Data Centers Power AI, But At What Cost?

The Velvet-Glove Disruptor

The Unlikely Battlegrounds of AI

In a world where computing power is the lifeblood of artificial intelligence, federal regulators have issued an unprecedented order: grid operators must connect big power users faster to fuel the data centers that run AI. This push came at the behest of Energy Secretary Chris Wright, who recognized the urgency of the United States' AI race with China.

But as this directive takes effect, a parallel battle is unfolding – one where state and local officials are vehemently opposing the construction of those very same data centers. The war cry is "not in my backyard," a refrain that echoes through every community where AI's mightiest machines threaten to alter the status quo.

This struggle is merely a symptom of a larger, more insidious trend: lawmakers nationwide are moving to restrict AI based on speculative harms, rather than addressing the actual problems these technologies pose. This shortsighted approach has far-reaching consequences – and those who suffer the most are the very people who should be benefiting from this technological revolution.

Consider the case of algorithmic rental pricing, software that reads local market data and suggests rents. California, New York, and other states have banned it outright or are considering doing so, citing concerns about fairness and transparency. But what is the actual harm caused by this technology? In reality, it merely reports on supply-and-demand trends in a given area, never altering those conditions. Austin, Texas, serves as a prime example: rents fell despite the use of AI-driven rental pricing, thanks to a rapid expansion of housing supply.

Then there are the states banning AI from mental healthcare – Nevada and Illinois prohibiting AI systems from providing therapy. While these laws may be well-intentioned, they ultimately deprive individuals of access to valuable resources during times of crisis. Parents and healthcare providers should ensure that teens do not rely on AI as a replacement for professional health consults; however, the laws themselves do nothing to address the underlying issues.

This pattern is all too familiar: lawmakers targeting technologies rather than addressing the actual harms they may pose. The result? A cost that no one records – and thus, no one pays. Renters who never found suitable accommodations, patients denied access to care, shoppers forced to pay more, and consumers reliant on foreign technologies are just a few examples of those who suffer in silence.

As AI continues to evolve at breakneck pace, the stakes grow higher. The answer lies not in blanket bans or restrictions but in thoughtful regulation that addresses specific harms while respecting the potential benefits these technologies can bring. Before lawmakers restrict anything, they should ask themselves two simple questions: What specific harm are we addressing? And can the laws we already have handle it?

Regulating AI is a complex issue, to be sure – but one that demands careful consideration rather than knee-jerk reactions. The alternative is a future where Americans pay more for slower service while the computing power and jobs created by these technologies migrate to countries willing to let them thrive.