Rep. Ashley Hinson
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As artificial intelligence continues to transform the world, it has sparked a global race to further develop what many consider the greatest technological revolution in centuries.
The ever-changing technology is now increasingly driving economic investment in communities across the U.S., including funding for mega data centers and building semiconductor fabrication facilities.
In this segment, we explore how AI has become a force for economic growth and what’s on the horizon as policymakers seek the best way to harness and regulate the technology.
We also talked to Rep. Ashley Hinson (R-Iowa) to get her perspective on how AI is changing rural economies and ways Congress is approaching the issue.
Be sure to tune into our accompanying podcast, where we’ll dive deeper.
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Google data centers are helping grow the Iowa economy
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The State of Play
Nearly every nation wants to get an edge on AI. And the U.S. is no different, particularly as it seeks to beat its biggest geopolitical adversary, China.
Washington is well aware of how much AI is a game-changer for the economy and other sectors, including education and the military. AI will impact nearly 40% of jobs around the world, according to the International Monetary Fund. AI is projected to boost global GDP by as much as 7% over ten years, Goldman Sachs estimates.
With that in mind, both Republicans and Democrats have been vocal in their support for continued AI innovation despite their shared concerns over its potential negative consequences.
A pricey investment: AI is expensive, partly because it does not just exist on a dream-like “cloud.” Rather, it’s very much a product of hard, energy-intensive physical infrastructure. To maximize training for AI models, tech companies are building massive data centers that occupy as much as hundreds of thousands of square feet of space.
The huge energy demands of data centers will present new challenges to state and local utilities. These centers could need more power than the entire communities they serve.
Additionally, advanced semiconductors, informally called chips, are critical for developing AI models, but they are also expensive. Chips are mostly imported from Taiwan.
Some of the policy work to facilitate the development of AI will be done in Washington as lawmakers revisit permitting requirements, economic incentives and regulatory measures. All of this will require a lot of investment from the private sector.
OpenAI, Oracle, SoftBank, and MGX announced earlier this year a $500 billion investment in AI infrastructure in the U.S. over the next four years. Meanwhile, the Taiwan Semiconductor Manufacturing Company recently pledged to invest $100 billion in chip manufacturing in the U.S. Other tech titans, including Google and Meta, are also pouring lots of money into AI infrastructure.
These investments will have a ripple effect in communities around the country, the tech companies argue, as many of these data centers and semiconductor facilities are built in previously underserved areas. The centers and facilities have the potential to spur economic growth and create jobs, they say.
The Spotlight Interview: Rep. Ashley Hinson (R-Iowa)
We spoke with Rep. Ashley Hinson (R-Iowa) to get a perspective from a policymaker who is watching the way these issues are playing out both in Washington and in rural America.
Iowa, a longtime big renewable energy producer, has seen a boom in economic investment driven by AI, Hinson said, with Google and Microsoft making investments in the state.
Those energy sources can make the state an attractive destination for tech companies looking to power their data centers with minimal environmental impact.
“This isn’t just about Silicon Valley. When we look at rural America and these kinds of investments coming in — the data centers, the economic driver of the infrastructure that needs to go in — we’re seeing AI really make a difference,” Hinson said.
“When we look at how that can help rural America, it can help cut costs, it can help improve efficiency, and then when you talk about the investments, it can really drive a lot of that local growth.”
AI is also transforming the agriculture industry as precision farming becomes increasingly feasible, Hinson said. Precision agriculture uses data collection and analysis to improve crop yields sustainably.
Hinson added that AI helps control how much fertilizer and weed killer should be used on crops, while maximizing efficiency.
“AI can help when you’re using drones to take pictures of fields, to analyze where water is moving and to help farmers better target those resources where they need to, saving them both time and money.”
Hinson said Iowa is working directly with its energy providers, including Alliant Energy, to support AI data centers.
“We have a nuclear power plant that was decommissioned a few years ago. They’re in talks to bring that power plant back because we’re going to need more energy generation,” Hinson said.
“Iowa — we are a very clean energy producer across the board. We have over 60% of our energy renewable. And so when you talk about not having all of your eggs in one basket and being able to support this technology and make it stable, Iowa looks pretty attractive as a place to do business,” she added.
Hinson also called for lawmakers to take a more active role in educating and upskilling workers to ensure the U.S. is building a workforce that is ready for the AI economy and a changing job market.
“When we talk about where Congress needs to act, it’s about making sure that our next generation of skilled workers are ready,” Hinson said.
“When you talk about the skilled workers that are going to be helping to not only build, but manage these facilities, that’s where we have to go. Helping prepare Iowa’s workforce for the AI economy, Industry 4.0. We need to dominate these emerging technologies.”
Hinson, a member of the House Select Committee on China, noted that it’s critical for national security that the U.S. beat the Chinese Communist Party on AI. She called on policymakers to explore whether the U.S. should strengthen export controls to block China’s access to advanced AI chips.
“The [Chinese Communist Party] is trying to, in essence, weaponize this technology and right now they’re just trying to exploit our loopholes in our policy. We cannot afford to underestimate what their intentions are or their capabilities,” Hinson said.
“When I hear that China is continuing to get these advanced chips, they’re clearly circumventing laws and so I’m focused on trade enforcement and empowering the DOJ under President Trump to be able to go after these bad guys.”
The Outlook
Policymakers in Washington and across the states still have to figure out how to make investments in AI easier.
In Congress, Republicans and Democrats want to pass permitting reform to streamline these energy projects to power data centers. And tech companies are just as attentive to energy policy on the Hill as they are about other issues. But while there is some momentum on both sides of the aisle, compromise on permitting reform has been notoriously elusive.
Incentives: Lawmakers are also looking for ways to provide economic incentives for businesses seeking to invest in AI. Republicans want to pass a package including tax cuts that the GOP says will make investments in the U.S. more attractive.
When we talk about where Congress needs to act, it's about making sure that our next generation of skilled workers are ready.
Rep. Ashley Hinson (R-Iowa)
However, it’s unclear what will happen to incentives like the subsidies for the semiconductor industry. President Donald Trump has attacked the bipartisan CHIPS Act, which provides financial incentives for businesses to produce semiconductors in the U.S. Commerce Secretary Howard Lutnick is also reviewing the program despite lawmakers from both sides contending the law is critical to securing domestic chip manufacturing.
Policymakers are also increasingly focused on the workforce impact driven by AI.
Continuing momentum: Outside of Washington, investments in data centers and other aspects of AI infrastructure are unlikely to slow down anytime soon. Tech companies will continue investing in data centers and the power plants used to satisfy their energy demands.
They will be scouting places with abundant land, water and energy, which brings an increased focus on much of the American heartland. The tech companies are making it a selling point that they will bring jobs and economic growth. What’s still unclear is how welcoming these communities will be to large swathes of their land going into development of data centers and infrastructure that caters to the tech sector.
Meanwhile, many on Wall Street have begun to question whether all these investments in AI are necessary in the world post-DeepSeek. The Chinese AI chatbot was supposedly developed at a fraction of the cost of its American competitors, raising the question of whether there’s a need for massive computing power to run AI.
As others in the tech world point out, however, if AI becomes cheaper to make, that will only increase demand for the ever-evolving technology. One way or another, AI isn’t going anywhere.
— Diego Areas Munhoz
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