Eric Schmidt has pulled himself out of the running for the first U.S. CTO At least that is what he told Mad Money’s Jim Cramer. While I’m not sure he was ever on the list, Schmidt did the right thing in taking himself out of the running. In fact I think the other contenders including Vint Cerf (see Ed Cone’s interview with Vint), Steve Ballmer and Jeff Bezos should also back off. They should not back off because they are poor candidates, but because the first CTO should really be a CIO. Here’s why.

Let’s just assume that a really good CIO puts business first and technology second. You look at business goals and then figure out how to accomplish or accelerate those goals using technology. That is not true with technologists that create or embrace a new technology and then wait for the business world to catch up with the possibilities. Technologists are great at creating new companies, new products and new markets. They are not great at orchestrating lots of conflicting opinions, managing projects or – especially in the political realm – settling on the best possible choice given budget constraints and political realities.

How many cybersecurity czars have we gone through since 9/11? I count at least three (Amit Yoran, Howard Schmidt, Greg Garcia and I’m sure there have been more) along with long gaps between selections. I think what happened was in the panic to develop national security there was an unwillingness to admit that a national security plan could take years and years to develop as competing agencies, privacy concerns and security processes needed to be considered. A national CTO could face the same difficulties.

Ok, so we exclude the vendor executives and concentrate on CIOs who show they know how to get things done. What does the short list now look like? And in the spirit of nonpartisanship, we won’t even take into account if they are Republicans or Democrats.

You could pick a business which has done a lot of work with the government, that is big, that is vital to the U.S. interests and is adept at working its way through the government bureaucracy. Someone who puts the attributes of trust and ethics ahead of all other qualities of character. Well, there goes all the social networking companies and a lot of Wall Street firms.

If you have a chance click over to the Navy’s CIO blog. Here is an organization with 750,000 members doing a vital job. The lead blog item recently was on trust. I’m not necessarily saying that Navy CIO Robert Carey should be the one sitting at the big table. I know him only from his blog and news reports. I’m saying the CTO position should be a CIO position held by someone who knows how to meet a customer’s strategic needs rather than a vendor trying to sell a product.