Wall Street is asking a polite question this week: will Alphabet's growth justify its AI spending? Consensus projections put capital expenditures at $55.2 billion for a single quarter. That is an almost unfathomable sum, and it comes from one company, deciding in private, for private return.
The investor question is whether the bet pays off for shareholders. Ordinary people should be asking a different one: who pays if it works, and who pays if it doesn't?
The answer is already visible, and it isn't mainly shareholders. Data centers are enormous consumers of electricity, and in the country's largest grid region, PJM, capacity prices have spiked, with data center demand a major cited driver. Households in those regions pay for that through their utility bills. A retiree in Ohio or Virginia is, in effect, being asked to co-finance a server farm to help a trillion-dollar company answer search queries with a chatbot. Nobody asked her. No ballot measure, no hearing she heard about, no stake in the upside.
That is the pattern with every great private buildout. Gains are concentrated, and costs are spread across people with the least say. If AI delivers the productivity miracle its sellers promise, the profits flow to a handful of firms and their largest shareholders. If it disappoints, the chips depreciate, the capacity sits idle, and the grid upgrades, the water use, the emissions and the tax abatements stay with the communities that hosted them. Google's own sustainability reporting has shown its emissions rising sharply since 2019, driven by data center energy demand. The climate pledges are being outrun by the capex.
The defenders of all this have a serious argument. This is private capital, not a government program. It builds things, employs electricians and construction crews, and America is in a technological race it cannot afford to lose. Fine. Then let it be private. A company confident enough to spend tens of billions of dollars in a single quarter is confident enough to pay the full cost of the power it draws, the transmission lines it requires and the generation it forces utilities to add. Private risk should mean private cost. Instead, we get tax abatements, discounted power deals and ratepayer-funded upgrades, a subsidy structure that would be called socialism if it were going to anyone poorer.
The Left has its own failing here, and we should name it. Too many Democratic governors and mayors have competed to host data centers, handing out tax breaks for a few dozen permanent jobs and calling it economic development. Labor-friendly rhetoric means little if the deal contains no hiring standards, no community benefit agreements and no protection for customers. We cannot denounce corporate power on the national stage and then give it a ribbon-cutting at home.
What would a serious response look like? Large-load tariffs that force data centers to bear the costs they impose on the grid. Public disclosure of energy and water consumption. An end to blanket tax abatements. Binding labor and local-hiring terms. And if public power, public land and public risk are going to underwrite this infrastructure, the public should own a share of what it produces.
The antitrust cases against Google already established that this company used its dominance to wall off competitors. Now that same dominance finances a capital program of staggering scale. Calling that simply a market outcome ignores how much of it depends on public goods: the grid, the research, the law and the land.
Investors will cheer or sulk on Thursday morning, depending on the numbers. The rest of us will find the bill in the mail, whatever they decide.
How it may affect me
If you live near a data center hub, your electricity bill may already reflect it. Check your utility's rate filings and your state public utility commission's dockets for 'large load' or data center tariff proceedings, where the public can comment. Also look up whether your state or county grants data centers tax abatements, and who in local government approved them.
