Slashdot Mirror
Are Silicon Valley's Glory Days Over?
Hugh Pickens writes "Pete Carey writes in the Mercury News that there are 'clear warning signs' that Silicon Valley has entered 'a new phase of uncertainty' in which its standing as a tech center is at risk and that decisive action by business, government and education is needed if the region is to retain its standing as the world's center of technical innovation. 'It could be that Silicon Valley has a different future coming,' says Russell Hancock. 'It's not a given that we will continue to be the epicenter of innovation.' Among the troubling indicators in the Silicon Valley Index (PDF): 90,000 jobs lost in the last two years; the influx of foreign science and engineering talent has slowed; venture capital funding has declined; per capita income is down 5 percent from 2007; and the number of people working as contractors rather than full-time employees is rising. Adding to the valley's problems is a malfunctioning state government that is shortchanging investment in education and infrastructure."
I keep telling these idiots that the first option you should look at when jobs are declining is to increase the importation of foreign workers but do they listen?
nnnnNOOOOOoooooooo....
Seastead this.
Need that money for more prisons.
For justice, we must go to Don Corleone
recent years have made working freely by contracting much more easier and feasible. in addition the respect for that kind of contracting and telecommuting increased as well. bright and capable people are now more and more working freely in contract fashion rather than being tied to some company by a salary. this can only increase.
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In California? Are you serious? California has always rewarded bright, young students interested in the sciences. Here's a recent example:
http://www.signonsandiego.com/news/2010/jan/15/students-evacuated-school-chollas-view/
"The average reporter we talk to is 27 years old......They literally know nothing." - Ben Rhodes
The synergy of government, university, corporation in Silicon valley
is glued there by one critical component -- the venture capital lives
down the block and they like to see how their money is spent --
daily. Perhaps others have more direct life experience but I've
definitely seen it in biotech.
As soon as the lure of big bucks goes away, tech will be a commodity
to be found in any medium sized city's office park. The cost of life in
CA is insane.
We are all in a global recession. As such, there are no "Glory Days" for anyone anywhere. I wouldn't count Silicon Valley out just yet.
My advice? Keep your current job if you can, and suck wind like the rest of us do.
Life is not for the lazy.
Actually we needed the exact opposite of H-1B, V1, B1 and all the rest. We built the tech industry without these corporate communist regulations because without them wages went up. Rising wages brought people into the field and encouraged risk.
All the federal government's interference in the US labor market has driven down wages and increased fear. It has also discouraged the best and brightest American students from entering tech. And what people seem to not understand is that Americans bring unique skills to technology. A diverse workplace is good. We had that back in the '90s. But today, we are way past that. In my office I am the only American. Mostly we have Indians. When you get over 25% Indians on a team you start to see their cultural influence. Hindus believe in a cast system where certain people are just better than others.
It starts to kill the team. And that's were I see most teams today in my company. They are Hindu teams where it matters which cast you are from more than anything else.
#1. criticism on the poster or whoever came up with the Slashdot article title "Are Silicon Valley's Glory Days Over?" -- yes, catchy and attention getting, but jumps to conclusions.
#2. what is this article about? It's from the business side of things. They spoke with:
- chief executive officer of Joint Venture: Silicon Valley Network ...where's the techies? "decisive action by business, government and education is needed" -- what about technological innovation? That is the other side of the equation too other than those funding these operations.
- chief executive and president of the Silicon Valley Community Foundation
- chief strategist in San Jose's Office of Economic Development
- Santa Clara County's budget director
Does this imply that continually electing right wing governors and the like has a little bitty teenie weenie something to do with economies falling into the toilet? Could it be?
I believe you'll find it's bloated government spending that's bankrupt California. And I'd hardly call Arnie 'right wing', except perhaps by Hollywood's standards.
It is hard to know how to respond to something so utterly ignorant. Where does one start? California has not gone to a Republican presidential candidate since 1988. That is 22 years since basic comprehension of reality is apparently beyond your grasp. The state's legislature is loopy leftist. The governor is a RINO.
As the testbed of liberal ideas, California is going the same way as its 1970's predecessor, New York City, did: into bankruptcy.
Just flood it, and we can turn it into a lake.
The only thing necessary for evil to triumph is for it to be pitted against a slightly greater evil
The obvious next step: Ban people who don't have H-1 visas from tech jobs. There's lots of jobs at Starbucks left for lazy overeducated white guys.
In this state's case, a lot of things led to poor money situation, but two stand out: 1) when times were good, they didn't allow themselves a 'rainy day fund' and mandated that any surpluses had to be spent out. 2) Net taxes paid OUT to the federal gov. are staggering, and California is the gross highest - in 2001, their "balance of payments" figure was 58 BILLION dollars.
Part of the problem in Silicon Valley is that the venture capital community has become noticeably more risk averse than it was many years ago. Many (most?) firms act more like investment banks than high-risk, high-tech venture funds.
Additionally, I think the rise of social media has biased venture capital deals in strange ways, steering even more money toward social network and media whores than actual tech ventures.
The actual problem is the set-asides imposed by referendums.
Indeed, California is suffering from too much democracy. It is especially easy to get well-meaning things (or at least things that sound well-meaning) on the ballot. People vote for them because they sound nice and the voters don't have to try to balance the state budget. This commits money to all sorts of things and prevents the government from fixing the budget. The Economist recently did an article on this topic that is very enlightening. As bad as politicians may be at budgeting, the voters are far, far more dangerous
First, bypassing the "story" and a layer of blogs, is the actual report.
What's really happened in Silicon Valley is that it's been hollowed out. Silicon Valley used to be a major manufacturing center. San Jose once had the highest percentage of manufacturing employees of the major US cities, something like 54%. Today, the assembly plants are gone. Most of the fabs are gone. Much of the engineering is gone. This is what happens when you "outsource". Eventually, everything moves to where the production is, including management and finance.
Part of the problem was the "dot com boom", with its fake companies and fake prosperity. That caused a major change in the culture, away from engineering and towards marketing. When the bottom fell out of the dot-com boom, most of the marketing types left. The number of twentysomethings in San Francisco dropped by half. (A friend in the club business says "and the other half are working their butts off and don't go out much.") The big name in Silicon Valley now is not HP or Intel or IBM or National Semiconductor or Fairchild. It's Google, which is an ad agency. That's a huge change in emphasis.
The innovation culture is declining. Portola Valley (a rich suburb) used to have the highest percentage of patent holders of any US community. That's dropped. There's not that much exciting innovation going on. I go to venture capital meetings, and the ideas being presented are just not very exciting. (I've heard a pitch for a social network for cats. And that made it through two rounds of filtering before I heard it.)
People are still struggling to get semiconductor line widths down, solar fab costs down, and such. But that's a grind. Mobile devices are not a fun area in which to work - the weight budget, the cost budget, the power budget, and the time budget are all very tight. The manufacturing is in Asia, anyway, and the engineering is going there. New areas aren't appearing.
There's noise about "green tech", but realistically, "green tech" is either vaporware, like the "smart grid", silly, like small windmills, or something that requires massive manufacturing, like big windmills. Five years ago, the noise was about "biotech", which doesn't employ many people.
Fewer young people in the US are going into engineering, and that's a rational decision. It's hard, it's expensive to study, your job may be outsourced, and it's now a low-status field. In 1970, lawyers and electrical engineers made about the same amount of money. That was a long time ago. On the other hand, in Asia, an EE degree puts you in the top few percent of the population in terms of income and status.
US government polices haven't really had much of an effect one way or the other on Silicon Valley, except that allowing the runup in real estate increased living costs substantially and that free trade has made outsourcing so easy.
2) Net taxes paid OUT to the federal gov. are staggering, and California is the gross highest - in 2001, their "balance of payments" figure was 58 BILLION dollars.
Wait, doesn't that mean that the bread and circuses/Keynesian method, high immigration numbers, and social service spending is working? If they finally legalize marijuana and reform their enormous prison system, looks like they'll continue to be the top performing state economy in the US.
California was too expensive to live in back before the Dot com Boom and worse today. You have regions around the US where the cost of developing sectors of R&D are a fraction of that in Silicon Valley and would better serve spreading the talent around the US instead of concentrating it into a zone where you drown in debt while gaining experience.
I left Apple a year after my former company, NeXT, merged with Apple because the cost of living and going through a divorce was bankrupting my ass. The cost has far surpassed the cost of living adjustments and it is not worth going back.
Finally, the GOP has wised up and has set out to systematically destroy Silicon Valley and all those liberal-minded programmers and their support for leftist educators that have nothing better to do than fill the minds of children with all sorts of thoughts.
If jobs aren't outsourced to India, how can American corporations make enough money to pay executive salaries? If Silicon Valley can be broken, computer talent can be had at pennies on the dollar, so that once again we will be able to compete with India and China.
Agree completely. To further illustrate to people who don't understand what we're talking about, say some group or another puts a measure on the ballot that reads something like this:
After-school sports programs are a valuable part of youth education. They increase socialization among youth, promote general health, and combat the rise of obesity in America. In addition, studies have shown that after-school sports programs typically lower rates of violent crime in affected areas by 29 percent. At present, however, such programs are dangerously underfunded. This bill proposes that California earmark $18 million per year to promote after-school sports programs. As this money will come from the general fund, it will require no new taxes. School district administrators will be required to submit budgets to state agencies for approval of their share of the funds, to ensure full accountability to the taxpayer.
So Joe Voter reads this, goes, "Sure, my lazy-ass kid probably should get out and play sports more," and votes Yes. The bill passes.
What Joe Voter has done is take $18 million per year out of the general fund, where it could have been spent on various under-funded services in tough economic times, and earmarked it for after-school sports programs, come hell or high water. School can't afford books? At least it has an after-school sports program.
And what Joe Voter might not have even understood at the time he voted for this measure is that traditionally, after-school sports programs had been managed by local nonprofits, rather than being funded by school districts. Under the language of the new law, school administrators now have the additional administrative burden of producing a budget for after-school sports, or their share of the funding will be cut. And if they take the money but don't spend it on after-school sports, they will be called to task for "accountability." And who wrote this bill? The accounting firm who stands to gain the contract for managing the invoicing and budgeting of the after-school sports programs.
This is a totally made-up example; I don't know the specifics of any bill that resembles this one. It's just to give you an idea. But each election, California ballots have a dozen or so bills that read just like this one, and if you don't read the information carefully, it's easy to make mistakes.
Breakfast served all day!
Malfunctioning state government?! Cripes, man, the state government here has basically declared open warfare on anyone remaining in the state who exhibits a microgram of productivity or independence. And when questioned (by the rare few in the news media that even bother) about the sanity of their actions in such a bad economy, they pretty much come out and admit they don't give a shit about anything other than some legacy involving bunnies and unicorn farts. Nearly every professional person I know is planning on leaving as soon as they can by looking for out of state work, getting their homes cleaned up for sale, etc.
And for the record, this state spends a lot on education- nearly half the state budget. The whole thing needs to be torn down and rebuilt from the foundations. Hell, you probably want to dynamite the foundations as well. But the political brain trust will just throw more money down the black hole, and they'll sit and wonder why it didn't help, and throw some more because doing anything else is ideological heresy. Rinse and repeat until the sate declares bankruptcy or armed insurrection occurs.
It's a combination. It's a Democratic majority that refuse to cut any spending combined with a Republican minority that, given the California 2/3rds requirement, vetoes any tax increase. It's a deadly combo that guarantees the state will never be run in a fiscally responsible way. (i.e. insisting that inflows == outflows.)
If either party were able to fully define both tax and spending levels, the state would be better off.
The cake is a pie
Policies that you can't argue against without putting yourself in an inferior position:
Patriot Act-->Who wants to be labeled as unpatriot in a time of grave danger?
Accounting by Fair Values-->Who wants to support "unfair" values?
Tax Relief-->Who the hell can be against relief?
etc; ad nauseam... The problem is that examples such as these are all complex laws with hordes of pages and technicalities, yet they sound FAIR, COMMONSENSICAL, HONEST, and with CA's direct democracy, Joe Average will be sucked into this type of framing trick.
I for one have always thought that ThePirateBay.org should change its name to "OurSharedCulture.org", or "AllHumanCulture.org". I REALLY Want to see a politician screaming on TV "We gotta shut down those bloody criminals from "OurSharedCulture.org"!!
For some reason you are posting from 2008. We just had the largest state tax increase in national history here in California last year. The Republicans capitulated in backroom deals, thus giving the required 2/3 majority.
We're now the highest taxed state in just about every area.
Guess what? It didn't help. It just raped an already bleeding economy in the ass.
The governor is a RINO.
From watching the antics of the Republican party, RINOs are actually the only ones that try to be republican. The rest are loony religious people trying to push their brand of god on everyone.
Reboot macht Frei.
Wanna blame? Blame yourselves !
Silicon Valley's glory and gloom has nothing to do with H-1.
Silicon Valley bloomed in yesteryears because of the incentives that were there for innovators to innovate.
Innovators were aplenty, and they were willing to share the findings to each others, and they actually encouraging each others to do more !
There were no patent trolls back then. No teams of lawyers who will sue innovators to bankruptcy or subpoena them to court to explain why they come up with this little piece of code/gadget/idea which happens to have similarity to another piece of code/gadget/idea.
In other words, there were no rent-seekers back then.
Nowadays? There are more rent-seekers in Silicon Valley than the innovators.
Blaming the H-1 visa is too easy, and everyone is doing just that. But will that help Silicon Valley?
What if all the H-1 visas are revoked tomorrow? Do you seriously think that Silicon Valleys can magically bloom again, just like that?
C'mon, guys ! Use your brain for once and stop regurgitating the vomit of others.
And PS. I was in Silicon Valley when it blooms, and yes, I was one of the innovators. Now I am no longer in the Silicon Valley, and heck, I am no longer staying in the United States, and you know why? Because I have had enough of those rent-seekers !
then your problem is the draconian, almost near feudal insurance system in usa.
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Secondly, if that 2k a year is not coming out of his pocket, then whose pocket is it coming out of, mine? So that's great, my dream of sending my son to college or even having a retirement just evaporated so I can foot the bill for someone else's problem.
What a lovely country you live in, filled with wonderful human beings like yourself who would happily let a stranger suffer so that they could buy a bigger TV. How glad I am that I won't ever live there, and you probably won't ever leave. It's a great deal all round.
No, his problem is MS. It's just that people who need medication think they are entitled to it, and its a pretty reasonable to thing to just give it to them when it is cheap, but, now, that is expensive, that question needs to be reasked.
That's like being forced to renegotiate your fire insurance between discovering your couch is on fire and your house has burned down. The whole point of insurance is that you pay a small premium on an unlikely event, and if it strikes you get compensated far more than you paid in. The way people with health problems are treated in the US is the greatest insurance fraud in history.
But I don't care, I don't need that.
You don't need it now, so you don't care now. This precious son of yours, does he have a medical insurance? Or is your theory you can just hit him over the head real hard and make a new one if he ever has a serious medical problem? And if he did develop a problem, would you like it if they just cheated their way out of paying for treatment and hiked the premiums until you couldn't afford it?
The reality is that spread across the whole population, health care is not that expensive. I just checked out national budget here in Norway and the costs for all the hospitals was 4.5% of the GDP/captia. That is all medical facilities excluding nursing/senior citizen homes (local, so no central figure) and subsidized health related supplies (another 1.0%). If you include all health stations and school nurses and whatnot that's another 0.4%, but then you're really scraping the barrel. For that, I don't have a private health insurance and I don't know anyone else that has either, unless they're professional athletes or the like.
Live today, because you never know what tomorrow brings
Kim Walesh, chief strategist in San Jose's Office of Economic Development, said the report "really nailed" the valley's increasing need for a healthy educational system. Because of post-9/11 restrictions on immigration and increased opportunities in India and China, the valley can't rely on foreign talent as it has in the past 25 years.
Similar articles come out practically every day. They all have the same message: US education system is inadequate, we need the "best and brightest" from offshore nations. Funny thing: the "best and brightest" always come from nations where the average wage is about $1 a day. No smart people in the UK, Germany, or any 1st world nation.
Strange how the country that build that IT industry is no longer capable of producing IT workers. No qualified IT workers from the country responsible for Cisco, Apple, Microsoft, IBM, Oracle, Yahoo, Google, eBay, Amazon, Intel, Dell, etc. No good scientists from a country where one top university holds more Nobel prizes in technology than the entire nation of India.
Remember the massive tech layoffs from one year ago? Practically all the major tech companies fired Americans by the thousands, if not tens of thousands. Yet with all of those unemployed, yet highly qualifed, US techies we need more offshore labor to take even more US jobs. Even with the highest unemployment since the great depression.
BTW: US restrictions on guest workers were a complete toothless joke, and US companies got all the H1Bs they wanted anyway.
...I'd say that the moment silicon valley (a dynamic, spontaneous effusion of capitalism on the tech frontier) requires GOVERNMENT intervention to remain viable, you can probably stick a fork in it.
Adam Smith cringes in disgust.
Not at the Government but at the Greed of Corporations will Smith cringe in disgust.
Wealth of Nation's main premise presumes all basic needs of Society are stable and manageable before the Free Market drives it as if it's a separate, closed system that won't impact an already stable system of zero needs.