Election '08: Seeking a 'Tech President'

Technology companies have much at stake in 2008. Here's where the candidates stand on the issues of crucial importance to Silicon Valley

by Aaron Ricadela

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Editor's note: This is the second of two stories (BusinessWeek, 9/17/07) examining how top Presidential candidates are grappling with the major science and technology topics of the day.

Presidential candidates, their eyes on early primaries, have understandably been spending much of their time lately courting voters in Iowa and New Hampshire. But Silicon Valley has merited some important side trips.

Democratic front-runner Hillary Clinton unveiled her technology agenda May 31 to an audience of executives from Microsoft (MSFT), Hewlett-Packard (HPQ), Intel (INTC), and Google (GOOG) in Santa Clara, Calif. Clinton, fellow Democrats Barack Obama and John Edwards, as well as Republican John McCain have appeared at question-and-answer sessions with Google employees at the company's headquarters in Mountain View, Calif. And McCain bolstered his tech bona fides with July appearances at Stanford University and the Churchill Club.

Candidates are making time for Silicon Valley in part thanks to the area's ascendance as a source of fund-raising. "There has never been this degree of attention paid by Presidential candidates to the Valley," says Gary Fazzino, vice-president of government affairs at Hewlett-Packard and a two-time former mayor of Palo Alto, Calif. The computer industry contributed $2.2 million to candidates in the first half of 2007, up from $1.2 million in the first six months of the 2004 and 2000 primary campaigns, according to figures cited by The New York Times.

Primary Clout

Courting California in an election this wide open is especially important given the early California primary, to be held on Feb. 5, 2008, and the role played by the state's industries in some of the most pressing matters of the day, including technological competitiveness with Asia and Europe and the need for sources of alternative energy.

So even while the general election is likely to be dominated by the war in Iraq, the continued threat of terrorism, and economic issues, candidates have staked out early positions on topics dear to the tech industry, including increasing federal spending on research and development, allowing more highly educated foreign workers into the country, widening the availability of high-speed Internet service to create new markets for hardware and online services, and improving the state of U.S. math and science education.

Also on the tech agenda: tougher sanctions against violations of American companies' intellectual property in China and greater leeway for courts to limit damages in patent-infringement lawsuits. "We want to make sure the next President is a 'tech President'—that they understand how innovation happens and have some concrete ideas about how to keep the tech economy growing," says Adam Kovacevich, a spokesman for Google.

Lobbying by information technology companies has taken on added urgency in light of tightened rules on appropriating funds for federal programs. "The IT sector needs to spend more of its political capital in the appropriations process," says HP's Fazzino. Meanwhile, the venture capital industry has been vocal about exempting corporate earnings from the higher capital-gains tax rate that some lawmakers want to apply to the booming private equity industry. "We might get tarred with the same brush," says Paul Maeder, a managing general partner at Highland Capital Partners.

The Candidates' Plans

Some candidates, including Clinton, McCain and Obama, have outlined ambitious tech agendas, while others, such as former Massachusetts Governor Mitt Romney and former New York Mayor Rudolph Giuliani, have yet to take strong, nuanced stances.