In his 2024 re-election bid, President Biden will undoubtedly tout his push for infrastructure improvements as an accomplishment of his first term (taxpayer money waste notwithstanding).
But the Democratic-led push for net neutrality at the Federal Communications Commission could undermine those supposed gains by stymieing investment in broadband.
A large part of the post-COVID infrastructure funding push in Congress is the expansion of broadband to close the digital divide once and for all. While FCC reports indicate that only a few percent of Americans still lack access to high-speed internet, most are in hard-to-reach and expensive-to-service locations. And 5G wireless services are also helping close the gap, with an estimated 93 percent of Americans accessing this fifth-generation technology with broadband-capable speeds.
The narrowing gap between the haves and have-nots regarding terms of internet access is largely because of record spending by broadband providers. USTelecom — The Internet Association reported that 2021 saw a 20-year high of $86 billion for capital expenditures into the nation’s communications infrastructure.
But the administration seems intent on making the same mistakes as the Barack Obama administration in seeking to reimplement Title II regulations on internet providers. The Phoenix Center for Advanced Legal and Economic Public Policy Studies found that investment into broadband infrastructure dropped by 20 percent to 30 percent between 2011 and 2015. This is when Obama took office and then FCC Chairman Julius Genachowski began discussing the Title II reclassification under the Communications Act of 1934.
The FCC implemented the reclassification through the Open Internet Order in 2015 under then-Chairman Tom Wheeler before reversing that decision in 2017 during the Donald Trump administration via the Restoring Internet Freedom Order under then-Chairman Ajit Pai. Phoenix Center analyst George Ford found that telecommunications investment was 25 percent below expectation in 2017, with the stricter regulation clearly affecting provider decision-making. As the adage goes, when regulatory burdens from the government increase, investments within an industry decrease.
Not learning from past mistakes, current FCC Chairwoman Jessica Rosenworcel has expressed an interest in bringing back the Title II classification of the internet as a common carrier service. Now that she has a 3-2 Democratic majority on the commission, that could come to fruition, although the “major questions” doctrine raised by the Supreme Court in a case involving the Environmental Protection Agency throws into question the FCC’s ability to reclassify an entire industry.
Such an action from the FCC would clearly be an economic mistake. As Free State Foundation President Randolph May noted in a recent op-ed in Washington Examiner, bringing back net neutrality for the sake of government control is “a steep price for consumers to pay for the government to address a nonexistent problem in the name of what’s now become little more than a political slogan.”
The light-handed touch of government has allowed innovation to flourish, and providers use various methods that include fiber, cable, wireless, fixed wireless, and satellite to provide broadband coast to coast. Bringing back Title II will surely slow efforts to close the high-speed internet gap by dropping investment in broadband again.
