Power Moves

Good morning from Buffalo, New York, where Governor Kathy Hochul is celebrating after receiving some bipartisan validation—or at least bipartisan cover—as Texas Governor Greg Abbott, a Republican, enacted his own moratorium on data center construction last week.

Texas is unique in that it is the only contiguous state with its own independent electrical grid. However, many of the underlying justifications cited by Abbott for the Texas moratorium at least echo those put forward by Hochul in New York. Just as in the Empire State, Abbott is asking state regulators to ensure data centers provide information on tax breaks, power use and generation, water use and cooling operations, and impacts on local communities before issuing interconnection permits. Hochul faced criticism from many, including President Donald Trump, after she enacted a year-long moratorium, but the impact of hyperscale data centers is quickly becoming a bipartisan issue across the country. 

While Hochul is hitting pause on data centers, New York is still full speed ahead on AI research and investing in the computational power that is driving the need for said data centers. Hochul announced last week that Empire AI, an NVIDIA-powered system that is currently the most powerful academic research computer in the country, is now officially online at the University at Buffalo. The Beta version will now be available to researchers from a consortium of public and private universities, and more than 300 research projects across the state are already in the queue to utilize the new system.

In a news release, Hochul offered, “New York State built Empire AI to show that artificial intelligence can be developed for the public good, and with Empire AI Beta officially online, New York is giving our researchers the most powerful academic AI research computer in the country. The National Science Foundation’s new hubs embrace the same core principle behind Empire AI—when government, universities, philanthropy and industry come together, they can deliver outstanding results.” The next stage of Empire AI will be a permanent, full-scale facility at UB known as Gamma that will utilize the heat generated by the computing center to heat buildings on campus through a closed-loop thermal energy system. Wow.

Similarly complicated to AI-level computing—at least in this parent’s view—is childcare, and last week in New York City, Mayor Zohran Mamdani and Hochul touted the successful rollout of New York City’s inaugural free childcare program for 2-year-olds. Now comes the hard part: paying for it. The state budget provided funding for the first two years of the program, but neither Mamdani nor Hochul has provided details on how they will sustain the multi-billion-dollar initiative going forward. When asked about future investments, Hochul said, “I can’t commit future budgets at this time, but I can tell you right now I’m excited about the growth of this. This is just the very beginning. We know there are a lot more families to be served. We’ll serve them in a way that we can afford, but I was proud to make the allocation we did within the confines of our existing budget.”

While he did not take the bait during the press appearance with Hochul, Mamdani and his progressive allies have made no secret of their intention to ramp up pressure on Albany to raise taxes on wealthy New Yorkers to pay for expanded services in New York City, including childcare. A recent study by the Center for New York City Affairs at The New School found that enacting universal childcare could cost upwards of $9 billion annually. Both the state and New York City are already facing significant out-year budget gaps, meaning Hochul and Mamdani will need to identify new funding streams or scale back the scope of the universal childcare program. Stay tuned.

In Albany, Senate Democrats announced Senator Shelley Mayer will be the new Chair of the Democratic Senatorial Campaign Committee (DSCC), the body’s formal campaign and fundraising arm, replacing outgoing Senator Mike Gianaris. Senate Majority Leader Andrea Stewart-Cousins offered, “While we will all miss Senator Gianaris as Chair, he has built the DSCC into an incredibly strong and durable organization, and I am thrilled to have Senator Shelley Mayer build on that success as she leads the committee into its next chapter. Shelley is an exceptional leader, a proven fighter for the people, and someone who understands what it takes to win campaigns.” The personnel shakeup comes as Senate Democrats look to bolster their supermajority by flipping seats on Long Island and in the Hudson Valley. Even with a motivated Democratic electorate, flipping state Senate seats will be a tall task for Mayer given the partisan trend on Long Island and in the Hudson Valley in recent election cycles. We here at OD&A hold Sen. Mayer in high esteem. She is an exceptionally thoughtful and intelligent member and will be a great DSCC Chair. Good luck, Sen. Mayer!

In Michigan, Abdul El-Sayed won the Democratic Primary for United States Senate against Rep. Haley Stevens in what was one of the most expensive and hotly contested primary elections this cycle.

El-Sayed ran on a decidedly Progressive platform that laid bare the differences between the two disparate factions of the Democratic Party. His win, however, was not the decisive win that some polls and many Progressive pundits projected or that had been hoped for by the Left. El-Sayed defeated Haley, who was recruited by Senate Minority Leader Chuck Schumer and ran in a more moderate lane, by only 1 point with 99% of the vote in. El-Sayed will now hit the General Election campaign trail against Republican Mike Rogers to convince Michiganders that his brand of Democratic politics can deliver for them. He will be joined on the campaign trail in the Wolverine State by state Rep. Donavan McKinney, a Democratic Socialist backed by prominent progressives, who unseated incumbent Rep. Shri Thanedar in the 13th Congressional District, and William Lawrence, a progressive climate activist, who defeated two establishment-backed candidates, Bridget Brink, a former U.S. ambassador to Ukraine, and Matt Maasdam, a former Navy SEAL. The lone blemish of the night for the progressive left came from Missouri, where Rep. Wesley Ball defeated former Rep. Cori Bush in a 2024 primary rematch that was largely defined by support for Israel. Broadly, DSA and more progressive Democrats have been winning in seats where a primary victory is tantamount to election, that is, districts with overwhelming Democratic majorities. Michigan, a deeply purple state, will be a brutal test for that wing of the Democratic Party to deliver.

The more establishment wing of the Democratic Party, reeling from an ongoing primary cycle where their candidates have been repeatedly defeated by the ascendent left, is looking for answers heading into the 2028 primary cycle. Jonathan Cowan of Third Way, a “national advocacy organization that champions moderate policy and political ideas,” announced that the group will be spending $15 million between now and 2028 to discredit democratic socialism. Cowan told the New York Times in an interview, “We are preparing for the next war that is coming… It is deeply troubling to see radical, far-left candidates winning in places that are potentially presidential swing states.” Cowan’s effort is an attempt to prevent what many Democrats see as the worst-case scenario in 2028—a DSA-aligned candidate winning the Democratic presidential nomination just to lose to a politically vulnerable GOP candidate. Instead of targeting progressive candidates directly, Third Way plans to focus its fire on the DSA to water down the group’s influence and energy heading into 2028. 

This week offered a mixed verdict for Trump’s political operation after his endorsed candidate lost a top battleground GOP Primary in Michigan. Amir Hassan, a Navy veteran and former law enforcement officer, finished behind retired engineer Tom Smith, despite Smith dropping out in mid-July and endorsing another candidate who ended up finishing third. Smith indicated he will accept the nomination and will face first-term Democratic Rep. Kristen McDonald Rivet for the highly competitive 8th District. In a statement, Smith said, “I look forward to working with Speaker [Mike] Johnson and the entire Republican team to expand our House majority and advance President Trump’s America First agenda to lower costs for working families and make America affordable again.” 

Meanwhile, in Tennessee, Rep. Andy Ogles lost his primary race to Charlie Hatcher, the state’s former agricultural commissioner, who was backed by establishment Republicans including Gov. Bill Lee. Ogles had a long history of controversy, including calling for New York City Mayor Mamdani to be deported and stripped of his citizenship. Trump, of course, shrugged off the losses, remarking that neither candidate was ever going to win, even with his backing. 

As Election Day draws nearer, the Democratic Congressional Campaign Committee (DCCC) has added 12 additional Republican-held seats to its target list, including two races in New York. The DCCC will now be active in NY-1 on Long Island, where military pilot Chris Gallant is looking to unseat second-term Rep. Nick LaLota. It will be an uphill battle for Gallant given LaLota and Trump both won by 10 points in 2024. Gallant is also well behind in fundraising—he entered July with just over $170,000, compared to LaLota’s $3.3 million. In the North Country, the DCCC is focusing on NY-21, where dairy farmer Blake Gendebien is running against Republican businessman Anthony Constantino to succeed outgoing Rep. Elise Stefanik. Gendebien does not have as much ground to make up on the fundraising front; he had $2.6 million in the bank compared to Constantino’s $3 million at the end of June, but will have a much wider margin to overcome in November. In 2024, both Stefanik and Trump won the district by more than 20 points. 

In case you missed it, embattled GOP congressman Max Miller had what political consultants from across the spectrum have described as a “disaster class” of an interview with CNN's Jake Tapper last week. 

 -Jack O’Donnell

Congratulations to Elizabeth Mauro of OD&A client, Endeavor Health Services, for also making the list.