Sunday, February 28, 2010

Opposing Views: Is Government Spending on Broadband a Waste?

The essential fallacy in the broadband debate is the conclusion that, because Americans would benefit from more broadband, we should spend public funds on broadband. But that simply doesn’t follow. Broadband costs money, and if we want it to be more widely available then we’ll have to settle for less of something else. To justify accelerating consumption, we need to show not only that more broadband would be a good thing, but that it would be better than anything else we could have spent that money on. That’s exactly what underconsumption means, and it’s extremely difficult to prove.


Actually, there is one guaranteed way to find out whether America is underconsuming broadband while benefiting consumers at the same time: Give back the money. Instead of spending billions more on infrastructure, tax billions less. If the taxpayers spent the difference on more broadband, then they were underconsuming. If they didn’t, they weren’t.

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