Data centers consume enormous amounts of electricity, require water for some cooling systems, create relatively few permanent jobs, and are increasingly unpopular with the communities where they're built. So why do I think stopping them would be an economic mistake?
My argument is not that the costs are imaginary. Grid strain, noise, water consumption, and poorly designed tax incentives are legitimate concerns. But many of these are engineering, infrastructure, and policy problems—not reasons to abandon the computing infrastructure increasingly underpinning AI and the digital economy.
In this video, I examine why the data center boom is happening, what communities are actually objecting to, and whether America would ultimately pay a greater price by slowing it down.
CHAPTERS
00:00 Why Data Centers Are Facing a Backlash
03:07 What a Data Center Actually Does
05:03 The Jobs Argument
06:33 Data Centers as Infrastructure
07:31 The Power Grid Problem
09:21 Big Tech Starts Investing in Power
09:59 The Water Problem
10:08 Can Engineering Solve the Cooling Problem?
12:26 The Subsidy Debate
14:32 Making Data Centers Benefit Communities
14:59 The Data Center Conspiracies
16:53 The Cost of Blocking Infrastructure
17:38 The Bigger Risk of Underinvestment
20:50 Where Data Centers Should Be Built
21:57 The Anti-Technology Backlash
23:09 AI, Jobs and Big Tech Anxiety
SOURCES & FURTHER READING
U.S. DATA CENTER ELECTRICITY DEMAND
U.S. Department of Energy / Lawrence Berkeley National Laboratory — 2024 United States Data Center Energy Usage Report
https://escholarship.org/uc/item/32d6m0d1
MICROSOFT'S $80 BILLION AI INFRASTRUCTURE INVESTMENT
Microsoft — The Golden Opportunity for American AI
https://blogs.microsoft.com/on-the-issues/2025/01/03/the-golden-opportunity-for-american-ai/
SCALE OF THE DATA CENTER INVESTMENT BOOM
McKinsey & Company — Scaling Bigger, Faster, Cheaper Data Centers with Smarter Designs
https://www.mckinsey.com/industries/private-capital/our-insights/scaling-bigger-faster-cheaper-data-centers-with-smarter-designs
NORTHERN VIRGINIA'S “DATA CENTER ALLEY”
Loudoun County, Virginia — Data Centers: The Loudoun Story
https://www.loudoun.gov/6408/Data-Centers-The-Loudoun-Story
DATA CENTER WATER CONSUMPTION
Lawrence Berkeley National Laboratory — 2024 United States Data Center Energy Usage Report
https://escholarship.org/uc/item/32d6m0d1
LBNL estimates U.S. data centers directly consumed roughly 17.4 billion gallons of water in 2023, up from approximately 5.6 billion gallons in 2014.
Water requirements vary substantially depending on cooling technology, geography, and facility configuration.
AMAZON / SUSQUEHANNA NUCLEAR DATA CENTER CAMPUS
Talen Energy — Talen Energy Reports Fourth Quarter and Annual 2023 Results
https://ir.talenenergy.com/news-releases/news-release-details/talen-energy-reports-fourth-quarter-and-annual-2023-results-line
GOOGLE / ADVANCED NUCLEAR POWER
Google — Our First Advanced Nuclear Reactor Project with Kairos Power and Tennessee Valley Authority
https://blog.google/company-news/outreach-and-initiatives/sustainability/google-first-advanced-nuclear-reactor-project-with-kairos-power-and-tennessee-valley-authority/
DATA CENTER TAX INCENTIVES
National Conference of State Legislatures — Subsidizing Servers: How States Are Competing to Attract Data Centers
https://www.ncsl.org/fiscal/subsidizing-servers-how-states-are-competing-to-attract-data-centers
AI INVESTMENT AND U.S. GDP GROWTH
Federal Reserve Bank of St. Louis — Tracking AI's Contribution to GDP Growth
https://www.stlouisfed.org/on-the-economy/2026/jan/tracking-ai-contribution-gdp-growth
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