Bill Ackman warns against slowing AI development during midterm cycle

The political cost of AI

Billionaire investor Bill Ackman recently addressed the growing political tension surrounding artificial intelligence. He noted that calls to pause AI development could serve as a tool for certain candidates looking to gain support during the midterm elections. While these moves might influence short-term voting patterns, Ackman argues they do not reflect the practical needs of the country.

The debate is fueled by concerns over the massive scale and cost of building out data centers. These facilities are the backbone of AI, providing the computing power needed to train complex models. As these projects move forward, they face increasing scrutiny from local communities and policymakers alike.

Ackman suggests that while some politicians may use the 'pause' narrative to win votes, the underlying economic reality is different. He believes the U.S. must prioritize staying ahead in the technology race. For Ackman, the goal is to ensure the United States remains a leader rather than a follower in the development of superintelligence.

A race for superintelligence

Ackman frames the current state of AI as a global competition that carries significant weight for national security. He describes the pursuit of superintelligence as a race that the United States cannot afford to lose. According to Ackman, falling behind in this specific technological area would be existential for the country.

To illustrate his point, he compared the push for AI infrastructure to the historical expansion of electricity. He argued that trying to slow down the growth of AI is similar to trying to prevent electricity from reaching the American public. In his view, AI is becoming a fundamental utility that will eventually be integrated into every part of the economy.

The investor believes that the demand for these facilities will persist regardless of local opposition. He pointed out that many states are eager to host data centers because they provide significant job creation. The sheer amount of landmass available in the United States provides ample space for this continued buildout.

Market impacts and holdings

The discussion around AI infrastructure involves some of the largest companies in the world. Tech giants like Amazon and Meta Platforms are investing heavily in the hardware and energy required to power their AI ambitions. These investments are significant enough to raise questions about whether the spending will become a major political issue.

Interestingly, Ackman’s own investment firm, Pershing Square Capital Management, holds large positions in Microsoft, Amazon, and Meta. This means his personal investment strategy is closely tied to the success of the very companies currently navigating these regulatory and political hurdles. His stance reflects a belief in the long-term value of these infrastructure plays.

Beyond the AI sector, Ackman identified other economic factors that could influence the market during the midterms. He mentioned housing finance and energy prices as key areas of concern. He specifically noted that the war with Iran has pushed up energy prices, creating a political headwind for Republicans while potentially helping Democrats.

Executive action and Congress

Ackman also discussed the legislative environment and what the president can achieve in a divided government. He highlighted the resolution of Fannie Mae and Freddie Mac as a significant economic policy goal. He noted that this specific issue could be addressed through an executive order, which does not require a vote from Congress.

He suggested that the administration might be intentionally waiting until after the midterm elections to act on such matters. This timing strategy is common when leaders want to avoid political friction during high-stakes election cycles. Once the elections are over, the president may have more room to move on these important economic issues.

While a divided Congress will make it harder to pass new legislation, Ackman downplayed the long-term damage of the midterm results. He stated that the country will survive the outcome of the next two years. For him, the identity of the next president is far more consequential than the immediate composition of the legislature.