Budget Cutbacks and Neglect Could Turn California’s High-Tech Industry Into an Also-Ran – (What is your state doing?)

California has long been the country’s high-tech power, but that position may be slipping away. Cutbacks in state funding, along with a failure by the state to foster leading-edge industries, could make California a high-tech runner-up, according to the Los Angeles Times http://www.latimes.com/business/la-fi-flan28jan28,1,822025.column?coll=la-utilities-business .

The federal government "doesn’t see California putting up seed money to back research" nearly as much as it used to, says Victor Hwang of the Los Angeles Regional Technology Alliance, a state-sponsored organization charged with spurring employment.

The result: Rivals are starting to win Uncle Sam’s backing instead.

Tod Newcombe

http://www.govtech.net/news/news.php?id=86525

The article points out that California has slipped to 21st in the country in per capita spending on R&D by university engineering programs. California was ranked 12th in 1997. Meanwhile other states, notably New York and Massachusetts, are pouring resources into programs that nurture the digital economy.

Another state singled out as an emerging leader, Virginia, is the subject of a special report in the upcoming issue of Government Technology’s Public CIO. Gov. Mark Warner has gained national attention for his efforts to combine IT reform with economic development. The article looks at the Virginia governor’s policy and examines how Secretary of Technology, George Newstrom, is executing Warner’s vision.

One initiative calls for increasing the state’s amount of federal dollars for R&D from $300 million today to $1 billion by the end of the decade. Another effort uses the state’s IT reform effort to induce new high-tech companies to locate in Virginia, especially in the state’s southern tier.

Meanwhile, in California, academic and business leaders fret about the state’s eroding stature as a bastion for digital entrepreneurship. "Just about every other governor is pushing academic engineering as key to developing high-tech industry," Ross DeVol an economist with the Milken Institute, told the Times. UCLA Vice Chancellor Robert Peccei echoed those thoughts when he said, "Ultimately the budget cuts will affect our ability to be competitive with other national centers of research."

The article on how Virginia is leveraging IT reform with economic development will appear in the winter issue of Government Technology’s Public CIO.