution and artificial intelligence stealing human jobs. It’s underscored by the extreme economic uncertainty that everyone is facing — except, maybe, tech executives and the people who design their messaging.
The Wall Street Journal has a new report out this week examining 10 different states that had previously granted tech companies sales tax exemptions for the equipment needed to run data centers. In each of those states, officials are now having second thoughts. The piece focuses especially closely on Ohio and the work that state legislators did more than 10 years ago to encourage Big Tech investment in the state by offering the sales tax exemption, and the ways in which the artificial intelligence surge of the last four years has resulted in over $1.5 billion in savings for tech companies developing data centers there.
After substantial public pushback, Republican Gov. Mike DeWine back in May placed a pause on new applications for sales-tax exemptions, and some state lawmakers are pushing for the sales-tax exemption to be repealed. Several other states are considering similar actions to end or pause these ongoing tax breaks for tech companies, which “seem to have more money than God,” as one Ohio lawmaker, state Rep. Tristan Rader (D-OH), put it to WSJ.
Elected officials and politicians across the political spectrum are grappling with how to address the sweeping and righteous outrage against data center construction in rural and urban communities across the country. The notable exception is President Trump, who has maintained his allegiance to his big tech friends — who are funding his ballroom, and who donated to his inauguration, among other things. He memorably told Americans that only communities who want to be “backwards and poor” should oppose the new construction. His Environmental Protection Agency, meanwhile, is proposing a federal policy change that will make it easier for data center construction to move forward without input from the public.
Republicans are struggling with how to walk the line, but the backlash has been so severe back home that many are fully breaking with the Trump administration on the matter. Texas’ Republican Gov. Greg Abbott recently announced that he was placing a pause on the ability for new data center projects to be connected to the state’s power grid. Sen. John Thune (R-SD) and Vice President JD Vance have attempted to carve out a reasonable place for Republicans to stand should they not want to bow down whole hog to tech oligarchs, like Trump. The two have both independently suggested that states should look at mandates for tech companies to “be putting power back into the grid” as one way to address Americans’ concerns that the mammoth AI facilities are spiking electricity costs.
Related Reading
As Rader, the Ohio Democrat, said above …
WSJ: More Money Than They Ever Imagined—and No Clue How to Spend It
Bigger Than Politics
You may have seen by now the deadly warning from an Anthropic researcher who resigned from his job and warned that unregulated AI models had the potential to destroy humanity in the next four years.
“I resigned from Anthropic today. I spent the last three years doing pretraining research at both OpenAI and Anthropic,” Anthropic research Jason Coxon, who worked on training models, said on X. “Neither company is acting responsibly. They are racing straight to self-improving superintelligence and gambling with our lives.”
“The people building AI earnestly believe that it could kill us all by the end of the decade. This is not a marketing stunt,” he continued.
Lawmakers across the political spectrum are calling on Congress to do something to prevent what Coxon and others from Anthropic have been forecasting.
One Funny Thing
I’ll bring your attention to one matter in today’s edition of Where Things Stand that is less existential than the threat posed by America’s tech oligarchy. The White House apparently got involved in the recent mystery surrounding Fox News’ ousting of longtime Fox Business News host Maria Bartiromo.
Trump’s trade adviser Peter Navarro said during an interview with Newsmax Tuesday that the White House reached out to network executive to let them know they were dismayed by the decision.
“But suffice it to say that Suzanne Scott got a call, and basically the White House let her know that that kind of thing is totally unacceptable,” Navarro said, referencing the Fox News Media CEO.
Navarro went on to complain about how “out of control” Fox News is, suggesting that the network has become anti-Trump — a suggestion that flies in the face of how often the network bolsters the president’s agenda. After news of Bartiromo’s ouster broke, reports surfaced suggestion the longtime host reportedly shared details of internal editorial decisions with the White House.
“The bigger story here is, forget about anybody thinking that Fox is a conservative network that’s friendly to MAGA, that’s friendly to Trump,” he said. “They’ll feed you some red meat over there — the easy stuff, the trans stuff, stuff like that — but when it comes down to MAGA things, Suzanne Scott gets rid of everybody over there who wants to talk about MAGA issues.”
What to Read From TPM Today
Josh Kovensky and Layla A. Jones report on the Trump administration officially moving to exclude certain noncitizens from being counted in the upcoming Census, finding that the new, official policy is actually more extreme than the draft version that TPM was first to report on in August: Trump Admin Officially Moves to Reshape National Political Power With New Changes to 2030 Census
Kate Riga covered oral arguments today in the abortion pill mifepristone case before the Fifth Circuit Court of Appeals: Appeals Court Skeptical That Louisiana Can Sue FDA Over Mifepristone Being Mailed into the State
John Light helps unpack the convoluted legal situation in Missouri regarding which maps to use in the upcoming election — and what it reveals about the Trump administration’s approach to sowing legal chaos in the election administration process this fall: Dueling Missouri Court Decisions Give Us a Preview of the Kind of Midterm We’re in For
Yesterday’s Top Story
Making Sense of That Big Story Saying Netanyahu Was Warned About Oct 7
What I’m Reading
Jeffries says Trump is too ‘corrupt’ to focus on Americans’ struggles
Trump says he’d consider pardoning Michael Cohen
Associated Press will stick with Lake Ontario over Trump’s renamed ‘Lake America’
