Silicon Valley Executives Create Political Group

When Larry Gerston produced one of the standard texts on California politics 14 years ago, he wrote about the influence of Hollywood, agribusiness and the aerospace industry.

But not a word was devoted to the Silicon Valley, an omission that persisted through several revisions, myriad statewide campaigns, a steep recession and a percolating recovery.

Today, some of the Silicon Valley’s leading entrepreneurs and executives will announce their intention to write a new page in the state’s political primer, through a venture dubbed the Technology Network.

Co-founder John Doerr describes the group as a national political organization for leading industries of the “new economy,” from “bugs and drugs”--biotechnology--”to bits and bytes”--computers.

Despite more than $2 million in start-up funds, however, the high-tech executives must overcome considerable skepticism before they can wield any sort of political power approaching their enormous economic clout.

In particular, observers say, the high-tech entrepreneurs must overcome a history of apathy, along with an abundance of political naivete in their ranks and a creative culture that tends to militate against cohesion and cooperation.

“The people here are not joiners by nature,” said Tom Hayes of Applied Materials, the world’s largest semiconductor equipment maker, who has opted against throwing in with his fellow Silicon Valley executives for now. “Their druthers would be to avoid dealing with government if they could.”

Or, as Gerston put it from his vantage point at San Jose State: “These guys don’t know from politics.

“Their mentality has always been to take every dime they had and put it into research and development, and then product.”

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Many in the industry hope to change that as high technology helps stoke California’s comeback and spurs a national economy increasingly reliant on exporting the sorts of goods--from computer hardware to Internet software--produced in the booming Silicon Valley.

The planned announcement is scheduled to be held at the Mountain View headquarters of Netscape, where a virtual high-tech who’s who will assemble to unveil what backers hope will be a unique one-stop lobbying shop and campaign-financing franchise.

The bipartisan group, based in Palo Alto, will lobby on issues, endorse candidates, fund political campaigns and promote causes, starting with legal reform and education overhaul.

“We’re committed to doing this for a long time,” Doerr said, in contrast to the industry’s notably spotty involvement in politics up to now.

The new effort comes at a time when “technology and exports are the engines driving the national economy,” said Stephen Levy, head of the Center for Continuing Study of the California Economy, “and the demand is primarily for the kinds of goods California is producing.”

Two sets of statistics help illustrate the point.

Between 1990 and 1996, California’s exports doubled from $50 billion to $100 billion, and almost all of the increase was attributable to technology-related products, according to Levy.

Meanwhile, from 1987 to 1997, California’s share of the nation’s exports grew from 13% to 17%. Most of the growth has come in the last three to four years, as the state pulled out of the recession. And, again, most of the growth was related to technology.

For all its significance, however, high-tech is still a relatively young industry, having grown up in just the last 30 years or so. For most of that time, the focus has been inward-looking, befitting an enterprise in its embryonic stages.

There have been some notable industry figures with strong political connections, of course. Industry pioneer David Packard, the founder of Hewlett-Packard Co., was a noted philanthropist and Republican Party stalwart who served as undersecretary of defense under President Richard Nixon.

Favored home-grown candidates such as former state Sen. Becky Morgan, Rep. Tom Campbell and former Rep. Ed Zschau--a one-time head of the American Electronics Assn.--were elected to office with the substantial backing of the Silicon Valley.

But the industry’s political involvement has tended to be sporadic and fleeting.

Only when issues such as export policy, protectionism and the ability to raise capital grew more pressing did Silicon Valley rouse itself from its endemic indifference.

“For many years, the attitude was, ‘Life is good, we’re new, we’re fresh, we’ve got product,’ ” said Gerston, who teaches political science at San Jose State. “Then the world started getting smaller and competition started increasing and all these political issues started impacting their economic livelihood.”

Industry leaders started getting involved more in regional politics, recognizing how matters from permitting to taxation and transportation had a direct impact on their companies’ bottom line. Executives “came to realize there was a cost associated with ignoring government,” said Hayes, head of global corporate affairs for Applied Materials.

On the national scene, Bill Clinton consciously cultivated the Silicon Valley in his 1992 campaign, the first such courtship from a presidential candidate. Clinton’s efforts were partly a statement of generational affinity with a cutting-edge industry. Partly, too, he was capitalizing on ties established by then-U.S. Sen. Al Gore, his running mate, who made high-tech a specialty in Congress.

The relationship, rocky at times, has continued throughout the Clinton administration. Gore, with an eye on a likely presidential candidacy in 2000, has met with members of the Technology Network half a dozen times in as many months.

But the industry’s great political awakening came last year with Proposition 211, an attorney-sponsored effort to facilitate the filing of securities fraud lawsuits. High-tech companies have been a prime target of such shareholder suits because of the volatility of their stocks. Industry executives treated Proposition 211 as a mortal threat, raising $40 million to defeat the measure.

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Now, Doerr said, industry leaders hope to establish a permanent political presence in state and national politics, in contrast to the industry’s more episodic involvement.

“Instead of being reactive,” said Doerr, a leading venture capitalist, the hope is to have “a steady, sustained conversation with public policy makers.”

Kevin Spillane, a GOP consultant with campaign experience in the Silicon Valley, said, “There’s definitely going to be a learning process” for many of the high-tech leaders involved.

“By their very nature, they’re anti-political, and they are going to have to learn to adapt to certain political realities. On the other hand, if they can adapt--and the political culture can adapt to them--they have tremendous potential.”

They certainly have the financial wherewithal. Doerr refused to provide a figure, but said the group is ready to spend “lots” on supporting favored candidates.

But the question remains how closely the executives will operate absent a perceived political threat like Proposition 211. After all, part of the high-tech mythos is the individuality and independent thinking that fostered the industry’s ability to alchemize sand into silicon wafers.

“There are a lot of dynamic, energetic, creative, brilliant people in the area,” Spillane said. “But more often than not, they’re interested in building their businesses and making money [more] than being involved in the political process.”

Industry executives have also been involved in some notable stumbles in the past--some of which were caused by what critics consider a lack of political sophistication.

The battle with plaintiffs lawyers over legal reform issues was one prominent example. Many observers, including some inside the industry, saw the lawyer-sponsored Proposition 211 as retaliation for an earlier, unsuccessful attempt by the industry to tilt the legal system more in its own favor.

Notably absent from the ranks of top-drawer executives lending their wallets and willpower to the new organizing effort is Tom Proulx, the former Intuit executive who led the legal reform fight.

Doerr said Proulx “wanted to move on and build another company.” But others said Proulx was excluded because of resentment among some Silicon Valley executives who believe his earlier work backfired. Proulx could not be reached for comment.

There are times, too, when the industry’s enduring faith in a technological answer to problems seems out of sync with more mundane realities. Addressing the problem of parent-teacher communication, for example, Doerr recently floated the idea of the industry providing free cellular telephones for state schoolteachers.

Relating the incident, one high-tech executive quoted his child’s teacher scoffing, “Forget that, I need glue sticks.”