Local governments spent years competing to attract data centers with tax breaks. Brookings senior fellow Darrell West tells Yahoo Finance’s Brooke DiPalma that the bargaining has flipped, and communities now want tech companies to pay them for the right to build. He explains why energy, water and land use have turned public opinion against the buildout, how the issue is running in Senate races in Ohio and Texas, and why paying more at the local level starts to show up in the returns on AI infrastructure.
Featuring
Darrell West, Senior Fellow, Center for Technology Innovation, Brookings Institution
Brooke DiPalma, Senior Reporter, Yahoo Finance
Timestamps
0:00 Energy, water and land use, and how opinion turned
1:29 Why communities stopped offering tax breaks
2:38 The Senate races where it has become an issue
4:01 Who ends up paying, and what it does to returns
5:02 Whether the buildout actually slows
On the polling: the 64% figure cited here is from a Reuters/Ipsos survey of 4,531 people published in June 2026, in which 64% disagreed that building data centers at a rapid pace is mainly a good thing. A more recent ABC News, Washington Post and Ipsos poll published October 21, 2026 found roughly two-thirds oppose new data center construction nationally, with 30% in support.
In Ohio, Democrat Sherrod Brown is running against Republican Senator Jon Husted. In Texas, Republican Attorney General Ken Paxton faces Democrat James Talarico.
#DataCenters #AI #Midterms #Brookings #YahooFinance
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