Weighing The Candidates On High-Tech Promises, Pitfalls

Cisco CEO John Chambers is a rarity in the high-tech community -- he's on the record with his endorsement of a candidate in the 2008 presidential race. And Chambers doesn't just back Republican John McCain, the Cisco boss is the Arizona senator's senior technology advisor.

Most IT executives and professionals, like their counterparts in other industries, are reluctant to make their politics known. They're in the business of doing business and that means minimizing the risk of alienating potential customers on partisan lines. As one San Francisco-based system integrator told us, he knows who he supports and he knows who his biggest clients support, "and I'm pretty sure they're not the same person."

That particular Barack Obama supporter was so concerned about going public with his politics that he declined an invitation to be named for this article. But more than a dozen of his high-tech peers, including top executives like Chambers, Intel CEO Paul Otellini and Microsoft chairman Bill Gates, as well as middle managers at IT companies, software developers, engineers, business owners, academics, analysts and bloggers were willing to tell us which issues concerned them as the race for the White House heats up, even if few wanted to name their preferred occupant.

In our broad survey of the IT industry, the core issues that kept cropping up concerned innovation, growth, regulation, jobs, education, taxation and sustainability. No surprise there, though policy recommendations from respondents were sometimes at odds with those of other interviewees. Such differences reflected particular interests but also different philosophies towards government -- ranging from the 'leave us alone' libertarianism of some, like IT business owner Oli Thordarson, to proposals for more direct federal investment in high-tech by others, like start-up founder Joshua Rand.

Meanwhile, a ChannelWeb online poll found that a plurality of our visitors prefer McCain (44.32 percent of the online vote), but combining the totals for Obama (41.08 percent) and Hillary Clinton (14.59 percent) gives the Democrats the majority backing of our readership. So how do the three major candidates actually stack up on the issues that concern the IT community? Let's take a look at what's on offer from each.

Next: Presidential Promises

Hungry for change? You got it. The upcoming presidential election is the first since 1952 that has no legacy from a sitting administration in the race. A fresh face, at least at the top of the winning ticket, is guaranteed.

John McCain has wrapped up the GOP nomination and only awaits his official coronation at September's Republican National Convention in Minneapolis-St. Paul. On the Democratic side, Barack Obama and Hillary Clinton continue to battle it out for their party's nomination and face a crucial primary showdown in Pennsylvania on Tuesday.

As each candidate makes his or her case to the voting public and various interest groups across the polity, it becomes increasingly important from our perspective to discover what Clinton, McCain and Obama plan to do for the IT and high-tech sector. Depending on your political persuasion, that could mean taking a more active role in industry issues or leaving us alone to innovate and grow our businesses. Our investigation of the candidates begins with a look at their IT-specific policy statements and how well they jibe with our interviewees' concerns.

It's generally accepted that Clinton and Obama differ only slightly in their overall policy platforms, and the conventional wisdom arguably holds for their respective positions on technology issues. Both Democratic candidates promise a more active role for government than McCain, detailing plans to create or beef up new and existing high-tech programs whereas the Republican speaks more broadly about reducing or eliminating taxes on corporations, Internet transactions and cell phone purchases and services.

But the two Democrats aren't as similar as it seems at first blush, argues leading open-net advocate Lawrence Lessig, a law professor at Stanford and founder of the Creative Commons.

"There are basic issues, where [the Democratic] candidates seem similar, such as a commitment to network neutrality. But in the details, Clinton and Obama are actually different. She's not really been pushing it, but he has a very strong position," says Lessig, who has endorsed the Illinois senator. Indeed, Obama's platform includes a promise to "support the principle of network neutrality to preserve the benefits of open competition on the Internet."

Drilling deeper into their specific policy prescriptions, a pattern starts to emerge. Clinton emphasizes the established institutions of technology and science, promising, for example, 50 percent budget increases over 10 years for basic research at the National Science Foundation, the Department of Energy's Office of Science and the Defense Department.

Obama's IT platform, by contrast, reads like a Silicon Valley wish list for bringing about Government 2.0. His promises include appointing "the nation's first Chief Technology Officer," leveraging blogs, wikis and social networking tools across governmental agencies, and making government data publicly available online "in universally accessible formats."

One area where Clinton and Obama seem to agree is the need to improve national broadband coverage. Such initiatives can't come soon enough for Rand, founder and CEO of New York, N.Y.-based start-up Sapotek, a U.S./Mexican developer of open-source Web applications and services such as free online desktops.

"In terms of public IT infrastructure spending, for the wealthiest, most powerful nation on the Earth, we're shamefully delinquent in a number of areas and technology is only one of them," contends Rand. "All you've got to do is hop a plane to South Korea and everywhere you go -- you can be in the middle of a rice field 50 kilometers south of Pusan -- and you've got perfect bandwidth. That's not the case here in the United States, which is a shame."

Next: Innovation Agendas

Rand has more ideas for incentivizing innovation, particularly in open-source software development. He wants lawmakers to mandate the inclusion of open-source vendors in the federal procurement process and would like to see direct government funding of technology start-ups to supplement private equity and venture capital.

Meanwhile, McCain's plan to slash the corporate tax rate from 35 to 25 percent has a fan in Intel's Otellini, who believes such a tax cut is necessary to stimulate high-tech innovation. It's unlikely the Democrats would ever agree with that reasoning, but Obama does concur with McCain on another issue close to Otellini's heart, a permanent R&D tax credit.

"Without a doubt, this credit helps keep innovation and high-paying R&D jobs in the U.S.," says the chief executive at the world's leading maker of computer microprocessors. "Yet our lawmakers have let the credit expire repeatedly over the years, instead filling the gap with repetitive short-term extensions which, frankly, have negative financial consequences and disrupt research planning."

Otellini wants the R&D tax credit "enhanced and made permanent," which coincides with McCain's promise to "establish a permanent tax credit equal to 10 percent of wages spent on R&D," but also Obama's promise to "double federal funding for basic research and make the R&D tax credit permanent."

Clinton's pledge is a little more vague -- the New York senator says she'll "overhaul the R&D tax credit to make the U.S. a more attractive location for high-paying jobs." But Clinton is also a great deal more specific than Obama, and certainly McCain, in detailing her plans for boosting research in the public sector. These include a requirement for setting aside at least 8 percent of the budget at federal research agencies for discretionary funding of high-risk research and tripling the number of NSF fellowships and increasing the size of those awards by 33 percent.

Two of the most controversial issues for the high-tech community are outsourcing and its lesser-known cousin, the "in-sourcing" of foreign nationals for technology jobs in the U.S. via H-1B visas. Microsoft's Gates, testifying before Congress in March, called for the cap to be raised on green cards and H-1B visas as one of his recommendations for countering "a gathering threat to U.S. preeminence in science and technology innovation."

Gates has a supporter on this issue in Dave Roberts, VP of channel sales at San Diego-based security vendor Websense: "We need the capability to have more jobs here in the United States, and they need to expand the ability to get visas to IT workers and developers. That's kind of my big issue."

Not everybody agrees, to put it mildly, as the heated argument on ChannelWeb's forums over H-1B visas demonstrates. So far, the three presidential candidates have largely avoided this political third rail even as they've traded barbs over more general immigration issues.

Improving education was also part of Gates' prescription for maintaining the U.S. edge in innovation. It's a plea that has widespread support in the IT community, whose members worry that American youngsters are falling behind globally in math and science.

"The next administration must be far more serious about education, with an emphasis on including minorities and women, especially in science and technology. When we lose that potential in the next generation, we lose the potential for national dominance," says technology author and Obama supporter Nancy Ramsey.

Next: Help IT Help You

Although he's a political conservative, Cisco's Chambers certainly doesn't sound like he's channeling Rush Limbaugh when he talks about reaching across the aisle to work with Democrats or leveraging IT to achieve the "major national goal" of "expanding health care to all people in our country." Perhaps that's because, unlike right-wing radio host Limbaugh, Chambers runs a major corporation and has first-hand knowledge of employer-sponsored co-pay plans and their effect on the bottom line.

Or maybe Chambers strays from the Republican reservation on universal health care because so many of Cisco's channel partners do big business in the health care vertical, integrating medical records systems in compliance with legislation like HIPAA. At any rate, it's interesting to note that it is Obama, not Chamber's candidate McCain, who makes the biggest promises on health care IT. The Democrat says he'd tag $10 billion a year for the next five years to upgrade U.S. health care's electronic information systems and health care records.

"[Health care] is really an area where IT can take a leadership role," says Brian Deely, GM of Baltimore-based IT firm Graymar Business Solutions. "Our industry is really going to see growth in areas where we can bring efficiencies, where we can take technology and improve efficiencies and offer the best solutions possible.

"That can free money up and maybe we can get to that magic dream that the candidates talk about of universal health care."

Another area where IT opinion-makers think the White House can make a difference is in the promotion of environmentally friendly technology, or Green IT. Julienne Givot, director of managed services at San Francisco-based educational solution provider Varsity Technologies, touts the business value of energy-saving technologies like virtualization.

"Green IT definitely has a cool factor, but in terms of the business impact, you're also looking at the life cycle of your infrastructure and our customers are very interested in it from lots of points of view," says Givot, who hopes the next administration further incentivizes migration to environmentally friendly technology with tax breaks and other efforts.

If environmentalism is increasingly a bipartisan concern -- some 83 percent of Americans support stricter laws and regulations to protect the environment, according to the Pew Research Center -- differences on taxation are where Republicans and Democrats still draw their lines in the sand.

Or do they? Obama supporter Ramsey and McCain backer Thordarson, CEO of Irvine, Calif.-based IT services provider Alvaka Networks, couldn't be more different in their economic outlooks. Ramsey argues that the budget crisis and economic downturn can't be fixed without new taxes, while Thordarson believes the road to growth is paved with tax cuts. That's a pretty broad fault line, or so it seems.

Where Ramsey and Thordarson find some common ground, however, is in the details. Both fret about under-the-radar taxes and tariffs that they argue stifle innovation, information exchange and business growth. Ramsey's concern is what she calls "sneaky taxes" on Internet services in the form of fees and surcharges by providers. Thordarson warns that service taxation, like Maryland's recent expansion of its sales tax to include computer services, could be "a more directly threatening issue for the VAR-service provider-MSP community than any of the issues that a lot of people are talking about."

"If something like this takes hold and starts sweeping the country, it will be a huge issue cutting into our client's IT budgets everywhere," he adds.

On some levels, the candidates themselves have barged onto each others' well-cared-for garden paths to economic bliss. McCain, for example, promises a ban on regressive Internet and cell phone taxes -- typically that's the domain of progressive politicians. For their part, Clinton and Obama have pledged tax cuts for the middle class -- not terribly unusual for Democrats until you realize that they've defined "middle class" to include any household making under $250,000 a year.

Cynics will ask how these don't-tax-and-spenders will pay for their promised programs -- Clinton and Obama for their domestic initiatives and McCain for what he's said could be "100 years" of U.S. boots on the ground in Iraq. On the other hand, it's generally understood that presidential candidates pander to the crowds to get elected, so it's wise to take all the promises with a grain of salt.

Our final piece of advice to the candidates? Whichever one of you winds up in the Oval Office, make your first act as President the permanent extension of XP downgrade rights. The IT industry will love you forever.