Data Centers
If You Are Against Them, You Are Playing Into Chinese Hands
I have watched the debate unfold across the country on data centers. It’s a hot debate in Nevada. I was speaking at the Boulder City Republican Women’s Club in late May. A person who builds data centers spoke before me and dispelled a lot of the false arguments against data center buildouts.
For some in the room, it didn’t matter. These “data dogs” who supposedly form their opinions on data believed the hype and were against data centers. One question: “Why are they building data centers where it is hot when they get hot and need to be cooled?”
You might say the same for that person’s house or a fast food restaurant that gets built.
We know people are easily misinformed. My bet is the same Republicans who are against data centers were against the response to Covid. This time they took the bait and played into the hands of the anti-progress people.
Let’s get the hyperbole out of the way.
Data centers do not increase energy prices. They generate their own energy. Here is a photo of an energy plant Elon Musk built in Mississippi for a data center a few hundred feet away across the border in Tennessee. You can internet search why he did that. He wanted to build it all in Tennessee, but people are dumb.
Data centers do not take a lot of water. They get filled up with water, and 100% of it is recycled. They don’t use evaporative cooling. Some book was written with false information in it by an activist, and people cite it all the time. Data centers use about the same amount of water as two fast food restaurants. In fact, some data centers use artificial coolant. Where there is a problem, there is an entrepreneur. I just came across this Nevada-based company. WAVR Technology can make water out of desert air. The problem will be solved for data centers soon.
Data centers do not cause cancer or disease. This is totally false. Yes, they make some noise, but they shouldn’t be built in residential areas anyway.
What do they do? They create thousands of jobs during construction. They create hundreds of jobs when they operate. They sustain millions of tech jobs after being built.
They generate millions of dollars in tax revenue for state and local governments.
If you live in a rural town, where are you going to get the money to sustain your city services and schools? You are faced with a hard choice. Grow, or raise taxes. Data centers are growth and might be a lot better than a mining operation or something else. If your community is against a data center, how is a factory going to build there?
The idle vacant land in the middle of nowhere isn’t productive. Putting a data center on it is hugely productive.
Yes. People and communities ought to have input. We shouldn’t take every inch of land and put data centers on it. Areas are zoned industrial for a reason. There can be traffic issues, but those are solvable.
For what it is worth, I bet the anti-data center crowd has no problem at all with taking that same land and putting in an inefficient solar installation.
It’s not hyperbole to say it is a national security issue. Our military needs data centers.
Someday soon, they will build them in space. But we need them today. I’d encourage you to listen to this podcast from about 14 minutes in to 23 minutes, where they discuss data centers.
Artificial intelligence is here, and it will expand. It’s not going away. Bernie Sanders and the communists are against it because it usurps their power if they can’t control it.
Open source artificial intelligence will make it significantly harder to have one company dominate. Data center buildout enables open source and increases the total volume of compute power so the United States can have fierce competition between companies.
That’s better for you.
The anti-data center movement reminds me of the anti-nuclear power movement. The US blew it. We are forty or fifty years behind. Nuclear power offers up incredibly cheap green energy. But the Luddites are still against it, including every Democrat in the Nevada federal delegation.
Our US economy isn’t agrarian or “factory” now. Factories are fine, but America is an on-demand energy information economy. We are building robots, electric vehicles, driverless vehicles, and software. If you are at all interested, follow Aayush Pathak on Substack. Aayush Pathak is building chips for physical artificial intelligence and explains it well. You will have robots in your home soon. In fact, technically you do today if you have a washing machine. The new robots won’t be dedicated to one task, and will be able to perform multiple tasks.
As a matter of fact, our agrarian and factory ecosystems in the US need data centers to produce and innovate. You need them for your cell phone, computer, and general standard of living as well.
The Chinese are building data centers like crazy because they know they are in a race for tech supremacy with the US. They want to see the anti-data center crowd win.
My friend Nick Kokonas used to trade treasuries at the CBOT. He cofounded a three star Michilen restaurant, Alinea. He also started a restaurant reservation business, Tock, which he sold. He and I don’t agree on everything, but we agree wholeheartedly on data centers. He tweeted:
The politicians and people who are against "data centers" (a ridiculous catch-all) are creating bills against progress, abundance, and literally intelligence itself.
There is a certain irony to that last point.
But it is truly painful to watch. And a line in the sand.
The idea that atmospheric water generation is going to source water for evaporative coolers is insane ignorance of thermodynamics.
Otherwise mostly agree. There are extremely good reasons we need them in friendly political jurisdictions instead of China.
I'll give you point 3. Jeff - I'm not viewing data centers as cancer centers any more than wind turbines are or 5G cell towers. It's not correct to simply assert 1. and 2. though. You could say data centers development in certain parts of the country and on the grid don't have to raise energy costs. You could also have a great debate about the good things that come from raising the cost of energy in different cases. Data centers don't actually all "bring their own energy" today (nor would it necessarily be great if they all did so - we do have headroom on the existing grid that can be supported with distributed energy equipment. Data centers absolutely utilize hundreds of thousands to millions of gallons of water. R&D on cooling and recycling are in progress - but by no means a solved issue in the industry.
It's not going to work to just call people stupid and say they are going to let China win. Endless conflict isn't inspiring to Americans. We are actually going to have to do the tough work with governments, public utility commissions, and utilities to continue evolving rules that make sense for economic growth of the country. In my view- the strategic vision really matters in terms where we are heading in order to drive coordination and speed. Perhaps it's because we are going through the muck of GenAI bs - but the tech leaders actually publicly speaking today aren't saying anything worth driving toward. Oh yes, please take us to the land of our kids having no jobs, damaged brains by social media and digital learning techniques...where we have to take care of them for the rest of our lives... except we too will be ground down and replaced so that the government can take care of us with universal income as we await our chances to being bred into some different kind of human perhaps? At that point, wouldn't we just as well blow up? Get it done quickly. Usually not this blunt - but leaders really need to start filling the vaccuum with accurate information, insights and wisdom about a future that seems healthy and rational on data centers and technology... for people to embrace and take forward.