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Palihapitiya: Data center backlash is a GDP risk for AI
Chamath Palihapitiya warns data center backlash could cost the US economy 2-3% of GDP. Political opposition is spreading across Ohio, Texas, and Pennsylvania as AI leaders fail to make their case.
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Venture capitalist Chamath Palihapitiya warned Thursday that the growing political backlash against data centers could become an anchor on the U.S. economy, shaving 2 to 3 percentage points off annual GDP if it spreads.
“This is a powder keg and has the potential to unwind 200-300 basis points of annual GDP if it metastasizes,” Palihapitiya wrote on X.
Palihapitiya, co-host of the “All-In Podcast,” directed his criticism at the “collective leadership of frontier AI,” whom he said have failed to convince the American public of the benefits of their industry. Data centers, the sprawling facilities housing the advanced chips that train and run AI models, have become the focal point of that failure.
“Data centers have unfortunately become THE symbolic representation of the asymmetric upside for a very narrow tech elite and a class that are untrustworthy,” Palihapitiya wrote.
Palihapitiya was responding to a report that the National Republican Senatorial Committee sent a warning to major AI labs about the issue’s electoral consequences. The NRSC memo, confirmed by a person familiar to Business Insider, said Ohio Sen. Jon Husted and former Sen. Sherrod Brown are in a dead heat, and that data centers are a problem for the Republican incumbent.