One of the marquee items in President Obama's economic stimulus proposal is a plan to bring broadband Internet access to places that don't have it. It comes up in almost every speech supporting the package.
In a speech Monday in Elkhart, Ind., for example, Obama called for "building new high-speed broadband lines, reaching schools and small businesses in rural Indiana so they can connect and compete with their counterparts in any city in any country in the world."
The House and Senate currently differ on how many billions should be spent on broadband, but there's a broad assumption that it's a worthy project.
Internet Traffic Jam
When school lets out in the tiny town of Republic, Wash., there's a traffic jam — not on the roads, but on the Internet. Resident Betty Buckley says that if you're at your computer, you notice when the kids get home.
"Homework, Facebook, gaming — who knows what the kids are doing," Buckley says. "But, boy, you can tell it the way it slows down."
Buckley helps run a Web site called Shop the Frontier, and the staff has learned to get its uploading done before the end of the school day. She says pokey Internet speeds can threaten a town's survival.
"If you don't have some way of transporting your product or pictures of your product, or ways of selling your product, the whole community just dries up and blows away eventually," Buckley says.
Debate On Economic Impact
But is laying more broadband lines to small towns such as Republic really a good way to stimulate the ailing economy? The idea certainly has its cheerleaders. Rob Atkinson, the head of the Information Technology and Innovation Foundation in Washington, D.C., says subsidizing broadband will be even more stimulating than securing new money for roads and bridges.
"It turns out when people get broadband, they are more likely to buy a new computer. They are more likely to buy a video camera or maybe upgrade to a digital camera," Atkinson says. "So you have this additional spending that consumers will do, which will spur economic activity and get us back on recovery faster."
Atkinson points to studies suggesting that towns with broadband grow faster than similar towns without. But it's hard to say if broadband contributes to growth or just correlates with it.
John Horrigan of the Pew Internet and American Life Project says there is no reliable national map of where broadband is available. The telecom companies, he says, guard that kind of information closely.
"The lack of data makes it then difficult for economists to undertake the analysis to see whether there's a link between broadband deployment and use, and jobs," Horrigan says.
It also may be a leap to assume that "if you build it, they will come." According to a Pew survey, only 14 percent of Americans still using dial-up Internet say it's because they can't get broadband where they live. Other factors are more important, such as the price of broadband and the fact that some people just don't want it.
Government's Role Questioned
"Let the wire go where the demand is," says Jim Harper, the technology expert at the Cato Institute.
Harper says the government shouldn't be pushing broadband into areas that aren't willing or able to pay for it. In the case of sparsely populated rural areas, he says, the government subsidies might actually get in the way of innovation.
"The best thing that could happen in broadband is for there to be additional sources of broadband," Harper says. "Right now, we have cable and DSL as the two big ones. We need some wireless; we need some other platforms.
"But those companies are very small — they don't exist yet, in Washington terms — so they aren't going to receive those subsidies," he says.
Proponents of this policy say broadband should follow the model of traditional phone service, which has long been subsidized both for rural customers and for poor people in the cities. As broadband becomes a necessity, they say, the government should make sure everybody can have it.