The Harris Broadband Rollout Has Been a Fiasco- Wall Street Journal Editorial Board

Three years after the $42.5 billion subsidy passed, not a single project is underway. Here’s why.

The Editorial Board Oct. 4, 2024 at 6:12 pm

Vice President Kamala Harris speaks during a high-speed internet infrastructure announcement, Washington, June 26, 2023. PHOTO: ROD LAMKEY/ZUMA PRESS

Government makes many promises, the Biden Administration more than most. Results are another story. For the latest example of the latter, consider the “internet for all” plan that President Biden tapped Kamala Harris to lead. Fiasco is the word for it.

The 2021 infrastructure law included $42.5 billion for states to expand broadband to “unserved,” mostly rural, communities. Three years later, ground hasn’t been broken on a single project. The Administration recently said construction won’t start until next year at the earliest, meaning many projects won’t be up and running until the end of the decade.

Blame the Administration’s political regulations. States must submit plans to the Commerce Department about how they’ll use the funds and their bidding process for providers. Commerce has piled on mandates that are nowhere in the law and has rejected state plans that don’t advance progressive goals.

Take how the Administration is forcing providers to subsidize service for low-income customers. Commerce required that Virginia revise its plan so bidders had to offer a specified “affordable” price. This is rate regulation.

Brent Christensen of the Minnesota Telecom Alliance recently reported that none of his trade group’s 70 or so members plan to bid for federal grants because of the rate rules and other burdens. “To put those obligations on small rural providers is a hell of a roadblock,” he said. “Most of our members are small and can’t afford to offer a low-cost option.”

Commerce hoped to spread the cash to small rural cooperatives, but the main beneficiaries will be large providers that can better manage the regulatory burden. Bigger businesses always win from bigger government.

Commerce is all but refusing to fund anything other than fiber broadband, though satellite services like SpaceX’s Starlink and wireless carriers can expand coverage at lower cost. A Starlink terminal costs about $600 per home. Extending 5G to rural communities costs a couple thousand dollars per connection. Building out fiber runs into the tens of thousands.

Fiber networks will require more permits, which delay construction. But fiber will require more union labor to build. Commerce wants grant recipients to pay union-scale wages and not oppose union organizing.

The Administration has also stipulated hiring preferences for “underrepresented” groups, including “aging individuals,” prisoners, racial, religious and ethnic minorities, “Indigenous and Native American persons,” “LGBTQI+ persons,” and “persons otherwise adversely affected by persistent poverty or inequality.”

Good luck trying to find “underrepresented” hard-hats in Montana. An official overseeing Montana’s program told Congress last month that the Administration has given “conflicting or even new and changed guidance after submitting our plans” and is “slowing states down and second-guessing good-faith efforts.”

The official added that “we have yet to receive clarity on permitting, a foundational component of broadband deployment.” The government system that states are required to use for federal permits, she noted, “will not be available for another 6 to 8 months to evaluate each project’s environmental and historic preservation effects.”

Then there’s this Catch-22. The Biden National Environmental Policy Act guidance requires companies that receive federal funds to consider alternative plans with smaller environmental impact. But the program’s rules disfavor such alternatives as satellites and home 5G.

States must also identify future climate risks and “how the proposed plan will avoid and/or mitigate” them. Broadband providers already safeguard their systems against natural disasters in part with redundant networks, so the extraneous mandates will merely make building more expensive.

Cox Communications last week sued Rhode Island over the state’s plan to “build taxpayer-subsidized and duplicative high-speed broadband internet in affluent areas of Rhode Island like the Breakers Mansion in Newport and affluent areas of Westerly,” where Taylor Swift owns a $17 million vacation home. Cox says there are better ways to spend taxpayer dollars. According to the Federal Communications Commission, 99.97% of U.S. households already have access to high-speed internet.

The broadband non-rollout is a classic of modern progressive government. Authorize money for a cause that private industry could do better, but then botch the execution with identity politics and union favoritism. Ms. Harris is promising four more years of the same.