President-Elect Barack Obama's $40 billion Handout Bailout to Internet Providers

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President-Elect Barack Obama's $40 billion Handout Bailout to Internet Providers

1934[1].jpg President-Elect Barack Obama is planning to send up to $40 billion in grants and loans bailout funds toward improving broadband availability and speeds as part of broader economic stimulus efforts, according to UBS analysts.

According to Telephony Online:
A draft of the proposed $825-billion economic stimulus bill circulating on Capitol Hill today lists $6 billion for expanding broadband "so businesses in rural and other underserved areas can link up to the global economy," adding that this provision could well aid the job-creation goals of the larger economic stimulus effort.

PC World writes: The money will "strengthen the economy and provide business and job opportunities in every section of America with benefits to e-commerce, education and health-care," a House Appropriations Committee document said. "For every dollar invested in broadband the economy sees a ten-fold return on that investment."

10X the return? I'm not buying it. My BS meter just went off the scale. Just my opinion here, but I see this as $40 billion in wasted tax payer money. The private U.S. sector already offers high-speed Internet to nearly every part of the country. Where DSL or cable isn't available, American can pay for high-speed satellite Internet access. If it isn't profitable for ISPs to bring high-speed Internet to boondocks USA, then I am very skeptical about the government paying for it. We've been down this road before with the Community Reinvestment Act forcing banks to give mortgage loans to risky  individuals, which turned into a very unprofitable venture with disastrous results.

Let the free market decide where high-speed Internet is profitable. Seriously, why should I subsidize high-speed Internet for Backwaters, U.S.A.?

In this tight economy, I'd rather have this $40 billion divided by 300 million Americans = $133.33 back per person.

That's $533 for my 4 person family.

Or if you only count just tax payers it's $40b divides by 136 million tax payers = $294 back per tax payer.

$40 billion doesn't seem like a lot in the grand scheme of things, but when the government spends $40b on this, $100b on that, $800b on bailouts, etc. soon enough your Federal income taxes starts shooting through the roof - or at least the deficit will until the bill comes due years from now. Average Americans no longer pay attention to how much the Federal government takes out of their paycheck each week/bi-week. It's money they never see, so they don't miss it.

I have a solution for this slow American economy - suspend all federal income taxes (except social security taxes of course) for 1 year. I guarantee that will give the economy a huge boost. It'll never happen though, because my fellow Americans will be shocked how much more dispensable income they will have in the course of one year. Once their eyes are opened, Americans will never allow the federal government to reinstitute the same amount of taxes formerly taken. Congress knows this and will never give up that much money/power.

Now, you could argue that poor Americans could use an Internet access subsidy. However, last I checked, poor people in this country had plasma TVs, PS3s, subsidized housing, free emergency care, and more. We have perhaps the richest poor people in the world or close to it. If they want Internet access, they'll pay for it. Americans work hard and will work to earn things they want. It's the way it's always been.

Unfortunately, we keep hearing these "great ideas" how to offer more services to Americans via the government, and we just think the government can do anything with their "limitless" funds. The U.S government can just print more money - it's just Monopoly money after all. Who cares about the impacts on inflation, which will no doubt hit us in the next 18 months from all these bailouts and new government spending ideas/plans?

So the question is do you want really want your federal taxes to increase and go towards building high-speed Internet access for every American. If you agree to pay higher taxes for that, why not tax the taxpayers even more to give a free car or a free house to all Americans making under $40,000? Bad analogy? Agreed, it is a bit over the top, but you see my point.

I'm all for stimulating the economy, but this seems like yet another wasteful government project.

Let Verizon, AT&T, cable cos, etc. make their own investments in building out their Internet networks. Enough with the government grants, subsidies handouts already!

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