We are all familiar with the bogeyman, and especially from our childhood. By definition, it is a mythical, shapeless, or terrifying figure used to frighten us into good behavior.
There are strong opinions about artificial intelligence, data centers, and rising electricity demand. Sen. Bernie Sanders is warning that unchecked AI could cost millions of jobs, increase inequality, expand surveillance, and weaken democracy. Even Elon Musk has repeatedly warned that AI could become an existential threat to humanity, with some comments going as far as saying it could cause “civilization destruction” or be “more dangerous than nukes.”
Others are more positive about the impact of AI technology. These comments include freeing humans for creative work and analyzing vast datasets quickly to spot trends, forecast outcomes, and minimize bias. Other descriptions include making faster, smarter, decisions and requiring less time to research and more time to “think” about data (Geoff Woods, “The AI-Driven Leader”). In medicine, AI enables accurate diagnoses, drug discovery, and robotic surgery, which can improve patient outcomes. Chatbots provide 24/7 support, personalize interactions, and handle more inquiries efficiently. Some 84% of salespeople report higher sales as a result of this boosted satisfaction. AI could add trillions to the global economy by 2030 through productivity and new jobs in AI fields. It also aids climate mitigation and agriculture via optimized resource use (Perplexity.ai).
Certainly AI is not possible without the construction of massive data centers that drive this new technology. Opponents claim data centers consume massive amounts of electricity and are causing rapidly increasing electricity prices. Some claim data centers consume millions of gallons of cooling water and create localized “heat islands” by releasing massive amounts of waste heat from computing and cooling systems into the surrounding environment. This could potentially raise local land surface temperatures by up to 16 degrees Fahrenheit and impact 343 million people worldwide.
New technologies such as AI have always been a disrupter to the norm. My wife is a career banker, and she compares the fear of AI with the impact of ATMs on the banking industry. Everybody assumed –including some of the bank managers at first – that automated teller machines were going to eliminate the teller job. And did they? In fact, since 2000, not only have teller jobs increased, but they’ve been growing a bit faster than the labor force as a whole. The impact of the ATM machine was not to destroy tellers; actually it was to increase it.
The fear of new technology has long historical roots. The Luddites were a 19th-century movement of English textile workers who destroyed machinery, particularly mechanized looms, as a form of protest against industrialization. These activists were brutally punished, facing mass executions, imprisonment, and transportation to Australia for destroying machinery.
In almost every case, revolutionary technology that changed the path of humanity for the better met initial resistance. Here are some classic examples of revolutionary technologies that sparked fear when they first appeared:
- The printing press – fears that it would spread heresy, misinformation, and social disorder
- The steam engine and mechanized looms – fears that machines would replace the jobs of workers
- Electricity – fears of shocks, fires, and even invisible danger from wires
- The telephone – fears that it would invade privacy, weaken social habits, or even cause health problems
- The automobile – fears that cars were dangerous, noisy, and disruptive to public health, besides threatening the horse and carriage industry
- The radio – fears of propaganda, moral decline, or hidden influence through broadcasting
- The computer – fears that machines might replace human judgment or make society too dependent on automation
- Nuclear power and the atomic bomb – fears about destruction on a civilization-wide scale
- The Internet – fears of exposing children to harmful content, crime, and social isolation
Certainly every advance has both costs and benefits. At a recent business roundtable meeting, one topic of discussion included the future of data centers in suburban Maryland, near D.C. Citizens were up in arms about a proposed multi-billion-dollar data center development. The project was mostly surrounded by commercial properties, and it was apparent, at least to me, that while data centers do not create many permanent jobs, they do create many construction jobs, pay lots of taxes, and do not stress local public services such as schools and ambulance services, etc. After the meeting I spoke with a state senator who also has a degree in electrical engineering. While he was fully versed in the negatives of data centers, he could not identify their primary benefit to the community, – tax collections. His response: “I should probably look into that.”
We are said to be in a critical AI race with China. Steve Forbes said, “The AI Cold War has begun and America cannot afford to lose. Allowing Chinese open models to become the global AI template would export more than code. It would export governance assumptions — about speech, privacy and political power. That is unacceptable for a free society.”
The question remains: Whose AI is the world going to adopt, a free world alternative or China’s? The risks appear to be very high according to Google.
Key Concerns Regarding Chinese Open-Source AI Adoption:
- Exporting governance models: Chinese AI models often include pre-installed content restrictions that prioritize speech, political, and surveillance control, which are inherently integrated into the code, reflecting the state’s governance style.
- Infrastructure dependency: By adopting Chinese AI models (e.g., from Alibaba, Baidu), foreign organizations may adopt Chinese technological standards and architecture, creating long-term dependency.
- Data security and surveillance: Open-weight models from China could facilitate “distillation,” allowing competitors to cheaply acquire powerful capabilities, potentially weaponizing them for military or intelligence operations, as discussed on Fox News.
- Rapid adoption and strategy: China is using an open-source AI strategy to circumvent U.S. export restrictions, encouraging global adoption in developing nations (the Global South) and among developers looking for free, high-performance alternatives.
So far, data centers appear to more of a bogeyman than a systemic risk, at least in terms of employment and the threat to democracy. Reports show that 75% of economic growth in the first quarter can be attributed to AI. The Labor Department said that initial jobless claims at the end of April 2026 were also the lowest in 50 years.
Data centers do consume a significant amount of electricity. In my next article I will investigate their impact on rising electricity prices and how much of an underlying cause are the states’ net-zero emission regulations.
Geoffrey Pohanka, Chairman, Pohanka Automotive Group
Capitol Heights MD
