Lawmakers Warn China May Be Fueling US Data Center Backlash as Local Bans Spread

From Legal Insurrection

Voters in a California city ban AI data center construction, plans for Utah data center shrinking over backlash, Seattle issues one-year prohibition on center construction.

Posted by Leslie Eastman 

In addition to some interesting developments in the Los Angeles primary — the results of which are yet to be completely determined — voters in the nearby city of Monterey Park had the chance to consider the fate of artificial intelligence (AI) data centers in the region.

They chose to ban them.

About 86 percent of voters in Monterey Park, Calif., voted in favor of the measure in Tuesday’s elections, according to election results from the county clerk.

The measure declares a prohibition on data centers citywide in order to “protect air quality, drinking water resources and public health” and “prevent impacts to electricity and water rates.”

It comes in response to a proposed data center project in Monterey Park, which was ultimately withdrawn earlier this year after the city council adopted a moratorium on data center construction.

Data center moratoriums and restrictions have gained traction across the country at the state and local level in the face of rising community pushback to the sprawling server warehouses that are central to the AI boom.

In first, California city overwhelmingly votes to permanently ban datacenters | Sanya Mansoor, The Guardian

Residents in Monterey Park, California, became the first in the US to vote on a permanent ban on datacenters on Tuesday, and early results indicate a resounding victory… pic.twitter.com/fXcCbFFJgu

— Owen Gregorian (@OwenGregorian) June 4, 2026

In the wake of backlash to a data center being in built in Utah, businessman Kevin O’Leary has agreed to cut the project area in half, from around 40,000 acres to around 20,000 acres.

Of the remaining 20,000 acres or so of the project area, around half would remain undeveloped and set aside as agricultural space or for wildlife, reducing the effective area facing development to 10,000 acres.

In a letter Thursday to Utah Senate President Stuart Adams, O’Leary said he’d remove two of the three proposed project areas from the data center initiative, one measuring around 19,430 acres in the Locomotive Springs area, another measuring around 620 acres abutting I-84. That would leave the third, more southeasterly parcel in the Hansel Valley, measuring around 20,000 acres.

“We agreed to remove the 19,000-plus in Locomotive and the 600 or so by the highway,” said Paul Palandjian, chief executive officer of O’Leary Digital, chaired by O’Leary and the business entity pursuing the initiative. “I think (that) addresses a lot of people’s concerns.”

“O’Leary shrinking Utah data center after backlash” – The Hill #SmartNews #Ban DATACENTERS https://t.co/YaV8BjKvmQ

— Sweet Tea (@LaurenSexyGirl) June 4, 2026

In Seattle, the city’s Land Use and Sustainability Committee voted unanimously this week to advance a moratorium on large-scale data centers.

If passed by the full City Council, the city would impose a one-year ban on data centers that use more than 20 megavolt-amperes, roughly equivalent to 20 megawatts. In that time, the city would study regulations that might allow large-scale data centers under certain conditions.

There were 30 public commenters at Wednesday’s meeting, the overwhelming majority who expressed concern about data centers’ electricity and water use, financial and environmental impacts, land use and noise. Several also voiced broader opposition to artificial intelligence.

Committee Chair Eddie Lin, who co-sponsored the moratorium bill, said he was concerned about the impact of “mega data centers” and how they may require the city to rely more on electricity generated from fossil fuels.

Amazon engineers in Seattle slam employer for building AI data centers while laying off 30,000 staffers | Annie Palmer, CNBC

Key Points

– Amazon engineers railed at their employer for conducting mass layoffs while committing to spend $200 billion this year on AI infrastructure,… pic.twitter.com/R4MgOJvLpX

— Owen Gregorian (@OwenGregorian) June 4, 2026

In the wake of these developments, it’s important to note that the House Energy and Commerce Committee asserts there is evidence that “strongly suggests” China and other foreign adversaries are fueling campaigns opposing data centers to undermine the U.S. in the artificial intelligence race.

Lawmakers on the panel urged in a new letter to the Trump administration to step up oversight of possible ties between China and anti-AI forces in the U.S., fretting that the international subterfuge could undermine American dominance.

“Our nation is locked in a race with China to innovate and lead the world in the development of Artificial Intelligence technologies,” House Committee on Energy and Commerce Chairman Brett Guthrie (R-Ky.) told The Post.

“The fact that Chinese Communist Party-backed entities and other foreign adversaries may be attempting to influence decisions related to American data center infrastructure puts into perspective how serious of a fight we are in.”

 — REPORT: House Republicans warned that evidence “strongly suggests” China and other foreign adversaries may be helping fuel anti-data center campaigns in the United States in an effort to slow American AI development and gain an advantage in the global race for artificial… pic.twitter.com/UIMQViXbpO

— Belaaz News (@TheBelaaz) June 4, 2026

The local votes in Monterey Park and Seattle may look like ordinary civic environmentalism, but the House Energy and Commerce Committee’s warning reframes them in a far more sobering light.

Evidence “strongly suggests” that CCP-aligned entities and foreign adversaries are actively fueling campaigns to block American AI infrastructure, which is the same infrastructure Beijing is simultaneously subsidizing at home for its own AI competitors.

Paired with “virtue signaling” and NIMBY attitudes, these developments suggest that the future of AI in this country may not be quite what its promoters have advertised.

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46 Comments
ResourceGuy
June 6, 2026 6:17 pm

That leaves more capex spending for projects in TX, AR, TN, and MS. Bring it on.

Scissor
June 6, 2026 6:18 pm

I’m not sure a slow down would be such a bad thing but the situation is reminding of Y2K, opposition to fracking, FF, etc.

Giving_Cat
June 6, 2026 6:22 pm

> [T]he House Energy and Commerce Committee’s warning reframes them in a far more sobering light.
> Evidence “strongly suggests” that CCP-aligned entities and foreign adversaries are actively fueling campaigns to block American AI infrastructure, which is the same infrastructure Beijing is simultaneously subsidizing at home for its own AI competitors.

McCarthy redux.

George Thompson
Reply to  Giving_Cat
June 6, 2026 8:11 pm

Um, not to be difficult here and this will upset some folks, but McCarthy was on to something, like it or not. USSR then, and now we have a much better organized China at the gate…and the usual idiots in Congress. So, your point…?

Reply to  George Thompson
June 7, 2026 4:37 am

Yeah, there were actual communists in the U.S. government, just like McCarthy said there were.

It was the Democrats/communists who were telling the lies.

The Democrats have a long history of lying about things, right up to the present day.

2hotel9
Reply to  George Thompson
June 7, 2026 5:55 am

McCarthy was right, just unpleasant.

Jeff Alberts
Reply to  George Thompson
June 7, 2026 7:18 am

McCarthy was definitely right. And we’re seeing the fruits of the Communist efforts starting back then all around us. Bezmenov told us and we ignored him.

MarkW
Reply to  Jeff Alberts
June 7, 2026 11:14 am

Slightly off topic.
The Presbyterian Church in the US is about to split into open civil war.
Seems some conservative has proposed a change to the church’s bylaws that if a pastor is in a sexual relationship with someone, it should be a monogamous one.

No requirement that the pastor be in such a sexual relationship.
No requirement that the pastor be married to the person he or she is boinking.
No requirement about the gender of either party.

Just the notion that the pastor only be in a sexual relationship with one person is too much for the liberal wing of what was once an actual church.

MarkW
Reply to  Giving_Cat
June 7, 2026 7:10 am

McCarthy was right. There were communists in the state department and many of them, as we learned when the Soviet Union fell, were actively spying for the Soviets.

Socialists always scream McCarthy, whenever the rest of us get too close to the truth.

George Thompson
Reply to  MarkW
June 7, 2026 7:27 am

Tail gunner Joe…I was way too young at the time, but I remember my Mom (who worked in a torpedo factory in WW2) talking about him, and the times. I got tired of hearing about it, but as I grew up and learned more, much more, about the Red Scare and spys in our Gov and State Dept.—well, very sobering and my mother was right. And BTW, she hated Democrats-as do I. Wondered why then, not now. God help us and the Republic.

Mary Jones
Reply to  Giving_Cat
June 7, 2026 1:47 pm

McCarthy redux.

“McCarthyism” is a lie. Joseph McCarthy didn’t invent blacklists or witch hunts — he uncovered Soviet infiltration at the highest levels of the US government, even the precursor to the CIA.

He was vindicated by the release of KGB records after the end of the Cold War.

June 6, 2026 10:25 pm

 the city would impose a one-year ban on data centers

They will cost 10% more in 1 year.

MarkW
Reply to  Mike
June 7, 2026 7:11 am

Or someone else, presumably in China, will build them.

Bill Toland
June 7, 2026 12:23 am

I don’t understand how a data centre can use 20,000 acres.

MarkW
Reply to  Bill Toland
June 7, 2026 7:12 am

Solar panels?

George Thompson
Reply to  MarkW
June 7, 2026 7:32 am

Greed…follow the money. Some folks made real big bucks buying up the empty farmland around what became O’Hare airport, then selling it for light industrial (then) use. Now it’s a mix of some industry and heavy suburban housing.

MarkW
Reply to  George Thompson
June 8, 2026 8:37 am

How is that greed?

George Thompson
Reply to  MarkW
June 8, 2026 11:03 am

You need a definition for “greed”? Hoo boy.

George Thompson
Reply to  George Thompson
June 8, 2026 12:27 pm

OK, unfair. Some background: A whole section-a big square-was cut out of the adjoining county and given to Cook county…just given away. It was a Republican county given to a Dem county…now do you see the graft coming? Because it did. Big money changed hands, and then more money was made…and so it went.

Jeff Alberts
Reply to  Bill Toland
June 7, 2026 7:19 am

Go big or go home.

rovingbroker
June 7, 2026 2:44 am

For some reason, the number of jobs that would be created by the construction (not operation) of these data centers is never mentioned in these stories. Nor are the likely positive effects on local businesses — all those workers will need to eat and buy clothes and sleep somewhere.

Tom Johnson
June 7, 2026 4:17 am

It seems to me that Moore’s Law seems to have been forgotten in the AI quest for supremacy. Historically, energy efficiency in the use of semiconductor chips has doubled every year and a half, or so. There’s no indication that I can see that AI would negate this. It certainly has held true for more than a half century.

GeorgeInSanDiego
Reply to  Tom Johnson
June 7, 2026 5:59 pm

The indication is that the lower limit of the width of the laser beams used to etch the circuitry into the semiconductors has been reached. Two photons wide is the minimum, due to the effect of Werner Heisenberg’s indeterminacy principle. So the limit to the number of transistors per square millimeter has been reached.

Reply to  GeorgeInSanDiego
June 8, 2026 8:17 am

Multi-patterning works for EUV as it has been working for DUV. After 40 years in the semiconductor supply chain, I have heard the same arguments that we were nearing the limits of technology every few years.

June 7, 2026 4:41 am

Trump says, and repeated this just the other day, that AI facilities will produce their own electricity which will not drive up electricity prices.

Can you say “Luddites”?

I would bet money that China is involved in turning these yokels into luddites.

George Thompson
Reply to  Tom Abbott
June 7, 2026 7:41 am

Yokels? Luddites? Unfair because people live in in rural areas to avoid, well, urbanized madness, noise, pollution, and urban people. I live in a rural setting, and I cringe when I see the land scraped clear for subdivisions, and country roads turned into 4-lanes…county commissions be damned; again, follow the money. Could very well be China involvement at a higher level.

MarkW
Reply to  George Thompson
June 7, 2026 10:57 am

If you want to control what your neighbors do with their land, I suggest you buy the land yourself.

George Thompson
Reply to  MarkW
June 7, 2026 11:16 am

Bah! When I have to pay a coupla grand to drop my well pump because some idiot wants a pretty lawn and waters even when its raining, or bury my cat because some effing townie’s kid is screaming about the backroads, or I have to help the local fire dept. put out a pasture fire caused by said townie’s punk kids shooting off fireworks on a very droughty 4th because its illegal in town, damned straight I get p’ssy about it. If I could afford to buy all the land, some wise guy county commissioner would zone me out via taxation for them, not for any services for me or my neighbors. BTW, it was a neighbor’s house I helped save from that fire. So get over yourself, townie.

MarkW
Reply to  George Thompson
June 8, 2026 8:40 am

In other words, you want government to make sure that none of your neighbors ever do something you don’t like. How delightfully totalitarian of you.

George Thompson
Reply to  MarkW
June 8, 2026 9:11 am

My neighbors feel the same way, and every once in awhile somebody gets a dog put on them; pitties and pittie lab mixes are favored (friendly, gentle, and bitey when annoyed), or shot for rustling (yes, really). Trespassing is taken very seriously and the Sheriffs are not amused by gee, I don’t see any signs. You really don’t understand the concept of wanting to be left alone, do you? Most urbanbites don’t. Ordinarily I tend to agree with you on many if not most things-this is not one of them. Totalitarian? My rosie red … .

Randle Dewees
Reply to  Tom Abbott
June 7, 2026 6:25 pm

Well, the proposed data center here in the Indian Wells Valley would use both local grid and scarce ground water. Water is the bigger problem, we are already in trouble from both a dropping water table, and heavy handed completely weird state requirements that we *pay* for replacement water resources. Of course, there are no available replacement resources in California. Especially for an isolated desert valley in the middle of nowhere. But we are all now *paying* to the state Ground Water Authority to pump from our *private* wells.

The community is pretty much 100% in opposition, remarkable, and something that makes me smile, remembering the acrimonious and divisive battles we’ve had in the past when the business community and town gov tried to turn us into a prison town. But even the money grubbers know there is nothing good about the center (won’t be on city land and therefore can’t be taxed), and pretty much everyone knows we are up against it with water. I don’t even see how the state would allow it in view of our water status, but apparently, they would.

George Thompson
Reply to  Randle Dewees
June 7, 2026 6:52 pm

As always, follow the Benjamins.

Randle Dewees
Reply to  George Thompson
June 7, 2026 8:30 pm

Normally I would agree, but it seems too bizarre for routine Kali Korruption. I think this one might fall into a “catch 22” type loophole – a glaring omission in the new water basin oversight that didn’t anticipate data centers.

Beefing up the local grid service to handle the data center is at least technically feasible. The water problem is intractable, and having the state gov promoting a water guzzling data center in a state designated critical water basin at the same time, it is too bizarre.

2hotel9
June 7, 2026 5:54 am

China, Russia and Soros Foundation are and have been bankrolling all manner of disruptive, anti-American organizations for decades. What morons do not already know this?

Reply to  2hotel9
June 7, 2026 9:57 am

The same morons that think that somehow, government is your ultimate mommy and daddy, providing everything you need for a happy life.

George Thompson
Reply to  doonman
June 7, 2026 1:26 pm

Yup…get your money for nothing and and your chicks for free?

I'm not a robot
June 7, 2026 5:58 am

“20 megavolt-amperes, roughly equivalent to 20 megawatts”.

So data center loads have a power factor significantly different from 1? I’m skeptical, and am loath to ask an AI.

Factories full of electric motors require lots of capacitors to minimize what I think is called reactive power (power factor correction).

VA versus W seems a distinction without a difference otherwise.

2hotel9
June 7, 2026 6:03 am

Look, AI is here, it DOES NOT require data centers. It is already in every phone, tablet, laptop and desk top being used today. Allowing China, Russia and Soros Foundation to fund and create all these anti-technology, anti-capitalism and anti-American groups needs to be brought to an end, first step is seizing all this money they are throwing around, designate all their groups terrorists and drop a hammer on them. LONG past time to bring this sh*t to an end.

Reply to  2hotel9
June 7, 2026 6:52 am

Yes, the United States is being actively undermined by a lot of entities, foreign and domestic.

Trump is following the money, both foreign and domestic. Bad Actors are finding it difficult to hide their activities from the Treasury Secretary, Bessent. He is on to their tricks. They should be worried.

George Thompson
Reply to  Tom Abbott
June 7, 2026 7:48 am

Unfortunately, Tom, they won’t worry-they’ll just buy more Congrees critters or try again to assassinate DJT…and let’s not forget the ability of Democrats to lie, defame, poison reputations-or simply steal an election or two. And how, I wonder, is the California ballot counting going?

Jeff Alberts
Reply to  2hotel9
June 7, 2026 7:22 am

Other than very simplistic AI, the only thing in your phone is the front end. To actually process requests requires the data centers.

2hotel9
Reply to  Jeff Alberts
June 8, 2026 8:07 am

That is not how this is explained by several people actually involved in AI. Each device running AI is a “node” in the expanding AI system, the hysteria being pushed over “AI Data Centers” was originally being used as a distraction from that point. Now it is being run by foreign influence for their own agenda. AI expansion is driven by millions of devices, not hundreds of data centers. If it came to pass that all these data centers were blocked AI will continue to expand.

George Thompson
Reply to  2hotel9
June 8, 2026 9:14 am

Ultimately it’s about control.

June 7, 2026 2:20 pm

While tech companies state these centers are built for consumer AI and cloud storage, the sheer scale of this infrastructure creates a turnkey system for total digital surveillance and population rationing.
The Tracking Infrastructure: To track a carbon footprint accurately, a system needs to monitor everything a person does. This includes tracking what you buy, what you eat, how far you drive, and how much electricity you use at home.
The Need for Massive Computing Power: Collecting this continuous stream of data from billions of people creates an unimaginable amount of digital information. The new, hyper-scale data centers provide the exact physical infrastructure and AI processing power needed to sort, analyze, and store this planetary-scale data in real time.
The Control Mechanism: If a government or corporate entity decides to enforce carbon limits, they can connect this tracking data to digital systems. For example, linking carbon footprints to digital IDs or Central Bank Digital Currencies (CBDCs) would allow for automated enforcement. If a person exceeds their monthly carbon allocation, the system could automatically restrict their ability to buy gasoline, purchase meat, or travel outside their designated zone.

kwinterkorn
June 7, 2026 5:35 pm

Economic growth in America will continue to bifurcate berween the states that embrace enterprise and those that embrace poverty. AI is an important part of future economic growth.

As an MD, I just attended a meeting in Boston that discussed multiple research studies which showed dramatic radiology imaging improvements with AI. Many other fields will be using AI to improve both quality and productivity.

As always, the Luddites will get left behind.

June 8, 2026 8:12 am

Shanghai based Neville Roy Singham and his Code Pink spouse are funding many of the demonstrations that we are seeing in the US. It would not be surprising that he would be pushing local governments to ban or restrict data center construction. The negative arguments are not based on new data centers which recycle most of their water and bring their own power.