This week’s New Yorker has a long article by George Packer on the politics of Silicon Valley. If you live and work in SV, you should read it (yes, even those of you in SF.)

Packer writes about the attempts of several SV people to deal with the political system. Regrettably, he interviews pretty much only billionaires, as if their issues have anything to do with reality.

But he asks a few very good questions. For one: If high tech is so productive, liberating, enhancing, optimizing, etc., why has the US gone into long-term economic decline? The rise of Sillicon Valley matches the collapse of the USA. Are the two related? If not, where is the benefit of tech? Has SV done anything to improve the USA? Few of his interviewees even attempted to answer that.

I live in Palo Alto. I have a house here and I’ve been here for 20 years. In the 90s, SV was high-tech, i.e., engineering and hardware. Every year, there were significant technological and engineering advances.

But in the last ten years, certainly in the last five years, there has been very little development. Facebook, Twitter, and yes, even Google are just advertising networks, which is to say, they are glorified billboards. There are no technology breakthroughs from Google or Apple (no, iPads and Glasses aren’t technology. They’re mass-market consumer products.) SV is the concentration of ever more wealth in the hands of a few (50 or so) billionaires.

Can those 50 or so do anything? Better to ask: do they have a clue? Google has spent $30 billion in R&D and has nothing to show for it. None of their R&D projects are profitable: not one. Google has 7,000 Ivy League engineers who can only come up with Popular Science gimmicks. They simply don’t know what to do that matters to people outside of SV. Packer writes that the current dotcoms (be able to order gourmet food from your smart phone, etc.) solve the problems of rich kids. That’s really funny and it’s true.

Apple, Google, and others have hundreds of billions of dollars in the bank. How? Simple: they don’t pay taxes. None at all. They’ve offshored their profits and parked the money in the Bahamas and other places. Hundreds of billions of dollars. These companies now want to solve social problems? They’re not even part of society.