Here in the land of high technology, where the silently whirring computer is king, lies the capital of success and the creator of American myths. If only, one hears people say in the depressed mill towns of the Midwest or stricken lumber villages of the Pacific Northwest, we can attract the great new high-tech firms.
If only we can be another Silicon Valley, all of our problems will be solved.
The wish is just that -- a fanciful illusion born of hope and spurred by desperate need.
It ignores realities about the Silicon Valley, of which Sunnyvale is the heart, and about the reasons why other areas have fallen upon such difficult circumstances.
It also ignores a truth about the Silicon Valley today.
Just two years ago, this area was in the midst of so great a boom, attracting one new employe every 10 minutes, that its city council declared a moratorium on new industries locating here. The Silicon Valley had become saturated with its own success. It was awash in jobs and had so much surplus local revenue that it gave back money to the taxpayers. Its citizens wanted to slow down their rate of growth. Now there are layoffs and hiring freezes. People are apprehensive. Over and over, they will speak of being "on edge." Some of the aggressive, small, new firms that had attracted national attention as models of initiative and enterprise are struggling to survive.
"We've been walking a tightrope on the economy for the last six months," says Bert Braddock, president of ZyMOS Inc., founded four years ago with four employes and now one of many multimillion-dollar electronics firms here in Santa Clara County 40 miles south of San Francisco.
"We find ourselves doing what seems like a Herculean job of survival. In the long run, maybe Reagan's program is going to work, but right now it's becoming very tenuous for all of us. Wall Street's going crazy, and I don't see any reason in the world for it. It's insane. There's nothing to base it on. There's no growth in the economy," Braddock said.
"It's raw competition out there, your company against your neighbor down the street or against the Japanese or whoever else. We're seeing an industry that's been growing like this one cut to its knees," he said.
The lesson from Silicon Valley is simple: It can happen here. Even the nation's most spectacular growth industry, the one that increasing numbers of analysts believe holds the key to the American future, does not stand immune from economic distress elsewhere.
Other aspects of the Silicon Valley story carry national implications. Two years ago, officials were dealing with questions about how best to preserve the community's quality of life. They discussed such things as growing traffic jams, automobile pollution and overcrowding. Those concerns continue and, if anything, the problems they represent have grown worse. But now more pressing questions have overtaken them.
Sunnyvale city officials have been shocked to learn that their high-technology industries, thought to be so much more pollution-free than their heavy industrial counterparts in other sections, are not.
"We now have a sense of how dirty our clean industry is," City Manager Tom Lewcock says. "We've had a rash of failures of underground storage tanks containing toxic materials that have been leaking into the ground. This raises substantial concern about it getting into the underground water table that we rely on. Personally, I believe it's been happening a long time but no one was reporting it."
Now, coupled with new environmental concerns, strong support exists for the nuclear-weapons freeze. That movement cuts across all kinds of conservative-liberal ideological lines. So does a new voter initiative to ban handguns in this community.
This is the fifth in a series of articles during the congressional election campaign examining American communities in today's economic climate.
President Reagan, who carried this area two years ago, does not fare as well today. Paradoxically, in an area where substantial defense dollars are going to the electronics industry for Pentagon contracts, his defense spending and weapons policies work against him politically because of the widespread pro-freeze sentiment.
In yet another paradox, Gov. Edmund G. (Jerry) Brown Jr., the Democratic candidate for U.S. Senate, is the favorite of the technicians and managers in Silicon Valley. One reason is that Brown has made "High Tech," emphasis on research and development of new technological industries, a major campaign issue. He proposes more Silicon Valleys, perhaps as many as two dozen, across the nation.
Many voted for Reagan in 1980 and would not vote for Brown for reelection as governor because they don't think he is a good manager. But they think he is a marvelous idea man and that he can be effective in his championship of "High Tech" with the Senate as his platform and operating base.
But the greatest concern, here as elsewhere, is about the nature of the economy. Here, too, one encounters expressions of belief that the country faces fundamental national economic problems. Silicon Valley is cited as a prime example.
"In the last 10 years, something like 80 percent of the new jobs created in this country were created by firms four years old or younger," says Regis McKenna, who formed his own company here and has shared in the high-technology boom. "And they have also come from firms employing under 20 people.
"Basically, it's small businessmen in America where all the jobs have come from. There's really not been much of a net increase in Fortune 500 companies in terms of employment. And just look at what's happening. We've had 17,500 business bankruptcies so far this year, most of them from small businesses.
"So the small businessmen who were really creating our jobs, and who were really changing our future, are in jeopardy. We tend to focus on the auto industry or the steel industry, but I think what's really happening is that small business itself is disappearing.
"Most of the industries I know dedicated most of their planning to coming out of the recession a year and a half ago. Over the last year there's been a continual decrease in their optimism.
"We really do have a spiraling depression -- not a recession, a depression -- today. A depression is self-defeating in that every business that goes bankrupt and every person that goes out of work basically owes money somewhere they can't pay. Which means it lowers the amount of money available in circulation; it's not circulating anymore.
"We already know that with the federal government taking up most of the available money to service the national debt that eventually the interest rates, which I think have been artificially lowered, will come back up. They have to because there's not going to be that much money available for borrowing."
Not that Sunnyvale and the Silicon Valley in any way resemble the depressed conditions encountered in other places on this trip around America.
Life remains bountiful here. The good life, and all the emblems that are equated with success, are highly visible. At one Chinese restaurant, the parking lot is filled with Mercedes Benz automobiles. At marinas on the bay, families set out on Sunday expeditions in their new cabin cruisers and sloops.
Other areas can wish they had it so tough. Small wonder that they look longingly toward Silicon Valley to rescue them from their hardships.
In the last generation, no other place in the United States has provided such a stunning example of success. Here, at the western land's end, stand about 3,000 electronics firms, more than anywhere else. They have spawned many others being exported elsewhere.
It has been 23 years now since the invention of the silicon chip touched off an electronics revolution that continues with unlimited possibilities.
On a crystal made of silicon, about the size of a fingernail, are placed tens of thousands of transistors, diodes, capacitors and other electronic material that form the so-called integrated circuits, or semiconductors, of the space-age technology that reshapes our lives. Silicon chips are the brains of computers and perform such varied tasks as controlling the path of unmanned missiles to converting sunlight into electricity.
All this began in Sunnyvale, igniting the extraordinary boom that transferred this great agricultural area into the center of the new high-technology industry.
Naturally, other sections want to emulate Silicon Valley. But that wish ignores the reasons why Silicon Valley -- a name, though world-famous, that does not exist on a map -- became the center of this industry.
It already was a center of world-renowned scientific research. Surrounded by the great universities of Stanford and California at Berkeley and set in a benign, appealing climate with mountains and ocean in close proximity to cosmopolitan cities, it attracted increasing numbers of bright people. With them came government contracts for firms engaged in such things as missiles and space research and development.
Few other American areas have such ingredients. Few begin to see high-tech firms develop around them in substantial numbers. Others include Rte. 128, Boston's beltway area in Massachusetts with Harvard and MIT in the background; the research triangle of North Carolina, boasting the universities of North Carolina and Duke; the region around Austin, Tex., with the booming and fabulously wealthy University of Texas.
And, as current experience indicates, even Silicon Valley is not immune from national and international economic currents. Sunnyvale finds itself dealing with kinds of problems it thought only less fortunate cities had to face. The reason is obvious: the recession.
"It's tight," says Mayor Ron Gonzales, first Hispanic elected to the city council and mayorship. He works as a professional for an electronics firm here. "Everybody is really tight right now. The recession has finally hit Silicon Valley," he said.
"I have a lot of contact with senior citizens," says Dianne McKenna, a city council member and wife of Regis McKenna. "They are aware that state and county governments have begun to cut back, and now we get them coming to us for services the city never had traditionally provided before. Two years ago, we had about 25,000 outside funding-source requests. Since then, that has gone up 300 percent, and I predict it will go up significantly this year."
For all of the new requests and all of the new concern, this area remains confident about itself and the American future. Silicon Valley believes in its dream and that of the country. City Manager Lewcock put it best:
"This valley, which this economy is dependent upon, can't lose in the long run. It's still going to be the product that this country, as well as the industrial marketplace, is going to grow on. We're going through a difficult time now, not as difficult as most places, but it's not as good as it used to be. But the industry itself certainly will bounce back."