Broadband Socialism

According to Terence Corcoran, the government should scrap any plan it has to provide broadband internet access to all Canadians (Broadband Socialism, The Financial Post, 19 June 2001). The government would do well not to listen; following Corcoran's advice would be short-sighted and stupid.

In Canada, reliable high speed internet (for example, cable and DSL service) has been available in most major centres for the last three years. Contrary to what Corcoran believes, the foundation for this access was laid by public enterprise, either through Federal programs, such as CANARIE, or provincial programs. In the United States, where high speed internet access has been left to the private sector, customers continue to be plagued by inadequate service and higher costs.

According to Corcoran, the authors of the proposal had to "fabricate a national crisis" in order to justify universal access. The authors fabricated no such crisis; they merely demonstrate that they, unlike Corcoran, have an understanding of network economics. What use would we gain from roads if they served only metropolitan areas? How valuable would the telephone system be if it only served the Greater Toronto area? Networks become valuable only when they connect most, if not all, cities and regions.

The only justification Corcoran can find for a national broadband network is "to perpetuate and expand the existing national system of transfers from urban to rural." Perhaps, as fellow columnist Lawrence Solomon seems to suggest, we should solve the problem of rural access by depopulating Canada's remote regions. (Coast-to-coast subsidies trap rural Canada, The Financial Post, 19 June 2001) But most rural residents would oppose living their lives in suburbia, no matter how pleasing some Toronto journalists find that environment.

But in any case, the justification for a national broadband network extends far beyond rural subsidy. By ensuring broadband access for all Canadians, the government can save hundreds of millions of dollars offering services online, everything from tax filing to enumeration to permits and licenses. Similar savings are realised by corporations, public and private, as they convert billing, ordering and even retail divisions to an online format. For Canadians as a whole, access to medical services, learning and even employment becomes cheaper and easier. The net benefit to Canada's economy far exceeds the government's $4 billion investment.

But these savings only occur if most, if not all, Canadians are connected. Otherwise, the government and corporations must offer two sets of services, one for the connected, the other for the unconnected. That makes no sense in anyone's books.

Corcoran opposes this investment, partially because it transfers wealth, but mainly because it smacks of socialism. Well, perhaps it is socialism, but even if so, it is far better than the alternative. In a global economy, even such villages as Montreal and Edmonton are considered small markets (Corcoran probably does not read the sports pages either), and as such, last on the list for private sector technology. Leaving the development of such services as broadband internet to the private would condemn Canada to second tier status, slowing the economic advantage we gain from converting to online services, weakening our position in a knowledge economy, and accelerating the departure of information workers and technologists.

If Canadian history followed the Corcoran model, there would be no national railroad; all Canadian traffic would flow through Chicago. There would be no national highway system, as blacktop to Wawa is an unacceptable rural subsidy. Canada's telecommunications industry would not exist because our phone system would exist only as an arm of AT&T. And the Canadian information industry, our best hope at diversification beyond farming, fisheries and forestry, would die stillborn.

Perhaps that is Corcoran's vision of Canada. It is not mine, nor, I suspect, most Canadians'.
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