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February 19, 2012

A New Shade of Blue in Silicon Valley?

Joel Kotkin wrote a thought-provoking piece in The Daily Beast the other day about how Silicon Valley’s elites are predominantly supporting Democrats.

It wasn’t always this way, Kotkin argues. While firms were in the business of manufacturing hardware, they were concerned with much of the same things as any other business: minimizing onerous government regulations which impact the bottom line, ensuring that utilities such as electricity were as cheap as possible, and making public-funded education good enough to keep their employees content. The Valley was not a lock for either party, but the voting pattern was predictable: Republicans and business-minded Democrats were favored.

But with the switch away from manufacture into software engineering, the calculus has  changed:

Today’s digital aristocrats manufacture virtually nothing here; anything made in volume is produced outside California and usually out of the country. Software-based firms don’t worry about energy costs, since they can simply place their heavy user server farms in places like the Pacific Northwest with low electricity rates. They do not use much in the way of toxic chemicals or groundwater, making it easier to avoid scrutiny and harassment from California’s hyper-aggressive environmental regulators. Because they rely on an increasingly narrow band of highly educated employees from elite schools, the secular decline of the state’s higher education system hardly impacts them. And as many of their employees are young and tend to buy houses after collecting the spoils of an IPO, even high housing costs and poor public K-12 education don’t matter much.

Silicon Valley types support green causes because doing so does not impact their bottom line while aligning broadly with their comforting self-image as being broadly progressive. One can go even farther; shifting as much of the tax burden as possible from income and payroll taxes to energy and carbon taxes would shift the tax burden away from Silicon Valley onto conventional mining, manufacturing and agricultural interests. And since tech companies have a virtually union-free workforce and no pension burden, they’re not forced to reckon with the ever-widening cracks in the Blue social model which we’ve been writing about here for months. On cultural issues as well, the tech meisters tend to go Dem. Issues like IP protection through legislation and trade diplomacy matter hugely to the Valley as well; it makes sense to keep presidents sweet. President Obama, who just opened a field office for his reelection campaign in the Valley, is keen to harness his new constituency’s enthusiasm.

American politics has always been a complicated business in which party and ideological allegiances don’t always track perfectly with class interests. Some of America’s richest and most dynamic tech firms are perfectly happy with blue model politicians because the model’s flaws scarcely touch them. This won’t save the blue social model — just like Silicon Valley can’t save California — but it can make the struggle to replace it longer and more interesting.

Building bridges to Silicon Valley is one of the things that a movement to recast the American Dream will have to figure out how to do.

Posted in Blue Social Model, Economics & Business, Politics, Quick Takes
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  • WigWag

    There are plenty of other reasons Silicon Valley types prefer Democrats to Republicans. High Tech types are keenly interested in promoting immigration for technologically advanced foreigners who want to move here; they are turned off by the Neanderthal one size fits all policy of the Republicans.

    The tech wizards from Silicon Valley tend to be highly educated, especially in math and the sciences; naturally they are uncomfortable with the legions of hot-religion Christians who have found a home in the Republican Party. I would venture to guess that most high tech types want their children taught about evolution in their high school biology classes not “creation science”.

    Many of the best and the brightest in Silicon Valley are young which means that they are at a stage in their lives where they are particularly focused on sex, especially recreational sex. A party supported by people who are suspicious of contraception and abortion doesn’t interest them. Every time they hear candidates like Rick Santorum criticize contraception and every time they hear pundits like Professor Mead criticize the new Obama policy on contraception they are reminded why they despise the Republican Party.

    Gender equality is an important value to Silicon Valley types. To the extent that the Democratic Party stands up for gender equality techies in Silicon Valley are impressed. To the extent that former Republican operatives working for the Susan G. Komen Breast Cancer Foundation try to ban Planned Parenthood from receiving grants, these same Techies are repulsed.

    Finally, as anyone who has been to Silicon Valley knows, a clean environment is one of the things techies like about living their. The last thing they want is for the smog and other pollution that characterizes Los Angeles to work it’s way north. Democrats are almost universally perceived as the political party that cares about a clean environment while the Republican party is perceived as looking out for the polluters. Superimpose on this the fact that many “green” energy firms are either located in Northern California or funded by venture capital firms headquartered in Northern California and the techies have another reason to love Democrats and hate Republicans.

    There are exceptions; Carly Fiorina and Meg Whitman were both high tech Republicans. Both were slaughtered at the polls in a hugely Republican year.

    The two most financially lucrative sectors in the United States are the high tech companies which are heavily located in Northern California and the hedge fund business centered in New York City and is suburbs. Given the importance of money to American politics, how these two industries go is likely to tell us a great deal about the future political direction the United States will take.

    What these folks do with their money is consequential in the long run. The Tea Party movement and the Occupy Wall Street movement are little more than side shows for the naive and easily confused

  • Derek Footer

    I think you are focusing too narrowly on a very small subset of Silicon Valley techies. I was one for many years, until migrating to San Diego. Most are not unaffected by the ravages of the blue state model, as most are not swimming in IPO wealth. Crappy schools and high costs do matter to them, even though the public schools in the area are generally very good. So it is possible, and I hope likely, that eventually they can be convinced to help rectify the situation at least to ensure that Silicon Valley doesn’t become an area walled off from the rest of the state.

    But, as @WigWag alludes to, the crucial thing driving techies to the Dems are social issues. The Republican move to socially conservatism is the wedge issue that prevents them making inroads into Silicon Valley. Until the last 15 years, California was very hospitable to Republicans, and they have dominated the governorship – 32 out of the last 45 years (if you count Schwarzenegger as a Republican). But those Republicans have been social moderates. If the California Republican Party wants to get its mojo back, it needs to get back to its more libertarian roots. Seems unlikely for the near future though.

  • Kenny

    Good analysis, Mr. Mead.

  • WigWag

    Another reason that the tech world loves Democrats and dislikes Republicans is the respective views of the political parties on the rights of homosexuals. I don’t know specifically what Bill Gates, Mark Zuckerberg, Sergey Brin or Larry Ellison thinks about gay rights but it isn’t hard to guess; after all, their companies all voluntarily provide fringe benefits to the same sex partners of their employees.

    Given the Republican Party’s antipathy to gay people, is it really surprising that the tech world turns it’s back on Republicans? This year one of the remaining Republican candidates (Santorum) has particular animosity to the idea of gay rights and the other candidate (Romney) is a Bishop in a Church that spent $9 million to support Proposition 8.

    The likelihood that Silicon Valley executives will be providing Republicans with either campaign cash or their votes is vanishingly small.

  • Walter Sobchak

    You are being far too kind to Silicon Valley. What drives them is, and what drives their cousins on the east coast in Cambridge, Fairfield, Manhattan, and Montgomery is contempt for the “unenlightened”. What James Taranto calls oikophobia.

    To me this is not the basis for a political revival. You cannot run a society, where you feel compelled to display an ostentatious contempt for the vast majority of the people you claim to lead. I have repeatedly pointed to their disdain for religion and for the military as mortal weaknesses in their pretensions to political power. What lies in store for them is not beyond blue, it is civil war. One they will lose because they do not know how to field strip and clean their weapons, let alone how to load, aim, and fire them.

  • Wayne Lusvardi

    American politics may not neatly track with social class, but the Silicon Valley elites are members of the Knowledge Class, not the Business Class. Thus, it is predictable that they would gravitate to Democrat politics.

    Even Libertarians are typically involved in the Knowledge Class. That may explain why they revile big government Republicans.

  • Cal

    One point:

    “Both (Whitman and Fiorina” were slaughtered at the polls in a hugely Republican year.”

    They both got 50% or more of the white vote. They lost or were slaughtered because of Hispanics, which aren’t particularly overrepresented in the elites of Silicon Valley.

    Both Derek and Walter Sobchak (in comments) are correct. The elites are much more contemptuous than WRM portrays them, but the average upper income folks are, indeed, worried.