Midterms Flip the Board: Big Tech Races to Win Back Democrats

Days before the midterm elections, OpenAI hired Jessica Schumer, daughter of Democratic Sen. Chuck Schumer — and started calling its data centers "compute campuses." The timing tells you everything: Silicon Valley's biggest companies spent two years courting Donald Trump, and now they're scrambling to rebuild bridges with Democrats who have pledged to tighten AI oversight.

For practitioners, this isn't cosmetic noise. It signals where the regulatory fights will actually happen over the next two years, and most of it won't be in Washington.

What did Big Tech get from Trump?

The ledger so far is substantial. According to reporting on the industry's ties to the administration, Silicon Valley's biggest names attended White House events, some scaled back diversity, equity and inclusion programs, and some executives donated millions to super PACs backing Trump's campaign and allied candidates.

The payback came in policy form:

• Tax breaks benefiting the industry
• The pausing of some federal investigations
• Looser AI regulation overall

The exposure cuts both ways, though. Meta faced lawsuits and billion-dollar fines over the same period, and OpenAI faced suits alleging its technology harmed users. The Trump years were friendlier, but not friction-free.

What does the pivot look like now?

J.B. Branch, director of federal AI governance and technology policy at Public Citizen, a nonprofit advocacy group that describes itself as nonpartisan, said the tech industry "realizes they have an optics problem." He characterized the Schumer hire and the data center rebranding as "PR washing."

Expect more of it, Branch said. He pointed to OpenAI's partnership with the American Federation of Teachers, announced last year, plus Anthropic's newly launched Claude Corps and Meta's America's Workforce Academy. "I would imagine more of that sort of investment in these corporate, private-public partnerships," he said.

These moves didn't come out of nowhere. Meta and other tech companies reportedly began looking for ways to strengthen ties to Democrats as Democratic gains in the midterms looked more likely. A Meta spokesperson pointed TechCrunch to remarks Meta President Dina Powell McCormick made this week at WSJ Tech: "You have to work with the government that the American people elect. I have seen it across the board that you have to be bipartisan, and you want to be, because you want buy-in on the things that you're trying to do."

Will Democrats buy it?

Not everyone thinks the pivot lands. Alice Marwick, director of research at the tech policy nonprofit Data & Society, expects Big Tech to try moving back toward the middle, "if not the left. But it's a little too late," she said. "Tech companies should be asking themselves how their products can make people's lives better, because right now, it doesn't seem like they are."

The practical stakes are concrete. Data center moratoriums are gaining traction in communities across the country, and a wave of AI regulation bills awaits drafting. Powell McCormick said Meta wants to show that communities welcoming its investments will see "an enormous amount of benefit," while those that don't want them "will of course have the right to stop them."

Where will the real fights happen?

Here's the part operators should underline. Washington likely delivers gridlock for the next two years, which pushes action down to the states.

Aryan Ranjan, founder of Baraza, a political campaign management software company, said most action will probably happen at the state level, since states have already sued tech companies and passed regulations. At the federal level, he expects a shift in framing: "A coalition built on newer, working-class voters is likely to push Democrats to frame AI around electricity bills, data-center siting and jobs rather than abstract AI safety."

The federal-state collision is already staged. Last December, the Trump administration signed an executive order creating the AI Litigation Task Force, a federal group meant to challenge state AI laws. The administration has argued that U.S. AI companies "must be free to innovate without cumbersome regulations." Many states have nonetheless passed their own laws, including measures on chatbots and deepfakes.

President Trump's next moves remain an open question — whether he signs more AI executive orders or vetoes bills that could be seen as anti-AI. What's clear is that voters want stronger guardrails around the technology.

What does this change for AI companies?

Compliance geography, for one. "For the next two years, a company's AI rules may depend more on where it operates rather than on anything Washington passes," Ranjan said.

Then there's the market dimension. Branch argued that Trump's political fortunes are now tied to the AI industry itself. On Wednesday, the day after the midterms, a trillion-dollar market sell-off spooked investors — some of whom are reportedly now reconsidering Anthropic's reported trillion-dollar IPO.

"There's a very strong likelihood that there will be an AI bubble pop, and it'll happen on Trump's hands," Branch said, predicting a possible market collapse. "Does he want to sink or swim along with the AI industry?"

A White House official, in a statement to TechCrunch, framed the administration's position: "American leadership in super intelligence is essential for our national security, economic prosperity, and the quality of life of the American people. President Trump is committed to ensuring America continues to lead the world in super intelligence while protecting American consumers. As the President has said, he's willing to work with anyone to continue delivering victories for hardworking Americans."

For operators, the takeaway is straightforward: plan for a patchwork of state rules, expect the PR-offensive to intensify, and watch the market — because a trillion-dollar sell-off the day after an election is a reminder that policy risk and valuation risk now move together.