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Once billed as the heart of Silicon Valley, San Jose has an unemployment rate of more than 13 percent. Santa Clara County over all has lost 50,000 jobs since August 2008. And while many economists think the region may have hit bottom, a recovery is going to take years.
When Congress approved the $787 billion federal stimulus package this year, Mr. Reed hoped it would help hard-pressed cities like his. But so far he has been underwhelmed.
In Washington last month, Mr. Reed delivered his message to White House economists and an audience at the Brookings Institution: the design and implementation of the stimulus package could not have been worse for Silicon Valley. The money it doles out in the short run has arrived in a trickle, too slow to do much. And for the long run, it does little to help generate permanent jobs.
“We have only received and spent six or seven million dollars,” Mr. Reed said in an interview last week. “You can’t expect a very big impact out of that.”
Nationally, the number of jobs created by the stimulus money has been the subject of considerable controversy. But there should not be much doubt in San Jose. The number is so small that it is barely worth arguing over, and city audits show what kind of jobs they have been.
Officially, the audits say, 250 full-time equivalent jobs have been created. But 240 of those positions reflect 900 part-time summer jobs that were created for area youths. Since those were summer jobs and winter is nearly here, the jobs are already gone. The other 10 full-time equivalent jobs were part of an airport project to improve the screening of checked baggage. The city has spent $3.3 million of its own money on that project and has yet to see a dime of the promised reimbursement.
Mr. Reed said he did not mean to play down the value of summer jobs for teenagers, who can learn basic job skills. “It’s not that it’s bad,” he said. “But that is not how you create long-term economic growth that is going to help the economy.”
Even if all $300 million of the stimulus money promised to Silicon Valley eventually arrives, it will amount to just one-tenth of one percent of the region’s $300 billion annual economic output, one of Mr. Reed’s advisers pointed out. It will hardly be noticed.
What would Mr. Reed have done if he were in charge? He is enamored with the potential of an obscure Department of Energy program that offers loan guarantees to companies producing renewable energy products. He said that 11 San Jose businesses were on the application list already and that he would like to see the review of those applications accelerated.
“The capital markets have not been helpful to our solar companies since the crash last year,” Mr. Reed said. “That’s why the loan guarantees are so important in getting them access to capital.”
One local company, NanoSolar, has a factory in San Jose where it manufactures solar cells that it says are the least expensive of their kind. Mr. Reed said the business already had orders that would keep the factory running at capacity for the next four years. The company’s founders would not discuss their expansion plans, but Mr. Reed said he had been told the company would build another factory in San Jose if it could get a loan guarantee.
Obama administration officials have said they share Mr. Reed’s desire to see jobs in the renewable energy industry at the heart of the stimulus effort. But they also say the country needs short-term measures to help the economy and provide immediate relief to the jobless.
Last month, the administration named a venture capitalist to run the Energy Department’s loan guarantee program, giving new hope to renewable energy advocates who have complained about the slow pace of the program’s approvals. And there are signs that the next round of federal economic aid will focus more on “green jobs.”
“I’m cautiously optimistic,” Mr. Reed said.
Given the record so far, his caution might be more in order than his optimism.
http://www.nytimes.com/2009/12/13/us...tics.html?_r=1