Chapter 7: The Public Information Superhighway- Government Up for Bid in Virtual Competition

Chapter 7:
The Public Information Superhighway-
Government Up for Bid in Virtual Competition

For today's progressives, there is no challenge more compelling than the need to replace a governance model developed for the Industrial Age--an era characterized by large, centralized institutions, public and private, that once guaranteed citizens a decent standard of living and personal security in exchange for their allegiance...By dramatically lowering the costs of information and communication, microchip technologies break bureaucratic monopolies on expertise and diffuse knowledge--and therefore power--more broadly.
The new model decentralizes decisions, expands individual choice, and injects competition into the delivery of public goods and services... Progressives should develop a new governing approach that does not merely hand down programmatic "solutions" from Washington but instead creates an enabling environment where citizens and communities can fashion their own responses to local problems.
-- Will Marshall, Policy Directory, Democratic Leadership Council1

Despite the financial crises of local government (exacerbated by the Internet) and the loss of economic institutions such as utilities and banks tied to regions, the above quotation is the model of local governance and activism promoted by New Democrats like Will Marshall at the Democratic Leadership Council. It is a vision that sees cyberspace "enabling" local government power. And Newt Gingrich and his allied Republicans continue to frame their dissolution of federal programs as an attempt to "decentralize" government in an era when the Internet is making federal bureaucracies inappropriate: "The question is no longer whether second wave governments are in remission, but rather what will the governments of cyberspace look like?" argues George A. Keyworth, chairman of the Gingrich-allied Progress and Freedom Foundation. "Massive, widespread decentralization is already, irreversibly underway."2 The conservative and liberal sides of this consensus may disagree ferociously on many of the details of how and what is being decentralized (and share the hypocrisy in rhetorically ignoring what national regulatory apparatuses are being strengthened), but the consensus on the virtue of community economics and politics driving government is remarkably shared.

Yet the reality is that corporate businesses are already happily promoting the use of the technology as a way to disempower local government and make it serve the bottom line for business interests. If one wants to contemplate the rawest view of the tissue paper dispensability of local government for business in the new economy, there is no better example than a 1996 Forbes article called, appropriately, "Buy the Government of Your Choice." Don't like local regulation? Looking for a lower cost workforce with weaker labor protections? "Vote with your modem," writes author Peter Huber, and go "shopping for a better government." Huber observes that most people have contemplated the instantaneous transfer of money across the globe as people and companies search for lower tax rates. But he sees the new opportunities for forcing governments to reshape government policy to serve global corporations as an even greater gain for companies in the new age of "cyber power." With the power of the new networked technology, Huber (approvingly) notes:

...a manufacturing company can move jobs and capital around like pieces on a chessboard, shopping continually for the best-priced labor - and the best labor laws. Their managers will be able to move jobs almost as fast as governments can rewrite employment laws. At the margin, the managers of these transnational companies will adjust their portfolios of labor in much the same way as the manager of the Templeton Growth Fund trades stocks.

Unless governments keep their "services" in-line with the global competition, Huber argues they will lose "market share to the competition."3

As described in the last chapter, networked technology is accelerating the competition between and within regions for tax dollars. But if Huber is correct, the devastating effects of competition for tax dollars may end up being a sideshow to the much higher stakes of technological competition between local government bodies. Economic competition between regions is driving the most fundamental transformation of urban infrastructure since the rise of the interstate highway system and is driving the greatest internal restructuring of the functioning of local government since the emergence of integrated water, sewer and utility infrastructure at the turn of the century.

It is an invisible physical restructuring as networks of fiber-optic cables, satellites, microwave stations and other data connections reshape the virtual geography. These information crossroads of the new age are playing as key a role in economic booms as in the days of the railroad stockyards of Chicago. In some ways, the effects are even more fundamental since, unlike transit, telecommunications do not so much shrink space in some measured way, but instead make space irrelevant for certain economic functions of those connected directly to the high-speed telecommunications circulatory system. Through telecommunications networks, the financial markets of New York, London and Tokyo are virtually adjacent and this gives rise to a global financial market that places each of them more tightly at the center of its workings and employment. At the same time, new highly networked regions like the San Francisco Bay Area find themselves able to "move next door" through networking investments.

However, such connections invisibly and selectively penetrate traditional physical geographies. In more traditional models of urban planning, cities were usually treated as unitary objects that could be enhanced through growth coalitions investing in the urban infrastructure, while the new model of telecommunications can tightly integrate subsections, even small city blocks, into virtual adjacency to global production, while other areas within a region can be left far off in the boondocks even while appearing to be in the traditional heart of urbanization.4 This uneven investment in telecommunications in different areas, both by private industry and by local governments, is helping to reinforce the polarization between regions and within regions. Cities react to the competition to serve the telecommunication needs of global corporations not by disappearing but by creating a grab-bag of new technologies for the elite while leaving those without with less, exacerbating inequality. The ideology of privatization has meant in practice that government in elite areas assists in the planning for upgrading the technology of economic centers for business, while leaving other areas with little support.

Even the hope that technology-assisted education, in the form of distance learning and other networked education technology, would help to diminish the gap between educational opportunities is giving way to the reality that technology investments for privileged students is just further reinforcing educational stratification. Private business investments and support for schools in their suburban enclaves just further the economic disparity.

But the effects of networked technology has not been merely in the disparity of fiber laid or computers purchased but in the wholesale transformation of local government to serve the needs of business. The Progressive Era of government reform -- the creation of a civil service and the integration of broad areas into integrated regional planning bodies -- was itself a product of planning tied to new regional water systems and the drive for coordination of utility functions. The shape of local government is again being remade by the demands of the new telecommunications infrastructure.

The new technology seemed to promise local government a new opportunity to deliver services and expand economic development for its citizens. The Center for Civic Networking, a non-profit advocate at the center of many community networking efforts around the country, described this new public information infrastructure as a chance to:

...streamline internal operations of municipal government, improve delivery of town services to citizens and businesses, reduce traffic congestion and air pollution, bring new educational opportunities to local schools, and help local businesses prosper in a global marketplace. Our challenge now is to build "electronic city streets" to link homes, schools, libraries, hospitals, and small businesses to this ever-growing information superhighway... Just as electricity, streets, and sewers are core infrastructures that serve residents, businesses, and government alike - so too is the information infrastructure a community-wide need...The information infrastructure holds opportunities for creating new jobs in a changing economy.5

With local government as a key source of information serving the whole community and with governments increasingly integrating their databases, information would become a new fuel for empowerment and integration of regional economies across the nation.

Unfortunately, the reality has been that these new information networks are being used as often to divide communities against each other and empower global corporations with little permanent relationship to those communities. The selective market-oriented shape of current telecommunications, driven by both technology and federal government policy, is encouraging each jurisdiction to see its telecommunications policies, from hardware to Web sites, as one more element in the desperate attempt to attract and hold multinational corporations within city limits. This is occurring even as those same policies further undermine traditional methods of local economic planning. As in private industry, technology has emerged as one more tool to assist the downsizing of local government employment.

As more and more of the operations of government are integrated into the Internet, cities are experiencing the eroding of the barriers of information and the need for day-to-day local relationships that had once supported a regional civic and economic culture oriented to local growth. Any attempt by local government to build up local businesses may be undercut by global businesses scooping up government bids off the Internet and underbidding local contractors based on volume sales. The Internet may be the tool that those global companies need to reach those governments and replace traditional firms that once had a "local advantage" in getting information at the town hall.

The information at town hall itself is becoming more a part of international commerce than a local tool for economic development as the lines between public information and private information brokers blur. It is an irony of the "information age" that most information-gathering divisions of government, both national and local, are seeing budget cuts -- a factor that is pushing many local governments into privatization of information-gathering functions and a drive for profit-making enterprises from that information. A further irony is that even as the integrated economic geography of regions fades under the onslaught of global commerce, the selling of information about the physical geography of regions, contained in so-called Geographic Information Systems (GIS), is becoming one of the most profitable areas of government information. As selling government information for profit becomes a model for more local government, local government workers are losing out to information brokers often located far from their home cities. In all these trends, local governments increasingly find their fates more and more controlled by companies located far from their region. With local services provided by far off companies and government information increasingly controlled by private companies, the public finds itself losing political control of many economic development decisions they had previously taken for granted.

The fact is that for government as in business, the local region is increasingly not an economic unit unto itself but becomes merely a realm of negotiation by global actors. However, in the case of local government where local officials negotiate with global business, the power of business to "shop" for alternatives leave local governments in a desperate competition with each other in a race to lower standards - effectively leaving most local community actors out of the power equation. Those who have more power globally have a stronger hand for negotiating locally within a region, while those unable to muster such power are out of luck. The end result is more inequality within regions.

This chapter will detail how the promise of information technology for open government has increasingly given way to the reality of opening up government more to the influence and domination by global economic forces. While many of these trends are occurring across the country, the Bay Area and California have been what Silicon Graphics CEO Ed McKracken has called a "beta site" for industry in testing its products and applications.6 That attention has been both an advantage and a complication for the region, much as any beta software often leaves the original testers with buggy results.

Wiring government and communities

Across the world, upgrading telecommunications for economic development has become a key strategy of governments. In the East, Japan has the goal of a $540 billion market by 2010 for fiber optic-related goods, including video program distribution, terminal equipment and networking businesses.7 Korea, with an even tighter government planning system coordinated by the Ministry of Information and Communication, has plans to directly spend $58 billion by 2015 to link all 80 major Korean cities and incorporate 30,000 public organizations through fiber-optic cable. The plan envisions a high-speed broadband information highway across the country integrated into the global information network.8 With various levels of telecommunications privatization, European countries are more slowly moving forward on full digital upgrading of their infrastructure.

When Bill Clinton ran for President in 1992, he promoted federal investments in a National Information Superhighway as a key part of both his technology and economic plan. In his 1992 campaign document, he wrote:

Each year, I plan to devote a significant portion of my four year, $80 billion Rebuild America fund to laying the groundwork for the nation's infrastructure needs in the 21st century. Federal funding for the National Research and Education Network is one example of how the federal government can serve as a catalyst for private sector infrastructure investment. We will also provide additional funding to network our schools, hospitals and libraries.

Clinton specifically compared his plans to Japan where the "the Japanese government has committed to invest over $120 billion by 1995 to develop a digital broadband communication infrastructure called the Information Network System, and plans to invest another $150 billion to establish model programs for business and residential."9

However, with the defeat of Clinton's proposed infrastructure jobs bill in 1993 and the chilling of attempts at broader initiatives after the Republican takeover of Congress in 1994, Clinton began rapidly backpedaling from any commitment to direct federal funding of telecom infrastructure beyond the universal access funds that the FCC would approve. By 1997 when the Clinton administration would publish a major new document on electronic commerce, it had largely abandoned any serious role for the federal government: "Though government played a role in financing the initial development of the Internet, its expansion has been driven primarily by the private sector...Innovation, expanded services, broader participation, and lower prices will arise in a market-driven arena, not in an environment that operates as a regulated industry."10 Given the subsidies to businesses and ISPs contained in telecom regulation, this description was heavily strained, but the implication was clear: access at the local level was not going to come from direct federal government direction or investment.

Oddly, despite the ode by the Clinton White House to the success of expanded access in the free market, the plans by cable and telephone companies back in 1992 to 1994 of building the wire to homes has retrenched remarkably from original grandiose visions. Companies like TeleCommunications Inc. and other leaders were explicitly abandoning universal access plans for the near-term. Into this breach in the mid-90s, very tentatively, stepped state and local governments and a mixed stew of business initiatives collaborating (and in some case interfering) with such efforts. While the initial focus were on networking government offices, libraries, and schools, the efforts have also raised the issue of how to extend access to the general population for the "last mile" of high-speed connections to the government information being created in the public sphere.

One irony of the breakup of AT&T was that it actually increased state governments involvement in running their own telecommunications systems, with many states like California creating quite elaborate phone systems connecting their state institutions. By 1996, California was spending nearly $2 billion annually on information technology and telecommunication systems, including seventeen separate telecommunications networks that grew in the wake of the AT&T divestiture in different departments and statewide agencies. Unfortunately, with different agencies working with different contractors, the state ended up with seventeen separate, often redundant telecommunication networks. These were pulled together somewhat through the creation of an integrated CALNET service which by the mid-90s was providing voice phone services to 85 percent of state agencies, as well as a number of cities and counties in the state.11 With a new Department of Information Technology and an agency head dedicated to privatization, bids to privatize the system were being made by 1997 as telecommunications companies circled the statehouse looking to land the estimated $500 million five-year contract for connecting agencies.12 Other privatization proposals were in the works as well by 1997, including a transfer of the California State University technology infrastructure to a consortia run by Microsoft, GTE, Hughes and Fujitsu.13

At the more local government level, efforts to connect government offices to the Internet and enhance computerization were much more scattered. Much of the business interest in strengthening the public Information Superhighway has been in making it more in the service of business in the economy, from speeding up permits for land to development to making government data more available to the private sector. Through a whole range of institutions swirling around the business-led Smart Valley consortium and Pacific Bell's own involvement, businesses in Northern California played a leading role in setting the agenda for the public infrastructure and shape of the public IS. Pacific Bell launched its $35 million California Research and Education Network (CalREN) in 1993 to promote innovative networking projects in the public sector.14 The business goals of the project were bluntly noted by Syd Leung, CalREN's Project Manager: "The altruistic side is to help out California and fund these projects. On the business side, is to leverage as much public relations as possible. If we fund these other institutions, they can create new applications and we can leverage these into new business products."15

The strength of technology businesses in California intersected with the weakness of regional government, what one regional official called the "Yugoslavia" of conflicting jurisdictions in the region. Without a regional pooling of resources, the squeezed local government budgets made cities open to any financial support and direction from the local technology firms. This meant that most of the earliest cities to struggle onto the Internet like Palo Alto did so with help from local technology firms, while other poorer low-tech towns were left farther behind. In this scattershot approach to government access, high-tech companies were most interested in supporting the upper-income communities of their engineers and plant sites.

The experience in Northern California parallels the building of state information systems from North Carolina to Georgia to Texas with each having their own mix of public and private involvement in putting their systems together. North Carolina teamed up directly with three major phone companies (BellSouth, GTE and Sprint Carolina) to use major new government markets to spur the creation of an overall high-speed fiber-optic system throughout the state with a clear eye on spurring economic development.16 Texas was an early pioneer in getting state agencies on the World Wide Web and quickly saw the advantages of moving state agencies like the Department of Human Services from traditional networks to an intranet based on the IP protocol.17

Ironically, the most developed state information networking system was not in one of the traditional high technology states but in one of the least expected places, Iowa. In 1989, Iowa had begun planning an improved technology network but had trouble finding businesses interested in its dispersed rural areas, so legislators approved the creation by the state itself of the Iowa Communications Network (ICN) to link government agencies, schools and libraries throughout the state by fiber optic lines. State officials note that the telecommunication companies that did bid to build the system initially were promoting an analog system that would target only the metropolitan areas. "A lot of states have studied what we have done," notes ICN coordinator Harold Thompson, ICN's chief operating officer, "but few have been able to replicate it, because of the political consequences. It takes a lot of initial nerve to do it because everyone just says this belongs to the private sector, and the government should not be in it." By 1999, the state plans to link up 662 sites, including 474 schools, colleges and public libraries. By the mid-1990s, the state had spent roughly $200 million in bonded debt with additional funds coming from the federal government in the form of grants to wire veteran hospitals and other military-related facilities.18

The three things facilitating the Iowa network seems to have been the size of the state (2.8 million people), state officials willing to take the leap forward, and the initial failure of the private sector to make serious bids for the project. It is an interesting contrast between the regionally coordinated response of Iowa (without much help from local technology companies) versus the balkanized, haphazard system emerging in the Bay Area under the influence of hundreds of technology companies trying to cut separate deals with different governmental authorities.

Raising the stakes in all states and localities is how wiring government offices will influence access to high-speed Internet for citizens in each region. In Iowa, telecom companies have complained that the ICN is stealing not only government offices as customers but point to requests by teachers and students to dial-in to the ICN and the Internet from their homes - access that threatens even further erosion of their potential markets. When Republican governor Terry Branstadt vetoed a measure to ban such access to the ICN from home, GTE vocally announced an end to a $5 million investment in Internet access to communities. Despite the fact that the ICN has plenty of excess capacity, even supporters of ICN are feeling the political and economic pressure to privatize the ICN system. The state is unlikely to recoup its investment in the system from private sale for the same reason the state built the system in the first place: no private company will pay for the ICN's universal access to rural communities.19

The economic threats that are limiting consumer access to ICN in Iowa is a counterpoint to the failures of the cable and phone companies to deliver high-speed access across the country after blue sky promises in the early part of the decade. Companies like Telecommunications Inc. (TCI) that had promised high-speed fiber to home and businesses across the country spent much of 1996 canceling orders relating to infrastructure upgrades, while in 1997 Time-Warner pulled the plug on its interactive television project showcased in Orlando, Fl. By 1997, hopes for high-speed access were almost all focused on existing wiring using cable modems and other compression technologies hoping to squeeze the last bit of speed out of old phone and cable wires.20

With plans for broader regional and statewide high-speed access temporarily shelved by most players in the private sector, individual cities (usually those serving high-income residents) began building their own high-speed networks. This is further undermining universal access to telecommunications in favor of regional polarization and inequality. In 1996, the city of Palo Alto, one of the first cities with a Web site, began investing $2 million in a 26-mile superfast fiber-optic ring for Internet access to connect both its own government buildings and lease access to businesses, Internet providers and telecommunication carriers. By the end of 1997, 35 Internet service providers, including WebTV, UUNET, Deutsche Telekom North America and Hongkong Telecom, had setup shop in the central Internet Exchange for the fiber-optic loop. All of this is aimed at making Palo Alto even more central to the economic and technological geography of the region and the nation.21 Similarly, wealthy Anaheim in southern California is creating a public-private venture through the city-owned water and electric utility to invest $275 million in 96 fiber-optic loops with the goal of linking its 300,000 citizens and 2000 government offices to each other and the Internet at blindingly fast speeds. And unlike cities without the resources to make such investments and who expect to be spending large amounts on telecommunication services, Anaheim expects to be earning $10 million for city coffers by the year 2010.22

The irony is that even as high-tech firms are promoting deregulation and the retreat of government, local publicly-owned utilities are emerging as the most dynamic delivery systems for broad high-speed access - albeit only for upper-income communities. The results of market competition for telecommunications is more broadly following the model set in Scottsdale, Arizona where universal cable and telephone service is giving way to piecemeal competition serving select communities. US West telephone is planning to offer high-speed video and data access to a planned community of 7200 luxury homes in the city, while Cox cable, which serves the city as a whole, has complained that this amounts to cream skimming that no cable franchise would previously have been allowed to do before the 1996 Telecommunication bill.23 This is part of the general trend where local phone companies, now being forced to give competitors access to their customers, have scaled back infrastructure investments for all but their most profitable business and upper-income customers, while residential and business customers outside that core targeted base are expected by most analysts to suffer under an increasingly antiquated infrastructure.24

For most California cities, market competition in telecommunications is threatening to further shred city budgets. Due to a 19th century law passed originally to encourage telegraph system expansion, telephone companies in California are allowed free use of public land in cities for the right-of-ways needed to lay wires and build facilities. This loophole has been expanded to include telecommunication services such as phone, data networks and wireless services by over sixty-five companies given free use of public land with no compensation to local governments. Worse, proposed new legislation in the state would extend the loophole to cable companies, costing cities an additional $130 million in cable franchise and right-of-way fees.25 Even if state legislation is not passed, many cities worry that the proposed national "Internet Tax Freedom Act" would, because of vague wording, ban franchise fees on telecommunication companies and cost state and local government billions of dollars in revenue nationally.26 Such legislation would not only undermine their tax base but would remove the leverage local governments have in extracting promises of universal service from many cable franchises.

Schools and Economic Equity

Even if local government networking and high-speed access to the home has been a slower, more haphazard process than originally envisioned, many pro-market advocates trumpet the "American Success Story", in the words of the Progress and Freedom Foundation, of computers and networking in the public schools. The Progress and Freedom Foundation itself cites studies showing 98.6 percent of schools already have computers with 64 percent of all schools already connected to the Internet. Like President Clinton and most of Silicon Valley, they also cite the efforts such as "Net Days" where as many as 100,000 volunteers across the country have spent a day installing equipment and wiring schools. By the end of 1996, more than 250,000 volunteers in 40 states had installed wire in more than 50,000 classrooms.27 Under state telecom regulations, schools have been given discounts between 20 and 90 percent on telephone and Internet access.28 Federal Communications Commission access fees, amounting to $1.7 billion annually were directed at public schools and libraries starting in 1998 (cut back from an initially proposed $2.25 billion per year).

While all this is accurate, the numbers are deceptive as far as how technologically sophisticated most schools really have become and the numbers hide the fact that technology spending is largely reinforcing inequality in education. The respected Education Week newspaper surveyed the broad problems in implementing technology in schools across the country and, in particular, rated California as one of the most technologically backwards school systems in the country. California ranked 43rd in the nation as far as providing up-to-date computers with only one computer available for every 52 students. This is added to the fact that California already ranked dead last in the ratio of books and librarians to students.29

Beyond the overall inadequacy of the spending is the fact that dollars are going overwhelmingly into equipment with little funding for training teachers and other school personnel to make that spending effective. A 1997 report by the Benton Foundation, one of the most engaged funders of non-profits in the technology field, has highlighted the fact that where federal guidelines advocate that 30 percent of technology budgets for schools go to staff development, only 5 percent of school technology spending in 1996 went to training.30 The corporate donations of equipment and quick-shot volunteerism of "Net Days" just add to the mismatch between equipment spending and lack of training for teachers.31 Another four-year study of the impact of the Internet in schools noted that in poorer schools, high achieving students were usually the only ones getting access to the technology. This just ended up increasing the inequality in education between high-achieving and low achieving students.32

These recent studies just highlight how the new round of Internet-related spending is repeating the mistakes of the 1980s when computers were first introduced in mass numbers and technology just heightened differences in classroom experience between rich and poor schools. Back in 1992, MacWorld magazine devoted a famous issue to highlighting the rising inequality in the classroom that directly contradicted the then-glowing statistics: "What we found is a false dependence on statistical analysis and a reality so discouraging that it made us question how this situation has remained unremarked on for so long."33 An article in that issue emphasized how lack of training was increasing inequality between those schools using the new technology effectively and those left behind:

Inner-city and rural school districts rarely have the skills or funds to maintain their machines. These districts lack the training and social support to use computers effectively. In most cases, computers simply perpetuate a two-tier system of education for rich and poor. Nearly every school in America owns personal computers. But without expertise to use and maintain them, thousands of machines lie fallow. When computers are grafted onto dismal, underfunded schools that lack appropriate staff support, students and teachers rarely use them effectively.34

The volunteerism favored by many corporations and promoted strongly by Silicon Valley organizations like Smart Valley just adds to this inequality. Organizations like Smart Valley and Joint Venture have focused corporate contributions overwhelmingly on high-tech suburban schools, even as poor cities like Oakland across the Bay have been largely ignored. Volunteers with technological expertise are most available in upper-income communities so events like "Net Day" just reinforce the advantages of schools serving middle and upper-middle class kids. After the 1996 NetDay, the San Jose Mercury News noted that their computer analysis of the effort showed that "by significant margins, schools in the most affluent neighborhoods have attracted more volunteers than the less affluent." The paper noted that with schools in richer communities nationwide already having access to the Internet at twice the rate of schools in poorer communities, NetDay just reinforced those trends.35 Many poorer schools did not even try to participate, knowing that they lacked the staff support to follow up. "When we've got leaky roofs, filling a room with technology seems stupid," argued Kevin Gordy, lobbyist for the California School Boards Association, at the time. " It's like serving filet mignon to someone who's starving."36

Unfortunately, even public spending on technology in schools has been modeling itself on this "volunteer" approach. California's Governor Pete Wilson strongly promoted state government funding of a foundation run by John Detwiler, an investment banker and advisor to Wilson on education policy. The foundation refurbishes computers and donates them to schools. Critics, including state legislative analyst Elizabeth Hill, noted that the program locked out many schools from the program since the Detwiler foundation required each school to find a locally donated computer in order to receive one from the foundation. The result was that in the first six months of the program, over two-thirds of the computers funded by this state program went to schools in Silicon Valley.37

The use of prison labor by the program just added to the gap in training in local schools. Along with providing public funds, the state also provided prison labor to assemble and refurbish computers to be donated to schools. Many schools offered to refurbish the computers themselves in lieu of having to find a locally donated computer but the Detwiler program denied this option. This moved needed training funds and potential personnel out of the school districts. The Foundation's dismissive attitude towards school personnel was accented when the program's executive director, Diana Detwiler, emphasized the productivity of the prison workers, adding contemptuously, "Maybe it's because they don't get any summer vacation." The program received $10 million from the state in fiscal 1996-97, which Wilson sought to expand as a model for the state.38 New funding for the program was blocked in summer of 1997 when former employees publicly reported that the foundation had been misrepresenting the success of the program to legislators.

The contrast could not be sharper between California's volunteristic approach, where even the optimists don't expect every school to be connected to the Internet until 2001, and Iowa's state-run ICN network which expects to connect every school to the Internet by the end of 1998.39 Unfortunately, many more states are following the California model where volunteers, corporate donations and lack of spending on teacher training have ended up just reinforcing inequality between richer and poorer school districts.

Technology and the Transformation of Civic Government

The technological polarization between cities within regions is just a piece of the broader transformation of civic government under the impact of the new technology. Moving information on-line and the computerization of public information are part of wide-ranging changes in the nature of local government. The balkanization of regional telecommunications infrastructure is reflected in the move to privatization and "entrepreneurial government" lionized by New Democrat thinkers like David Osborne and Ted Gaebler. In their book Reinventing Government, Osborne and Gaebler see this new "entrepreneurial" government as a successor of Progressive era civil service bureaucracies. While hailing the new commitment to "empowering citizens," they also admit that much of the momentum for government transformation is derived more from budget constraints like Proposition 13 and the need to forge public-private collaborations out of budgetary desperation.40

In his earlier book Laboratories of Democracy, Osborne had noted the appearance of regional economic policies focused less on traditional growth strategies than on enhancing "processes" such as capital formation, the commercialization of research and the adoption of manufacturing technologies (foreshadowing much of the Joint Venture-style regional strategies detailed in Chapter 4). Even then, Osborne noted that bringing the poor into the growth process should be part of the agenda but rarely was under the new paradigm.41

That the fracturing of telecommunications infrastructure is coinciding with the fracturing of traditional city and regional government is appropriate given the origin of regional government in the early 20th century due largely to the need to manage emerging energy, water and sewage networks.42 One of the impulses for universal infrastructure back then were new understandings of the bacterial spread of disease and the commitment to extend water and sewage systems to all residents as a way of assuring general public health.43 Since elite computer users hardly fear the spread of computer viruses due to unequal technology access, we have lost that factor in pushing forward universal networked infrastructure.

A stronger parallel to the varied trajectories of telecommunications infrastructure development is the varied historical municipal approaches to transportation systems. Analysts like Anthony Sutcliffe have argued that both the degree of infrastructure development and its universality have been tied closely to how and who was able to harness the social product of infrastructure networks. Transit by itself never generated the profits necessary for its expansion, so the key to its development lay with the capture of the external social product generated by transit. In Europe, comprehensive transit systems emerged due to municipal ownership of peripheral land whose increase in value funded further transit expansion. In the United States, government ended up ceding land speculation and the profits generated by urban sprawl to private interests, thereby undermining integrated transit networks in favor of suburbanization.44

Much as the dismantling of urban mass transit systems in the US helped facilitate the profits of suburban land speculation and profit, the dismantling of telecommunications utilities has blocked the ability of government to direct the social gains of telecommunications to universal expansion of the network, thereby facilitating the process of private gain in telecommunications "sprawl." If anything, as noted in Chapter 6, the impact of the growth of Internet commerce will be a significant loss in revenues for local government and the further erosion of programs aimed at economic inclusion and regional integration between rich and poor communities.

In the post-war period of growing suburban sprawl, the main countervailing force against municipal fragmentation between suburb, city and later exurban growth was the direction of federal funds into regional planning bodies. If specifically local growth was not to be harnessed for regional integration, the overall national boom was redirected through block grants and other programs into political forms that restrained municipal centrifugal forces. The 1980s and 90s, however, would see both the dismantling of integrated regional telecommunications systems and the political liquidation of most of the federal programs that encouraged regional integration. The result is what urban planner Allan Wallis has called the era of the "networked" region where different municipalities are held together through a complex web of relationships brought together by the active involvement of public, non-profit and increasingly business sectors.45

Into this regional vacuum has emerged the "gated community" business politics for regions detailed in Chapter 4 as global companies located in localities shape regions into useful research and production nodes in the global production system. The reality for local governments has been the movement from growth coalition politics to a politics of selling their cities and regions in competition with both their neighbors and regions across the world. Telecommunications and the Internet have emerged as a key part of transforming civic culture in service to business needs.

Budgetary Desperation and the Virtual Downsizing of Government

When the Association of Bay Area Governments (ABAG) began its abagOnline Internet system as an off-budget "skunkworks" project, it saw its role as encouraging local governments to play catch-up and bring government processes up to the needs of local businesses and the public. With a $500,000 grant from the National Telecommunications and Information Administration, it hoped to help promote and integrate emerging on-line government sites in the region. Terry Bryzinsky, head of Information Services for ABAG, explained:

ABAG perceived that local government has not fundamentally changed the way its done business for many years, while business for its own survival has embraced change. So local government has fallen behind. Now, we see great financial pressure on survivability for local government, and pressures on local government in delivering services. So ABAG saw a need to help local government adopt technologies that promise greater efficiency.46

For most governments, the process was slow and unsteady with little coordination from state government. ABAG's Bryzinsky noted that early on in 1995:

With abagOnline, based on the overall lack of participation by local government, I have to say the forces within government pushing for this have been few and far between. My experience is that it is usually a white knight pushing it within an agency. If they're there, they go with it. If they aren't, it doesn't happen. I see a push from non-governmental organizations, who are more persistent than individuals, who tend to nag government more. The pull side of it comes from the flashy image makers, the leading government agencies, the ones who have pulled it off...That's rather shallow this keeping up with the Jones, but the practical side of doing government on the Internet hasn't been realized. So without the practical, the weight is on the flashy. There's nothing like having a few pictures of elected officials up there.47

Similarly, Kurt Handelman, who pushed forward on-line projects at the state Employment Development Department, noted that only similar "peer pressure" pushed forward state government on-line systems: "The state moved slowly at first. When they moved, they moved out of fear. First, they saw what other states had done--North Carolina and Louisiana. They had put their job search on-line. That sort of shamed us--we consider ourselves better, we're California."48 There is also the more generational reluctance to embrace new technology. Victor Pottoroff, Deputy Director of the California State Association of Counties (CSAC) which coordinates strategy and lobbying for counties statewide, admits that he barely knows how to turn off a computer and while "fascinated by the Internet" is not sure that he likes it. "It's accelerating so fast that it may overwhelm the average person."49

While uneven, the support of corporate money, from sources including Pacific Bell to Smart Valley funds aimed at hooking up schools to the Internet, has played a role in pushing governments on-line in the region. As importantly, the same pool of expertise and technology "being in the air" in the region that Saxenian highlights in the private sector, has played a strong role in early public successes. The fact that some cities have engineers on the city council or informal contacts have moved technology forward. Warren Slocum, County Assessor of San Mateo County, notes "Computer companies in area and things like the Smart Valley initiative help; having Universities around helps the process compared to Rockford Illinois. I used to live in South Dakota; there's a difference here who you meet at the gym: one day you meet the Pac Bell guy who invented the pager system, so the next day you are talking about paying your assessment taxes by touch-tone phone. It's the informal contacts that make a difference."50 On the other hand, many governments might as well be "in Tanzania" in the words of ABAG's Bryzinsky as far as technological expertise.

In the end though, local governments fundamental reluctance has been driven more by budgets than cultural resistance. With few resources for any untraditional projects, it has been nearly impossible to launch new initiatives around the new technology - one reason the NTIA grant for ABAG made its role more prominent. EDD's Handelman expressed a common irritation at complaint's of government slowness in adopting new technology:

It's not realistic to expect us to be dramatic in making these changes. Everyone wants to do Electronic Data Interchange--money or files. For us, it's the best use of the taxpayers money to let the banks crack that nut. It's not the best use of our resources to do it. When Wells Fargo and BofA figure it out, we'll do it. They're private people, so they can afford to risk more than we can. Contrary to public perception, we don't have extra money. Every dime from the federal government goes to specific places. There are no slush funds. So we have to know how to make it profitable before we do it.51

Even in the heart of Silicon Valley, mayor Wally Dean of Cupertino noted that "Governments in the state of California are so severely cash-strapped that they can't take the first step. To make the commitment to get a city on-line, you need elected officials to have the political guts to do this and the budget to do it." Dean explained that he was able to sell his initial version of a quasi-Internet system called CityNet to his fellow city councilors only based on its fiscal advantages. With the CityNet system, Dean argued that the city had been able to lay-off 11% of city staff without impacting city services. "We're starting to learn how to move information around directly...Our city hall is paper generated - when something is generated, you have a staff person file it, pull it out for users, etc. If you can eliminate the labor charge and do it electronically, it becomes a very cost-effective way of running a city."52

Other governments around the country have sought similar cuts in government costs as a prime reason for increasing networking throughout the state. North Carolina's corrections department has harnessed its high-speed networks for video conferencing for arraignments and hearings, saving an estimated $700 for each hearing used for this method in mostly rural areas.53 In Texas, the state government has pioneered one of the most developed public on-line systems in the early 1990s. As one example, the Texas Department of Human Services (TDHS) has launched a three-year project to migrate 600 statewide offices from a host-controlled network that supports state welfare benefit services to an Internet protocol based system. The entire project is expected to generate $9 million in savings over the 1993-98 period.54

Increasingly, budget savings are being made through the outsourcing of technology and privatization. The federal Office of Management and Budget has assumed overall oversight of IT spending in recent years and sees lean budgets and the need to replace downsized federal employees as a key reason for technology investments. "With the number of federal employees declining and resources more scarce, there is certainly a significant incentive for the government to become a world-class user of technology," says John Koskinen, deputy director for management at OMB. "In some ways we just don't have any choice but to keep on spending money [on information technology]." At the federal level, privatization of technology spending has been rapidly increasing to the point where two-thirds of the estimated $26 billion of yearly information technology spending is being done through private contractors.55

The reshaping of government information systems is seen by many as a deliberate reorganization of government to undermine the power of unions and traditional government-led growth advocates. In Silicon Valley's San Mateo County, County Assessor Warren Slocum was a strong advocate for moving Internet operations out of the county and onto ABAG computers, less as an attempt at regional integration than as a way to undermine the county's unions in its technology division. "Unions and Democrats would argue that we should be employing all these people. Should it be done by the County itself or through shared resources like ABAG? This government has a foot in many different worlds and it's a transitory world, and he who controls the public policy debate on this issue controls the future. The debate is much more than the Internet, related to whether the county should be building hospitals when the private hospitals have vacancies."56

Marketing Government to Global Corporations

The most immediate applications of the new technology for local government just seem to heighten, or at least accentuate, the vulnerability of local towns and cities to the forces of the global economy. In The Condition Of Postmodernity, geographer David Harvey describes a vision of local regions, under the pressures of new technology, as unable to establish long-term differentiation of space between areas. Instead, we see a desperate search for short-term exploitation of lower wages or tax benefits for business - a race that the loss of tax revenues to on-line commerce just escalates. Marketing regions to attract the relocation of business becomes a high premium for local government.57 The way all information becomes an almost undifferentiated mass on the Internet may just add to this problem, but the World Wide Web accentuates the desperation of cities and towns in promoting their "unique" attraction to business development by global companies.

If downsizing government employment is the strongest initial selling point for information technology, local governments see the competition for economic development as a key reason for getting on the Internet. If regions are losing their purpose as planners and growth promoters, they are increasing their role in marketing to global corporations. From the beginning, ABAG's Bryzinsky saw making the Bay Area competitive as a central purpose for promoting on-line information by local governments:

The economic health of the region is definately tied to government actions and policies. For example, if we have different ports in the region competing for business, Long Beach wipes us out because they have a uniform marketing operation. For many businesses, the Bay Area is not just a region to move to, its a question of where their workforce is going to live, how much their cost of living will be and how much they have to pay their workforce. So regional government is definately involved in international competition. We saw the Internet as a key part of the battlefield...with cities on-line gaining economic competitiveness for attacting business, for encouraging international opportunities in world trade. If Nissan announced they were looking for a new site, you can bet there would be a lot of on-line lobbying.58

He expects that cities without on-line access will be left out in the international competition for jobs; "Companies would rather do business with modern governments rather than governments from the stone age."

A range of government leaders in California expressed embarrassment that other states like Texas did a much better job than supposedly high-tech California in initially using the Internet to attract business. "Texas's on-line site practically grabs you by the tie," noted Richard Eposito, executive directory of the Sacramento Cable Television Commission, "and tells you to move to Texas. It asks you what region you are interested in, it tells you who is the regional economic director, and tells you that if you contact them, Texas has a database of contacts in China and Russia that they will hook you up with."59 Kurt Handelman at the state Employment Development Department admired the fact that at Texas's site, "you can find out how many graduating seniors and the SATs of the high school in each town. How much land is available, nearest airport, average wage in the city. We have all that crap. We publish it, but EDD publications are not something you find at the newsstand. And you usually learn it on the front page and only two statistics."60 He is working hard to get more of that information up in a way that can assist the state in economic development.

Smart Permits: Blurring the line between government and business

One key aspect of using the Internet to make cities more attractive to global corporations is allowing them to process land use permits electronically. Smart Valley has a whole project dedicated to "Smart Permitting" on-line and a stock worry for governments involved has been fear of losing jobs to other areas due to companies seeking faster permit approval. At one ABAG meeting where the concept was being discussed, Leslie Saal from Smart Valley cited an estimate from Hewlett Packard that on one project, delays in permit approval cost $1 million per day. The key fear is that with short product cycles and advantages gained by early entrants to key markets, global companies are unwilling to suffer permit delays. Saul argues, "Networks connecting businesses to government can be a big part in speeding things up."61

Much of the literature around new flexibility in corporate alliances has highlighted the way technology has blurred the boundaries between the internal structures of different firms. In the same way, on-line permitting is beginning to blur the boundaries between the internal structures of private business and the government. The Smart Permitting project is coordinating efforts across twenty cities around Silicon Valley in coordination with private industry to set the software standards for how permits will work on-line. The process has largely followed a design completed by Santa Clara County's Manufacturing Group, a consortia of high-tech manufacturers who pushed for agreement between towns on uniform regulations.

Leading the effort on the government side was the city of Sunnyvale, which committed millions of dollars in conjunction with the US patent office in developing initial software and computer systems. Working with other cities, Sunnyvale hoped to recoup the costs of maintaining the software through the consortium.62 Smart Valley's Saal notes that, "Sunnyvale has been light years ahead of the rest of us. We think that despite the cost, the capital investment will be paid off in the increases in productivity, in less clerical staff, and in attracting the businesses to maintain your tax base...If there are some kind of standards in place, it will also help cities exchange information as well, which is very important."63

Electronic permitting is expanding across the country, including the kinds of public-private collaborations developed in Silicon Valley. In 1995, Minnesota's Pollution Control Agency began a software-based system of permit applications in collaboration with American Management Systems, Inc., a systems integration firm based in Fairfax VA. As AMS sells the software to other states, the state of Minnesota will receive royalties from the software sold.64 Other states and cities are moving as well from software to Internet-based permits and application review.

The darker side of this process is that it puts pressure on other local governments to adopt the new standards and application processes built into software systems or else face much higher comparative costs in processing permits if they stick to their own standards chosen by local voters. And the emphasis on the speed of processing permits threatens the time for review- which is the major chance for democratic input in permit decisions. Even as it increases efficiency, on-line permitting threatens to move standards for permits from local voters over to quasi-private consortiums designing standards not so much in accordance with local democratic decisions but in the name of software efficiency and standardization that may ignore the long-term health of local citizens.

For Silicon Valley, this danger is not abstract but a matter of history. The semiconductor boom of the 1960s and 1970s has left a legacy of more Superfund contamination sites (29) there than in any other area in the country with more than 150 ground water contamination sites. The small city of Sunnyvale alone has six Superfund sites. It was only when citizens and grassroots groups formed organizations like the Silicon Valley Toxics Coalition and Communities for a Better Environment in the early 1980s that the industry began being investigated and pollution restrained in what was formerly thought of as a "clean" industry.65

Activists see those gains threatened by the push for "streamlining" permit processes and moving permit information on-line. Greg Karras, a Senior Scientist at Communities for a Better Environment, worries that "not everyone is on-line and many of the people most effected by this pollution are not on-line: people of color, low-income folks." He also scoffs at the idea that industry's goals in modifying permit processes is just to make them more consistent and efficient, since lawsuits by companies blocking regulations has been the major cause "of the permit process being lengthened, delayed and weakened." High-tech cities like Sunnyvale run subsidized waste treatment plants for the electronics industry and have ended up siding with the polluters in lawsuits, adding to the inconsistent and weakened regulations for other cities around the region. "This is exact opposition to the 'streamlining bullshit' that the industry mouths and it is because of lawsuits by the polluters. This all makes it harder for government to do its job."

Karras cites the danger of electronic permitting to democracy in the example of regulatory changes in 1997 that proposed to weaken water pollution protections in the region, changes that Karras labels "the worst thing for the SF Bay in the history of the Clean Water Act." Where in past years, the proposals would have been mass mailed to community organizations and interested citizens for comment, the EPA in 1997 had just posted the proposals on its Web site as all the public notice needed. Karras himself did not track down the proposed changes until 55 days into the legal 60-day comment period for challenging the regulations while poor and low-tech community organizations in effected towns only heard about them when Karras himself called them. "If it can happen like this for something this big, imagine how it will work for individual permits?"66

How On-line Purchasing is undermining Local Development

Along with downsizing employment and speeding permit approval, one promise of the electronic networking for local government is cutting the costs of its own purchases, especially important as more goods and services are outsourced. The problem for local government is that virtual purchasing of goods will likely have the same impact on local economic employment as online consumer purchases have had on local tax revenues, namely the undermining of integrated local economies.

Government contracts are the classic example where government corruption and government activism for local economic development have gone hand in hand. By steering contracts towards local firms, government officials nailed down political support but could also help out local businesses that needed a leg up. Governments might be targeting up-and-coming firms that are key to a neighborhood's development or the officials might just be lazy and call the same two or three firms and remind them a contract was about to be available by the city.

The Internet and other on-line channels promise to change that, opening the process both to smaller bidders who might never have heard of the bids before but also opening up bids to multinational corporations that would never have troubled themselves before to track information on the myriad of local governments. ABAG and other governments around the country have followed the model of the Los Angeles's Metropolitan Transit Authority, the largest local government purchasing agency in the country and one of the first to establish an electronic bulletin board posting procurement needs of the agency.

With its contracts posted electronically, the agency saw a 7 percent overall reduction in costs on $170 million of business when the electronic bulletin board was established in 1993. The MTA had traditionally mailed out procurement contracts to interested businesses once per month, but that was useful only for long-term construction contracts. As outsourcing of personnel services had increased, monthly contracts were not fast enough to keep up with agency needs. With contracts on-line, potential private contractors could keep up-to-date instantaneously; on hard copy, 30% of bids had been worthless because dates were outdated by the time people received it.

At the same time, on-line bidding made more complicated contracts easier to administer, since updates and new specifications can be posted on-line as well. "It used to be that you had to rewrite and mail out upgrades and worry about whether everybody gets the bids at the same time," noted the creator of the MTA system, Cary Paul Peck who heads Vendor Relations for the MTA. The new system will allow bidders to enter a code and keep track of changing specifications over time.67

Northern California's ABAG has launched a similar project to post government contracts from throughout the region on the Internet. With the looseness of regional government cooperation, it is unlikely to have the comprehensive success that the single-agency MTA has had, but ABAG's Bryzinsky is hopeful. One sign of success has been complaints from the Pacific Daily Builder, a weekly magazine that had published government contracts for subscribers, that the online contracts exchange would cut into its business. "We haven't made a big dent in their business, but that's only a matter of time. Then they will really complain."68

So far this seems all to the good: lower prices for government, more access for a wider range of businesses. The rub is that a wider range of businesses also can include businesses with no local connection to the local economy. The positive side is that a small earth moving company in one economically depressed part of a state may get to bid in another part to drum up business. However, it also makes it easier for giant Bechtel to scout out the largest and the smallest contracts in the state, tracking down contracts and displacing smaller local businesses where it would have previously been too expensive to spend the time keeping track of all the contract possibilities.

While the purpose of the system was to expand universal access, Peck acknowledges that it is really the sophisticated users who most heavily download bids: lobbyists, engineering firms, larger companies. While small companies with "Tandy [computers] and a schlocky modem crawl on-line," most of the traffic is from large corporations like the multinational construction firm Bechtel.69 Bryzinsky expects the contract exchange to give small companies a better chance to weather local economic storms; "If I was a small company in Redding CA, and we were an earth mover company and in a depressed area - the Internet makes it more feasible for that small company to find out about Cal Trans jobs all over the state." But he also admits, "It also makes it easier for Bechtel...and Bechtel has the most resources to divert to finding work."70

Any attempt by local government to build up local businesses may be undercut by global businesses scooping up government bids off the Internet and underbidding local contractors based on volume sales. Where the upside of Internet access had been more businesses trying to bid, the downside may end up being the narrowing of actual successful bids to a few global companies. Visit any local government convention right now and it is inevitably dominated by tables of new global companies seeking to supply everything from trash collection to food service for local jails. The Internet may be the tool that those global companies need to reach those governments and replace traditional firms that once had a "local advantage" in getting information at the town hall.

The other potential issue is the downsizing of government in favor of private global information "brokers." Where the Los Angeles MTA has moved forward on full public access to procurement information, California state government has been reluctant to move from an all-paper state bidding system which costs $42 million just for its printing bill each year. Instead of moving directly to on-line access, the state has been looking to sell its information to a private company who would repackage the information electronically and sell it back to anyone interested in getting information on available government contracts.71 In effect, this would transfer jobs out of state government procurement offices into the hands of private companies who would then profit from reselling public information back to the public. (We will return to the issue of government information being privatized later in the chapter.) As selling government information for profit becomes a model for more local government, not only will local businesses lose employment opportunities but local government workers may lose out to information brokers located far from their cities, further cutting the link between local government spending and local job creation.

In all these trends, local governments find their fates more and more controlled by companies located far from their region with the public finding themselves losing political control of many economic development decisions they had previously taken for granted.

Virtual Job Placement and the Fractured regional employment market

The California State Employment Development Department (EDD) is thoroughly computerized around the state with 14,000 employees scattered around the state, most of them with e-mail access. The challenge is translating the connections into jobs for the unemployed. Kurt Handelman at EDD envisions a time when, "Say there is a mass layoff or plant closure, we will already start a search for jobs so by the time they apply for jobs the next day, we have already set up a list of jobs for them. The problem with the unemployment office is that you'll be beside someone who is obnoxious, in front of you behind you, sneezing. So the idea is to make this serve people. It might be possible that by the time someone calls up to file for unemployment, we could have already processed it and send them a check. There are legal issues, but we could do it better."72

If nothing else, Victor Potoroff, Deputy Executive Director of the California State Association of Counties, hopes that government can use the technology to help find jobs for government workers losing their jobs in ongoing downsizing. "When there is a base closure we get the President coming out," complains Pottoroff, "but when we lose 12,000 county employees, no one cares. That is a service that our personnel department could do is helping people find jobs when they are laid off from government."73

On the other hand, Handelman sees the limits of the state Employment Development Department's ability to make radical change for the unemployed because most of what the EDD does is unemployment insurance, disability and other "band-aid stuff." The limits to its power is the fact that while it often gets lists of the unemployed, it gets fewer job listings from employers, especially for jobs for the least skilled and most in need of jobs. Employers have long resisted listing too many jobs since they fear being inundated with unqualified job seekers and, in Handelman's words, "just want fresh meat delivered--they want to be able to pick people who will do what they need to do."74

Many local agencies involved in job placement for the unemployed, especially for the long-term unemployed, complain that business refuses to cooperate in efforts to use new technology to list jobs and help the unemployed find jobs. Most businesses prefer to find all but elite employees through secondary channels that avoid them being inundated with new applicants. This without question is linked to the rise of contingent labor--temps, self-employed contractors and other employment schemes that take businesses out of much of the direct employment market. The fact that almost all net jobs created in the last half-decade in Silicon Valley were non-permanent contingent jobs means that few new jobs were permanent jobs hired in a conventional way.75

Handelman, from a statewide policy vantage point, notes the worry by policy makers if the hiring process does become too visible. Policymakers might see the possibility of destabilization of job markets that have thrived on limited information. "You don't want to advertise that there are 200 lumberjack jobs in Humbolt County to a jobs-starved state, and have caravans going up the state. There could be a bad influence on migration and stability."76 This illustrates the point that while the technology may facilitate openness, there are significant elite interests in maintaining stability in the job markets and business interests in limited information for low-wage job seekers.77

The reality is that state and federal employment agencies have bowed to the will of employers in not consistently collecting and publicizing information on job openings for low-wage workers. So instead of the dream of an electronic "hiring hall" for regional labor markets, we see instead a core of elite engineers networking for jobs electronically while the vast majority of low-skill workers exist in an almost invisible peripheral job market. Rather than the new technologies making the job market more visible, it has assisted in the growth of temporary agencies managing that peripheral market more effectively for the corporations who can thereby avoid dealing directly with most of their peripheral employees.

Databases and the Privatization of Public Information

The choice of government not to collect and distribute information on job openings goes to the core politics of networked technology and government: what information will be collected, who will have access, and at what price will it be available? How those questions are answered is increasingly shaping how government itself is organized internally and in relation to other political bodies and the private sector. Government is one of the key sources of information in society and one would expect that role would enhance its role in an age deemed the "information economy," yet local governments are finding that role as much a burden as an opportunity.

Even with information that government has traditionally collected, basic bureaucratic resistance had restricted access to data long before the Internet even was imagined. Control of information is power within government and most agencies fight tooth-and-nail against losing that control and many see the Internet as a decisive threat to their control. Despite laws mandating access to government information, studies in 1997 by the non-profit Center for Investigative Reporting and subsequently by the Associated Press found stiff resistance by California's state government to releasing a whole range of information they held in electronic form. One of the worst offenders was the Teale Data Center, one of the main repositories of economic and demographic information in the state government.78

Even other government officials often find it impossible to extract information from other agencies. Daniel Wall, who oversees Revenue and Taxation policy for the California Association of Counties, told how he had fought for years to get information from the state Controllers' office stored at the Teale Data Center so he could make county-by-county comparisons. It was only when he was joined by the legislature and private financial institutions that the Data Center released the information.79

In political terms, this kind of resistance is understandable given the nature of bureaucratic infighting. Michael Duffner was the first Webmaster for ABAG and subsequently was hired to help run the city of San Francisco's Web site; Duffner argues, "In most bureaucracies, information is viewed as power and indeed it is power. So information shared is power lost. Trying to work in that culture, that mentality is very difficult." But Duffner sees the budgetary pressure on officials as a deeper culprit: "There are many competent people in government who haven't lost sight of what government should do. But they also have to protect their own interests or they won't survive."80 Many officials worry that if information is shared, the public will use the information in the short-term without recognizing the ultimate source of that information. The result will be (and has been) budget cuts that ultimately undermine the ability of those officials to keep providing the original information.

Within Northern California, how to effectively share information has intersected with the "Yugoslavia" of divided city, county and agency bailiwicks. ABAG is one agency that has been slowly, too slowly in some critics' view, trying to get local governments to integrate their information together through its Web site and information exchange systems. Argues ABAG's Bryzinsky, "It is a challenge to ABAG to get governments together to avoid a tower of Babel. We may not have picked the best standard, but it's hard. But there's nothing that we can't rearrange and move; we aren't pouring concrete here."81

On the other hand, a project launched by Smart Valley called BASIC (for Bay Area Shared Information Consortium) is seeking to create public-private consortia to design information standards and act as a group purchasing agent, much as Smart Permitting worked to establish electronic permitting standards in Silicon Valley. BASIC creates a "bottom-up" approach, argues its director, Don Wimberly, who had previously been head of procurement for the high-tech city of Mountain View. Starting with a consortia based in Silicon Valley's Santa Clara county, Wimberly hopes to create a model that can be expanded over the other eight counties in Northern California. He contrasts BASIC with ABAG who are "doing this regionwide and pushing it down. People don't want more government...It's a philosophical issue. BASIC's idea is to empower the locals. We can with the assistance of government empower local business and with business empower local government." He argues that the consortium, by having governments and local business jointly sell information, will generate new data for education and business and "open up tremendous new markets and business opportunities."82

ABAG's Bryzinsky is less enthusiastic about BASIC's approach: "They are headed in the right direction but they are not giving the proper care to agencies that have developed geographic databases over years." He worries about approaches that take public information and sell it to the public. "There is a perception that [BASIC] is trying to leverage other peoples' work" for their own profit. He worries that the focus on economic incentives is distracting from the real need to find compatible standards governing a broad regional system open to the public.

One of the more successful approaches to government cooperation around data exchange has been in the city and county of San Diego which as far back as 1984 formed a non-profit, public-benefit corporation called the San Diego Data Processing Corporation to handle government data in a partnership called the San Diego Regional Urban Information System (RUIS). RUIS now serves 17 departments in the city and county covering 2.6 million residents and 4200 square miles. The partnership has been reluctant to move forward on selling any data until public access has been assured but budgetary pressures are mounting.83

The stakes are high across the country in the battle for control of government information and the software to create integrated databases. Even before the advent of the Internet, spending on so-called Geographic Information Systems (GIS) totaled over $3.5 billion by 1991. Roughly a quarter of the market was selling information systems to the Pentagon and another half to mostly federal government offices but geographic information software makers see their real growth in local government and leveraging government information to private industry markets. By the end of the decade, analysts have projected up to $100 billion in software and system sales.84 Many point to the benefits from GIS data in pinpointing the origin of Legionnaire's disease or helping Florida communities coordinate emergency relief during hurricanes.

But with everyone from utility companies to fast food franchisers to rental companies interested in using government data in locating and managing their branches, the industry has been exploding in recent years. Insurance companies are looking to use GIS data to calculate how far a customer's home is from a fire hydrant or police station and to calculate the real risks in their commute each day. Information from a range of government sources can be combined with private sources of information to create detailed customer profiles on each individual, a key tool for banks and other companies engaged in "data mining" to manage customer marketing. Significantly, all three major credit bureaus and others in the information field have acquired or merged with GIS mapping companies to forge new partnerships in producing data mining software to track individuals across the country.85

The Invasion of Privacy and the Threat of Economic Discrimination

While many people worry about bureaucratic resistance to releasing information, others worry that too much is being released. Surveying plans in California to connect justice system information with social services with transit and Department of Motor Vehicles information, Victor Pottorof at the California State Association of Counties comments that soon people "probably will be able to punch up too god damn much information about me."86 San Mateo Assessor Warren Slocum relates the store of police calling him up and complaining that his office was selling property information that some company was using to publish the home addresses of judges. Slocum worries about the implications: "If anyone wants to get this information, someone can come into this office on the computer and find it. Women living alone - we don't want people knowing they have three bedrooms and living alone."87

As what was previously government-only information is made public and integrated with private information sources, many analysts are worried about the systematic invasion of privacy as previously disparate pieces of information about individuals are combined to provide marketers with a comprehensive profile of each person. When P-Trak, a database service by the information company Lexis-Nexis, provided social security numbers on individuals across the country, a frenzy of public horror swept the country, but many analysts noted how limited the P-Trak service was in reality compared to the comprehensive information available to companies in other, less public database vendors. For set fees, it is now relatively simple to find out whether any specific individual owns a plane, has ever been a felon, when they last moved, what their driving record looks like, and an employment background check - all gleaned from public records.88

Access to database information that the Federal Bureau of Investigation was once denied by law has now been made available to anyone willing to pay for the information as governments have marketed information to private data vendors. Most legislation protecting privacy is so weak that little has slowed this ongoing encroachment into the private lives of people. While marketers trumpet the advantages in delivering tailored offers to customers, legal scholars highlight the growing imbalances of power in an information economy where individual preferences are so perfectly surveyed by global corporations. "Through the use of data banks, the state and private organizations can transform themselves into omnipotent parents and the rest of society into helpless children," wrote Paul Schwartz and Joel Reidenberg, two American lawyers, in a book commissioned by the European Union to study American data privacy laws.89

The danger, however, is not just at the individual level. As states and local government increasingly market themselves to global capital, the aggregate data released on individuals within a region has the potential to radically expand geographic discrimination and economic redlining of all forms. One of the most advanced data integration projects has been in Washington state where, in the name of expanding its "competitive environment", the state has implemented information projects to integrate information databases within a web of public-private partnerships. Charles Cook is a former director of a US Congress Office of Technology Assessment of the original conception of a National Research and Education Network and now privately studies the emerging data networks in the economy. He has highlighted the dangers of programs like Washington state where databases of community data on "at-risk" four-year olds and juvenile offenders are being linked to public information systems:

Someone has obviously decided there is a public purpose to be served in creating a database of at-risk four-year- olds and another of violent offenders. Missing from the Washington State scene is any widespread public understanding either that these and other data bases exist. Also absent is any reasonable means of challenge by the public to state agency use of them. For example, what if [the state] were to decide that when a business had narrowed its choice to four potential locations, the final step towards maximum competitiveness for that business would be to show it the population density of at-risk four-year-olds and violent offenders in each of the sites? The business would surely choose to locate in an area with as few undesirables as possible. The potential of information technology to be used in building economic ghettos in Washington State is not generally known let alone an item on the public policy agenda.90

The Lure and Losses for Governments of Selling Information

In an ideal world, the choices between expanding access to public information and protecting the privacy of individuals in the electronic age would be balanced based on a careful scrutiny of gains and losses for democracy in our society. Unfortunately, the more relevant context has been the budgetary desperation of local and state governments seeing the selling of public information as a revenue alternative in a time when other tax sources are being undermined by global pressures.

Federal projects promoting "smart highways" - toll booths that collect tolls through electronic sensors - are also being used to raise revenues for local government by selling "information of commercial value" to entities like auto insurance companies willing to purchase the data.91 Even as ABAG in Northern California has opposed some public sale of information, it has tried to raise revenue (somewhat unsuccessfully) from its public contracts exchange and other ventures. San Mateo's Assessor Warren Slocum sees the detailed information on property sales collected by his office as a potential revenue bonanza if sold to real estate companies: "We have what people want to know when they buy a home: what schools are there, how many square feet the house has, when it was built. We have this wealth of information. What if instead of them having to do that additional research, we charged them a buck or two bucks. The idea is to create independent revenue streams and we could be more independent of the general revenue stream and not compete with fire and public safety."92 Across the country, local governments have turned to selling public information as a new revenue source.

Free speech advocates have responded by demanding that such public information be released at no charge rather than be limited to those with the funds to pay for such services. Some have pursued lawsuits and others have turned to legislation to block the sale of information to private resellers. In California, one of the first victories of free-speech advocates was a legislative mandate to put all legislative proceedings on the Internet, thereby ending a long-time monopoly on such information in electronic form held by a private company. Local governments in California have fought furiously against similar mandates for local government to release all information onto the Internet.

Pilot projects in the early 1990s had allowed Los Angeles, San Bernadino, and a number of other counties in the state to raise money by selling special services and information to private companies and 1996 legislation sought to regularize and expand the pilot to include other counties. One example was Los Angeles County's proposal to sell electronic lists of civil and small-claims lawsuits to private firms for a total of $800,000 to $1.2 million, information that would be resold to credit-reporting businesses, land-title firms and other commercial customers. Newspapers and other public advocates argued that they should not have to pay hundreds of thousands of dollars to obtain such information in electronic form, since established laws required free access to tax, property and other government records.93 Other state officials have sponsored alternative legislation to mandate that local governments provide information at the cost needed to reproduce it.

Local government officials, including the municipal courts of Los Angeles, have responded by arguing they could not afford to format their information in electronic form without private sale of the information, so the public would not have access in any case. This is the bind local governments find themselves in: if they have to provide the information in electronic form for free, not only do local governments forego the added revenue of commercial sales, they incur new costs in preparing the information in a usable form.

The danger of this economic bind is not just to local government budgets but to the existence of information being available in any form. Many local governments faced with increasing economic pressures have discontinued various kinds of public information collection altogether. Don Wimberly, as head of the BASIC consortia, sees laws banning governments from selling information as a mistake that will just speed this loss of public information. He cites the example that in the early 1980s, Santa Clara County made the financial decision to stop collecting some land information history, including the tract maps created by land surveyors:

There are lots of examples of this; they don't create the information, don't collect it, or they throw it out. We need to create an incentive for local governments keeping and sharing their information. You're a city manager; it's going to cost you $30,000 to generate this information, but you can only charge you for what it costs to copy it. It gets you nothing if you don't capitalize on this. So if it's not your number one priority, you'll drop that data collection, which is what Santa Clara did.94

Across the country, governments have been discontinuing data collections with states like Alaska virtually abolishing their data center. This has reached to the federal government where the Census Bureau has cut its operations and has begun paring back what information it plans to gather in the year 2000 census. Officials have already cut back on the publication and reports on data from previous surveys.95 Other federal government information centers are following suit to such an extent that many analysts who depend on government information are seeing an emerging crisis. In his 1996 address, the President of the National Association of Business Economists, Maurine Haver, argued, "Resources for research on how to measure the increasingly complex service sector and high tech industries have simply not been available." He noted that statistical agencies have maintained present programs by reallocating research dollars to information collection and production, but termination of information collection programs had already begun. Surveys including the U.S. Industrial Outlook, the Quarterly Plant & Equipment Survey, and others had been terminated with more to follow.96

Michael Duffner, from his experience running Web sites for both ABAG and the city of San Francisco, is scornful of those advocating reselling public information as the solution. His view is that if one vendor is reselling the information, the city probably failed to get its full value in any case, while citizens end up paying a premium for access to privatized information that should have been available for free since they paid for it as taxpayers. The relationship corrupts information collection agencies and invariably brings in less revenue that the costs of collecting it in the first place. The whole approach ignores the long-term gains from adequate freely available information while concentrating on its short-term value, a recipe for the public undervaluing information:

It's like government making timber sales at a massive loss, selling off assets below cost and selling the value of future tourism and quality of life. Information is a similar kind of thing. When you do sell information, you are never going to get what it cost to aquire it, so if you sell it you will decide it's not worth it and get out of the business. You should just see how information like census data drives the economy and give it away.97

The irony and danger of the information age is that even as detailed, invasive information on individuals is increasingly in the hands of the global corporations, the public is increasingly denied information on the broad social and economic trends in the economy that might give them the chance to collectively act to reassert authority over those global forces.

Public-Private Partnerships and the Privatization of Democracy

As governments privatize information sales and even its collection, the end product becomes the loss of democratic control as information critical to democratic decision-making becomes the property only of those with the wealth to pay for it. Increasingly, key government information is being distributed and sold exclusively by private companies. The Reporters Committee for Freedom of the Press is one organization that has been raising alarms bells about the impact of this trend on democracy. They point to states like Mississippi where a single publisher has been given exclusive rights to distribute and sell the electronic version of the state's laws or to the federal government's sale to private companies of once-public data from the National Institutes of Health, the Social Security Administration and the Federal Communications Commission.98 This ends up forcing both the public and the government itself in many cases to pay for access to information critical to democratic discussion that was created and collected at taxpayers expense.

The most notorious example of the costs of privatizing control of information is in the area of federal legal decisions. The federal government in the early 1970s created an electronic database called JURIS of all federal court decisions and much of its administrative law. In 1983, it contracted out maintenance of the JURIS database to long-time legal publisher West Publishing. When its contract was not renewed, West demanded that all records in the database created during its contract be expunged to prevent public advocates using the Freedom of Information Act to create a publicly available legal database to compete with West's own private electronic databases. West had long asserted copyright control of the citations to its books detailing case law, thereby preventing any competing electronic legal database from being viable. By dismantling JURIS, it thereby forced the federal government to pay West millions of dollars each year to access West's database of the government's own case law. At the same time, this monopoly control of legal citation by West ends up burdening those in the legal system with few economic resources to pay the high costs of West's electronic services.99

The BASIC information system being developed in Silicon Valley is taking this privatization trend to a new and, from a privacy viewpoint, much scarier point. At one level, the goal is simply to take the scattered information privatization deals and integrate them into a one-stop information spot selling information from both private and public sources, from governments to utility companies to credit bureau records. By integrating these information sources, any business planning to locate in a city will have a comprehensive view of everything from zoning regulations to how many customers likely to be interested in their particular product are located close to their proposed location.

There is the obvious danger for democracy that the information infrastructure of the Bay Area would be controlled by a business-led consortia whose information, by definition, would not be subject to freedom of information review. However, BASIC has taken the trend towards information privatization one more step by combining all this electronic geographic data with satellite imagery of the physical geography of the region in a project called the Bay Area Digital GeoResource (BADGER). The latter was made possible by the participation of NASA's Ames Center and Lockheed in the consortia. Largely an offshoot of Star Wars funding, companies like Lockheed pushed through declassification of satellite imagery in 1994 in order to resell those images to commercial ventures.

With satellite imagery available that can show photographs corresponding to one meter per pixel, an observer can clearly see buildings, trees and even cars. By combining this data with BASIC, the idea is to create a digital atlas distributed over the Internet where utility companies can visually survey vegetation encroachment on their wires or fast-food outlets can locate stores based on market data and observing the physical flow of cars at any point. There will no doubt be advantages for government (at a price) in surveying the effects of suburban sprawl, but the real gains will be for commercial enterprises looking to market goods or locate within any region.

"This is the Home Shopping Network for geographic data," in the view of David Milgram, Lockheed's principal investigative researcher on the project. "If I have a property map and a recent satellite image, I could identify where the swimming pools are and which are dirty. I could then identify the homes that have swimming pools and finding out who's property it's on, and sending a mailing to people about my swimming pool cleaning service. Or see whose roofs needs reshingling and tell people I have a deal for them."100 While not legally licensed yet, there is the obvious next step of satellite imagery that can see down to the detail of individual people whose movements could be tracked throughout the day by satellite, thereby opening up a whole new kind of surveillance-based marketing within regions.

Prostrate governments in the information age

That governments are assisting in the marketing of its citizens is just the obvious end-product of the desperate economic marketing of their regions to global corporations on the prowl for low costs and compliant governments. With local government budgets teetering on the brink of insolvency, information technology has emerged more as a tool for marketing and downsizing public employment than as the promised tool for open government and citizen empowerment.

Modern progressive government was born at the turn of the century as the need to manage industrial growth intersected with the need to manage the growing networks of power, telephone and water infrastructure. As those integrated utility networks have been torn apart by deregulation, new telecommunications infrastructure is increasingly polarized between highly developed high-tech suburbs and downtown urban enclaves versus poorer towns left behind with inadequate access and unequal schools.

In order to meet the demands of global corporations, the very structure of local government is being transformed through outsourcing, the privatization of information, and the general blurring of the lines between government and business functions in areas ranging from local contracting to development permits to employment policy. Where regional governments once saw their role as promoting general growth in a region, that function is increasingly lost in favor of a desperate marketing to global corporations as each city or region bids with a combination of tax breaks and compliant government for corporate location choices. The exposing of the privacy of citizens has become an integral part of that bid for corporate location as once-private government data on individuals is increasingly sold to offset budgetary crises (themselves due at least partly to the globalizing effects of networked technology.)

Despite the rhetoric of New Democrats or Gingrichite "Third Wave" advocates, the local region has become not the venue for empowerment of individuals but the space where the power of global capital so outmatches the power of any other actors as to largely eclipse democracy itself. Whether with the threat of disinvestment or full-scale flight, global corporations are increasingly able to design government regulations and information infrastructure to suit their needs at the expense of local empowerment and equality within the region.

The reality is that if the new technology has any promise of empowerment for the individual and less well-off communities, it is at the national and global level. It is only at such a level that the combined power of working families, working through both government avenues and through labor unions, has any chance to match the power of global corporations.

Already, officials in local governments are using the Internet to strengthen their communication with each other and lobbying power at higher levels of government. "We can also use information technology to track changes in federal and state legislation and regulation," notes Victor Pottoroff of the California Association of Counties, "since those things change on almost a daily basis." Groups like the National League of Cities have become increasingly savvy in fighting against bills like the Cox-Wyden "Internet Tax Freedom Bill" which would further erode local government revenue-raising ability. Because of their mobilization, the cities and other local government authorities were able to prevent the bill's passage in 1997 and significantly water it down in 1998.

But the real impact of the Internet is among the community organizations and unions who increasingly find their power at the local level stymied by global corporate power and have turned increasingly to allied organizations nationally and globally to restore some balance to the power equation. If anything blocks a revitalization of grassroots power through use of networking technology, it is the ideology of decentralization promoted by many conservative apostles of the new technology. In the last concluding chapter in this dissertation, we will look at that decentralization ideology in the context of the arguments made so far in this dissertation and explore the real potential for community mobilization using the new technology.

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Endnotes for Chapter 7

1 Marshall, Will. "A New Fighting Faith: Ambitious Goals for the World's Oldest Political Party." The New Democrat. September/October 1996.

2 Keyworth, George A. "People and Society in Cyberspace." The Shape of Things: Exploring the Evolving Transformations in American life. No. 1. Working paper from the Progress and Freedom Foundation.

3 Huber, Peter. "Buy the Government of Your Choice." Forbes. Dec. 2, 1996.

4 See Graham, Stephen and Simon Marvin. Telecommunications and the City: electronic spaces, urban places. Routledge. London. 1996 for a good review of the literature in this area.

5 Fidelman, Miles R. "Life in the Fast Lane: A Municipal Roadmap for the Information Superhighway." Municipal Advocate. Summer 1994.

6 Interview with Don Wimberly, BASIC Manager, July 27, 1995.

7 "Telecommunications infrastructure." East Asian Executive Reports v18, n9 (Sep 15, 1996):14-16.

8 "In search of state-of-the-art technologies: Korea's drive to the information superhighway." East Asian Executive Reports v18, n9 (Sep 15, 1996):8,18+.

9 Clinton, Bill. Campaign document. Technology: The Engine Of Economic Growth. A National Technology Policy for America. September 18, 1992.

10 Clinton, President William J. and Vice President Albert Gore, Jr. A Framework For Global Electronic Commerce. Washington, D.C. July 1, 1997.

11 Information Technology: an Important Tool for a More Effective Government. Legislative Analyst's Office. State of California. June 16, 1994. California Integrated Information Network: A Strategic Plan for Calnet and All State Telecommunications Networks. Department of Information Technology. Department of General Services. State of California. December 1996. 1996 Annual Report. Department of Information Technology. State of California.

12 "California Wants Bids To Privatize State Telephone System." Newsbytes News Network. Oct 9, 1997.

13 California State University's Technology Infrastructure Initiative. Business Plan by GTE, Microsoft, Fujitsu, and Hughes. August 25, 1997.

14 Gengler, Barbara. "California's big picture: serious about the potential of the Internet, Pacific Bell has developed an experimental backbone." LAN Computing v5, n4. April, 1994.

15 Interview with Syd Leung, CalREN Project Manager, November 30, 1995.

16 Lutterbeck, Deborah. "Muni telecoms." Infrastructure Finance v6, n3 (Apr 1997):14-17.

17 Duffy, Jim. "IP net helps Texas dole out benefits." Network World v10, n48 (Nov 29, 1993):1.

18 Lutterbeck, Ibid. "Computer networking: The wiring of Iowa." Economist v336, n7923 (Jul 15, 1995):19.

19 "A Collision On the Iowa I-Way." Business Week, May 19, 1997.

20 Somogyi, Stephan. "Sages or stooges?" Upside v9, n6 (Jun 1997):62-68+.

21 McCabe, Michael. "Palo Alto Moves Fast To Center Of Internet; Fiber-optic ring nearly completed." San Francisco Chronicle. June 26, 1997. Markoff, John. "Will Commerce Flourish Where Rivers of Wire Converge?" New York Times. December 8, 1997.

22 Lutterbeck, Deborah. "Muni telecoms." Infrastructure Finance v6, n3 (Apr 1997):14-17.

23 Levine, Shira. "Fiber to the mansion?" Telephony v232, n15 (Apr 14, 1997):38.

24 "Bill could divide Telco customers into haves and have-nots." InfoWorld v18, n38 (Sep 16, 1996):72.

25 Moura, Brian. "The Telecommunications Revolution Comes to City Hall." Western City, the monthly publication of the League of California Cities. April 1996.

26 Clausing, Jeri. "Senate Panel Supports Ban on Internet Taxes." New York Times, November 5, 1997.

27 McClellan, Jr., Donald W. "The FCC's $13 Billion Tax Hike." Paper by The Progress & Freedom Foundation. 1997.

28 "Discounts for Telecommunications." Letter by Delaine Eastin, State Superintendent of Public Instruction. State of California. November 20, 1996.

29 Asimov, Nanette. "California Schools Rate D-Minus in Report. Exhaustive study blames Prop. 13 for the damage." San Francisco Chronicle. January 16, 1997.

30 Mendels, Pamela. "Study Faults Net Training for Teachers." New York Times. July 17, 1997.

31 Mendels, Pamela. "Not Everyone Is Eager to Jump On the Net-Day Bandwagon." New York Times. October 19, 1996.

32 Gartner, John. "Net Access May Increase Inequalities." TechWeb. May 11, 1998.

33 Borrell, Jerry. "America's Shame: How We've Abandoned Our Children's Future." Macworld. Sep 1992.

34 Piller, Charles. "Separate Realities." Macworld. Sep 1992.

35 Slonaker, Larry and Howard Bryant. "Wealthy Schools Draw Abundant Help in Net-Wiring Project, But Have-Nots Come Up Short In Volunteers and Funding." San Jose Mercury News. March 7, 1996.

36 Gunnison, Robert B. "Ex-Workers Say Giveaway Totals Were Inflated; Wilson-backed program to equip state's schools." San Francisco Chronicle. May 20, 1997.

37 Gunnison, Robert B. "Ex-Workers Say Giveaway Totals Were Inflated; Wilson-backed program to equip state's schools." San Francisco Chronicle. May 20, 1997. Gunnison, Robert B. "Computer Giveaway Favors Silicon Valley Schools; Foundation ignores most other areas." San Francisco Chronicle. March 1, 1997.

38 Sinton, Peter. "Big Haul Of PCs For Local Schools." San Francisco Chronicle. November 14, 1996.

39 Hanley, Michael. "Small towns, big plans." Telephony v232, n22 (Jun 2, 1997):246-256.

40 Osborne, David and Ted Gaebler. Reinventing Government: How the Entrepreneurial Spirit is Transforming the Public Sector. Addison-Wesley Publishing Company. New York. 1992.

41 Osborne, David. Laboratories of Democracy. Harvard Business School Press. Boston. 1988.

42 Tarr, Joel A. "Sewerage and the Development of the Networked City in the United States, 1850-1930" in Tarr, Joel A. and Gabriel Dupuy, ed. Technology and the Rise of the Networked City in Europe and America. Temple University Press. Philadelphia. 1988.

43 Guillerme, Andre. "The Genesis of Water Supply Distribution, and Sewerage Systems in France, 1800-1850" in Tarr, Joel A. and Gabriel Dupuy, ed. Technology and the Rise of the Networked City in Europe and America. Temple University Press. Philadelphia. 1988.

44 Sutcliffe, Anthony. "Street Transport in the Second Half of the Nineteenth Century: Mechanization Delayed?" in Tarr, Joel A. and Gabriel Dupuy, ed. Technology and the Rise of the Networked City in Europe and America. Temple University Press. Philadelphia. 1988

45 Schechter, Bill. "Metropolitan governance: a bibliographic essay." National Civic Review v85, n2 (Spring-Summer, 1996):63 (4 pages).

46 Interview with Terry Bryzinsky, ABAG. March 7, 1995.

47 Bryzinsky, March 1995, Ibid.

48 Interview with Kurt Handelman, Employment Development Department, March 29, 1995.

49 Interview with Victor Pottoroff, Deputy Directory of the California State Association of Counties (CSAC), August 29, 1995.

50 Interview with Warren Slocum, San Mateo Assessor, March 30, 1995.

51 Handelman, Ibid.

52 Interview with Wally Dean, mayor of Cupertino, April 5, 1995.

53 Lutterbeck, Ibid.

54 Duffy, Jim. "IP net helps Texas dole out benefits." Network World v10, n48 Nov 29, 1993.

55 Corbin, Lisa. "Contractors suffer blows in budget battle." Government Executive, Top 200 Federal Contractors Supplement (Aug 1996):41-48.

56 Interview with Warren Slocum, San Mateo County Assessor, March 30, 1995.

57(Harvey. The Condition of Postmodernity).

58 Interview with Terry Bryzinsky, March 7, 1995.

59 Interview with Richard Eposito, August 29, 1995.

60 Interview with Handelman, Ibid.

61 Leslie Saal, Smart Valley, speaking at ABAG meeting. November 13, 1995.

62 Sean Garcia, Sunnvale Director of Information Technology, speaking at ABAG meeting, November 13, 1995.

63 Saal, Ibid.

64 King, Julia. "Eletronic forms are new wave in pollution control." Computerworld v29, n28 (Jul 10, 1995):42.

65 Silicon Valley Toxics Coalition Web site. http://www.svtc.org/svtc/

66 Interview with Greg Karras, Senior Scientist at Communities for a Better Environment, December 1, 1997.

67 Interview with Cary Paul Peck, Vendor Relations for the Los Angeles Metropolitan Transit Authority, April 10, 1995.

68 Interview with Terry Bryzinsky, September 13, 1995.

69 Interview with Peck, Ibid.

70 Interview with Bryzinsky, March 7, 1995.

71 Peck, Ibid.

72Interview with Kurt Handelman 3-29-95

73Interview Victor Pottoroff, Deputy Executive Director CSAC 8-29-95

74Kurt Handelman interview, 3-29-95

75San Francisco Chronicle. "Labor Plans Big Sweep Up". Friday, May 31, 1996 Page A19

76Kurt Handelman 3-29-95

77 A too visible labor market would without question also create greater scrutiny of racism in hiring practices that are often obscured through the secondary hiring markets of contingent employment. Sociologist William Julius Wilson has highlighted the way the decline of large factory employment and the flight of core jobs from the inner-city has left many inner-city residents, particularly African-Americans cut off from knowledge or access to job openings.(Wilson. When Work Disappears. New York. Alfred A. Knopf. 1996.) Despite the attacks on the "work ethic" of inner-city blacks, Wilson colleague Martha Van Haitsma's research has highlighted how low-wage employers often use extended social networks of employees in their informal hiring practices, further isolating unemployed blacks with few job networks. One result of the underground and word-of-mouth nature of most low-wage hiring are dramatic differences in job access by immigrants and African-Americans in the inner-city. Immigrant families are much more likely to have multiple adults in the household along with extended family networks, thereby creating greater opportunities to hear about job openings often not advertised publicly. Employers can then use these Latino networks for hiring, reinforcing the broader employer prejudice against hiring African-Americans.(Van Haitsma, Martha. "Attitudes, Social Context and Labor Force Attachment: Blacks and Immigrant Mexicans in Chicago Poverty Areas." Paper prepared for presentation at the Chicago Urban Poverty & Family Life Conference. 1994.)

78 "Calif. Public Records Not So Public." Associated Press. August 18, 1997

79 Interview with Daniel Wall, Deputy Director Revenue and Taxation and Federal Affairs, August 29, 1995.

80 Interview with Michael Duffner, ABAG and San Francisco Internet manager, May 2, 1996.

81 Bryzinsky interview, 9-13-95.

82 Interview with Don Wimberly, BASIC Manager, July 27, 1995.

83 Mitschele, Rhonda. "hare and share alike: Creating a cost-effective GIS." American City & County. Mar 1996.

84 Kindel, Sharen. "Geographic information systems." Financial World. Jan 19, 1993. "The Delight of Digital Maps." Economist. Mar 21, 1992.

85 Bernstein, Nina. "Lives on File: Privacy Devalued in Information Economy." The New York Times. June 12, 1997.

86 Interview with Victor Pottoroff, Ibid.

87 Interview with Warren Slocum, Ibid.

88 Angwin, Julia and Jon Swartz. "P-Trak Defends Database; Other companies offer lengthier personal files." San Francisco Chronicle. September 20, 1996.

89 Bernstein, Nina. "Lives on File: Privacy Devalued in Information Economy." The New York Times. June 12, 1997.

90 Charles Cook. The Cook Report on Internet-NREN; NII: The Dark Side in Washington State. http://pobox.com/cook/washington.html

91 Cook, Ibid.

92 Interview with Slocum, Ibid.

93 Holding, Reynolds. "Bill to Allow Resale Of Public Records: First Amendment lawyers say free access is threatened." San Francisco Chronicle. January 22, 1996.

94 Wimberly interview, Ibid.

95 Holmes, Steven A. "Budget Cuts May Curtail Census In Year 2000." New York Times. Aug 23, 1995.

96 Haver, Maurine A. "Presidential address: economic statistics: a call for action!" Business Economics. Jan 1, 1996.

97 Interview with Duffner, Ibid.

98 Kovach, Bill. "When Public Business Goes Private." New York Times. December 4, 1996.

99 See the Taxpayers Assets Project web site at http://www.essential.org/tap/ for a full review of the West/JURIS controversy.

100 Interview with David Milgram, Lockheed Principal Investigator for BADGER, July 6, 1995. 476