"Handouts" is an excessively and inaccurately pejorative way of describing all that.

The military was buying real stuff, e.g. RADARs, that had real, measurable characteristics (can you detect a plane at this distance).

And it was used in real life:

In the mid-late '50s my father was the First Lieutenant on the USS Searcher (http://en.wikipedia.org/wiki/USS_Searcher_%28AGR-4%29), a radar picket ship stationed in the North Atlantic. While based in Newport, Rhode Island, she would occasionally stop in Boston for installation of a new RADAR system, most likely the product of Route 128 and/or Silicon Valley.

She would then steam out for a few days to shake it down, drop back to Boston to drop off the civilian technicians and return to station.

I was responding to the last paragraph of the blog post:

    We don’t want handouts. We don’t want "public-private
    partnerships," and we sure as hell don’t want legislation.

Those three things helped build the Valley.

And I firmly disagree with your characterization of customer-vendor relationships as being any of the above three.

With the single exception of the post-WWII government supported basic and applied research model. This would sometimes produce the basis for new toys the military then bought, but it's most certainly not the sense in which "public-private partnerships" is used today.

Again, the government was buying "stuff", abstract stuff, I grant you, but we're not talking about e.g. "investing" half a billion dollars in a solar cell factory who's production will only find a market due to hefty government tax breaks.

The poster you're responding to is correct. Michael Arrington uses heavy rhetoric, so we should probably translate "handouts" to mean expensive economic intervention which benefits an industry. Silicon Valley's fundamental innovations were driven by government research and intervention, through the military.

http://www.nytimes.com/2005/04/02/technology/02darpa.html?_r...

Arrington actually argues in favor of heavy government intervention: high speed trains, subsidized computers for children, etc. Just not the kind which might conceivably worry Silicon Valley investors.

I agree with some of the article's stances -- like on net neutrality and probably copyright.

No he doesn't, he's saying "if the government wants to spend money on innovation" then do it in leveraging infrastructure. He makes it clear that this is a "first do no harm" sort of thing in the closing "Heck, put a woman on the moon. I don’t know if that last one will do much, but at least they’ll be busy not screwing up Silicon Valley while they’re at it."

Governments like to spend money, he's suggesting what he sees as the least harmful ways to do that, not suggesting, at least in this post, that they do it in the first place.

(While he's not making it here, there's a strong argument to not do "unnecessary" government spending since it crowds out what the market would choose. Every dollar borrowed to build high speed trains is a dollar plus overhead not available to fund a startup.)

The military played a huge part in the growth of the Valley. Here's Steve Blank's presentation: The Secret History of Silicon Valley. http://www.youtube.com/watch?v=ZTC_RxWN_xo

That was a part of it to be sure, but I wouldn't say it was entirely "built" by defense spending alone:

http://en.wikipedia.org/wiki/Silicon_valley#History

Political and economic conditions are also vastly different now than they were in the 1950s, so it's apples and oranges to compare today's U.S. government to that of Eisenhower's time.

It certainly wasn't built on defense spending alone. But after a phrase like "I’ve always believed that government tends to screw up whatever it touches", he comes across as a bit silly.

It's quite arguable that government (i.e. the US Federal one) has gotten a lot less competent as of late, compared to the post-WWII through the '50s period. He's only 40, the government he's directly experienced is much later than the Silicon Valley seeding period we're talking about.

There are a whole lot of things you could (and people do) argue. Doing so is probably best left to other sites, but I guess I just don't like those sorts of statements. The government screws some things up, just like it gets some things right. Same goes for people and companies.

The author doesn't seem particularly opposed to handouts:

If the government wants to help innovation in this country they should get busy with infrastructure. Lay fiber to every home and business in the U.S. Actually start building some of these high speed train networks to make travel easier. Get computers into the hands of every child in the country as soon as they are physically able to press buttons.

The article mainly seems to be asking for better regulation/handouts, not none. Except for the last paragraph.

The entire federal budget was about 500 billion in 1960, inflation adjusted. The current federal budget is nearly 3 trillion. Yet today, we seem to be spending less money building infrastructure investments that create economic booms and more money to pay people to sit around. Perhaps he's arguing that we should be spending less on entitlement programs (handouts) and more on infrastructure investments like high-speed internet.

See my response to politicalist; at least in this posting, he's not, which is particularly clear if you continue the above quote.