1 May 2002 US president George Bush briefly set aside foreign policy issues yesterday and made his first visit to Silicon Valley since the onset of the technology industry recession.
Bush, speaking at San Jose’s Tech Museum of Innovation during a two-day fundraising tour of California, said that a blend of tax cuts, expanded trade and deregulation would help rally the technology industry as well as the wider US economy.
“I understand people are hurting here in the Silicon Valley,” he said. “I know American technology companies are the best in the world and we must open new markets so they can sell to the world. Our economy grows when entrepreneurs are rewarded for their success, not hounded by regulation and needless litigation.”
He added that the economy in general was showing signs of recovery, “yet this vital region reminds us that a lot of work needs to be done.”
The traditional heartland of the global tech industry has been hit hard by the recession. New figures show that the unemployment rate in Santa Clara County, the centre of Silicon Valley, was up to 7.4% in March 2002. It was only 2.2% the previous March.
Bush said: “So long as people can’t work, I’m worried. We must turn our short-term recovery into long-lasting expansion that reaches every part of our economy”. The Bush administration has taken steps in recent weeks to stimulate recovery in the tech industry.
The US president recently signed into law an economic stimulus bill that provides an immediate 30% depreciation write-off for certain new investments over each of the next three years. The law is expected to boost technology sales by allowing companies to write off purchases of computers and other hi-tech products on an accelerated basis.
His visit comes only a matter of weeks since US vice-president Dick Cheney himself visited the Tech Museum of Innovation. Cheney said at the time that concessions to the technology industry were high up the political agenda in Washington.
In addition to the depreciation write-off policy, he highlighted a range of other measures to stimulate recovery that were being considered. These include the continuation of the moratorium on Internet taxes and support for research and development programmes.
Governments act to stimulate a recovery (29 April 2002)
This article will appear in this month’s Infoconomist magazine.
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