Twenty-three million Americans will lose internet access tomorrow unless the House acts today

April 29th, 2024 by Tom Lynch

Do you doubt that reliable high-speed broadband is crucial for economic growth and improving productivity? Probably not.

A broadband connection gives firms access to a larger pool of resources, suppliers, and customers, enhancing business growth in both urban and rural regions. But building a nation of broadband connectivity requires having a wired system in place through which information travels, as well as convincing people that buying into the system enhances their economic prosperity to a point that makes the cost worth it.

And there’s the rub. Even now, millions of people, 23 million to be precise, can not afford the full monthly cost of a broadband connection. As a result, these people are disproportionately disadvantaged and, consequently, do not have an equal opportunity to succeed and thrive in America. Consider that less than 4% of citizens earning more than $70,000 annually do not have broadband, compared to 26% of those earning below $20,000 annually.

On November 21, 2021, President Biden signed the bipartisan Infrastructure Investment and Jobs Act, one part of which attacked this problem.

The Bipartisan Infrastructure Law consists of three key approaches to expanding broadband coverage and adoption, including the Broadband Equity, Access, and Deployment (BEAD) program, the Affordable Connectivity Program (ACP), and the Tribal Broadband Connectivity Program (TBCP). Currently, the FCC defines broadband as a connection with a download speed of more than 25 Mbps and an upload speed of more than 3 Mbps. However, the FCC recently recommended that the standard be increased to 100 Mbps download and 20 Mbps for upload.

The BEAD program has so far resulted in thousands of miles of wired connectivity being laid throughout rural America. The Congressional Research Service concludes $42.45 billion in BEAD funding has gone to expanding broadband infrastructure.  But if people can’t afford to access it, what good is it? That’s where the Affordable Connectivity Program (ACP) comes in.

The ACP provides a subsidy for households to purchase broadband connections; eligible families can receive a discount of up to $30 per month, while those on tribal lands can receive up to $75 per month. The program allocates $14.2 billion for broadband investment and provides up to a $100 discount for a computer or tablet.

A February 2024 economics working paper by Matthew Sprintson and Edward Oughton examined the GDP effect of the the three cited programs within the Bipartisan Infrastructure Act and concluded the total direct contribution to US GDP by those programs could be as high as $84.8 billion, $55.2 billion, and $5.99 billion for the BEAD program, ACP, and TBCP, respectively. Thus, overall, the broadband allocations could expand US GDP by $146 billion (0.13% of annual US GDP over the next five years). Consequently, for every dollar spent on the ACP, the nation’s GDP increases by $3.89.

Sound good? It’s a real win/win, isn’t it. Poor people get a chance to be part of the broadband revolution in America allowing them to have a better chance of pulling themselves out of poverty, and America gets a significant bump in GDP.

If only it were that simple. At this moment, it appears the BEAD, ACP, and TBCP have just hours to live.

The Bipartisan Infrastructure Act set the BEAD, ACP, and TBCP programs to run through April, 2024. The Biden Administration assumed (perhaps wrongly) Congress would reauthorize the programs once they proved themselves, which they have done. However, Speaker Mike Johnson, for some reason (he won’t say what it is), has thus far refused to bring a bipartisan reauthorization bill up for a vote. It is the Affordable Connectivity Program Extension Act, which would extend the program with $7 billion in funding. Failure to extend the funding runs the risk of consigning 23 million people to a broadband desert.

Although, as Judd Legum reported this morning in Popular Information, “The Affordable Connectivity Program Extension Act has 225 co-sponsors which means that, if Johnson held a vote, it would pass,” there has been no movement advancing the issue as of this writing.

Although a majority in the House supports reauthorization, one reason Johnson has thus far not allowed the issue to advance may lie at the door of the Republican Study Committee (RSC), a 179-member group Johnson chaired prior to becoming Speaker. This is a conservative group that has advanced its own budget proposal, which calls the ACP a “government handout that disincentivizes prosperity.” Given the Sprintson and Oughton paper, this kind of logic would have us believe rain falls up and not down.

Extending the ACP should not be controversial in Congress. As Legum reports, “The RSC’s position is not popular. A December 2023 poll found that 79% of voters support ‘continuing the ACP, including 62% of Republicans, 78% of Independents, and 96% of Democrats.'”

Regardless, if Congress does not act, and soon, many millions of Americans, our neighbors, will find themselves tomorrow in a dark wasteland of even greater economic inequality.

That should disturb all of us.