How High-Tech Advances Could Prompt Resourceful Retreats
With America on the brink of an information revolution, California ought to be sitting pretty. Silicon Valley and Hollywood, after all, should be the dual capitals of the republic of change arising from converging computer, telephone and television technologies.
It sounds great. Students in Pasadena could take classes with professors in Boston--fully participating as if they were all in the same room. Fiber optics will bring high culture and theater-quality motion picture images to every home. All data will be available everywhere. Work itself could be revolutionized; it might no longer make much difference where you live.
Ah, but there’s the rub. California’s a nice place, but if it doesn’t matter where you live, maybe you can live somewhere cheaper and less prone to carjackings. Be honest now: If you could make a living in Medford, Ore., or Woodstock, Vt., would you go?
For many affluent Californians, the answer is, unfortunately, yes. Changing technology could make it easier for workers whose skills (and jobs) are analytical to go. If we’re not careful, California could be hoist by its own petard. The technology this state is spawning could make it possible for more and more of its most productive citizens to do their thing somewhere else.
Two years ago, for example, I wrote a column about Graef S. Crystal, a leading critic of excessive compensation for corporate executives. Bud, as he’s known, was writing an influential newsletter on the subject from his home in Napa, Calif.
Bud still writes his newsletter, and it’s still scathing. But he does so from Incline Village, Nev., where there’s no state income tax. He says his neighbors include software developers and money managers from California.
Bud’s home office is the product of California technology. His three personal computers contain Intel chips, and his two printers are made by Hewlett-Packard. Both firms are Silicon Valley mainstays.
The power of technology to relocate work is especially worrisome because California is already seeing highly skilled residents leave. “The state is entering a new era,” Stephen Svete wrote recently in California Planning Report, a newsletter, “where population growth is not the reflection of a booming job market within California but, rather, the result of ongoing high fertility rates and worse economic conditions elsewhere--especially parts of Asia and Latin America.”
One result: California’s ratio of children and retirees to income-earners is moving in the wrong direction, resulting in shortages of government funds for services and, perhaps predictably, pressure on the quality of life.
So more people may want to move. And California technology may make their moves possible. Consider the recent decision by the Clinton Administration to secure government telephone calls and computer communications with a tiny encryption chip that can be tapped only by law enforcement authorities.
The idea is to make it possible for individuals and businesses to feel secure in their communications while allowing law enforcement, with the proper safeguards, to eavesdrop when it suspects terrorists are plotting some new misdeeds. The government chose a particular technology in hopes that it will become standard.
The two companies initially selected to supply the chips are in California: Mykotronix of Torrance and VLSI Technology Inc. of San Jose. This is great, except to the extent that the whole business is a step toward solving the security concerns many companies have about using the Internet (a network of networks that connects millions of computers nationwide and, increasingly, globally), and other communications webs.
Once those fears are allayed, it will be that much easier for enterprises to choose the lowest-cost location. And that isn’t likely to be California.
Then again, this isn’t just a question for California. America will bring about the information revolution, with some help from the Japanese. But will the revolution make it possible to do far more elsewhere?
Keyboarding, for example, is already done in Ireland, the Caribbean and the Far East, where typists work cheaper. The information revolution has already made it possible for their work to arrive instantly where it’s needed--in a customer-response center in Omaha, an executive suite in White Plains, N.Y., or an investment bank in San Francisco.
Fortunately, we are not helpless in the face of such changes. The revolution is coming, whether we like it or not. That Californians will make it happen is all to the good. We just have to get smart.
* California needs to shake off its legislative paralysis and tackle problems such as workers’ compensation, auto insurance and regulatory red tape, which make it so expensive to do business here.
* California needs to promote its own alternatives to Utah and Nevada. Superior California, for example, the northwest quadrant of the state, offers cheap land and a comfortable lifestyle. Land and labor are especially cheap in Imperial County, on the way to Arizona.
* California needs stellar education. Let’s stop accepting excuses for poor school performance--from schools, parents or children. Since there won’t be any more money available, we’d better learn to substitute competition for bureaucracy in public education.
Like most revolutions, this one will be pretty ruthless. Prosperity afterward will belong only to those with knowledge and skills. If revolutions really do eat their children, we better wise up, lest this one eat ours.
