The important consideration is whether states are competing for community benefits truly worth the bids made as tax breaks or whether the competition is just among politicians leveraging their personal control over tax breaks towards private benefit as power brokers.
Why do you see data centers as "energy parasites"? They are basically the best customers of the grid possible - consistent high usage. This is an opportunity for the US to pursue energy abundance and grow the economy. The only issues these cause is when states make it impossible to deploy more energy.
Anti growth environmentalism is so toxic when we could just be pursuing wide spread clean energy and growth.
> Hyperion will be exempt from state and local sales and use taxes on its data center equipment for the next 20 years, which includes the GPUs that train and develop AI models. Sherwood News estimated that since the state’s combined state and local sales tax stands at 9.56%, spending the roughly $35 billion for the GPUs of the center will hand the firm about $3.3 billion in tax breaks.
It's tempting to blame any political outcome you don't like on lobbying. It allows you to believe that almost no one supports the outcome that you don't like it, because you can blame it on politicians manage to be bought by a small number of lobbyists. But it might not be the case. Several states (I believe Texas, Georgia, and Indiana) don't charge sales tax to data centers. So from Louisiana's perspective, the alternative to the tax break might not be $3B in tax revenue, but $0 (as Meta would simply build elsewhere). I'm sure they still plan to collect income taxes for the temporary jobs created for the construction of the data center, and of the permanent jobs required to maintain it.
If states all worked together, they could plausibly prevent this race to the bottom by agreeing on a universal sales tax minimum, but there are many obstacles to that as well besides some vague sense of "lobbying". You'd want all states to work cooperate on their minimum tax, but every state has a big incentive to break from the cartel and offer lower taxes in exchange for getting all the datacenters built there. There are lobbyists who are working against this, but it's not just meta and google, it's also local utility companies and construction/trade unions (who all want their state to defect and be the one to get all the new money and jobs)
Well said: why does a tax break bother people so much? That feels pretty populist to me: data centers of this magnitude offer a ton of economic benefits to the area and the state, 3.3B in tax breaks are the price to pay to incentivize them to bring the business to the area, which will then provide a net positive financial benefit. I can see plenty of problems with data center construction that should definitely be addressed, but why do you think states offer such huge incentives?
I think there are plenty of issues with data center construction but there are real economic benefits here. If there weren’t it would be pretty easy for states to thwart them. You would see the leverage switch and companies paying states incentives.
> Entergy plans at least three new combined‑cycle gas plants totalling ≈2.26 GW specifically to serve Hyperion, with additional plants in the wider “AI build‑out” pipeline.
I think that this is one of the cases in which the Fed government should use it interstate commerce clause to prevent the states to compete until rock bottom. The EU has some regulations that forbid state help to private enterprises and they do seem to have some teeth. Nothing wrong with different states having different tax rates, but states should not be allowed to have favorite companies and kill competition.
For those who are unaware, construction of this datacenter has so far been an unmitigated disaster for the community and a fantastic example of how few shits companies like Facebook give when it comes to cutting corners vs. spending money to do things more safely. To say they aren’t taking the community into consideration is an understatement.
They averaged 7 crashes a month near the site. The community isn’t even 2000 people. They’d had 1 fatality already by the time this article was written.
Now if they can actually do something with AI that is meaningful? I assume Mark is trying to reach for like some crazy goal instead of just getting reasonable products to market. I've known the type of person who chases the stars instead of just taking their time, building up the core and then snowballing into greatness.
At this rate, it's almost an equal public-private cooperation - which would actually make more sense as it would give the public ownership over datacenters instead of creepy tech bros.
Will the earth’s climate get tax breaks too? What about the people living around these and paying for taxes. What about zero sum game we have here.
No one likes to see big companies avoid taxes.
But I don't see what other options are available for states to compete with each other if not through tax breaks.
The important consideration is whether states are competing for community benefits truly worth the bids made as tax breaks or whether the competition is just among politicians leveraging their personal control over tax breaks towards private benefit as power brokers.
> But I don't see what other options are available for states to compete with each other if not through tax breaks.
Federal ban on tax breaks for companies over a certain market cap?
Infrastructure is a good one. Universities and high quality labor too.
Compete for what exactly, in this case?
First to touch the bottom!
Capital, assets, jobs.
For the "privilege" (I assume they see some benefit) of their state being chosen as the location for the datacenter.
compete for graft, kickbacks, energy parasites.
Why do you see data centers as "energy parasites"? They are basically the best customers of the grid possible - consistent high usage. This is an opportunity for the US to pursue energy abundance and grow the economy. The only issues these cause is when states make it impossible to deploy more energy.
Anti growth environmentalism is so toxic when we could just be pursuing wide spread clean energy and growth.
> Why do you see data centers as "energy parasites"?
https://news.ycombinator.com/item?id=48123090
> They are basically the best customers of the grid possible - consistent high usage.
The grid exists to serve the populace. It's why we tend to call it a "public utility".
You know I’m sure this is true on some level but if you think this is all or a majority of the motivation I think that sounds pretty conspiratorial.
> Hyperion will be exempt from state and local sales and use taxes on its data center equipment for the next 20 years, which includes the GPUs that train and develop AI models. Sherwood News estimated that since the state’s combined state and local sales tax stands at 9.56%, spending the roughly $35 billion for the GPUs of the center will hand the firm about $3.3 billion in tax breaks.
If they are willing to spend 35B there's no doubt they could spend 30B without asking the government to reach into the people's wallet.
The US needs to do something about lobbying. It seems too late already, but maybe you can get things to improve a bit.
It's tempting to blame any political outcome you don't like on lobbying. It allows you to believe that almost no one supports the outcome that you don't like it, because you can blame it on politicians manage to be bought by a small number of lobbyists. But it might not be the case. Several states (I believe Texas, Georgia, and Indiana) don't charge sales tax to data centers. So from Louisiana's perspective, the alternative to the tax break might not be $3B in tax revenue, but $0 (as Meta would simply build elsewhere). I'm sure they still plan to collect income taxes for the temporary jobs created for the construction of the data center, and of the permanent jobs required to maintain it.
If states all worked together, they could plausibly prevent this race to the bottom by agreeing on a universal sales tax minimum, but there are many obstacles to that as well besides some vague sense of "lobbying". You'd want all states to work cooperate on their minimum tax, but every state has a big incentive to break from the cartel and offer lower taxes in exchange for getting all the datacenters built there. There are lobbyists who are working against this, but it's not just meta and google, it's also local utility companies and construction/trade unions (who all want their state to defect and be the one to get all the new money and jobs)
Well said: why does a tax break bother people so much? That feels pretty populist to me: data centers of this magnitude offer a ton of economic benefits to the area and the state, 3.3B in tax breaks are the price to pay to incentivize them to bring the business to the area, which will then provide a net positive financial benefit. I can see plenty of problems with data center construction that should definitely be addressed, but why do you think states offer such huge incentives?
Do you have evidence that lobbying is what produced this outcome?
Please don’t do that.
So glad to see small companies like this get a leg up.
Seems only fair that we pay our taxes when those are used to subsidize such lofty endeavours.
I think there are plenty of issues with data center construction but there are real economic benefits here. If there weren’t it would be pretty easy for states to thwart them. You would see the leverage switch and companies paying states incentives.
> Entergy plans at least three new combined‑cycle gas plants totalling ≈2.26 GW specifically to serve Hyperion, with additional plants in the wider “AI build‑out” pipeline.
https://spectrum.ieee.org/5gw-data-center
I think that this is one of the cases in which the Fed government should use it interstate commerce clause to prevent the states to compete until rock bottom. The EU has some regulations that forbid state help to private enterprises and they do seem to have some teeth. Nothing wrong with different states having different tax rates, but states should not be allowed to have favorite companies and kill competition.
For those who are unaware, construction of this datacenter has so far been an unmitigated disaster for the community and a fantastic example of how few shits companies like Facebook give when it comes to cutting corners vs. spending money to do things more safely. To say they aren’t taking the community into consideration is an understatement.
They averaged 7 crashes a month near the site. The community isn’t even 2000 people. They’d had 1 fatality already by the time this article was written.
https://lailluminator.com/2025/11/22/meta-data-center-crashe...
Now if they can actually do something with AI that is meaningful? I assume Mark is trying to reach for like some crazy goal instead of just getting reasonable products to market. I've known the type of person who chases the stars instead of just taking their time, building up the core and then snowballing into greatness.
You call chatting with AI-influencer chatbot 'friends' un-meaningful ? Don't make little Marky cry. Not after the VR disaster.
At this rate, it's almost an equal public-private cooperation - which would actually make more sense as it would give the public ownership over datacenters instead of creepy tech bros.