Meta warns election backlash against data centers could threaten AI expansion

What did Meta say about the midterm impact on data centers?

Meta president Dina Powell McCormick told the WSJ Tech conference on Wednesday that the Democratic sweep in this week's midterm elections will make it harder to build data centers, the physical backbone of the AI industry.

"I think it's going to be harder," Powell McCormick said when asked about the future of data center construction after the election. She said the industry has "not done as good a job as we needed to explain the benefits of these investments" to local communities.

The comments reflect a growing recognition across the tech sector that the political environment around AI infrastructure has shifted. Voters in dozens of communities approved moratoria on new data center construction during the midterms, with 43 out of 44 local data center restriction measures passing, according to data compiled by the nonprofit group Data Center Watch.

How big is Meta's data center footprint?

Meta operates data centers across 23 states and has five projects in the pipeline that are planned at 1 gigawatt or more, including one in Texas, Powell McCormick said. The company has been building its own data centers for roughly 20 years, she noted, long before the current AI boom made compute infrastructure a high-profile political issue.

"The visible manifestation of AI is a data center, and it's something that people can say, 'I don't want this in my community,'" she said. "I think there's an underlying bigger issue, which is how people feel about AI in general."

The political backlash was already a factor in Meta's planning. The company has been positioning its data center projects as local economic wins, paying for its own electricity, directing tax surpluses toward teachers and first responders, keeping labor local, and securing bipartisan support for each build. Powell McCormick said this model has worked and that communities only want data centers when they see direct benefits.

What is Meta doing to address the backlash?

Meta is betting that demonstrating the concrete value of AI technology to ordinary people will turn around negative sentiment. "The stakes of who builds the technology that cures cancer, that gives access to education, that is also a very fundamental difference," Powell McCormick said, describing CEO Mark Zuckerberg's view.

The company's consumer AI agent, Muse, has reached 10 million users, and Meta believes it can scale to serve billions. But even if its own AI ambitions don't require every megawatt it has contracted, Powell McCormick said the compute itself will be valuable. "We're getting calls every day to lease that compute, and so one way or another, we're seeing a path to monetization," she said.

How does this connect to the broader AI infrastructure picture?

Meta's warning adds to the post-election uncertainty around AI infrastructure. The Nasdaq Composite fell 5.5 percent into correction territory on Thursday, with AI stocks losing roughly $2.5 trillion in market value as investors priced in the risk that a Democratic Congress and local government opposition will slow data center buildouts.

For context on the market reaction, read our earlier coverage of the AI stock rout and the data center slowdown panic.

The data center moratoria that passed during the midterms span both red and blue states, suggesting the issue transcends party lines. Communities have raised concerns about water usage, noise from backup generators, pressure on local power grids, and the limited number of permanent jobs data centers create once operational.

The midterm outcomes for data center policy were covered in how data centers lost the midterms and the Democratic plan for Congress to limit data center expansion.

What happens next?

Powell McCormick said she expects data center projects to face more review and be weighed against whether constituents actually want them. Going forward, communities are likely to demand that data center operators demonstrate local benefits before approving new builds, rather than treating them as automatic economic development wins.

For Meta, the political headwinds could complicate the company's ambitious AI roadmap. The company has pinned its growth on Muse and other AI products, and it has committed tens of billions of dollars to data center capacity. If local opposition slows down construction, Meta may need to lean harder on leasing existing infrastructure or expanding existing sites rather than breaking ground on new campuses.

The broader question of whether the AI boom can survive its own infrastructure backlash was examined in previous coverage of AI super PAC spending and the results of those political investments.