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* Tuesday November 6, 2012
Stakes high for Silicon Valley this election
By Marianne Levine November 6, 2012
Silicon Valley and Washington D.C. are 3,000 miles apart, but policy and
economics tie them closely together. Though technology policy and
regulation rarely make it into candidates’ stump speeches, the policies
of the next president will impact the hiring of foreign workers,
government investment in technology and privacy laws — all of which have
profound impacts on companies based in Silicon Valley.
Political trends in the Valley
Silicon Valley, like most of Northern California, traditionally votes
democratic. According to Mark Lemley, director of Stanford Law School’s
program in Law, Science and Technology, the Democratic Party favors big
government and is more likely to invest in innovation.
While President Obama received significant support from Silicon Valley
donors in 2008, there has been a noticeable drop in enthusiasm for this
coming election. Although Lemley acknowledged Silicon Valley’s
democratic inclinations, he noted a tension between support for Obama’s
stance on technology innovation and opposition to government regulation
in the technology industry.
“My guess is that if you had to describe a dominant political philosophy
[for Silicon Valley], it would be libertarian,” Lemley said. “Neither
the Democrats nor the Republicans are particularly libertarian these
days. Republicans want to lower taxes, but want to regulate personal
life. Democrats traditionally want more government … regulation but more
Bruce Cain, political science professor, echoed Lemley in a statement.
“The Silicon Valley is a little more divided this election as compared
to last,” Cain wrote. “Romney offers lower tax rates and a light
regulatory touch, but is less invested in green tech.”
According to a recent article published by The New York Times, some
Silicon Valley CEOs who had supported Obama in 2008 switched allegiances
this year, donating money to the Romney campaign. The same article
stated that many of these CEOs find Governor Romney’s business
background appealing. In addition, as attention moves to Internet policy
and privacy issues, many technology companies find Romney’s stated
aversion to regulation appealing.
Still, Obama has raised significantly more funding from the tech
industry than Romney. According to the Center for Responsive Politics,
the computers/internet industry donated a total of $7,092,464 to the
Obama campaign and $2,966,214 to the Romney campaign.
Immigration policy is another issue of concern for Silicon Valley
voters. While the candidates’ discussion of immigration policy most
often refers to illegal immigration policy, members of the tech industry
remain concerned about the candidates’ decisions with regard to H-1B
The H-1B visa program allows U.S. companies to employ foreign workers
with a particular specialty. At present, the H-1B program limits visas
to 65,000 foreign nationals. One of the criticisms of the H-1B visa
program is that it causes job outsourcing. There does not appear to be a
significant difference on H-1B positions between the candidates. Obama
outlined in the White House immigration blueprint a plan to strengthen
the H-1B program, while Romney favors removal of the visa cap.
Yet, Cain believes Romney’s stance on immigration could challenge his
ability to attract voters from the Silicon Valley.
“The [Silicon Valley] has long wanted an easing of H-1B visa limits as
part of a comprehensive immigration policy, but Romney is more committed
to a restrictive immigration policy given pressure from his activist
party base,” Cain said.
Hank Greely, professor at Stanford Law School, expressed more
ambivalence, stating that the immigration of highly skilled workers
could bode well for either candidate’s platforms and ideologies.
“I think the Obama administration would be more open to [the immigration
of highly skilled workers],” he said. “They’re more open to immigration
reform generally, but, then again Romney himself would likely be
sympathetic to the high-tech industry’s concern to hire and keep
high-tech citizens but his party seems unlikely to accept any change.”
Congresswoman Anna Eshoo indicated that small startups in the area are
most concerned about immigration policy for highly skilled workers. The
majority of her constituents support immigration reform, hoping to
retain a greater proportion of international students, who come to the
United States to refine their technical skills.
Venture capitalist Theresia Ranzetta further emphasized the importance
of H-1B visas, during a seminar in the Election 2012 series. Ranzetta
cited that 15 percent of tech companies have a foreign founder or
co-founder. She stated that while the United States is able to attract
technical talent to its universities, the current immigration policies
prevent such talent from remaining in the country. She added that many
of the beneficiaries of H-1B visas go on to start companies that, in the
long run, are large net job creators.
University President John Hennessy stated in the Election 2012 panel
that his main concern was companies deciding to establish international
divisions to make up for insufficient technical talent in the United
On Oct. 13, both candidates released statements detailing their plan to
grow the technology startup industry. Obama cited that in his first term
he created the chief technology officer position, overhauled patent
reform and legalized crowd funding. Romney stated he would reform
immigration policy for high-skilled workers and create the “Reagan
Economic Zone” or an organization “committed to the principles of free
Predictably, the winner of today’s election will influence Silicon
Valley’s future business practices.
“There is … the question of whether companies like Apple that do so much
of their manufacturing overseas in China will run into problems with a
second-term Obama administration committed to not favoring companies
that ship jobs overseas,” he said.
During his 2008 campaign, Obama stated he would eliminate tax breaks for
companies that outsourced labor. The president revisited this campaign
promise in his State of the Union address this past January.
“Companies get tax breaks for moving jobs and profits overseas. …
Meanwhile, companies that choose to stay in America get hit with one of
the highest tax rates in the world. … It makes no sense … so let’s
change it,” he said.
In particular, policy toward China will have an impact on Silicon Valley
manufacturing techniques. While both candidates have emphasized a tough
policy toward China, Romney reiterated in the Oct. 22 presidential
debate that he would label China a currency manipulator on the first day
of his presidency.
“One area where Silicon Valley is probably very concerned is Romney’s
position with regard to trade and China,” Greely said “China is
practically an adjunct to Silicon Valley. … Major implications would
follow that would have negative consequences for Silicon Valley and for
the whole country. It’s hard to believe he’ll actually do it.”
Science, Technology, Engineering and Math (STEM) funding is also a major
“The Obama administration has been much more willing than a Romney
administration [would be] to invest in science and technology, to get
the government involved in research and clean energy,” Lemley said. “One
area where Romney has spoken out is to criticize the federal
government’s investment in Tesla. We can infer something from that for
support for government funding.”
While Romney indicated in his statement that the government should avoid
picking “winners and losers,” he did state he would “focus government
resources on research programs that advance the development of
knowledge, and on technologies with widespread application and potential
to serve as the foundation for private sector innovation and
In spite of the need for technology policy reform, the panelists at
Tuesday’s elections class agreed that the majority of lawmakers fail to
understand the technical complexities behind the policies they wish to
implement. Ranzetta also cited that technology’s rapid progress could
make policies obsolete. Regulation of technology will continue to be a
topic of discussion, regardless of who is elected.
Congresswoman Eshoo said Obama’s appointment of Todd Park as chief
technology officer reflected his commitment to technology innovation.
On Oct. 20, tech industry leaders released a two-minute video, endorsing
Obama. LinkedIn founder Reid Hoffman and Entelo founder Jon Bischke were
among the leaders featured in the video.
“I support Obama because I personally realized how much he cares about
innovation and future to which we all aspire to build,” Hoffman said.
In addition, Obama has gained endorsements from Yahoo CEO Marissa Mayer
and former Google CEO Eric Schmidt. Former Hewlett-Packard CEO Meg
Whitman, on the other hand, has endorsed Romney.
“If the industry wants to avoid regulation, it is probably better off
with a Republican president,” Greely said. “To the extent they want
regulation, like privacy regulation, they might be better off with a
Q&A with Congresswoman Anna Eshoo Q&A with Congresswoman Anna Eshoo
The American Anatomy: How Silicon Valley can harm CS majors The American
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