Why would Elon Musk invest $20 billion into Mississippi instead of Canada?
On paper, Mississippi may appear disadvantaged, yet it is outperforming Canada in attracting capital and fostering opportunity.
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Tonight, Ezra examines a striking economic development that highlights Canada's competitive challenges: Why has Elon Musk chosen to invest $20 billion in U.S. dollars—through his company xAI—in Mississippi, the poorest state in the United States, rather than in Canada?
On January 9th, xAI announced plans to construct a major data centre in Southaven, Mississippi, named MACROHARDRR (an apparent reference to Microsoft). This represents the largest private investment in the state's history. The project will deliver hundreds of permanent jobs, thousands of indirect positions through subcontracting, and a supercomputer cluster with 2 gigawatts of computing power. Operations are scheduled to commence next month, facilitated by the rapid execution demonstrated by xAI and Governor Tate Reeves' administration, which has prioritized reducing taxes and regulatory barriers.
BREAKING: xAI is building the world’s largest super computer in Mississippi.
— DogeDesigner (@cb_doge) January 8, 2026
xAI is making the largest private investment in state history, unveiling an 800,000 sqft Colossus 3 datacenter.
$20 billion+ project will be creating hundreds of direct jobs statewide. pic.twitter.com/JtM1GMlKtx
Mississippi is often viewed by Canadians as a stereotypical Southern state—small, with fewer than 3 million residents, and associated with historical civil rights issues as depicted in films like Mississippi Burning. On nominal GDP measures, it ranks low. However, when adjusted for Purchasing Power Parity (PPP)—accounting for lower costs of housing, food, and energy—a different picture emerges.
Analysis from The Hub indicates that Mississippi's adjusted per-capita income surpasses that of several Canadian provinces. Ontario ranks 48th when compared to U.S. states and Canadian provinces combined, while the Atlantic provinces (Prince Edward Island, Nova Scotia, and New Brunswick) fall further behind, with average equivalent incomes below $50,000 USD.
Notably, the average African American household income, adjusted for PPP, exceeds that of families in these Maritime provinces. Despite Canada's frequent emphasis on moral superiority regarding U.S. race relations, many Americans in even the poorest states enjoy a higher standard of living than residents of multiple Canadian regions.
The reasons for Musk's choice are clear.
Excited to invest in Mississippi! https://t.co/p2eu6aVVcp
— Elon Musk (@elonmusk) January 9, 2026
Canada has not attracted a comparable genuine private-sector investment of this scale in years. Past energy booms, such as in the oilsands, have been curtailed by provincial NDP and federal Liberal policies that blocked pipelines and development. In contrast, billions have been directed toward subsidized electric vehicle initiatives, even as companies like GM and Ford record substantial writedowns following the removal of the $7,500 federal EV tax credit under President Trump.
Mississippi provides advantages including industrial electricity rates approximately half those in Ontario, strategic proximity to existing xAI facilities near Memphis, competitive taxation, and expedited approvals—without the political interference seen elsewhere. Examples include past hostility in California, where union leaders criticized Musk during COVID restrictions, prompting Tesla's headquarters relocation to Texas, and domestic cases such as Ontario Premier Doug Ford's cancellation of rural internet initiatives perceived as retaliatory toward Musk.
A modest petition of 900 signatures and environmental concerns from advocacy groups have not halted the project in Mississippi, which prioritizes jobs and growth. In Canada, similar opposition—often involving environmental or racial considerations—frequently delays or derails major developments, with timelines for projects like pipelines extending to 2040 or beyond.
On paper, Mississippi may appear disadvantaged, yet it is outperforming Canada in attracting capital and fostering opportunity. This investment positions the state for further gains on PPP-adjusted rankings, while Canada risks continued stagnation despite outward displays of resilience.
GUEST: Daniel Fritter, Publisher of Calibre Magazine, discusses the Liberal government's controversial gun 'buyback' program and other pressing issues facing law-abiding firearm owners in Canada.
COMMENTS
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Fran G commented 2026-01-10 21:28:51 -0500AI scares the crap out of me. There is 2 proposed AI data centres in Alberta, one near Grande Prairie and the other down south. AI research uses a huge amount of energy and water. Any where AI is produced they always need a small nuclear power plant to generate that energy. I dont want any AI or nuclear power anywhere near me. AI does go rogue and they have no idea on the ramifications of it. I believe AI will be known in the future as the biggest mistake mankind has implemented. -
Neil Winter commented 2026-01-10 13:11:25 -0500If Elon had stayed here in Canada our government would have him reduced in to being a welfare recipient. All entrepreneurship here is punished .
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Anthony Salotti commented 2026-01-10 07:19:33 -0500Why would anyone want to invest anything in Canada these days .
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Joe Harris commented 2026-01-10 05:52:16 -0500Of course Elon chooses a place making a way for businesses, to invest and employ people. Reduce tax and red tape, the workers pay their tax, business owners grocery stores and buildings homes etc that are built because people are moving into area, property tax on that. The government and people do well. Good for Elon for moving into a poor spot in America. Maybe one day Alberta can be our own country maybe with Saskatchewan again. Then we to can do well and our children will not be under the influence I hope of the socialist communist WEF agenda.
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Bernhard Jatzeck commented 2026-01-10 00:10:23 -0500Like any astute investor, he wants a good return on his money. Mississippi is a better opportunity than Canada.
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Matt Abrahams commented 2026-01-09 22:51:57 -0500You don’t want any of those datacentres in Canada. They can’t even turn half of them on because they can’t generate enough electricty to power them. Mississippi won’t have cheap electricty for long; once this datacentre is operating the demand for (and thus, the cost of) electricty will increase exponentially.
Moreover, all of these AI datacentres that are being built have considerably increased the demand for RAM and NAND flash memory, causing the price of RAM and solid state drives to more than triple. So, when you go to buy your next computer, it’s going to cost A LOT more. -
Paul Scofield commented 2026-01-09 21:11:33 -0500Mr. Fritter introduced a thought I had not considered before: one thing keeping Canadian gun laws (in action) even a bit in check is the idiocy, ignorance and incompetence of the Federal authorities trying to implement them. Ole!
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Bruce Atchison commented 2026-01-09 20:43:17 -0500Reagan nailed it. “Government is the problem.” If we didn’t have gullible voters who have TDS, we’d be open for business. So Canada lost out on good-paying jobs that went to Mississippi. This one is on you, you Liberal boomer voters!
Regarding guns and crime, I still love what Danielle Smith said. “If you don’t want to be beaten up, don’t break into people’s houses.” If we were allowed to guard our homes, even if it was a rented room, the country would be safer. And if the crooks and gangs were forced to do hard time, we’d REALLY be safe.
