Saagar Enjeti: data center backlash will go national in 2026 as electricity costs hit rural America

and brands. Be like MongoDB indeed. Docuine RAM. Yeah, we have Sager and Jenny from Breaking Points. Sager, how are you? Oh, it's great to see you guys. Thank you for having me. Great to see you finally.

Only after uh a million text messages every morning back and forth on the AI apocalypse and political crisis have we actually just put it together that we should just hang out on the stream. I really appreciate you taking the time. Um Oh, thank you. Thank you.

Uh give everyone like a quick shape of of the actual flow of the content like uh like the the proper fun of your business. Some credit.

He kind of created neotrad media which is which is a new which is a new framework we're working on which is new media that that sort of embodies or kind of looks and feels like the the so your show looks like a proper TV show.

You wear a suit and and so we call that neotraditionalist media neotrad media and we're firmly trying to do that. I love it. And I and I will say one of the only reasons I am here is because both of you are bringing suits back to the bums of Silicon Valley.

And I know many of you are watching uh right now and you're Lululemon or Viori and you don't look cool. You don't look better than John or Jordy or myself. You all are billionaires. Buy a suit. Stop. Just stop it. Stop it. That's great. I I I couldn't agree more.

Uh I think we're starting to have a small small effect, but it's but it's taking hold. A lot of a lot of people that visit the Ultradome wear suits. Okay.

Well, uh I mean pretty pretty much like there are going to be tons of uh of AI folks, tons of tech people who are going to be dragged in front of Congress over this data center buildout. I I think you clocked this correctly.

Uh but walk me through is this a thesis that came from you see this coming or you're seeing uh smoke signals already? Walk me through your thesis of like how tech and the AI buildout runs on a collision course with the average American.

Yeah, the thing is guys and I really want to hammer this home for people who are watching because I uh you know shocker I think many people in Silicon Valley uh do live in a bubble. One of the best parts of my job is I do genuinely is I interact and we'll return to bubble conversation by the way.

Uh but what what I get to do is not only interact with a lot of people who are normal in politics and I mean that at the very base level. Not people who live in Northern Virginia. The vast majority of my audience don't live in Washington DC. Many are Uber drivers, hotel clerks, etc.

And I start to see bubbling stuff over the last 5 years over cost of living. At the same time, I'm tracking the electricity story. And it doesn't take a genius to pair that with data center buildout.

So one of the things that I really want to flag I think here on the show is that the coming data center collision at the heart of that is about electricity. It doesn't have to be this way. One of my favorite uh notes is there's an analyst I follow who was in China.

He had a very different uh view of the of this in in China even though of course you know they don't have democratic politics but of course they do have some level of democratic input is they said nobody's concerned here cuz electricity is cons is considered a solved problem.

We don't have a solved problem of electricity here in the United States and in fact worse you know our grid is aging and actually things are getting worse. So with all of this capital expenditure in data centers you are seeing a literal finite resource competition especially in rural areas.

So Virginia the state where I live 40% of all of our power is consumed by data centers. Oregon for example is some 33%. To be fair to many of the AI people who are watching it's not all AI. We are the hotbed, right, of of servers and Amazon and much of the federal government.

But the point is is that this is bubbling up at a very organic township level. So from Arizona to Virginia, data centers actually had a a mention in our more recent gubanatorial debate. Both the Republican and the Democratic candidate said that they wanted to do something about it.

There's Prince William County here in Virginia where this is an active live issue and the public is overwhelmingly against it. the city of Tucson is moving.

And so if we see this continued capital expenditure go up and especially in more rural areas, we see headlines like 267% power increases for power bills in rural areas which are built near data centers. Not to mention environmental concerns, etc.

That's when you're going to see people start to get dragged before Congress because Yeah. Go ahead. Yeah.

I I'm just curious what uh obviously every area, you know, people are not going to just watch a data center get built, you know, in their backyard and and not, you know, talk to their mayor or talk to the governor and and actually start a conversation in a debate and ultimately create policy around this.

Is there not some type of solution that would allow effectively allow data centers to pay a higher rate than everyday citizens and kind of make up the the difference? I think it's a great idea. Uh unfortunately, that's not how our power system works.

That the foundation of the United States is basically built on the fact that we're going to build this grid, this infrastructure, and we can all kind of consume the social benefits of it.

There are pieces of legislation, Jordy, of what you're talking about on the table, I think, in Oregon and in a few other states, but these are few and far between. I also think we got to take everybody through the story of the last 25 years.

Again, with great respect to the audience I'm speaking to, you can't be Amazon and be the second largest employer in the United States and then in your shareholder meeting come out and say that we want to fire 600,000 people or at the very least not hire 600,000 fewer people.

These are people who watch their towns get decimated. Then they watched Amazon.

I mean, Nomad Land, it's an Oscar-winning film about this, you know, this this uh I think what's challenging what's what's so challenging about this issue is that you have these massive infrastructure projects with massive spend and almost zero job creation. Exactly. Exactly.

Like like the plumbers and the electricians are going to are going to get paid and that's great. But we've even heard stories of the plumbers and electricians being flown around on private jets because their skill set is so and so that's not going to get people.

But yeah, so if you if you're, you know, living in a in a little town and you're watching, you know, the the mega mega project get spun up and you're getting not not only, you know, no real benefit, you know, maybe uh maybe you get more slop in your trough every day, but uh it's maybe that's the point. Yeah, go ahead.

Can you maybe take me a click forward into uh let's assume the trend lines kind of continue, electricity prices go up, there's more it's more clearly attributable to data centers, etc. , etc. Like how do the different political coalitions uh frame reframe themselves around this issue?

Like I imagine that there's a right-wing version of tech backlash that looks one way. There's the abundance lib uh direction. there's going to be the the actual socialist left and maybe they just say like no AI at all. Yeah. Right.

So like how do you see the different coalitions like grappling with what the the V2 of the messaging might be here? There's going to be a horseshoe element here. I think that the socialist left and much of the right is going to actually come in the same place of enough.

And so a lot of the socialist uh left is actually Bernie Sanders, I don't know if you guys saw this right before I came on the show, just called for a break up of open AI. So this is huge news. He's the first US politician actually to do so. Now, what is there to break up?

They have chat GBT and then they have a bunch of other things that are subscale. How about a nonprofit profit arm or whatever the hell you guys can explain that? Yeah. Yeah. I think Sam's like, I would love to break it up. I'm actually trying to break it up. I would love to just have a corp. Break me up. Yeah.

Is this some sort of like 4D chess and Sam's gotten to Bernie and told Bernie, "Hey, yeah, we we we need to break it up. That's really popular messaging. " And he's like, "Yeah, you know, Bernie's probably, you know, he's picking from an old tool book, so we shouldn't too much.

" He's basically just saying, "Let's pressure them. Let's make sure we have more regulation. " Right. Exactly. More regulation. On the right, I mean, much of this is going to be about distrust of Sam and many of the tech guys themselves.

I mean, when you have these people outwardly bragging about mass job loss, mass societal uh creation, there's a lot of us who are like, "Yeah, do I want this guy who's introducing AI porn to be the most powerful person in the world?

" I mean, the challenge the challenge is that the the job loss like uh like vision is so good for fundraising because if if you know people are are like, "Hey, maybe I don't have a job in 10 years.

" It's like, well, I want I want I want my money going into these companies, so at least I'll I'll have a chance at escaping the the permanent underclass. Question for you. Social media went through, you know, and continues to go is like a perpetual backlash at this point.

People say they hate it, they don't like it, they say it's bad. Uh many of those people still use it.

How uh do you think this this AI um development is different than that in that a generation will just log off and or or do you think it's it will be the same type of dynamic where people say they hate it, they're they're frustrated with the potential impacts of it, but uh they still line up.

That's a very astute observation and I think it's going to be somewhere in between. And so actually Jordy, this kind of gets to the point of what I reacted to. you put out a tweet about AGI and pornography. And what I reacted to that is I was like, "Yeah, AGI is not coming, guys. What's coming is porn.

" And what that means is the internet is just coming again. And so, you know, I downloaded the chat GPT browser. It's it's fine, you know. It's fine. Uh, it's it's a browser. And so, it's a browser that's going to serve me. I mean, literally, the ad read before I came in was about putting ads into chat GPT.

Wow, what a business model. Somebody should have invented it already. They did. It's called Adwords in 2003.

So, are we just competing for the exact same uh type of unit economics of screen time, of use of pornography, of the very same things which, as you said, Jordy, are making us miserable because that doesn't seem very cool to me.

And it also doesn't necessarily justify, let's say, 80% gain of the entire S&P 500 over the last 2025. This is the stuff actually that I text John about literally every day when I'm like, "A bubble is coming. A bubble is coming. A bubble is coming.

" I think I I I think the steelman of like the the like the the minim the medium case or I don't know how to put it but it's like if I told you it's just like well yes like AI is not AGI you're not going to lose your job over it it's not going to kill anyone but uh it will help you do research better it's better autocomplete it's this nice tool that'll help clean things up better spell check better grammar check you know fire it off and and and if you're like you're going to be you're going to be a little bit more more knowledgeable a little bit more performant, a little bit more efficient, and it's going to cost.

We're going to need to build some data centers, but we're not going to build, you know, so many data centers that we all lose our light and heating and AC. I think that's that's a reasonable like abundance.

the moment that's where we should the moment we are right now is that when somebody you know sees an AI video of you know the the one that went super viral a while back was like people on the roof of an apartment building and it's a pool and the glass breaks and people flow off it's like that video and videos like it are not worth for the average American an extra $100 a month you know extra $1,000 a year added to their electrical bill right and so exactly right and and that's the political dynamic and that's why John I go hey all of That sounds great.

Uh it's a little worrying to put my entire retirement portfolio based upon uh you know a very different message and when that's the reality of where we're going to end up a little bit better Microsoft Teams is just really not the anthropic vision which is being sold to me.

Okay, about I mean I talked to a guy who works at Accenture. I said, "How do you use AI? " He's like, "Yeah, it's great. It does auto uh meeting summaries for me. " And I was like, "Wow, you know, listen, definitely great. I mean, it means you don't have to hire some entry-level guy, although maybe that's not great.

And what really ended up happening is that you end up using it for these extraordinarily mundane tasks. I I have no issue with that as long as the attendant social fallout, government policy, power bills, and all of that is tied up into it.

Not to mention, and I I I really can't belly the social cost because what you said, Jordy, is is a central thing. There is a mass elite revolution right now against social media.

And between I think Jonathan height might be one of the most public like important public intellectuals in modern in like in a long time leading what I think is going to be at least a top middle discussion with all of these different school districts, states and others which are banning phones.

The recognition is that they are controlling us and we need to ret take control of our life. AI is kind of supercharging that message.

And if you talk to the vastly rich, which you do, and I've spoken to a few of them, how many of them really let unlimited screen time for their phones in the way that you know the income of, let's say, people making less than 100,000 do for their children? It's just completely different.

You know, they're very aware of that dynamic. And that is permeating social culture at a way that I don't think people in tech are quite realizing. Do you think we it always takes a generation uh to of guinea pigs to understand where a technology winds up?

I I because I grew up with the the panic around video games and the idea that if you played Counter Strike competitively at a very high level and became one of the greatest Counter-Strike players of 2003, you were definitely going to be crazy. Well, I did it. I was great at Counter-Strike.

I wasn't maybe one of the best ever, but I was pretty good. And I don't have any violent impulses. whatsoever. I was fine. I was not oneshot by uh 360 no scoping people. I became a productive member of society.

And I feel like we came up with the ESRB E, you know, R like like teen rated games, M-rated games, and we kind of figured out like where the line is. Parents adapted, kids adapted, and we got through that.

social media, it feels like we're towards the tail end of getting through it where most parents know, hey, the the young kids should not be on Instagram like constantly or Tik Tok constantly. And in with AI, we're just starting to understand.

Um, but it feels like we'll kind of wind up in the same place, which is like you might be right. Uh, but let me challenge you a little bit on the video game front because I think that video John, you also know my crusade against sports gambling. So, Robin Hood, if you're listening, please don't allow sports betting.

Uh but one of the important things around gambling, you also know my crusade against marijuana is here's the issue with video games with all of these vices and things that you're talking about. It's fine sometimes, but there is an attendant part of society which actually does lose it when immersed in this culture.

So, you know, I've pointed unfortunately part of my job I cover a lot of mass shootings. We had two or actually three very recently. We had Minnesota, we had the also the Charlie Kirk killer and then we also had the ice shooter. All three were deep in these weird Discord gamers. The ice guy spent 20 hours a day gaming.

The Discord is a social media thing. Discord the the platform. I don't think it is like a video platform. Yeah, but you guys can look at his Steam data. He was logging. I don't exactly remember the number off the top of my head, but an absurd number of hours playing video games. This is somebody who's 31year-old male.

This is kind of a contrarian take. I feel like most people close the book on the video games as as I'm back. I never left. Okay. Actually, no. I've never left. And that's part of that's part of what I think is important to say is that people say it worked out. I I I just dispute that.

I mean, we have millions of people now who are addicted to gambling, who are addicted to marijuana, who've gone psychotic, people who are wasting their lives in front of these screens, and it's like, did it work out? I mean, yeah, it worked out for the S&P 500. Did it work out for the United States of America?

I would say no. I mean, if you put all those things together. Yeah, it was interesting. Uh Ryan Ryan Cohen uh from GameStop came on the show on Monday. He was basically he was he didn't say this explicitly, but he he was basic it's he was seemed generally in favor of just stopping all AI research.

Well, I thought you were going to talk about his take on Call of Duty. He was like, I don't want He was basically like, I don't want people playing Call of Duty. Like, I don't want kids playing Call of Duty. Which is crazy from like the GameStop guy.

He's the CEO of the company, but he was he had sort of a similar like anti- video game take like maybe it's not as safe as people think it is. Well, I mean, if you guys talk to teenagers and you're like, "How do you guys hang out?

" A lot of them will be like, "Oh, we don't hang out very much, but we play a lot of video games together. " Sorry, that's bad. All right. I mean, this just It's weird. It's weird. Wait, but what about all the dudes?

I'm sure you know some of the guys who have been like one shot by golf where they're just golf is their whole personality. They just are all they do all day is think about golf and then on the weekend they go golfing. It's similar, is it not? Uh, no.

Oh, it's not similar because well, okay, when I said video games, what I said is they're at home playing online with their friends. Now, you and I you guys, we're all relatively the same age. Online play was not around that time. So, what we would do is you would gather at a friend's house. It was still pro- social.

It was it was it was couch. It was a thing when I was a a kid.

Uh, but I I lived somewhat in the country and so there before anybody could drive it was like your your parent wasn't necessarily it was it was tough to get around basically and so video games were a way that you could hang out with your friends and otherwise it would have just been hanging by yourself or whatever.

Maybe that's maybe that's maybe that's better. Uh maybe I mean I don't know.

What would get you to what would get is is there any can you imagine any scenario that would get you to change your mind on on AI because I'm I'm with you right now it feels like AI is an expand like the current state of AI in terms of products that people use and and are an everyday part of their life is just an extension of big technology right open AI has the aesthetics now of a big tech company they launch products like they're a big tech company they have a user base like they're a big tech company.

They're very young, but that's what they look and feel like.

They still have their nonprofit and they still have, you know, a research arm that is working on AGI, but it's hard for people to spend too much time thinking about AGI research when all the launches and the announcements are social media and new web browsers and erotica and things like that.

And so, but I'm curious, you know, and this is something we are always trying to tease out on the show is people that come on the show to talk about AI typically have some AI to sell you or some they have a startup equity to sell you.

Uh that that that's sort of predicated on on on these sort of more utopian visions of of AI. Uh and it's hard to paralle out, right? And so you had the the Carpathy interview recently which was kind of throwing fantastic interview. Yeah. And I I that didn't necessarily like update my worldview a lot.

I think you put a lot of these ideas really well, right? This idea of of, you know, agents are not, you know, uh are not uh the agents that we were promised maybe this year are not here yet. And I think that's that's okay. But I'm curious what would what would update your worldview? Um because it's hard.

It's like if we get massive canc drug success that was designed from AI that probably makes it all worth I think what John is correct is just show me like actually show it to me.

Stop telling me because it's creeping me out to watch talk about UBI and you know oh we're everyone's going to be uh you know extremely happy even though I run the entire world. I mean, listen, this I got to put my own cynicism and bias on the table. Like, I'm literally an anti-establishmentarian podcaster.

When these guys open their mouths, I'm just like, you're lying. And most of the time, that turns out to be true. So, it's one of those.

So, so I I I would I would take the other side of this argument and and say that it is possible that we never get some sort of big binary moment where we're like, "Oh my god, yes, like it did the thing that we wanted to do, but it's still like net good.

" I think about it like uh you know the invention of the credit card.

It's like it just like speeds up the economy every little it takes a little bit of friction out so that the the corner store can sell couple more muffins and then the person can pay with the digital, you know, the digital cash stored in their bank account and they don't need to do the check writing and it sort of puts a couple check writers out of business.

But people have new jobs digital currency will track your your CO2 consumption and no But there but there are tons of there are tons of examples.

Not to put on the tinfoil hat, but do do you think it's do you think it's funny how for basically decades people were so against central bank digital currencies and now they're like let me now now everybody's like I present to you stable stable coins.

Uh they're a little bit different but they're sure they're different but but the potential risks associated with digital digital money uh are still are still there. Yeah, I I I I want to pick up on what John said.

I think it's such an important point, which is I think you are exactly correct, but this is why I react so negatively to the rhetoric. And you know, guys, I mean, sure you have as well. One of my favorite books, do you know by Cassidy? Uh I could go through the list. Michael Lewis has a book on. com.

I I've read through I even I I watched a few documentaries. CNN, and you'll never hear me say this, actually has some decent documentaries about the decades. And they have a decent documentary about the 1990s. Yes, shout out to the old CNN. Shout out to the old CNN.

They had a great documentary about the '9s which I watched and the same level of enthusiasm they were talking about the information superighway is quite literally matches much of the rhetoric of today.

I'm too young to actually have experience much of it on the airwaves, but the same way and the fervor which was fueling so much of do just seems I mean same thing like ironically I used chatpt uh just before I came on here cuz I knew we were going to talk about this and I that's what I was saying though that's what I was saying though it's it's it's one of those things like people like social media they hate it but they use it.

Yeah. Well, I I don't hate your I just don't Oh, my finding was that we are mirroring almost exactly the same levels of tech stock growth from the year 1999 of the entire S&P 500 of stock gains and similar ones in terms of our GDP. If anything, the GDP number is higher today.

So the systemic risk which matches the rhetoric and that the risk itself of the fact is you know John what I've probably been texting you the most about is these roundtpping vendor finance deals and you you made a great point to me privately about ASML and how vendor finance itself is not necessarily a negative term in and of itself but it's really hard not to go and read the story of Cisco and to say hey you know if we have very similar type of downturn and reduction of expected revenue.

I'm not saying OpenAI itself will go bankrupt, but that itself is fueling the entire retirement portfolio of the whole country. Not to mention GDP, interest rates, everything is banking on this one sector. I think that's really dangerous.

And especially that background article, you guys are going to know a lot more than me. But Sam's story about uh you know, going back to Masayoshi, which look, no offense to the viewers, um you know, I read the Weiwork book. I I'm just saying I'm not saying I trust the guy. Well, credit credit on Masa with Weiwork.

Masa never really got a markup, right? Or maybe he got one or two, but not not not a lot on the real dollar. No, he was buying the top. He top ticked it. The dialogue earlier this year was Masa was is Masa top blasting OpenAI and then of course, you know, opening is up, you know, another thing.

Listen, his deal worked out, but it was more just the to the extent of it's very similar kind of Adam Newmanesque to me about like, oh, Sam, you need to go bigger and that's exactly what encourages him to start doing so many of these deals.

I don't begrudge them necessarily to do it, but you know, I really took to heart the too big to fail element of this cuz I'm thinking about this from a side. Just say you're not an investor in SoftBank Group Corp up 173% year to date.

Uh we we so so we have Jordan Schneider from China talk joining in just a minute but the last question I want is uh the update on you know obviously you know you believe there's an AI bubble uh is there a media bubble is David Ellison trying to build one like what's going on in the media landscape we were trying to map it out earlier taking you through uh new media neo media traditional media the legacy media the mainstream media there's so many different uh phrases like what's the most interesting story in media in 202 25 because we've already had the story about like we're leaving the mainstream and going independent.

Here's my counter take uh which I really came home with the gambling story recently at NBA.

There is a new media bubble and it's in sports and it's entirely because FanDuel and DraftKings have propped up way too many people with opinions and when there is even a modest push back on prop bets and the rest of the [ __ ] that these sports books are allowed to send you PM pardon my take and maybe two or three others are going to make it.

Everybody else is going to get wiped out. There are way too many sports uh sports podcasts if you're out there and in my opinion the biggest bubble is in sports media right now entirely inflated by the gambling industry.

Do you have any do you have any sense what percentage of advertising revenues in in sports is gambling but it but it has to be like 70% to 90% 80 to 90% I think the Pat McAfee deal was maybe 50% paid for by uh sports betting. Well I have a startup to pitch you.

There's a new startup that launched that allows you to bet on your bills. Only fans, child support, and last night Ubers wipe them from your credit card by playing your favorite casino trying to enrage from the comfort all from the comfort of their app.

Are you So if you have a big Only Fans bill, you can gamble it away. You can gamble it away. Investor in me. The investor in me wants to The investor in me wants to buy that company. You need a vice clause on your own investments. Yeah, you're right.

I mean part I I've said as much as I preach against this stuff if I actually had to open a business it would be called game day loans like instead of payday loans and it would float sports betterers uh who are out there who like at 18 to 25% interest. So that's a free idea out there. Game day loans.

I'm telling you it' be a billion dollar company. It's going to happen. It's going to happen. If you want to sell it to FanDuel you're ready. What what's your la last thing? What's your kind of like timeline on on this sort of tension bubbling up around data centers and slop and and uh the the build out overall?

I I have a very clear idea of how of how like it can get more it can get a lot more intense from here. It'll go national in 2026. The Democrats are going to win a decent amount of elections. Anti-tech is already a small D democratic issue. You're going to start hearing a ton of it at town halls. It's already happening.

and uh 2026 2027 is when it's going to happen. And and and on the right you're tracking like Marjgery Taylor Green or Josh Holly like who's who's going to be leading the front there on the right. It'll probably be Tucker Carlson at the top and from that point it will flow to the Margie Taylor Greens, the Josh Holl.

I'd be very curious to see where uh where JD lands on this actually where David uh David I mean is a central figure in right now. Yes, David Sax. Sax's point, Sax Sax's point, I think from earlier this week was that without AI, you have basically zero GDP growth. So, I think he's taking that's the problem.

So, well, and listen, that's not his fault. He's the AI adviser. He should be making that point. But if I want to lead our country, that's not the sale I'm making because what we have learned over the last We need to prop up the economy so you can lose your job. Yeah. Exactly. There you go.

That is the that is the end all of this entire conversation. Okay. Uh this is this is the this is the final boss of the of the anti- tech wave. It really is the is the fi potentially potentially the final battle. Yeah.

And it's going to be it's going to be it's going to be crazy and I'm I'm excited to have many more conversations. The singularity weekend. Yeah. Yeah. We'd love to have you back. This is so much fun. Uh thank you guys for having me. I really appreciate it. always and congratulations on on all your success.

Obviously, uh I've been doing this for seven years. Nobody gave me a Sunday New York Times profile. Okay. So, I think I think it's I don't know what's going on here. We know we know a guy. Yeah. Yeah. Yeah. We got to make it happen. Uh well, thank you so much. Have a great weekend. We'll talk to you soon. Cheers.

You too. Before we bring in Jordan Schneider from China Talk, let me tell you about linear. Linear is a purpose-built tool for planning and building projects and