AI First: How the Federal Government Is Prioritizing AI over People and Planet

30 Jun, 2026 •

Winston Yau, Matt Haugen, Jesse Goldstein, Dustin Mulvaney, Hannah Story Brown, Kenny Stancil, Sarah Knuth

Executive summary

The recent explosion of artificial intelligence (AI) and the construction of data centers threatens to swallow the US economy and transform society. The stock market and its AI-driven rally has dazzled investors with an endless wave of asset price appreciation. Yet despite all of its science fiction hype, the actual implications of the AI buildout are increasingly socially and ecologically destructive. Coupled with what projects to be long-term global economic and supply chain disruptions stemming from the US-Israeli war on Iran, the rise of AI portends increasing precarity for the global working class.

We believe that AI’s emergence shows the potential for state capacity to be oriented toward a different mission that centers the ambitious creation of socially useful green infrastructure like clean energy, healthy schools, libraries, social housing, and public transit. While we recognize that it is tremendously difficult to mobilize sufficient capital toward pro-social ends, the state-supported AI buildout offers a glimpse of the possibility that a transformed state could orient its significant market-shaping and worldmaking capacity toward the public good.

The AI and data center buildout is not the spontaneous outcome of an imagined “free market.” It is the result of political decisions past and present: subsidies, tax rates, infrastructure, deregulation, and an absence of regulation in the first place. Instead of anything resembling public control over economic and industrial planning, we are witnessing a corporate takeover of state capacity.

In this report we detail three key ways in which the federal government is facilitating the AI boom:

AI First national strategy: Asserting the AI “race” as a national strategic priority by entrenching it within the state bureaucracy and propping up the industry’s business model through government procurement, particularly in militarism and surveillance. This also entails weakening and neglecting to enforce antitrust law and a revolving door of influence peddling that allows AI-investors to shape federal policy from within, resulting in a sense that AI is too strategic to fail.

Antisocial infrastructure: Dismantling environmental protections and accelerating permitting reform in the name of “removing red tape” and warping electricity infrastructure around data centers. This entails boosting and selectively refusing to regulate fossil fuel power plants and backup generators that opens up hundreds of billions of dollars in additional revenues for data centers. It also includes demanding that costly and inefficient coal, oil, and gas plants delay their retirement, which—if expanded across all carbon-polluting plants slated for retirement—could potentially cause $3 billion in costs to ratepayers and cause tens of thousands of excess deaths, alongside enormous additional health damages from particulate and ozone pollution each year they remain open.

Paying for the party: Enacting corporate-friendly fiscal and market policies, such as low corporate and high-earner tax rates that allow for significant cash reserves to be deployed and used as collateral. For example, just three of the companies driving the AI boom (Microsoft, Meta, and Alphabet) avoided $50 billion in federal taxes in 2025 alone. This strategy also includes providing infrastructure tax breaks and public subsidies, and intervening domestically and internationally to “secure” the natural resource base for critical minerals, semiconductor supply chains, and the rest of the AI technology stack.

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The federal government enabled three companies to avoid $50 billion in taxes in 2025 alone, increasing cash reserves for rapid AI buildout.

Alphabet, Meta, and Amazon owed $65 billion in 2025 at the full corporate tax rate of 21%.

They paid only $15.3 billion…

and pocketed $49.7 billion for corporate AI buildout instead of public goods.

Source: Climate and Community Institute and Revolving Door Project, using data compiled by the Institute on Taxation and Economic Policy.1 Data center illustration by macrovector on Magnific.

As data centers spread across the United States, inequality rises, and climate and economic crises build, the ginned-up urgency of winning an AI race that most of us do not even want to be running in the first place needs to be named for what it is: an industry-led hype cycle that aims to supplant democratic control with investor prerogatives. Wresting the power of worldmaking away from the billionaires and into the hands of working people—and a government that puts people before profits—is urgent and necessary.

We reject the “AI race” as a productive and socially beneficial use of resources. Instead, we advocate for a “race” toward a liveable world (ecologically and economically) where abundance is not measured in asset prices alone, but in a more capacious, multi-dimensional sense of what working people actually need and want.

Across the United States, there is robust, well-organized, and successful organizing in local fights against AI data centers. In 2025 alone, local opposition contributed to the blocking or stalling of 48 projects worth $156 billion, often on the grounds of opposing additional pollution and lavish public subsidies to feed corporate profits. The alignment between public consciousness and the early but already widely documented harms of unfettered AI and data center deployment means the moment is ripe for a more transformative vision that drastically increases the federal government’s capacity to make choices for working people as opposed to working for AI and elite investors. CCI’s “Green Economic Populism” framework is an example of such an approach, one which aligns policies that bring immediate relief to working people with building a dynamic public sector that can enact the robust regulations and enormous green investments needed to realize a better future for all.2

As the data center boom shows, a state-capital partnership can rapidly roll out massive, world-shaping infrastructure when interests and motivations align. We want a government that directs collective resources and energy toward an agenda that serves people and the planet. This will require governing power and authority wielded for the public interest, with a focus on jobs with dignity, environmental stewardship and a green transition, and robust social welfare programs. This can only be accomplished with a means of democratizing investment decisions and developing a planning calculus that is insulated from corporate influence and so as to balance multiple, sometimes conflicting, objectives.

We conclude by sketching out five pillars of a green and democratically planned policy agenda that abides by shared environmentally and socially just values and prioritizes human dignity.

Contest Big Tech’s scale and desired expansion with democratic planning. It is necessary to develop a means of slowing and right-sizing the overbuild and overdeployment of AI and AI data centers, including decommissioning excessive private data centers and developing publicly owned computing infrastructure. That requires expanding public control over our economy with a national economic and resource planning authority.

Build and invest in a grid for social priorities. The AI buildout has revealed a severely undermaintained US electricity grid, but expanding it to meet AI’s needs will not conveniently meet the needs of working people. A federal public power authority could instead invest in and prioritize socially useful electrification needs.

Expand public investments that put people and the planet first. Rather than picking up scraps from Big Tech’s hyper-speculation, alternative government spending could meet working people’s needs with socially useful and ecologically sustainable infrastructure. A National Investment Authority could facilitate such investments in equitably distributed and durable ways.

Center the need for well-paid jobs with dignity across the labor market. Resistance to AI and data centers should be coupled with affirmation of working peoples’ dignity and their irreplaceable skills and creativity. A federal jobs guarantee could provide much-needed green public sector work which could backstop workers from disruptive effects of AI. This renewed and emboldened state capacity should provide a floor—both in compensation and quality of work—that raises the level of dignity and security throughout the labor force.

Fight Big Tech’s dystopian visions and increase public leverage over AI firms and technologies. A new vision for AI could center on human ingenuity, creativity, and know-how. Doing so requires expanding public control by breaking Big Tech’s monopolistic powers, massively increasing taxes on the rich and corporations, and enacting prohibitions on the most societally harmful uses of AI technologies.

Photo by Dillon Mahmoudi

Introduction

Concerns around rising electricity prices, air and noise pollution, and strains on local resources are precipitating a groundswell of campaigns to resist the construction of gargantuan, planet-warming data centers. There is increasing backlash against data centers and AI emerging from communities that are being asked to bear these burdens in exchange for local economic activity with a handful of permanent jobs while being offered little say in the matter. And what for? Behind the science fiction hype that AI will somehow birth a superhuman intelligence, workers fear and capitalists hope that AI will displace, disempower, or deskill wide swathes of the labor force. AI is getting generous public subsidies to erode public institutions and debase critical thinking capacities while locking the United States into massive, planet-warming energy uses that will make it even more difficult to transition to a sustainable future.

Aided by generous federal policy, major tech companies have inflated in valuation in the last few years, and the relatively small number of publicly traded, AI-focused companies have accounted for a large portion of recent stock market gains. As JP Morgan’s Michael Cembalest explained, “The market cap of four hyperscalers and the semiconductor ecosystem companies they rely on has grown from $3 trillion to $18 trillion in just a few years, and a broader group of 42 AI related companies has generated 65%–75% of S&P 500’s earnings, profits and capital spending since ChatGPT’s launch in November 2022.”3

Meanwhile, wide swaths of institutions and firms (including the federal government) are racing to implement AI throughout their operations. This rush toward adoption, often without regard for proven utility or effectiveness, is largely driven by industry hype, cost-cutting desires, and groupthink among investors and management. The widespread incorporation of AI tools into workflows is generating nowhere near enough revenue to make up for the massive sums that AI firms are spending, yet valuations continue to inflate. People with significant appreciating assets in stocks, investments, and real estate may be mostly content with their rising portfolios, but the working class is increasingly exposed to the precarity of deteriorating labor market conditions, the loss of personal freedom through increased surveillance, and a host of increasingly unaffordable essentials.4

This is all occurring as the Trump administration pours gasoline on our climate and ecological crises with its unabashedly polluter-friendly agenda. The administration has repealed most of the climate and energy investments of the Inflation Reduction Act (IRA) and moved to stymie renewable energy construction, while gutting environmental regulations on greenhouse gases, environmental review, hazardous chemicals, air pollution, land use, and more. These massi

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