(LOL articles are satire, perhaps mixed with some truth.) The headline is SENATORS URGING PRESIDENT TRUMP TO EXPAND BROADBAND ACCESS. They claim a jumpstart in growth and jobs. They insist on affordability. All are great ideas but almost none of the money will have that effect. Very little of the $7B Broadband Stimulus actually expanded access; most of it was waste and telco giveaways. This will be the same. Honest economists know the economic impact of rural broadband is somewhere between modest and too small to measure. Most of the signers will continue to do close to nothing for affordability..
The headline should have been 48 Senators urge Trump to give away money to telcos. They urge, “President Trump to include broadband in any infrastructure initiative.” This will provide, “economic opportunities that will jumpstart growth in jobs and wages.” They demand, “Connections [that] are fast, reliable, and affordable.”
Affordable would mean either lower prices or a huge government subsidy. The Republicans certainly will not approve large subsidies, so this is a call for lower prices. That’s a good idea; U.S. prices are typically 30-75% higher than peers in Western Europe. Millions of France Telecom customers can get 100 megabit down, 100 megabit up, for 41.99 € / month ($46.) That’s available to ~7M homes today, with plans for 12 million in 2018, and 18 million by 2022. (60% of the country.) ADSL is usually about $35. Verizon Fios starts around $75 and Time Warner Cable about $60 (including modem.) The French offers also include unlimited phone calls and about 80 channels of TV. Hundreds of programs have tried to persuade people to buy broadband, spending a half billion dollars or more of public money. Not one has solid evidence they worked except those, like Comcast’s, that brought down the price. I can almost guarantee that broadband will cost more after Trump is done. Under Obama, prices went up 25% to 35% despite a campaign promise of affordability. Most of these Senators won’t even try to do anything meaningful. You can’t bring down the cost of broadband without reducing the income of the telcos and cablecos. They spend $100’s of millions every year and nearly no one is ready to take them on.
Economic opportunities are somewhere between very small and too little to measure, especially in small rural pockets. Claims of large economic improvements have been debunked for a decade by Harvard professors, the World Bank, the Chief Economist of the Broadband Plan, and even the guy who did the first big study for Verizon. “The economic impact on the early adopters was much higher than the remaining unserved. Two of those spoke at a Columbia-Georgetown event in DC back in 2009. Any economist not bought and paid for knows their work. The pr claims, “In fact, for every $5 billion invested in broadband infrastructure, 250,000 jobs are created and with every percentage point increase in new broadband distribution, employment expands by 300,000.” It’s based on obviously flawed studies, usually paid for by telcos who got the numbers they wanted, which were then misinterpreted. Most of the people who signed are intelligent and honorable; that they got it so wrong is evidence of just how effective the hundreds of millions of telco lobbying has been. The 2+2=5 gang continues to rule..
Broadband to more people. Not. Contrary to the lobbyist propaganda, 96-98% of Americans are able to connect, the great majority at 100 megabits or more. Spending large amounts of money on broadband “infrastructure” will not bring many more online. The 2% to 4% still unconnected are scattered is small pockets – sometimes just a house or two – that no one wants to serve even with a reasonable subsidy. Half are probably in Verizon and AT&T territory, who both have told Wall Street they want to dump all landlines and go wireless only in ~25%. Nearly none are in towns of even 500 houses, which might attract a new provider. (Any broadband provider under about 10,000 customers is seriously underscale.) No one except the local telco or cableco likely has the backhaul and facilities needed to serve them. This became obvious when the hundreds of proposals came in to the Broadband Stimulus. Only a few dozen at most were going to spend the money on reaching “unserved.” Most of the money was spent on “middle mile” backhaul fiber that overbuilt fiber already in place. The hope ws this would bring down backhaul costs so much new providers would come in. Six years later, it’s obvious nearly none of this worked.
This is standard lobbying best practice. Find something people want (voter applause for broadband.) Insist to get what you want (government money) is the best way to satisfy that want. Ignore or bury a discussion of how “b” yields “a” and hope no one ever asks. (Half or quarter truths are especially effective. So are things that could be true but probably aren’t)
We all know about politicians and truth.
CAPITO LEADS SENATORS IN URGING PRESIDENT TRUMP TO EXPAND BROADBAND ACCESS
WASHINGTON, D.C. – Today, U.S. Senator Shelley Moore Capito (R-W.Va.) led Senators Amy Klobuchar (D-Minn.), Angus King (I-Maine), Heidi Heitkamp (D-N.D.) and John Boozman (R-Ark.), the co-chairs of the Senate Broadband Caucus, and 43 other senators in a letter urging President Trump to include broadband in any infrastructure initiative. This follows the letter Senator Capito sent President-elect Trump on December 12 encouraging the new administration to prioritize broadband deployment.
“A broad agenda to promote broadband access will empower Americans living in every community – from urban city centers to rural towns – with economic opportunities that will jumpstart growth in jobs and wages,” the senators wrote. “That is why improving broadband access must be a priority in the 115th Congress and broadband must be part of any discussions regarding infrastructure investments to meet the demands of the 21st century economy. In addition, policies that reduce barriers to investment in communications infrastructure and streamline the deployment process will play a key role in expanding economic growth.”
In addition to the co-chairs of the Senate Broadband Caucus, the letter was also signed by Senators Deb Fischer (R-Neb.), Bob Casey (D-Pa.), Dan Sullivan (R-Alaska), Maria Cantwell (D-Wash.), John Barrasso (R-Wyo.), Tammy Baldwin (D-Wis.), John Cornyn (R-Texas), Al Franken (D-Minn.), John Hoeven (R-N.D.), Ron Wyden (D-Ore.), Susan Collins (R-Maine), Maggie Hassan (D-N.H.), Steve Daines (R-Mont.), Kirsten Gillibrand (D-N.Y.), Lisa Murkowski (R-Alaska), Chris Van Hollen (D-Md.), Bill Cassidy (R-La.), Michael Bennet (D-Colo.), Roy Blunt (R-Mo.), Cory Booker (D-N.J.), Cory Gardner (R-Colo.), Joe Donnelly (D-Ind.), Pat Roberts (R-Kan.), Edward Markey (D-Mass.), Mike Rounds (R-S.D.), Catherine Cortez Masto (D-Nev.), Jim Inhofe (R-Okla.), Mark Warner (D-Va.), Dean Heller (R-Nev.), Gary Peters (D-Mich.), Bernie Sanders (I-Vt.), Joe Manchin (D-W.Va.), Elizabeth Warren (D-Mass.), Richard Blumenthal (D-Conn.), Patty Murray (D-Wash.), Dick Durbin (D-Ill.), Patrick Leahy (D-Vt.), Debbie Stabenow (D-Mich.), Dianne Feinstein (D-Calif.), Tom Udall (D-N.M.), Martin Heinrich (D-N.M.), Tim Kaine (D-Va.), and Brian Schatz (D-Hawaii).
The House Broadband Caucus, co-chaired by Representatives Peter Welch (D-Vt.), Adam Kinzinger (R-Ill.), Mark Pocan (D-Wis.), Kevin Cramer (R-N.D.), Dave Loebsack (D-Iowa), and Bob Latta (R-Ohio), sent a similar letter to President Trump today.
The full text of the letter is below:
Dear Mr. President:
As you work with Congress to address the infrastructure needs of our country, we urge you to prioritize policies as part of any infrastructure initiative that will promote deployment of high-speed, reliable broadband for all Americans. Expanding access to broadband, both rural and urban, is the infrastructure challenge of our generation and we cannot afford to wait to make progress on this important goal.
The internet has changed the way businesses reach their customers and workers do their jobs. From large companies that employ thousands to small businesses on Main Street, broadband access is not a luxury, it is a necessity. The internet expands opportunities for commerce and strengthens our economy. A broad agenda to promote broadband access will empower Americans living in every community – from urban city centers to rural towns – with economic opportunities that will jumpstart growth in jobs and wages. In fact, for every $5 billion invested in broadband infrastructure, 250,000 jobs are created and with every percentage point increase in new broadband distribution, employment expands by 300,000.
These benefits can only be fully realized when connections are fast, reliable, and affordable. That is why improving broadband access must be a priority in the 115th Congress and broadband must be part of any discussions regarding infrastructure investments to meet the demands of the 21st century economy. In addition, policies that reduce barriers to investment in communications infrastructure and streamline the deployment process will play a key role in expanding economic growth.
In order to maintain the United States’ position as a global leader for innovation, we must invest to expand our broadband infrastructure. This effort should include bringing broadband connections to locations where economic conditions or geography have made deployment difficult and improving the quality and affordability of existing broadband connections.