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Rural broadband stimulus: It's not about the jobs

An estimated $7.2 billion is on the table for a broadband stimulus plan, and economists are out in force debating whether it will create jobs or make no difference. Without a guaranteed rate-of-return for service providers to build out in rural and underserved areas, how else will it ever get done?

Shoot! All this talk of a rural broadband stimulus creating jobs has everybody in the Back 40 in such an uproar that they're taking the grass stalks out of their teeth to jaw about it, so I might as well join 'em. Just hang on a sec while I spit my tobacco juice on the ground.

Former FCC economist Michael Katz let loose at a recent American Enterprise Institute panel discussion about the broadband stimulus piece of President Obama's stimulus bill. Specifically, this is the $7.2 billion earmarked to expand broadband Internet access in rural and underserved areas. To be brief, Katz is against it and believes the money could better be used elsewhere.

According to the New York Times, most of the economists at the meeting said that broadband-stimulus based job creation in rural areas would be very difficult to quantify.

Will a rural broadband stimulus package create more jobs? I surely do not know. Maybe in the short term. But there's a bigger issue at stake. I don't see it being only about jobs. We all know that "underserved" areas are locations where service providers don't think they'll be able to make enough money now that there's no more guaranteed rate of return, as there was when the telephone company was a monopoly.

So why extend broadband there? And when we say "underserved," we all know it's a synonym for "inner city." In rural areas, there are big, expensive expanses of land to cover, and there aren't as many people living there. But so what?

Service providers are spending a lot of money deploying broadband in the U.S., even in this economy, but not necessarily in rural and underserved areas. What I find interesting about a good deal of the "should rural areas have broadband" debate is that it becomes an "us vs. them" argument.

The U.S. may not be a predominantly agrarian country anymore, in case anybody missed history that day, but that doesn't mean exurbanites should be left out of the broadband equation. Broadband can bring with it distance learning and healthcare capabilities, not to mention business revitalization. Rural life is different, but it's not from another planet. And a lot of rural people found telephones, electricity and roads very useful, too.

AEI's Robert Hahn, executive director of regulated markets, said 55% of U.S. households already have broadband lines, and most of the other 45% have at least some access to high-speed Internet. The key phrase is "some access." Try doing a day's work when you have "at least some access to high-speed Internet." From his statement, I assume he'd be happy to wait in line at the public library to use a monitor and not overstay his welcome. Hahn even added that 10% of these people don't even realize they have some access to high-speed Internet. That alone must tell us something about how un-broadband-savvy these people are.

Broadband has become a must-have, and if I'm not mistaken, it has been referred to as the information "superhighway" for years. Superhighways shouldn't start and stop. Let's not create a have and have-not thing. If the only way to build it out is through a stimulus package, I'm calling it money well spent.

I'd stay and talk longer, but I have some fences to mend, and if those cattle trample my fiber-optic cable again, I'm driving my tractor to Washington.


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This was last published in February 2009

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