Crawford Criticizes America’s Infrastructure Investment Heroes for Being the Best

by on July 26, 2012 · 4 comments

As budget deficits have increased, public investment in our nation’s infrastructure has declined. In just the last four yours, the “United States has fallen sharply in the World Economic Forum’s ranking of national infrastructure systems,” from 6th in 2007-2008 to 16th in 2011-2012. Our roads, bridges, rail networks, and ports are all straining to handle demand, but due to budget concerns, lawmakers have little interest in increased funding.

In contrast to the gloomy forecast for public infrastructure funding, private investment in our communications networks has been a bright spot in the economy. The Progressive Policy Institute released a report this month ranking U.S.-based companies by their U.S. capital spending in 2011. Who ranked number one and number two on this report? AT&T and Verizon. Both companies invested significantly more in U.S. infrastructure than any other U.S. company. AT&T alone invested more in the U.S. ($20.1 billion) than the 3rd and 4th ranked companies combined: Exxon Mobile ($11.7 billion) and Wal-Mart ($8.2 billion). AT&T and Verizon together invested $36.3 billion in our future. The Progressive Policy Institute calls these companies “Investment Heroes” for believing in American progress.

Susan Crawford, a “radicalized” professor at Harvard Law School, apparently believes our private investment heroes are “terrible for American consumers.” In her view, the government should own and control the Internet as a public utility, just like our decaying public roadways. She believes the Internet should be part of the government’s “collective responsibility” to modern society.

Although her economics are erroneous (more on that in a moment), her willingness to trust the government with control of our primary means of communications is even more astonishing. Since the invention of the printing press in the 15th Century, governments have attempted to control freedom of speech, beginning with laws establishing controls over printers. Even with the best intentions, allowing the government to own and control our Internet networks would chill our freedom of expression, at the very minimum, and could result in warrantless wiretapping or even government content blocking. Given the rapid migration of our information society from print to electronic media, Crawford’s proposal for government wholesale control over the Internet would be tantamount to wholesale government control of the press.

If you believe that’s unthinkable, think again. According to Google, U.S. government agency requests to hand over user data have increased 76 percent since the end of 2009. Google complied with only 93 percent of user data requests by intelligence agencies and law enforcement last year. If the government controlled Google’s servers, however, it wouldn’t need Google’s permission for the other 7 percent of user data requests. The government would have direct control over all user data and Internet content, including online news.

Crawford is wrong on the economic issues as well. She is best known for her view that cable is a de facto “monopoly.” A monopoly exists when a single enterprise is the sole supplier of a particular product or service, and it’s obvious that cable isn’t the only supplier of broadband access or subscription video services. The majority of consumers (78 percent) have access to more than one fixed broadband provider (whether wired or wireless) and 81.7 percent of consumers have access to three or more mobile broadband providers as well, facts she dismisses through narrative storytelling rather than data.

She maintains that mobile broadband cannot compete with cable, even though PC Magazine’s June 2012 mobile tests revealed that AT&T’s 4G LTE network is delivering average download speeds of 13.71 Mbps. That’s more than fast enough to support the delivery of high-definition video and actually exceeds the speed limit for web browsing. According to an FCC report released this month, the time needed to load a webpage stops decreasing at about 10 Mbps. The FCC says, “For these high speed tiers, consumers are unlikely to experience much if any improvement in basic web browsing from increased speed–i.e., moving from a 10 Mbps broadband offering to a 25 Mbps offering.”

The biggest barrier to competition between mobile providers and cable is a lack of mobile broadband spectrum, the availability of which is artificially limited by – guess who? – the government. Given that the government is responsible for inhibiting the competitiveness of wireless networks, I hardly think government ownership and control of the Internet is the answer to broadband competition.

Ironically, after blogging her belief that cable is a monopoly, Crawford’s very next blog post extolled Google’s deployment of a new fiber broadband network in Kansas City. She described the move as “very smart” and “very disruptive.”

I’m confused. If Crawford recognizes that new fiber entry is smart and disruptive, why is she advocating for government control of the Internet rather than policies that would promote more private investment in all-IP technologies? Because, by her own admission, she is a “radical” who believes in “collective responsibility” for our means of communications. Competition has nothing to do with it.

  • http://twitter.com/binarybits Timothy B. Lee

    I don’t think you’re being fair to Prof. Crawford. In the Bloomberg piece you linked to, she argued that state governments should allow local governments to provide broadband service to their own citizens. I don’t think it’s fair to describe this as “government wholesale control over the Internet.” I don’t see any indication that she’s seeking to nationalize the networks of private broadband providers, the Internet backbone, or the networks of companies like Google. And the claim that Crawford’s proposals would lead to “wholesale government control of the press” left me scratching my head. Do you have any examples of municipal fiber networks attempting to exert control over Internet news sources?

    Remember that newspapers have been delivered using government-owned roads (or using the government-owned postal service) for centuries, yet I don’t think anyone would claim that American newspapers are controlled by the government. Why is Internet access different?

  • LEW

    Publicly-owned roads are a response to market failures that are not present with telecommunications networks, unless you consider market concentration itself a form of failure. Proposals to expand the scope of government action should be subject to a high bar of justification. In this case, the fact that some people would prefer a type of infrastructure, fiber-to-the-premise, that private entities have not found profitable except in corner cases, is not a sufficient reason to tax everyone else. Even a majority should not have the power to force others to fund ventures that can be provided by private entities. Let Professor Crawford raise the money to fund the network she thinks people want from investors rather than taxpayers.

  • Steve Crowley

    LTE cannot, practically, be used to carry high-definition video for the reasons I discuss in this blog post:

    http://stevencrowley.com/2011/04/22/streaming-hd-video-on-mobile-broadband/

  • Pingback: At Brookings, Susan Crawford Fostering Internet Competition

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