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“New Tech Mirage” portrays a world
where the Sacramento Region makes a bid to become New Tech Valley,
but circumstances in the global marketplace, combined with mismanagement
at home, lead to a failure of that ambitious strategy.
“So join us next Thursday at 7 PM
for Quarterly Report, a special hour-long review of Sacramento’s
first twenty-five years in the twenty-first century. Until then,
I’m Stacey O’Casey, and you’ve been watching Sacramento
News,” signed off Sacramento’s top news personality.
She smiled into the camera until she got the signal that the transmission
had ended.
James Ramos—the show’s nine-year veteran
producer, sat down next to her. “I don’t know which
I feel worse about,” he said, “making you stay late
to help me put this show together for next week or forcing our entire
viewing audience into bouts of depression by feeding them 60 minutes
of bad decisions and short-term thinking.”
“They are already depressed, unless they’re
mortgage-free behind gates in Granite Bay,” replied Stacey.
The Sacramento Region was hardly the first place
in the world to face the problems of an economic bust, but the unique
nature of its own boom colored the character of its decline. Because
neither the leaders nor the voters nor the investors in growth paid
much attention to the way down while they were on the way up, the
downside was more painful than it might otherwise have been. In
the year 2025, it looked like things couldn’t get much worse.
“So, just how are we going to tackle this?”
she asked, taking the electronic pad from his hand. Placing it on
her teleprompter control, she quickly saw the foot-high words that
appeared to float upward from the floor next to the camera. She
gently touched the control to pause their ascent.
“We’ll start with voiceover and some
well-chosen stock footage. Can we run through your pieces once to
hear how they read?”
“Sure,” the seasoned professional touched
the teleprompter control and quickly tapped into her on-air persona.
BOOM (2000-2010)
“Building more research and manufacturing
capability in the Sacramento Region certainly seemed like a good
idea at the time back in the early years of the 21st century,”
she began.
“When Microsoft and Oracle merged in 2004,
the idea of a new facility on neutral territory had tremendous appeal,
both for workers in the valley who would burn less gasoline, and
for executives who wanted a green field enterprise where neither
the Microsoft nor the Oracle DNA would dominate. Part of the idea
behind the merger was to create not just a bigger company, but a
genuinely new chapter in the lives of both of those older organizations.
“With the global economy climbing out of
the slump, the promise of a new era in high technology was pulling
capital into California from all over the world. South Placer County
emerged as California’s New Tech Valley. Dozens of smaller
firms specializing in bio-tech, nano-tech and software sprang up
to occupy acres of industrial parks. Investments in broadband capacity
and proximity to Silicon Valley and the Bay Area’s great universities
made the Sacramento Region look like a very good bet for investors
in bio-technology, nano-technology, and a whole host of new technologies
clustered around the leading edges of research.
“Residential real estate developers kept
pace with the industrial expansion. Sheridan gained more than 10,000
upscale homes. Executive mansions rose from the ground in Natomas,
El Dorado Hills and Granite Bay. The number of homes in Sacramento
selling for over a million dollars jumped 10% each year during the
middle of the decade.
“The argument for a new chapter in the life
of the Central Valley was similar. Enough of the old rivalry between
real estate, industry and agriculture. Communities and developers
won the fight and chose to pave over farmland for commercial purposes.
There were predictable suits filed by environmentalists who lamented
the loss of habitats for wildlife. But the owners of the land, who
objected to being “lashed to their plows by the environmentalists,”
did not mind cashing in on acreage that yielded more as residential
or industrial real estate than as farmland.
THE BARBELL
“Voters in West Sacramento roundly defeated
an initiative to limit growth. They wanted to see new investments
and new jobs. Meanwhile inner-city revival efforts continued to
fail as urban decay continued. First, affluent foothill communities
refused to implement any low income housing plans, and other locales
were quick to follow their lead.
“No one wanted the poor in their back yards
. . . and despite significant growth in jobs during the decade,
the Sacramento Region found itself facing increasing unemployment
among poorly educated workers who could not qualify for most of
the new jobs. Of course there were still some low income jobs—domestic
help, sales help in the new malls, and still a fair number of agricultural
jobs. But those who filled the minimum wage jobs were hard pressed
to find housing they could afford.
“By the end of the first decade of the new
century, the Sacramento Region found itself facing what some called
a barbell economy with a bipolar split between increasing numbers
of rich and increasing numbers of poor. The gap was reflected in
widening differences among schools, increasing crime, growth in
gated communities and a growing gap in access to health care. Implementation
of the ‘Leave No Children Behind’ initiative meant that
half of all schools were defined as under-performing. However, the
other half of schools were quickly filled to the maximum so that
there was nowhere for the remaining children to go.
“As the demand for increased social services
for the poor and indigent increased, the supply kept pace as long
as the tax revenues from industry and expensive residential real
estate kept growing. Voters didn’t feel the need to renew
Measure A, the sales tax for transportation investment. During a
flush economy, voters seemed to want to spend their money on their
own homes and cars rather than on public transportation or infrastructure.
BUST (2010-2025)
“Like the early years of the 1990s, and the
early years of the next decade, so the early years after 2010 witnessed
a global recession in high technology. A massive transfer of manufacturing
from California to China and India brought new wealth to low wage
workers in those countries and new problems to the Sacramento Region.
How to provide services for a growing army of unemployed workers
in an area that was ill-equipped to handle them?
“When unemployment topped 9% in 2015, real
estate values plummeted. Bankruptcies soared. High school graduates
left the area to find work. The poverty level among children reached
34%.
“There was a time when the government had
been a major and very stable employer. But under the influence of
the business culture during the high technology boom, many government
jobs had been automated, privatized, or cut as former bureaucrats
found higher paying jobs in industry. Nor was it possible to fall
back on agriculture. Empty parking lots do not make for fertile
fields,” she read, reaching the script’s end.
“Jim, I’m going to add just one more
bit to close this...” said Stacy, wrapping up a long day.
She typed for a moment at the console and then
read aloud, “Looking back on the boom and bust, it’s
easy to accuse those who wanted to replicate Silicon Valley in New
Tech Valley of lacking foresight. But when you put yourself back
in 2003, it’s easy to see how workers, investors, and voters
were able to place such faith in the vision. How could they have
seen that it would turn out to have been only a mirage?”
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