Cautious optimism was the theme for the 2007 Milken Institute State of the State panelists. With its many entrepreneurial resources, the state is primed to explore new opportunities and seek innovation in everything from health care to clean-tech, but national trends may have a significant impact on the outcomes.
Some 500 decision-makers from business, finance, academia and government gathered at the Beverly Hilton to discuss formidable challenges facing California, as well as what can and is being done to secure the state's future prosperity.
The conference looked at several of the most pressing issues facing California, many of which show up daily in the headlines: how to pay for health-care reforms, subprime impacts, privatizing California state assets, the future of clean-tech in the state.
Among the highlights:
- Expanding health-care coverage cannot be pursued without a commitment to contain costs. While the present cost-containment ideas are small in scope – controlling obesity, electronic medical records, information to consumers – they must be aggressively pursued to sustain coverage expansion.
The most intractable piece of how to address the subprime fallout is not in figuring out ways to refinance loans or how to change the way loans are marketed or sold, it is the fact that recent homebuyers now owe more money than their property is worth.
- While California has much to offer in content and ideas to investors, particularly in private equity and venture capital, the state's dependency on ever-increasing tax revenues is driving away both large businesses and entrepreneurs.
- Private-public partnerships, through various privatization models, are a viable option to help solve the growing project financing problems of state and local governments.
- California leads the way in energy efficiency. If the rest of the nation followed California's advances in efficiency, the U.S. would already meet the Kyoto protocol levels.
Scott McNealy, the chairman and co-founder of Sun Microsystems, gave the keynote address at lunch. Drawing on the abundance of human capital and innovation available in California, he spoke of how his vision to bring open-source computing - free access to software and source codes - to the world is now the basis of his vision to accomplish a revolution in education.
The conference also marked the official launch of the Milken Institute California Center, a dedicated resource within the Milken Institute to focus on the state's unique needs and opportunities for long-term prosperity.
The California Center will house many of the Milken Institute's existing California-focused efforts, such as the annual State of the State Conference, and it encapsulates the work that has been done in the region.