Government Has No Business in Broadband Business

Should municipal and county government be permitted to own and operate local high-speed Internet systems—Community Broadband Networks (CBNs)?

Timothy Karr of and Gerry Smith of Huffington Post (among other writers) argue that governments should be permitted to own and operate CBNs because this provides “competition” against big Internet service providers (ISPs) such as AT&T, Comcast, Time Warner Cable, CenturyLink, and Verizon.

But such arguments ignore the crucial distinction between government and private institutions. Government has a legal monopoly on the use of physical force. Unlike private companies, government can use its taxing powers to prop up its “businesses” by subsidizing rates and capital costs—or use its regulatory powers to hamper “competing” private companies. Private companies are legally forbidden to use physical force against anyone. To suggest that competition is possible between two adversaries—one armed (the government) and one not (private companies)—is absurd.

Genuine competition is possible only between private entities operating on the free market principles of voluntary trade and equality before the law.

Government CBNs also pose a major threat to First Amendment rights. By owning networks, government has the power to control content. What does this mean for freedom of speech and of the press? (Recent events should cause extra alarm on this count.)

As for claims that government involvement is “needed” because some communities are “underserved”: The government is not justified in violating the rights of some in order to meet the alleged needs of others. If “need” means that people want the services, then their desires constitute some degree of incentive for existing private companies to offer the services or for new companies to capitalize on the opportunity. If the incentive is not enough, then it’s not enough. There is no right to broadband.

A government that “competes” with private business violates our rights to control our own wealth and to contract voluntarily with others. Thankfully, government-owned CBNs are now legally restricted or banned in twenty states. The rest of the states should follow suit. If we value our economic liberty and our right to speak freely, we must fight to keep government out of the broadband business.

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  • Anonymous

    This doesn’t invalidate your point but it is relevant that the companies you mention spend millions and maybe billions of dollars ensuring their own government granted monopolies.

    • David Blankenau

      Your point actually strengthens Michael’s argument. Remove government from the equation entirely, and the “government granted monopolies” immediately disappear. Everyone would compete for market share equally, with only their innovative and productive capabilities determining success or failure.
      Then perhaps we can adopt a proper motto for capitalism, such as “may the best businesses win!”

      • Anonymous

        Both the author of this article and other authors on this blog should do a better job of condeming the government and the people (AT&T/Comcast/Google) who support the use of government force to achieve their objectives. The majority of the writing on here points the finger at the government and ignores or turns a blind eye to the immorality of the companies.

        • Patrick Black

          While some business leaders are certainly guilty of using government force to protect their market share, I would see this as primarily a result of the fact that government is already interfering in those markets. If the government were not injecting itself into various markets, there would be no reason for businesses to try and get the government to use force on behalf of the business.
          Put another way, the business side of the equation I see as the symptom while government action is the actual disease. Going primarily after business in these cases is akin to simply treating the symptoms in malaria patients while doing nothing to rid the body of the parasites that cause them in the first place.

          • David Blankenau

            Precisely. Not only would there be no reason for a business to complain to the government, there would be NO WAY for the government to intervene unless there was clear (and objective) evidence of rights violations.

            In addition, the entire notion of government lobbyists would disappear (talk about a great side benefit!).

  • Anonymous

    By violating the right of free trade, Venezuela has run out of toilet paper (and other things). See the story (link) “Venezuela is running out of toilet paper” in an NBC News story that I saw yesterday. The situation reminds me of what I read about life in the Soviet Union.

    • Anonymous

      We had a toilet paper scare right here in the U.S., you might remember, in the mid 70′s, but for totally different reasons, and it was a false alarm. Somebody well-positioned started the rumor and it spread like wild fire. Everybody gobbled it up. There was a run on the stores of everybody buying up toilet paper. Mike Kevitt

      • Anonymous

        Don’t remember that. But I remember Nixons wage/price controls of 1971–a failure, as I recall.

  • Anonymous

    If an entity is granted, or assumes, a ‘legal monopoly on the use of physical force’, there’s no way we can help but end up with BIG BROTHER, 100%. Any assertion of individual rights in writing anywhere, in that context, is useless. Any such entity from the start is in principle & by its nature, a criminal regime.

    There’s a hair that must be split, for the right context. It’s the hair of physical force, which comes in 2 types: initiatory & retaliatory.

    YA JUST DON’T GRANT ANYBODY A LEGAL MONOPOLY ON THE USE OF PHYSICAL FORCE, & simultaneously assert individual rights, and get away with it. It’s a recipe for slavery, and it’s perverted, disjointed philosophy. No matter who’s who or who’s what or what’s what, you CAN grant such a monopoly, but it’s automatically illegal, by nature, prior to the objectivity of knowledge. Once that’s discovered, there’s no excuse. Where force is concerned, you grant a legal monopoly only on the retaliatory use of force. By nature, that’s the only monopoly that’s legal & enforceable by law. Once that’s known, that monopoly can be granted and we can inform everybody, so they can know. But, in any event we have the moral, egoist right to cram it down the throats of whoever objects and explain it to them later if we haven’t already.

    A monopoly on the use of force is crime, no matter any assertion of rights or any other glitz, fanfare or formality. But, with a monopoly on retaliatory force, rights are real & have substance and they command formality. A monopoly on retaliatory force is law & government. Mike Kevitt