NEW YORK (CNN/Money) -
"Politics," essayist P.J. O'Rourke once wrote, "are a last resort." Now the technology sector, after having weathered disappointing quarter after quarter, is in dire need of something -- anything -- to get it back on its feet. In last week's election, it might have found a savior.
While the political leanings of many digerati fall somewhere between radical libertarianism and extreme ambivalence, the CEOs who run technology companies and the organizations that represent them in Washington are eager for the new Congress to get under way.
It's easy to see why: According to a CNET (CNET: down $0.04 to $1.66, Research, Estimates) News.com analysis, Senate Republicans voted in accordance with the tech industry's views 84 percent of the time, compared with 65 percent for Senate Democrats. House Democrats went along with tech 43 percent of the time, while 89 percent of House GOP votes sided with tech.
"The prospects for the next two years are even better than for the previous two," says Ralph Hellmann, senior vice president for government relations at the Information Technology Industry Council (ITI), a Washington-based organization that represents 28 companies, including Apple Computer (AAPL: up $0.66 to $15.82, Research, Estimates), Cisco Systems (CSCO: up $0.92 to $13.08, Research, Estimates), Dell (DELL: up $0.53 to $29.64, Research, Estimates), IBM (IBM: up $1.98 to $79.27, Research, Estimates), Microsoft (MSFT: up $1.11 to $54.97, Research, Estimates), and Sun Microsystems (SUNW: up $0.17 to $3.34, Research, Estimates).
Connie Correll, executive vice president at the lobbying organization TechNet, says the technology industry generally views Republicans as "more free trade, less taxes, less regulation." Yet apart from that, some specific tech-related initiatives now stand a greater chance of securing passage than they have in the past two years.
Possibly the most important piece of legislation for revitalizing the technology industry is a proposal made last year by Rep. Jerry Weller, R-Ill. Weller's original proposal, the Expensing Technology Reform Act of 2001, called for accelerating the rate of depreciation for business technology products to one year from five. The argument goes like this: If businesses can write off tech purchases sooner, they'll be more likely to reinvest at a rate more in line with industry product cycles.
A watered-down version of Weller's bill (in which 30 percent of IT investment could be written off in the first year) was included in President Bush's 2002 economic stimulus plan. Now, with Weller on the GOP-led ways and means committee, "he's in a prime position to work on it again," says a Weller spokesperson. "He still thinks the economy needs a jump-start, especially the technology sector."
ITI's Hellmann says revisiting the Weller proposal is "one of our top priorities."
The technology industry also hopes to drive a stake through the heart of a controversial, Democrat-led copyright protection bill. The Consumer Broadband and Digital Television Act, sponsored by Ernest "Fritz" Hollings, D-S.C., would have required tech companies to incorporate special antipiracy technologies into consumer electronic devices.
"Hollings was facing an uphill battle with that act," notes Hellmann. "Now it's a battle against Sen. Trent Lott, R-Miss.; Sen. Tom DeLay, R-Texas; and Rep. Dennis Hastert, R-Ill. -- all of whom take a dim view of Hollywood's political agenda."
Not all tech execs are as sanguine about the prospects for a GOP-led Congress. Steve Kirsch, CEO of Net software firm Propel, based in San Jose, was the leading political donor from the entire technology sector, contributing to the Democratic Party, according to the Center for Responsive Politics.
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"I haven't seen anything from the Republicans that's going to make a difference in my business or in the business of people I know about," Kirsch says. "The Democrats are very business-friendly, but in a responsible way. That's the big difference."
Other legislative efforts the technology industry hopes to see enacted include broadband deployment tax incentives, permanent research and development tax credits, and an industry-friendly wireless spectrum policy.
Hellmann says he's looking forward to making progress quickly when the 108th Congress convenes in January. "The Democrats were good, but it took a while," he says, echoing the frustration of an industry that needs help. "We need swift passage and enactment."
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