Can Grass Valley Learn from Silicon Valley (Updated)?

Update 09-12-14:  A reader writes that Joel Kotkin will be speaking at the ERC  “The Big Splash 2015″ – ERC’s Annual Tribute to Business Success and Leadership   January 29, 2015 @ The Veterans’s Memorial Hall, Grass Valley – 3:00 p.m. – 7:00 p.m.

The title of this post was a question posed by our local left leaning blogger on April 10, 2009,  who is a Silicon Valley transplant. He moved from the Bay Area to Nevada County after a long career covering the high tech industry in Silicon Valley. In his mind we have a lot to learn from the folks on the Coast about economic development.

I am  reading Joel Kotkin’s new book The New Class Conflict. He makes the case that America’s real class problems are deeper, and more damaging than the typical election rhetoric about class warfare. As I read the text on my Kindle I am drawn to the parallels in our own  community.

According to Kotkin, California is an indicator of where the nation is headed, and it’s not an attractive destination. At the core of his argument is the emergence of a technology driven Oligarchy in Silicon Valley.  According to Kotkin, Silicon Valley hosts a group of super-wealthy tech oligarchs with almost unimaginable wealth. These oligarchs feel free, and even entitled, to choose the direction of society in the name of a greater good, but somehow their policies seem mostly to make the oligarchs richer and more powerful.

These oligarchs were the primary backers of the AB-32, the Global Warming Solutions Act of 2006, which was written to restrict the use of fossil fuels. They were the main funders of the opposition to Prop 23, with large donations by Tom Steyer a venture capitalist who made his money in oil and natural gas, eBay and TechNet a technology-led lobbying group, that includes Apple, Google, and Yahoo, venture capitalist John Doerr, and billionaire Vinod Kholsa formerly with Sun Microsystems. Many in this group are poised to make huge sums from alternative energy and government subsidies.

They were making the rules to their own benefit, which is making it harder for middle class businesses to survive in California. According the Kotkin environmental regulations a much larger burden on small business than the businesses of the oligarchs and the growing and expanding NGO’s that they fund.

I am finding that Kotkin’s book confirms many of my observations on who was behind the global warming legislation, a Silicon Valley oligarchy which was assisted by what Kotkin calls the “clerisy” class — an amalgam of academics, media and government employees who play the role that medieval clergy once played in legitimizing the powerful, and in implementing their policies while quelling resistance from the masses.

By his own admission, our local lefty blogger was part of this Clerisy class, and is still struggling to exert his influence in the community with his publications and blogs. His wife edits the GoNevadaCounty web page.

What have we learned from Silicon Valley? Do we meed our own Oligarchy, our own version of the Clerisy? Or, has Silicon Valley done enough to hollow out our middle class and create a community of haves and have-nots?

Your thoughts are most welcome.

I am only one-third through the book, but I highly recommend every Californian read the The New Class Conflict.

About Russ Steele

Freelance writer and climate change blogger. Russ spent twenty years in the Air Force as a navigator specializing in electronics warfare and digital systems. After his service he was employed for sixteen years as concept developer for TRW, an aerospace and automotive company, and then was CEO of a non-profit Internet provider for 18 months. Russ's articles have appeared in Comstock's Business, Capitol Journal, Trailer Life, Monitoring Times, and Idaho Magazine.
This entry was posted in AB-32, Analysis, California, Economics, History, Local, Local Media, Technology. Bookmark the permalink.

6 Responses to Can Grass Valley Learn from Silicon Valley (Updated)?

  1. Sean says:

    The most insidious thing about the silicon valley oligarchs and the clericy that make up the most powerful and influential in government is their desire to trade in what should not be theirs. Personal privacy is a thing of the past when you think about what sorts of data Google, Facebook, Amazon and the Government are collecting on a regular basis. Oddly enough, that’s not so much of an issue for the older more settled generation but it impacts the millennials.and younger folks who are trying to move up in the world. The younger folks also suffer more when new businesses don’t form to provide the entry level jobs and growth that can lead to career advancement. California is a high cost state in a variety of ways. The cost of housing is high, energy costs are high, compliance costs with regulations are high and taxes are high. The only way to be successful in that environment is to chase margins and no one has done this better than silicon valley. But the bulk of successful businesses and many of the entry level job opportunities are in industries where the amount of money to be made is much smaller and these companies have to leave California’s high cost structure or go bankrupt. It’s ironic that the party that’s supposed to represent the rank and file workers of the world has created policies that turn the middle class into an endangered species.


  2. Russ Steele says:

    Jeff writes on this blog about this post:

    In short, Russ is still peeved that AB-32 was not overturned, but his imagination runs personal (as always) labeling the “local lefty blogger” as member of the “clerisy” class of Silicon Valley —”an amalgam of academics, media and government employees who play the role that medieval clergy once played in legitimizing the powerful, and in implementing their policies while quelling resistance from the masses.”

    Oh, I am supposed to be “struggling” too — well, not exactly. In fact, I am thriving.

    I am not the only one that is going to be peeved, when the price of gas and diesel shoots up by 50 to 75 cent per gallon on 1 Jan 2015. Ask all those CEOs that have decided to more their companies out of CA due to higher cost and unreliable alternative energy. Were they peeved about AB-32?

    Jeff claims he is not struggling to be an influential member of the local Clerisy, but the evidence is right on his web page. Look at the number comments he gets on posts. George Rebane’s post get 100s of comments, the one on Measure S is over 250. In a parallel post on an RL Crabb Cartoon Jeff got 18 comments. Same cartoon Rebane Rumination’s 66.


    • The fight against the very flawed Prop 32 (which wasn’t a repeal of AB32, Jeffie, just a delay) promised voters affordable, renewable energy; in the end, this grabbed voters more than the “well, yes, AGW is real but let’s wait until we can afford to shoot ourselves in the foot to fix the problem”. What Californians are about to get is a big increase in the price of gasoline and continued increases in the price of electricity, with a lion’s share of the money flow going to the Bullet Train to Nowhere.

      In order to have alternative energy such as wind and solar being a major part of the grid, there has to be fossil fuel backup sources spinning and able to contribute in a fraction of a second for the inevitable dips lest the grid crashes, a hidden expense most ignore.

      It does appear the political end game is on its way… the anemic Solar Cycle 24 second peak is about to wane, the Atlantic and Pacific thermal oscillations are trending cold. This may well be the last election cycle in which AGW supporters actually scare enough people to affect results.


  3. Two cousins are moving back to Grass Valley from San Jose this month. One just retired. They can’t stand the great divide between the rich and poor. Apparently there are homeless, even families, everywhere downtown. Police constantly on the move. I was shocked to hear this, but my older sister said she worked at a bank downtown about 40 years ago, and it was the same then. Whatever….we do know that the middle class was always the backbone of American prosperity that even the Democrats used to acknowledge, before they started beating up on it.


  4. “By his own admission, our local lefty blogger was part of this Clerisy class”
    Admission? He’s desperate to be thought of as important.

    El Hefty wasn’t a mover and shaker in Silicon Valley, just the hired help on staff at The Chronicle, later CNET. It may be that that glossy advertiser of his that is his current gig (he says it’s profitable but apparently not enough to actually have employees) was a natural outgrowth of writing puff pieces for his previous employers that suited the needs of the people who used him for their purposes.


  5. gjrebane says:

    Silicon Valley oligarchs’ response is classical. Big companies have a hard time innovating sufficiently to keep their growth rates up in an open and competitive market. When you have enough money, the solution is easy – buy govt laws and regs that remove the lower rungs of the success ladder for smaller companies. Who needs competition when you can buy the govt gun to be on your side?


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