Prof G Markets
00:31:38 · Alex Bores
[00:31:38] S6: Well, I think it was Camus who said humans aren't rational. They're rationalizing. So the philosophy of the mind, we can... And and of the voters, can put off there. But there is a... You know, if a data center... I like to point out there are plenty of data centers that exist in my hometown of New York City. They're just in buildings. They're not these big campuses that that impose on land use in lots of ways. So there are legitimate concerns about land use, about power, about noise in some of these places, and all of that's reasonable to talk about. And then there's the separate fact that data centers are the first time that AI is meeting democracy. And so let's say you're fine with a data center, but you're really upset about the way AI is being forced into schools as we saw news with Google this week. Or you're worried about the impact of AI on chatbots or even AI automating your job. You haven't gotten a vote on any of those changes. Polling that Who Decides did that our organization did found that over 70% of Americans agreed that AI has been forced into their workplace, their kid's school, or some other part of their daily life without them being consulted. And so they just feel alienated from being able to make any choice with this technology. And if the first choice you get is whether you could build a local data center, well, I understand people then expressing a broader preference through that vote.
00:33:03 · Ed Elson
[00:33:03] S3: Yeah. It's a great point. Just looking at the market's reaction, so it seems as though investors basically believe that this blue wave, this blue tsunami essentially means that we're gonna have very, very stringent regulation on data centers, or at least data center construction is gonna be significantly slowing down. Neo clouds have sold off massively. All of the all of the names that... Whose only business is to build data centers, they are they are plummeting right now. Interestingly, big tech did not, and it seems as though investors believe that maybe they'll have a competitive advantage over the NeoClouds now, or maybe just that this means that they'll stop spending crazy amounts of money on these data centers, and maybe that's a good thing because it sort of derisks their businesses, unless you disagree with my characterization of what's going on in the markets right now.
00:33:56 · Alex Bores
[00:33:56] S6: I think your characterization is spot on, and I find it fascinating. Right? It expresses a bet that there will be stringent regulation on building new data centers, that that capacity will be curtailed, but that there won't be regulations that impact the profits of the tech companies and the AI companies. That's interesting, right? That is a bet that what voters were expressing and then what the electeds will follow on with is just on data centers. I don't think that matches what I'm hearing from voters. And I also don't think that that matches the what electeds have been talking about and what their incentives are when they're thinking two years down the road. Now, perhaps there's another nuance level of that, which is much of the regulation that's been proposed around AI that isn't data centers, doesn't actually restrict profits all that much. Right? What's being proposed has been tremendously light touch, Even having third party auditors, all the companies have said they wanna do, so maybe that is priced in. I mean, I remember this when it was fights about the RAISE Act in New York, where we had intense lobbying against it, but the trade organization that was fighting back said that it would cost... And right, the group that has every incentive to say this will be a crushing overreach, a crushing burden on business. That trade association said it would cost Meta, and Google, and OpenAI, these massive companies, would cost them one full time employee to comply with. So maybe this is the market recognizing that even if regulation is coming, it's not really gonna threaten profits, and there's room for government to take action here.
00:35:34 · Ed Elson
[00:35:34] S3: Based on the the investors' reaction here, it seems as though they believe... Investors believe, Wall Street believes, that data centers are essentially gonna be gutted. I mean, it's a pretty strong reaction that we're seeing. And I imagine they... I mean, you are kind of the face of this movement in a lot of ways, certainly in New York. And I would imagine that that people see you as someone who says data centers should should just disappear. They should go away. And I wonder if maybe Wall Street investors are overreacting to the extent to which data centers will be disrupted or the build out will be disrupted. To me, it seems like actually a lot of these these newly elected Democrats are pretty reasonable in suggesting maybe we pause this amount of of capacity here until we have a framework in place, which maybe could take, like, you know, less than twelve months. Would you agree with that characterization that maybe that that they're too concerned that we're gonna have this giant crackdown that's gonna kill the data center industry?
00:36:45 · Alex Bores, Ed Elson
[00:36:45] S6: I think that's right. Certainly, there's a spectrum, and and some of the people who were elected yesterday on both sides of the aisle just want there to never be another data center or even to walk back. Right? I'm not gonna say that those voices don't exist. But, yeah, I think most of the people who have... Even those who have advocated for a pause, it's been just that, a pause. Let's get reasonable regulations in place. Let's pass laws that say how it needs to be treated. Even where we started this conversation with Governor elect Innohosa, her two year moratorium was, and these specific regulations need to be put in place before we renew any new ones. So there will still be room to grow the data centers. Now maybe some of these companies are so highly levered that any threat to them, any delay could have larger business impacts. But this is not the end of building data centers in The US. It's just maybe entering a mode where they're a little more regulated. [00:37:40] S3: Alex Bores is a New York State Assembly member and author of the RAISE Act. Alex, we appreciate your time. [00:37:45] S6: Thanks for having me.
00:37:51 · Ed Elson
[00:37:51] S3: Well, The Blunami has arrived. The Democrats took the house and the senate in what will go down as one of the most resounding victories in the history of congressional politics. Across the country, districts swung blue. We saw upsets in Texas, in Kansas, in South Carolina, in Maine, potentially in Mississippi as well. These are states that have not elected Democratic senators literally in decades. This was unlike anything we have seen. Now we will be digesting and analyzing this over the next few days. But to begin, I would like to take a quick victory lap because I predicted a democratic landslide back in June when that was not a popular opinion at all. And I doubled down on that prediction last week, and I even said in my newsletter that this would be similar to the eighteen ninety midterm elections and that it would be one of the greatest defeats ever. And that is exactly what happened here. This was a blowout. It was a bloodbath, a slaughter, whatever you wanna call it. This was huge. Now the question is, what's next? Well, there's been some debate as to whether the Democrats should pursue prosecutions and retribution against Trump. Some people think that it's an unnecessary distraction from the real issues. Others think that it is important. I personally am in the others camp. I think that prosecution is not only important but essential. Why? Well, because it appears that this person actually committed crimes, whether it be bribery or insider trading or abuse of office or securities fraud or covering up a child sex abuse scandal, you name it. And so to not pursue accountability for crimes is to let our politics hijack our justice system. This isn't lawfare. This is simply the law. And if we find that Trump did nothing, then okay. But if he did, then he needs to be punished. And that to me is a nonnegotiable. And if the Democrats don't pursue that, well, then I think they will be admitting weakness and defeat. At the same time, though, they also have to fix the economic problems. They do have to deal with the affordability crisis. That means immediately repealing the tariffs and immediately getting out of Iran. How do they accomplish that? I don't know, but they should try. It also means addressing the housing issues. We have a very significant supply problem in America.