US AI Sector Faces Political Chill: Market Plummets After Midterm Elections Bring Regulatory Threats and Local Backlash

Following the US midterm elections where Democrats scored a landslide victory, the AI industry is facing a dual squeeze. Lawmakers have proposed halting advanced AI development and banning superintelligence, while local voters and newly elected governors are pushing back against new data centers due to soaring electricity bills. These political headwinds triggered a market rout, with the Nasdaq plunging over 5% and Nvidia falling nearly 9%, shaking confidence in the unlimited expansion of AI infrastructure.