Stanford University economist Paul Romer’s observation that “a crisis is a terrible thing to waste” could be a rallying cry for past and present efforts to revive the economy and create jobs by bringing critical technology to Americans who need it.
In 1935 the crisis was the Great Depression and the critical technology was electricity. In 2009, the crisis is what’s being called “the Hurricane Katrina” of recessions and the technology is broadband Internet service.
Government response in 1935 was creation of the New Deal’s rural electrification program, a public/private partnership that raised the percentage of rural households with electricity from ten percent in 1930 to ninety percent by 1940. Today we have the $7.2 billion set aside in the economic stimulus bill to fund broadband deployment in unserved and underserved areas, and it’s critical we use it wisely.
Whether it’s in rural areas or big metro areas, the benefits of access to high-performance, affordable broadband to small businesses are often overlooked. Big businesses can count on multiple providers competing to offer them the best deal on broadband connections. Small businesses like mine don’t get that kind of built-in advantage, and yet small businesses have long been America’s prime engine of job growth.
That’s not about to change in the current economic climate, so the nation in general has a vested interest in seeing small businesses get the best broadband available. Broadband access is the potential great leveler. It gives small businesses access to the sophisticated online services and data bases that let us compete with much bigger companies, not just in the U.S. but overseas as well. Competitiveness like that creates profits and jobs.
Consensus is an elusive commodity among economists, but U.S. economists widely recognize the connection between broadband investment and job growth. Professor Raul Katz of the Columbia University Business School has estimated that the broadband expansion called for in the stimulus package would create 110,000 new jobs.
Hard as it might be to imagine, the broadband services we’re seeing today are just nibbling around the edges of what’s possible. Those millions of YouTube videos being posted 24/7 are fun, but the millions of new jobs that can be created as the United States moves to a broadband economy are far more important to our future.
Broadband can and should be the pathway for new and more efficient ways to do business, shop, get an education, find a job, access health care or maybe even vote. It is above all else an enabling technology. Broadband can enable the establishment of new businesses in rural areas and reverse the exodus of jobs and population from rural America. It can empower start-up companies in declining urban neighborhoods that once depended on manufacturing jobs now long gone.
Getting the full economic and social benefits of broadband depends on delivering broadband connections to every household and small business in America. The latest figures I’ve seen put household broadband penetration at 56 percent. One of the biggest obstacles to expanding that number is the cold hard reality that one-third of America’s rural households have no access to broadband service, whether they want it or not. Getting access to these unserved areas so that all Americans have the opportunity to be connected should be priority number one.
Funding the future by investing in broadband expansion now is one of the most productive investments America can make with taxpayer dollars. If it took an economic crisis to get that investment flowing, so be it. We can be secure in the knowledge that this is one crisis that won’t go to waste.