Politics & Perspective
To Strengthen our Infrastructure, Invest in Rural Broadband by DOUG BRAKE As Wilber Ross and Peter Navarro wrote in the Trump Most involve a mix. While it is not possible to say a priori campaign white paper, “[t]oday, much of America’s which functions are best served by public or private actors infrastructure is crumbling. Much more needs to be built for all infrastructure projects, everything else being equal, anew.” The American Society of Civil Engineers agrees — private-sector ownership and operation brings several the organization’s recent Infrastructure Report Card gave advantages, most notably a greater incentive for efficiency, U.S. infrastructure a grade of D+. innovation, and investment. But if new infrastructure spending is to be effective in Public ownership or operation of infrastructure makes growing the economy long term, and not just a Keynesian the most sense for true public goods: resources that are sugar high, it must move beyond both non-excludable (meaning simple concrete and rebar. Any it’s difficult to prevent access to infrastructure package should focus those who have not paid) and nonon smart infrastructure that integrates rivalrous (meaning consumption by both physical and digital aspects, one doesn’t prevent simultaneous and at least some support should go use by another). It is often difficult to pure digital infrastructure. Smart to price public goods based on use, infrastructure and robust broadband so there is little to no incentive for networks can deliver the next wave the private sector to provide these of innovation and economic growth. services, justifying government Some see infrastructure intervention. Broadband does not as having little capacity for fall into this category. innovation. Roads and bridges But there are other circumstances spring to mind, which have changed where the government should little over the years. While there intervene, if not through outright may be innovations in physical operation, at least in financing. One infrastructures, today’s biggest such circumstance is where the opportunities for improvement are overall benefits are great, but it is Doug Brake in embedding digital technologies impossible to turn a profit because in physical infrastructure. Sensors, costs are too high or hard to recoup. smart meters, and remote-control In addition to This is extremely relevant in the rural technology can dramatically improve connecting infrastructure, broadband context, where the coststhe efficiency and performance of per-home passed are much higher broadband use is an everything from sewage pipes and than in more-densely populated waterways to railroads and highways. urban areas, and revenues from engine of economic Upgrading our nation’s dated customers simply are not enough to growth in and physical systems and augmenting recover the initial investment. them with information technology of itself. Broadband sees significant presents a true opportunity, but network externalities, where the all those sensors and meters must benefits of bringing more users onto be connected. An infrastructure package should look to broadband networks benefits the broader economy and expand broadband performance in rural areas. In addition society, not just individual users. That does not mean that to connecting infrastructure, broadband use is an engine of every potential user should obtain subsidized broadband. economic growth in and of itself. In many cases, such as very remote households, the One of the core questions regarding any infrastructure combined private and public benefits of connectivity do project is the appropriate mix of public and private not necessarily exceed the very high costs of connection. involvement. Some projects are designed, built, managed, But the benefits of being able to organize our society under and financed by government, others by the private sector. the assumption that all have access to the Internet (online RIPON FORUM April 2017
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