Still True: “Rural Broadband: No Job Creation Machine”

Saul-180In 2009, the NY Times reported, “A gathering of academics poured cold water on the idea that the new stimulus plan will create lots of jobs.” Saul Hansell’s sources were several of the most quoted economists in the field, including Scott Wallstein, who went on to be the chief economist of the Broadband Plan. (Saul, a friend, is probably the best mainstream reporter about the Internet in the last ten years. Dean Baquet should reach out to Saul and try to bring him back. John Markoff just retired; they need a few stars.) I wish broadband did wonders for jobs and the economy; the evidence says it doesn’t

In 2017, The Washington Post printed, “For every billion dollars in spending, 13,000 jobs lasting at least a year would be created,” based on some claims by Democratic Senators. They added, “Economists generally believe that improving infrastructure would increase productivity and economic activity.” The “13,000 jobs figure” is almost certainly rubbish; Shane Greenstein, now at Harvard, ripped into similar claims made at the beginning of the Broadband Stimulus. We all know about politicians and truth; the Post should have found at least one non-DC source before printing that. I’m sure if I looked I could find similar in the Times as well.

“Economists generally believe …” is offbase, at least in broadband.

The World Bank issued an important report last May that led with, “Digital dividends—that is, the broader development benefits from using these technologies—have lagged behind.” Greenstein and half a dozen of the best economists long ago looked and couldn’t find a large economic impact of broadband in the data. I expect there is an effect, but the best research finds it too small to measure. 

Every reporter at the Post and the Times knows the danger of using anonymous sources. In D.C. in particular, there’s so much propaganda you need to make an extra effort. I leave out names far more often than I like; many of my best sources would find their job in jeopardy if I named them. Nine-tenths of the true experts in telecom work for a company that doesn’t want them saying anything. At AT&T, a senior technical guy long ago told me even being seen talking to me “could be career-limiting.” That’s changed under current management.

A CTO of one of the largest equipment vendors trusted me enough to say, “Millimeter wave is an incumbent’s game.” His company does $billions every year with carriers who are denying 5G will give them a competitive advantage. (I have loads of confirming datapoints. Curt Kinojia of Starry disagrees; he thinks his millimeter wave equipment will be so cheap new companies will be able to jump in.)

On something important, the Columbia Journalism School teaches to have at least two sources. That’s very hard with today’s 24-hour news cycle and web competition. After 17 years covering broadband, I often know enough to be comfortable presenting my opinion without a need for “experts.” One very famous paper recently quoted me as an expert, always flattering. But the reporter checked the substance with an academic and the subject of the story, AT&T.

All governments lie.



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