Gary Gorshing

Moderator

English

Research Papers in Economics

Gary Gorshing: In keeping with the format of this
morning, we will accept questions for Pike. 
Jack Geller, Center for Rural Policy and Development,
Minnesota:As Austin grew from a sleepy college town
to a tech center, talk a little bit about whether or not
it lifted all boats in the community or created graded
disparities within various cohorts in the community?  
Pike Powers: That is a very good question. It did
create a disparity, not only on the educational attain-
ment level but also on the occupational income levels.
It exacerbated some pre-existing conditions or situa-
tions. It made it difficult for us to address some of the
social concerns or changes. As a consequence, the
business community had to pitch in and work harder
to try to live through some of those issues. It became
acute in the 1990s, which was a time of great pros-
perity in our community. A number of companies
locally grown and developed took initial public offer-
ings (IPOs), and people became outrageously wealthy
overnight. The newspaper, of course, would publicize
those stories on the front page with pictures showing 
celebrations and bottles of champagne. The gap
became wider.  
With the dot.com crash beginning March 2000,
people got back on a more reasonable communica-
tions keel. The humbling of the technology
community actually made possible more serious social
consequences discussions. You are absolutely right,
Jack. We don’t have a perfect answer to it. I don’t think
there is one. There was a great disparity, and it drove
some wedges that weren’t there before in the 
community to have some people doing well and other
people not catching up at all. That is the ugly 
underside of the technology success story. This is no
surprise to anyone in this room, I suspect.  
Andrew Skadberg, Texas A&M University: I am
actually at an advantage because I lived in Austin for
five years. In looking at the opportunity that you were
part of in Austin, do you think Austin was in a unique
situation? I know Austin is a great town. It has a lot
of natural resources. It is at the center of things. In
comparison with other places that might be more
challenged, did you have to, as part of your initiative,
try to draw that story of Austin out or do you think
people knew it was a great place?
Mr. Powers: Certainly, all of us who have been
involved more than 25 years would be reluctant to say
it was our efforts that did it. It is a wonderful place, as
you know, Andy.  It has a magical feeling of quality of
life. People love being there. It is the city of choice for 
Texans when they can get away from wherever they
are living because of job opportunities.  
On the other hand, we faced some big challenges in
terms of persuading some members of the 
environmental community that the technology scene
was the way to go.  We had others who were skepti-
cal and antagonistic about incentive packages. They
were asking how we could pay so much for so little
and saying that the project really would not make a
long-term difference. All of the traditional economic
development struggles did go on. What was positive
and a real learning experience for us over the last 25
Building the Austin Technology Cluster: The Role
of Government—Discussion
Moderator: Gary Gorshing
73years was that when the chips really got down 
everyone rallied to the cause. Everybody basically said,
through unanimous votes of the city council, county
commissioners court, and state legislative delegations:
“This is bigger than we are.”  
The real lesson in all of this is—if presented prop-
erly and there is the right buy-in from all segments
of the community—is that it can be an enormous
community builder, in addition to being an 
economic builder. That is what happened for us. I
give the people of the city—the human capital—and
the university great credit for that. You are right. We
had a head start on a lot of other communities, given
our natural beauty, natural assets, and the 
university. Still, we had some tough days in the 
middle of that along the way.  
I am very fond of Texas A&M. Had it not been
for the A&M engineering school in 1983 and
Microelectronics and Computer Technology 
Consortium (MCC), who came and made pitches
and presentations, we would not have gotten there
a number of times on various projects. 
We have recently repeated all that one more time
and have a new project in place called the Texas
Technology Initiative, which emphasizes advanced
technology platforms. Austin continues to grow,
change, expand, and be competitive.  
Mr. Gorshing:Thank you, Pike. 
Mr. Powers:Thank you. 
74 Moderator: Gary Gorshing

Building the Austin technology cluster : the role of government and community collaboration in the ‘human capital’ : discussion

http://www.kansascityfed.org/PUBLICAT/NewGovernance04/QA3.pdf

Building the Austin technology cluster : the role of government and community collaboration in the ‘human capital’ : discussion

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