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For Immediate Release Daytime contact: Alexa Moutevelis 202-467-5318
April 24, 2007 After hours contact: Tom Finnigan 202-253-3852
CAGW Tells Congress to Keep Their Hands off the Internet
Washington, D.C. - Citizens Against Government Waste (CAGW) today urged Congress to say no to a national broadband policy and government intrusion of the Internet. After the release of a world-wide broadband usage report, Senate and House Committees held hearings today to examine the need for further government involvement in broadband service in light of other countries’ policies.
“The Internet has thrived in America precisely because it has been free from government interference. The implementation of burdensome regulations, wasteful subsidies, and complicated tax breaks that other countries are imposing will only stifle growth and innovation,” said CAGW President Tom Schatz. “Competition and the free market must be allowed to continue to work.”
The Organization for Economic Co-Operation & Development (OECD) Broadband Statistics to December 2006 report was released on April 23. While finding that the U.S. has the most total broadband subscribers of the 30 studied countries, it ranked the United States 15th in broadband-deployment penetration. The survey does not disclose how it obtained its numbers and does not take into account population density or supply and demand.
The Rural Utilities Service (RUS) is an example of an ineffective government program charged with increasing broadband access. Besides the more than $30 million in broadband loans that have gone into default, the program has lost its focus on serving rural America. The RUS has been subsidizing private companies to provide broadband in suburban neighborhoods that would have received service anyway. Instead of allowing the free market to work, efficient private sector forces are crowded out by government subsidies.
According to a September 2005 audit by the USDA Inspector General (IG), “RUS has not exclusively served those rural communities most requiring Federal assistance to obtain access to broadband technologies. Because RUS’ definition of ‘rural area’ is too broad to distinguish usefully between suburban and rural communities, the agency has issued over $103.4 million in grants and loans (nearly 12 percent of $895 million in total program funds) to communities near metropolitan areas.” The IG report noted “one of the more highly publicized cases, [where] RUS issued loans to a company providing broadband access to affluent suburban communities a few miles outside of Houston, Texas.”
“Instead of increasing government control, Congress should remove barriers to the further flourishing of Internet usage and access by rejecting net neutrality, continuing the Internet tax ban, and protecting intellectual property,” concluded Schatz.
Citizens Against Government Waste is a nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.
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