A Comment on South Bend’s Municipal Broadband Effort

Published February 2, 2005

Dear Editor:

The debate taking place in South Bend over municipal involvement in a broadband communications system [Martin DeAgostino, “Bill may derail city’s plan for broadband system,” January 24] is very similar to one that took place recently in the Tri-Cities area in Illinois.

Voters in the Tri-Cities (Geneva, Batavia, and St. Charles, west of Chicago) have twice voted down referenda to build a municipal broadband system. Voters rejected the plan despite hearing many of the same concerns being expressed in South Bend about access to affordable broadband, and despite assurances that taxpayers would not be left holding the bag if the venture failed.

Voters are right to be skeptical of these plans. If fiber optic networks are such a good idea, why do they need public subsidies? How many people want or are willing to pay for more bandwidth than what is now available from satellite, terrestrial wireless, cable, and telephone companies?

Voters should not be asked to pay for a gold-plated system used by only a small number of companies and individuals who can afford to pay market prices but choose not to.

As Gov. Mitch Daniels was quoted as saying in DeAgostino’s article, “we do have to be careful when governments go into the business of competing with the private sector. In the first place, they generally don’t do a very good job of it; and secondly, it’s hardly a way to grow our economy to have any agency of government subsidize competition for business on the backs of taxpayers.”

Joseph L. Bast
President, The Heartland Institute
Chicago, Illinois

Joseph L. Bast ([email protected] )is the president of The Heartland Institute, a national public policy think tank based in Chicago. He is the author of two policy studies on municipal broadband, which can be found online at: http://www.heartland.org.