New Study Shows Inefficient, Duplicative Nature of Government Broadband Loan Program

Digital Liberty ^ | 2011-07-07 | [Staff]

[92nina]

...Oddly enough, while the BIP funds were meant to serve these areas due to a lack of broadband services, the authors of the report found that 85% of households in the three regions already had access to one or more broadband providers. The study found that the cost of providing broadband to the few underserved or unserved households in the three regions totaled $349,234…per household.

The project in Montana, in particular, was especially useless and wasteful. Over 98% of the households in the Southwestern Montana region that received subsidized broadband funds already had access to broadband. If 3G wireless service is taken into account, only seven households in the Montana project area had no access to this service. Eisenach and Caves calculated that to serve the households that did not already have access to broadband services in this particular region, it cost $7 million per household. This is hardly a justifiable amount, especially considering that many of these households probably did not want access to broadband services in the first place.

With such a blatant misuse of taxpayer dollars, it would obviously be prudent for Congress to scrap funding for the RUS, right? While they did, indeed, attempt to do so in June, a last-minute amendment from Rep. Chris Gibson (R-NY) in the Agricultural Appropriations Act of 2012 (H.R. 2112) was passed and moved to reinstate the taxpayer-backed program with $6 million out of another administrative fund. The roll call vote on the Gibson Amendment can be found here.

As the debt ceiling talks continue, it remains a mystery as to why President Obama wants to keep tax increases on the table while so many useless and wasteful programs like the RUS can easily and painlessly be cut.

[92nina]

A new study, released by Jeffrey A. Eisenach and Kevin W. Caves of Navigant Economics, examines the subsidization of rural broadband services by the American Recovery and Reinvestment Act of 2009 (ARRA). As was suspected, this program has proven to be an extremely wasteful and inefficient use of tax dollars...

Take this article and others I found to the fight to the Libs on their own turf; put the Left on the defensive at at Digg and at Reddit and in Stumbleupon and Delicious

[556x45]

Have posted this before...I live in a very rural part of the country and for years and years theres been talk of internet in our area. To date large sums of $ have been spent and reports written but no service. Its not surprising since all the grants get sucked up in the studies. Frankly, I would be surprised if it comes until the area has been McMansioned into a ‘burb. Few of my neighbors own a computer or even care to, much less ‘surf’ the web. Those remaining couldn’t generate enough revenue to justify the infrastructure. So, I think we’re in for another decade or so of studying.

[92nina]

Thanks for the insight; (and hopefully a recent college graduate sees this thread and applies for one of those positions doing a study. Anyways...)

I wonder if SmartPhones render the need for rural broadband less vital. People living in an area that can move long distances don’t need a desktop with quick Internet, rather they need mobiles that surf the Web.

[556x45]

Sort of...thats what we use at the moment and its passable most of the time. Cell coverage isnt uniform either b/c of geography or lack of population. In other words some places are impossible to cover and others not profitable.