Blackstone addresses AI data center backlash in the U.S.

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Blackstone AI data center backlash

Highlights

Blackstone CEO Stephen Schwarzman says the firm is addressing workforce, environmental, and community concerns by creating union jobs, water-free cooling systems, and investing locally.
A June Reuters/Ipsos poll finds only 14% of Americans support new data centers in their community, fueling political and market resistance that resulted in QTS terminating a Virginia project after litigation.
Schwarzman highlights AI’s strategic importance and ongoing dialogue with policymakers as the Trump administration balances AI expansion, energy costs, and competition with China.

Blackstone outlines response to local concerns

As reported by Reuters, Blackstone CEO Stephen Schwarzman says the firm is working closely with portfolio companies, including data center businesses, to address the workforce, environmental and community effects of development. He says those efforts include creating union jobs, expanding workforce training, using water-free cooling systems, adding power generation and making significant local economic investment.

Schwarzman says the impact of AI could echo the industrial revolution, which eventually raises living standards, but adds that major technological change also creates anxiety because of uncertainty over how the technology evolves. His comments come as private capital firms continue to invest tens of billions of dollars into infrastructure and businesses intended to expand computing capacity and run energy-intensive AI models.

Political and market pressure builds around expansion

Opposition to new facilities is emerging as a broad political challenge. A June Reuters/Ipsos poll finds that only 14% of Americans would support a data center being built in their community for technology companies.

The local pushback has already affected projects in the sector. Data center operator QTS, which Blackstone took private for $10 billion in 2021, says earlier this month that it terminates a project in Virginia after years of planning, following strong local opposition and litigation even though county authorities had approved it.

The Trump administration views AI development as a strategic race with China, while also trying to protect households from higher energy costs tied to that expansion. Schwarzman, a longtime donor to President Donald Trump, says he has been spending substantial time with industry leaders and policymakers on ways to address these issues while preserving U.S. leadership in AI.

The dispute over U.S. export controls on advanced AI semiconductors has been intensifying as Senate oversight zeroes in on whether current rules still prevent high-end chips from being diverted to China through intermediaries. Our publication previously noted that Sen. Elizabeth Warren is pressing the Commerce Department for enforcement records, arguing that changes tied to the rollback of the AI Diffusion Rule may have created a licensing gap that weakens safeguards meant to protect U.S. national security.

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