Charles Krupa/AP Photo
Ashley Bullard, left, sits on the porch of her family’s home in North Sandwich, New Hampshire, as her daughters try to complete their classwork from home during the coronavirus outbreak on a very limited internet connection, March 26, 2020.
During the Great Depression, President Franklin Roosevelt signed the Rural Electrification Act (REA), which electrified rural communities across the nation as part of the New Deal. Over the next 20 years, the REA provided this essential utility and radically altered the quality of life for millions of Americans.
The next presidential administration needs to follow this example and lead the country into a new technological era. Just like electricity, the internet has become an essential utility, and it should be provided to everyone.
Confined to their homes for the majority of their work, educational, and entertainment activities, Americans are now relying on the internet more than ever. At the start of the pandemic, internet usage increased by 47 percent. Despite some states opening up their economies, usage as of August 2020 was still 36 percent higher than pre-pandemic levels. More than 70 percent of respondents to a U.S. poll said that they would not be able to perform their jobs without an internet connection.
This increased reliance has revealed the real consequences of America’s decades-long struggle to provide universal broadband access. While studies show that 90 percent of Americans use the internet, a 2018 study from Microsoft shows that almost half the population does not use it at broadband speeds (defined as at least 25 Mbps). Thus, although millions of Americans technically have internet access, the speeds are so limited that more than two devices would clog their bandwidth and make it unsuitable for modern uses such as videoconferencing and streaming, which are now essential aspects of work and education. In addition to inferior speeds and adoption rates, American internet is also exceptionally more expensive, in some cases 50 percent more costly than comparable international counterparts.
Almost 1 in 5 students, or roughly nine million, do not have home internet access.
For students in particular, the lack of internet access is distressing. Almost 1 in 5 students, or roughly nine million, do not have home internet access. According to a 2020 RAND Corporation survey, one-third of teachers described the absence of home internet as a major obstacle to educating students. One school district in Texas found that half of its student population had no high-speed internet at home. Similar numbers exist for West Virginian students.
These circumstances make virtual learning effectively impossible, and as more than 50 million K-12 students start the 2020 academic year, millions of young people are being effectively deprived of their right to an education. The Pew Research Center identifies a “homework gap,” as the lack of internet access impedes children from completing their assignments. In some cases, students trying to do their homework have camped outside their schools or at Taco Bell parking lots seeking adequate Wi-Fi.
People of color are particularly affected by the digital divide, having consistently lagged ten percentage points behind white Americans for broadband penetration. “Technology access is one of the most pressing education issues of the pandemic, especially for these students—low-income, students of color, students with disabilities, and English learners—who were already underserved and who have generally experienced less access to resources during the pandemic,” said Linda Darling-Hammond, president and CEO of the Learning Policy Institute.
The Federal Communications Commission (FCC), the federal agency in charge of structuring telecommunications in the United States, has received multiple directives from Congress to provide universal communications and information services. The 1934 Communications Act stated that the FCC must “make available, so far as possible, to all the people of the United States … a rapid, efficient, Nation-wide, and world-wide wire and radio communications service with adequate facilities at reasonable charges.” In 1996, Congress amended the 1934 act to include advanced telecommunications.
Despite this command, the FCC’s recent efforts have been woefully insufficient, and the broadband divide persists. Between 2013 and 2017, the FCC and the U.S. Department of Agriculture (USDA) gave more than $22 billion to private companies to expand rural internet service, and in January, the FCC committed another $20 billion over ten years to try to close the gap. Even the $2 trillion CARES Act, passed in March in response to the economic cataclysms resulting from the pandemic, provided $100 million to build facilities and purchase equipment for enhancing rural broadband. But despite these outlays, millions have no access; the mechanism of feeding private companies giant sums of money for broadband build-out simply hasn’t worked.
AMERICA’S INTERNET DEFICIT is predominantly confined to the most rural areas and states. The FCC’s 2019 Broadband Deployment Report states that 26 percent of rural Americans, as compared to 1.7 percent of urban areas, do not have access to broadband internet plans. The 2017 USDA “Rural America at a Glance” report, which details economic and population trends in America, cites insufficient internet access as one of the reasons for the first-ever recorded decline of America’s rural population.
Remarkably similar circumstances existed in the 1930s for electricity in rural America during the Great Depression. Over the course of 15 years, electricity went from luxury to necessity, and advocates believed that our nation was morally obligated to provide the benefits of electricity to all Americans.
ISPs typically do not provide service to rural areas because of high fixed costs and the low revenue potential due to poverty and a lack of customer density.
During the 1930s, only 10 percent of rural Americans had electricity. In Mississippi, fewer than 2 percent of farmers had electricity. The unavailability of electricity and the ancillary technologies that depend on it were one of the key reasons for the decline of economic vitality in rural towns. Millions of citizens were deprived of modern technologies that we still depend on today, including the use of electrified machinery and tools, clean water, plumbing, and refrigeration. But electrical service did not just provide Americans the capability to radically enhance their working and living conditions; it also profoundly enhanced their means of leisure and their ability to acquire information, through access to radio and television.
To provide these essential services, FDR committed to rural electrification. With subsequent amendments by Congress, the REA eventually brought electricity to millions of farms. The project was deemed so effective that one historian called it “one of the most immediate and profound success[es] in the history of federal policy-making of the national economy” and “the New Deal’s best model for government intervention.”
The REA facilitated the creation of electricity cooperatives, where community residents, rather than investors and financiers, own and operate the organization. Farmers had formed cooperatives since the 1880s, and were a critical factor in the success of the REA, because they ensured that the electrical utility companies created to provide electrical service to rural areas operated in the public interest and were responsive to the needs of the local community, without a profit motive.
To take advantage of the new utility, the REA also provided low-interest loans for citizens to purchase electrical tools and equipment so that they could immediately benefit from the new service. In addition, the act, similar to the expansion of post offices throughout the nation during the early years of the republic, adopted a goal of universality regardless of cost or potential financial benefit. Lastly, the act directly funded the physical infrastructure (often the most expensive aspect of electrification).
By 1962, 96 percent of rural American households were electrified. Looking to extend the success of the program, Congress amended the act in 1949 to allow electrical cooperatives funded and overseen by the REA to build and operate derivative technologies such as telephone service, which approximately 95 percent of farms did not have. Five years later, 50 percent of farms had telephones.
In essence, the REA was a governmental response to a persistent failure of private utilities to serve rural America. Congress can use the REA as a model to intervene in broken telecommunications markets and provide high-speed broadband to all Americans.
Private internet service providers (ISPs) have been reluctant to provide broadband service to rural areas. Research from the Institute for Local Self-Reliance shows that more than 80 million Americans have access to only one monopoly internet provider. ISPs typically do not provide service to rural areas because of high fixed costs and the low revenue potential due to poverty and a lack of customer density. Electrical providers in the 1930s asserted the same reasons as a justification for depriving rural areas of electricity.
Congress can use the Rural Electrification Act as a model to intervene in broken telecommunications markets and provide high-speed broadband to all Americans.
American cities could fund broadband access directly and set up cooperative enterprises to ensure local ownership and control. We know this because they’ve done it. In McKee, Kentucky, the local telephone cooperative, with state and federal funding, decided to provide fiber-optic internet to everyone in the area, offering speeds of one gigabit per second (40 times faster than basic broadband). Also using cooperatives, North Dakota telecoms purchased the telephone infrastructure from US West (one of the regional successors to AT&T following its 1982 breakup) to provide fiber-optic internet to nearly everyone in the state. North Dakota now has some of the fastest internet in the country and leads the nation in fiber-optic coverage at 83 percent.
Eleven municipal governments in Utah created an open access network (OAN), building the infrastructure for internet connectivity and then bidding out access to residential homes to ISPs. Prospect editor David Dayen, in his new book Monopolized, explores how the Electric Power Board (EBP), a municipally owned electrical distributor in Chattanooga, Tennessee, decided to provide fiber-optic internet to everyone in its service area, after years of neglect and reluctance to improve internet service by Comcast. It now serves half of residents and businesses in Chattanooga, and delivers the fastest broadband in the country and perhaps the world.
Providing broadband has incredible economic effects. Similar to electricity, multiple studies have confirmed that internet access leads to higher wages. A 2015 study by the University of Tennessee showed that, in a five-year period, Chattanooga’s gigabit internet generated $1 billion in direct economic benefits. A 2016 study from the Hudson Institute found that rural broadband added $24 billion to the U.S. economy in 2015.
Indirect benefits can also be just as significant, if not more so. In McKee, Kentucky, the installation of fiber-optic internet created and expanded a raft of new jobs and businesses. McKee also saw the founding of a training camp to educate and prepare residents for the modern computerized workforce. The program has created more than 600 jobs and trained many people to use computers. The internet cooperative was able to partner with the Department of Veterans Affairs to create a telemedicine office, and a helicopter plant in the city expanded its operations. In Chattanooga, a wave of entrepreneurism started, eventually leading to the creation of 550 companies. Electrical rates were also reduced across the board. In total, more than 900 communities have built their own municipally or cooperatively owned internet networks.
When the Rural Electrification Act was signed, private utility companies coordinated what D. Clayton Brown, a history professor at Texas Christian University, termed “the most carefully planned and executed lobbying campaigns in American history.” Private utility corporations stoked post–World War II fears by claiming that the government’s actions were communist or beyond its constitutional authority. Decades later, when state and local governments decided to provide broadband, private monopolistic internet providers have vigorously fought back.
According to FCC data, the cost for universal broadband would be $80 billion, or about 2 percent of the federal budget.
When the EBP initially tried to provide fiber-optic internet in Chattanooga, Comcast sued the city. Even though Comcast eventually lost the lawsuit, Comcast and AT&T used their financial war chests to limit the expansion of municipal broadband outside electric utility service areas. Big Telecom has taken similar actions in at least two dozen states. Efforts from the FCC to preempt restrictive state laws also failed in the courts, despite clear congressional authority to take “immediate action to accelerate deployment of such capability by removing barriers to infrastructure investment and by promoting competition in the telecommunications market.” One lobbyist said that AT&T is the “most powerful lobbying presence in Tennessee,” because of its commitment to shutting down any attempt by the state or federal government to expand access to broadband. Internet monopolies have even funded propaganda-like studies detailing the supposed problems of government-funded internet.
A single effort similar to the REA would transform a patchwork of smaller efforts capable of being suppressed by monopoly internet providers into a federal campaign to provide universal service. The Rural Electrification Act cost $26 billion in today’s dollars. According to FCC data, the cost for universal broadband would be $80 billion, or about 2 percent of the federal budget. Such a modest cost is well worth the price, given the benefits. And the millions of Americans who remain effectively offline demonstrate that a focused effort is necessary.
Fortunately, universal broadband has become a mainstream idea, particularly among progressive Democrats. Former Democratic presidential candidates Elizabeth Warren and Bernie Sanders proposed plans to provide universal broadband, and Democratic nominee Joe Biden has also put forth his own plan. Federal legislation should, in the same spirit of the REA, fund and assist the creation of rural broadband cooperatives and municipal broadband providers, as well as explicitly provide the FCC the ability to preempt state efforts to block broadband expansion.
With the pandemic still raging, our internet-dependent lives will likely continue for months. History provides us a guide to provide a basic utility to all. Proposing legislation is the first step, but the fiscal and public-health crisis created by the pandemic should jolt the next president to act and get it done at the onset of their term.
