Data Center Backlash Isn’t Killing AI Spending. It’s Changing Where the Money Goes.

Listen to the audio version of this article (generated by AI).

Editor’s note: “Data Center Backlash Isn’t Killing AI Spending. It’s Changing Where the Money Goes.” was previously published in September 2026 with the title, “What the History of Electric Wires Can Teach Us About the Data Center Backlash.” It has since been updated to include the most relevant information available.

One October, in the late 1880s, just before 1 p.m., two Western Union linemen climbed a pole in lower Manhattan to cut down dead electrical wires. Only one returned alive.

Atop the 50-foot-high pole, crowded with electric wires, a nearby fireman caught a terrifying glimpse of the grisly scene.

One of the men, John Feeks, fell from the pole, struck a crossarm, and came into contact with an electric wire.

At that moment, “The current was completed,” the Ann Arbor Register reported.

Feeks’s body stiffened. His leg remained hooked over the crossbar.

“There was no movement.”

His coworker scrambled down and fled. Below, people witnessed a scene Deputy Coroner Jenkins described as the most ghastly he had ever seen. Even afterward, Jenkins could not say whether the current had killed Feeks immediately: “The shock may or may not have killed him instantly.”

The horror soon became public fury, and a full-blown electric wire panic. Building owners cut wires above their rooftops. Newspapers demanded accountability. The next day, Mayor Hugh Grant ordered unsafe wires removed.

New York had already passed legislation requiring wires to go underground. Feeks’s death gave that longstanding fight a terrible urgency.

The Backlash Didn’t Stop Electrification

Put yourself in an investor’s shoes.

A technology that promised to transform everyday life had become a source of public terror. As a result, authorities ordered its infrastructure torn down.

Would you have bet on the future of electricity?

Two years later, a traveling lineman named Henry Miller organized a convention in St. Louis that founded what became the International Brotherhood of Electrical Workers. Today, electrical power-line installers and repairers earn a median $95,320 a year, or nearly twice the median for all occupations.

The lesson I draw is that a technology’s dangers can make the work of building and maintaining it more valuable.

And that brings me to AI.

When investors see backlash, they tend to ask how much growth it could destroy. I think there’s another question worth asking:

How do we solve the problems standing in our way?

That’s the question I’d bring to the AI debate in 2026. Because investors who see only the panic may be putting fear of the unknown ahead of the opportunity.

$130 Billion in Projects Were Blocked or Delayed

Let’s give the panic its due first – because it’s real, and now it’s measurable.

Organized opposition delayed or blocked an estimated $130 billion worth of U.S. data-center projects in the first quarter of 2026 alone. New York enacted the nation’s first statewide moratorium on new hyperscale facilities over the summer. And AWS chief Matt Garman says more than 100 local moratoriums are now under consideration across the country, as communities push back on electricity prices, water use, construction, and secrecy around new projects.

The industry is already reaching for the old playbook. 

Amazon (AMZN) just committed more than $1 billion to its host communities in a move we’d call the 2026 version of burying the wires.

The electric industry didn’t win its fight by dismissing public fear but by spending money to address it. 

The data-center industry just started doing the same thing.