New leaders vow to pause data center growth after election wins

The iShares Semiconductor ETF fell nearly 9% on Tuesday, marking the start of a steep decline in tech shares. By Thursday, the selling had intensified as investors reacted to election results. Nvidia shares dropped 8%, while Advanced Micro Devices lost more than 14% of their value.

The market move followed a sweep of victories for Democrats in the midterm elections held on Tuesday. According to a CNBC Voter Poll, 56% of voters cited AI and data centers as a major factor in their choice. Among those voters, 65% supported Democratic candidates for Congress. The results gave Democrats a large majority in the House and control of several key state governments.

Sen. Bernie Sanders, an Independent who caucuses with Democrats, posted on X that the results signaled a clear mandate. He called for a national data center moratorium immediately. "Americans don't want Big Tech oligarchs wrecking the environment, gutting jobs and threatening humanity's future," he wrote. Rep. Yassamin Ansari from Arizona agreed, stating that pausing AI development must be a Day 1 priority. Rep. Greg Casar, chair of the Congressional Progressive Caucus, amplified Ansari's post with a simple "Yes!"

Winning candidates in battleground states also targeted the industry during their victory speeches. In South Carolina, Democrat Annie Andrews defeated incumbent Sen. Darline Graham. Andrews had labeled her opponent "data center Darline" during the campaign. In her speech, Andrews said voters chose a state where local people, not Washington billionaires, make decisions. In Ohio, returning Sen. Sherrod Brown told supporters, "I do not work for data centers."

Pennsylvania Gov. Josh Shapiro, who signed an executive order in August to slow development, said big tech companies should not determine residents' futures. He emphasized that local communities must have the final say. Texas holds the largest share of planned capacity, with 27% of the total according to Wells Fargo. New Gov. Gina Hinojosa, who defeated incumbent Greg Abbott, did not mention data centers in her victory speech. However, she posted a video in late October promising a moratorium on all approvals until the legislature passes protective laws.

Hinojosa framed the issue as a choice between a state governed by its people or a world dominated by billionaires. The new leadership in these states now holds the power to influence how quickly new facilities can be built.