I think you are underestimating University of Texas at Austin as a research powerhouse, particularly in engineering. It's not quite Berkeley or Stanford, but I

I think you are underestimating University of Texas at Austin as a research powerhouse, particularly in engineering. It's not quite Berkeley or Stanford, but I absolutely would put it on a part with anything just outside that very top tier (certainly equivalent to UCSD or USC, which are very influential research universities). That said, I do agree with the general thrust of your argument - California has a silly number of top research universities overall and in engineering (Berkeley, Stanford, UCSF, UCSD, USC, UCLA, Cal Tech... and many of the universities in CA I haven't mentioned would be considered a tremendous asset to any region trying to build a tech center). California does have a tremendous lead here.