Tech issues in Lewinsky balance
Silicon Valley executives hope that the sex scandal in Washington won't delay industry-backed legislation or affect the economy.
During his six years in office, Clinton has presided over an economy that rebounded from recession of the early 1990s to attain vigorous growth and record-low unemployment levels. The ensuing stock market rise propelled many of Silicon Valley's elite to millionaire status almost overnight.
Now speculation about the president's fate--about whether his admitted sexual relationship with former White House intern Monica Lewinsky will force him to resign or lead to his impeachment--threatens to put a damper on markets that already have started to falter.
Some Wall Street observers have expressed concern that, should Clinton resign or be removed from office, the resulting uncertainty about the nation's leadership would further convulse an already volatile stock market.
That could lead to roller-coaster stock prices for many technology companies in the coming weeks.
"Certainly, the volatility in the market right now is not good," said Kelly Blough, director of government relations for Network Associates, a network security and management software firm. "We'd like to see this resolved as quickly and as painlessly as possible."
Not only could the scandal affect the digital economy, but it also could detract from the work at hand on Washington's high-tech docket, including proposals advocated by many in Silicon Valley that deal with securities litigation reform and the revision of immigration policies for skilled foreign workers, an issue known inside the Beltway as H-1B.
"Congress has several important high-tech issues on its agenda right now," Blough said. "From a company standpoint, we wish more attention was being paid to issues of H-1B visas, the Internet Tax Freedom Act, and encryption reform."
The Semiconductor Industry Association shares Blough's concern about the H-1B visa issue and separate legislation requiring corporate disclosure of progress on Year 2000 bug fixes.
"The concern is the preoccupation with this whole escapade could prevent things from getting done," said Jeff Weir, a spokesman for the chipmaker trade association. "The longer Congress is preoccupied with the concerns of the White House, the less mind share they're going to have for this other stuff. And because it's an election year, Congress wants to get out of there as early as possible so they can go campaign."
High-tech trade groups, which are gaining political clout, are reluctant to talk about the scandal for fear of alienating their new allies in Washington. Neither the American Electronics Association, nor TechNet, the bipartisan upstart run by Reed Hastings, venture capitalist John Doerr, and a handful of political operatives, would comment on how they perceive Silicon Valley's reaction to the White House situation.
Meanwhile, industry-backed legislation by Rep. Lamar Smith (R-Texas), which would increase the annual number of H-1B visas handed out to foreign workers from 65,000 to 115,000 in three years, will face a vote on the House floor Thursday, Smith spokesman Allen Kay said.
But scandal, not policy, has taken over in Washington and some political observers say Clinton, in an effort to appease more liberal Democrats, will have a hard time supporting the legislation even if Congress approves it.
"The old Democrats are the only friends [the president] has," said Republican political consultant Dan Schnur. "The scandal pushes Clinton back toward the Democratic base so he can't fight for these things, even if he wanted to."
But even as some technology companies are gripped by fear that legislation pertaining to their interests will be put on hold, newspapers across the country--including the paper of record in Silicon Valley--are calling for Clinton's resignation, citing moral and ethical concerns.
The San Jose Mercury News, whose readership comprises most of California's technology industry, called on the president to quit in an editorial Sunday.
"For the good of the country, President Bill Clinton should resign," the newspaper's editors wrote. "That is not an easy thing for us to say. We endorsed him with enthusiasm in 1992, and, less enthusiastically, but with hope, in 1996."
Phil Yost, chief editorial writer at the Mercury News, said it is hard to know whether most local technology companies would support the paper's editorial stance, especially given the technology industry's diverse political allegiances.
"There's actually a pretty wide political viewpoint in Silicon Valley," Yost added. "There's Democrats, Republicans, and libertarian Republicans, so [Silicon Valley is] not monolithic on this at all."
Revealing is the fact that Vice President Al Gore, regarded as among the more tech-savvy politicians in Washington, quickly is becoming Silicon Valley's favorite politician in light of Clinton's missteps. Many technology executives already have asserted that they are ready to see Gore in the Oval Office.
"If Clinton goes, the vice president would replace him, and Gore is seen as a pretty good friend of Silicon Valley," Yost noted. "My guess is that [technology companies] are not concerned that they'd lose an advocate in Washington [if Clinton quits or is impeached]."