George Gilder of Discovery Institute Tells Washington Leaders: ‘Broadband Is Crucial to the Struggle Ahead’

WASHINGTON, October 23, 2001 – “A strong economy is a must if the government is to afford to wage war on terrorism, strengthen our homeland defenses and mount major public health initiatives,” George Gilder told senior White House staff, Congressional leaders and journalists on Tuesday. “Broadband is crucial, short-term and long-term, to reviving this economy–and imperative if we are to finance the struggle ahead.

“This economic revival will happen only if policy makers quickly end perverse applications of the law that have impeded broadband for half a decade,” said the Discovery Institute Senior Fellow and chronicler of the high-tech era.

“We need policies that create–not punish–investment in fiber, cable, digital subscriber line, fixed-wireless, satellite, and that build the last-mile between American households and the Internet,” Gilder said.

“Our overloaded communications systems on September 11th dramatized the constraints of trying to operate a knowledge-based economy on a 56k modem,” he said. “Broadband–or high-speed Internet access–is the only way to bring e-commerce up to the speed of the 21st Century.”

However, the long-awaited broadband revolution has been “imprisoned in a lockbox” by the last eight years of FCC rulings, he said.

“By forcing successful broadband companies to share their facilities with rivals at below cost, regulators have privatized the risk and socialized the rewards of broadband,” Gilder said.

“Advancing the peak-point of a broadband build-out by just four years would add $500 billion to the economy,” he said. “Now recession is here, sales of personal computers are down by 21 percent, and a telecom implosion has wiped out $1.7 trillion in stock capitalization. We can no longer afford to allow legacy networks and ham-fisted regulation to keep this driver of growth running on idle.”

In a paper released today, entitled “Broadband or Bust!,” Gilder and his Discovery Institute colleague and senior fellow, John Wohlstetter, spell out specific changes in law and deregulatory steps to accelerate broadband and re-ignite the high tech sector.

“If potential profits for broadband investment continue to be socialized, the rollout of broadband will be slow,” he said. “If Washington leaders stand by the status quo, they will soon find themselves taking credit for the recession.”

George Gilder, one of the founders of Discovery Institute and a senior fellow, is chairman of Gilder Publishing, LLC. He is publisher of The Gilder Technology Report, owner of The American Spectator, and author of many highly acclaimed books. Download a copy of Gilder’s paper, “Broadband or Bust!” here.