Harvard's Rogoff Warns of 30% Stock Drop as Trump Campaigns on AI Buildout; Ohio Holds 20 of 34 Data Center Ballot Measures

The fight over AI data centers has moved from polls to ballots and balance sheets. With this year's midterm elections days away, Harvard economist Kenneth Rogoff is warning that the economy's dependence on AI spending leaves it exposed, and Ohio has become the main testing ground for voter anger over the facilities.

Rogoff's warning is blunt. "Trump could easily run into a financial crisis before his term is up," he said. "It is entirely plausible to have a 30% — or more — drop in the stock market, and in the context of an economy so dependent on AI, this in turn could easily lead to a recession and widespread financial distress."

He also said the government has less room to respond than in past downturns. "Because government finances are already strained, with the national debt on a patently unsustainable trajectory, there is no guarantee of a sharp drop in long-term borrowing rates for the government," Rogoff said.

The numbers behind the worry

Independent analyses cited by the Los Angeles Times found that data center infrastructure spending last winter and spring accounted for nearly all U.S. economic growth. Without it, growth would have been a fraction of a percentage point.

The Nasdaq 100 carries about 70% of its index weight in companies that depend on AI, per the Times. That includes chipmakers, Big Tech, cloud platforms and software firms.

Ray Dalio, founder of Bridgewater Associates, has warned that AI stocks have detached from financial fundamentals. Hedge fund founder Ken Griffin said last week that AI is "almost certainly" fueling a market bubble that could be near a burst.

Anthropic plans an initial public offering next month. OpenAI expects to go public next year.

What the White House is saying and doing

Trump is campaigning on a "golden age" of prosperity he says will last through the end of his presidency. In Ohio he defended the buildout directly: "Look, there's so much money to be made for Ohio, you can't just turn them off."

His position is that the U.S. has to win the race for superintelligence. According to the Los Angeles Times, he dismissed a September whistleblower's viral warning of existential risk. The paper also reports he rejected calls to negotiate guardrails on advanced AI models with Xi Jinping during the Chinese leader's visit to Washington.

The Times also reports that Trump has privately worried public hysteria over AI could jolt markets that have become heavily concentrated in AI-related stocks. It adds that he had seen polling showing widespread bipartisan opposition to data center construction.

Ohio, ground zero

Voters will decide 34 data center-related ballot measures in seven states, by Fox News' count: California, Florida, Illinois, Kansas, Nevada, Ohio and Wisconsin. Twenty of them are in Ohio, spread across 17 jurisdictions.

The issue is also inside the state's Senate race. Republican Sen. Jon Husted led the Senate push for the Ratepayer Protection Act, which would make data centers pay for the power and infrastructure they use instead of shifting costs to taxpayers. Democratic challenger Sherrod Brown, who held the seat from 2007 to 2025, has attacked Husted over data center development. Trump has defended Husted on the trail.

A Fox News national poll taken last month found 71% of voters oppose AI data centers in their area, including 46% who strongly oppose. A narrow majority, 52%, supported building them in remote locations, while 44% opposed.

Overall, 60% of voters held a negative view of AI and 37% a positive one. That 23-point gap has more than doubled since a July Fox poll. Favorable views of AI skewed Republican and unfavorable views skewed Democratic, and the split was sharper on data centers themselves.

What comes next

The Ohio measures and the 14 on ballots elsewhere will give the first hard vote counts on local data center projects. Anthropic's IPO, planned for next month, will show how much appetite investors still have for AI valuations that Dalio and Griffin call stretched. Rogoff's scenario of a 30% market drop is his assessment of what is plausible, not a prediction that one is under way.