Investors see risk from US midterms to AI trade as data center backlash builds
QQQ•Investors are watching whether opposition to data centers and election outcomes could slow AI infrastructure expansion, which is expected to attract more than $1 trillion in spending next year. A Democratic sweep of Congress could bring more AI-related hearings and investigations, while state and local races may affect development rules and costs.
1. Midterms and AI scrutiny
Public opposition to data centers is emerging as a potential risk to the AI trade ahead of the US midterm elections. Companies including Alphabet and Amazon are investing heavily in data centers, and spending on data centers and other AI infrastructure is expected to top $1 trillion next year.
2. Congressional oversight
A Democratic sweep of the Senate and House could lead to more hearings and investigations into AI and data center construction, though analysts doubt legislation that significantly impedes expansion would become law. A Reuters/Ipsos poll found that 69% of Democratic registered voters support limits on data center construction, compared with 43% of Republicans. President Donald Trump has said companies building data centers should pay communities a “dividend.”
3. Local races matter
Investors are also tracking state and local elections, where officials can influence data center development. Analysts said policy uncertainty is unlikely to derail AI investment, but could disrupt its timing and cost.
