From Harvard Business Review · Blair Levin · Nov 5, 2026 · 4m

AI lost big in the midterms. What comes next for business

Voters rejected AI and data centers in the 2026 midterms. Tech companies now face a fragmented regulatory landscape that could reshape competitive advantage.

In brief

Voters rejected AI and data centers in the 2026 midterms. Tech companies now face a fragmented regulatory landscape that could reshape competitive advantage. Voters in the 2026 U.S. midterms rejected AI and data centers as major issues, signaling a shift away from permissionless innovation and forcing businesses to…

#ai #data centers #2026 midterms #technology regulation #public trust #policy strategy #antitrust #privacy #surveillance #business strategy #business #management

Tech became a ballot issue

In the 2026 U.S.midterm elections, voters cited fears about AI and data centers as galvanizing issues.

Voters want AI to slow down

One poll in October found that nearly two-thirds of U.S. adults felt that AI is developing too quickly. Nearly three-quarters of Americans supported some form of slowdown or ban on data center construction.

Voters rejected AI in key states

Winning candidates in Texas, Ohio, and Pennsylvania campaigned for tougher restrictions on emerging technologies. Across the country, voters in at least thirty-eight communities approved restrictions on data-center development.

AI shaped how people voted

Nationwide, fifty-six percent of midterm voters cited AI and data centers as major or crucial factors in their congressional vote.In Texas, voters in one city rejected continued use of AI-powered surveillance cameras.

Permissionless innovation may be ending

For business leaders, the message is that technology policy has become an electoral issue, not just a regulatory one.In the U.S., the longstanding embrace of permissionless innovation may be fading.New rules may be coming soon.

Technology outpaces regulation

Technology moves faster than regulation. The legal system is slow and deliberative, whereas controversies around disruptive innovations arise and evolve quickly. This creates a gap between technological change and policy response.

Policy shapes winners and losers

Policy interventions can significantly skew the trajectory of new technologies and reshuffle winners and losers, sometimes dramatically.

Microsoft lost to policy distraction

The nineteen ninety-eight federal antitrust case against Microsoft distracted the company's management when computing was moving toward the network. While Microsoft hesitated, new entrants in search, social media, and mobile quickly defined emerging information industries.

Public trust in tech has collapsed

Public trust in technology companies slipped from thirty-two percent in twenty twenty to just twenty percent in twenty twenty-six, according to Gallup.

Policymaking is now fragmented

Regulatory authority has splintered among courts, agencies, states, and legislatures.The EU and China play significant roles.

States fill the federal void

Federal gridlock creates an opportunity at the state and local level to fill the regulatory void, creating a patchwork of requirements for companies operating nationally.

California is regulating AI directly

Recent California legislation mandates safeguards for AI companion chatbots, requires human oversight of automated employment decisions, and prohibits defendants from blaming injuries on the autonomous behavior of AI systems.

Lawsuits are becoming regulation

Difficult issues are being pushed to the courts.Meta's multi-billion-dollar settlement with forty-seven state attorneys general included changes to teen access, feeds, parental tools, and age assurance.

Six policy battlegrounds ahead

Business leaders should assign the general counsel, policy lead, CTO, and strategy chief a quarterly joint review of legal developments.

Data center bans threaten projects

In Sunbury, Ohio, nearly eighty percent of residents voted to ban data centers that use more than twenty-five megawatts a month, potentially derailing a proposed two billion dollar Amazon project.

Elections can reverse policy overnight

After the twenty twenty-four presidential election, the Department of Commerce reversed a preference for fiber in the forty-two point five billion dollar Broadband Equity, Access, and Deployment Program, giving satellite and fixed-wireless providers greater opportunities…

Business must adapt faster than policy

To sustain a policy advantage, business leaders need to integrate legal and policy responsibilities into strategic planning and adapt their strategies faster than both technology and political institutions change.

What it means

Voters in the 2026 U.S. midterms rejected AI and data centers as major issues, signaling a shift away from permissionless innovation and forcing businesses to integrate policy strategy into competitive planning.

Read the original on Harvard Business Review

How we make summaries