On May 20, 1936, the US Federal Government passed a major piece of legislation, the Rural Electrification Act (REA), that instituted a low-cost loan and grant program to bring electricity to Rural America.  This legislation was a major game changer for Rural America.  Since then, nearly 100% of Rural America has electricity.

A key factor in the success of this legislation is the focus of providing funds to the cooperatives, not the larger electrical providers located in the Tier 1, 2, and 3 cities.   In 1936, it was recognized that the cooperative model was geared to support the true rural marketplace, which was later reinforced in 1949 when the REA was authorized to provide low-cost loans to rural telephone cooperatives.

Now in the year 2017, the Federal Government has become bloated and so full of red tape that the ability of rural entities to use the federal grants and loans to bring a highly-needed broadband service to Rural America is extinct.  The Federal Government stimulus and broadband loans/grants have proven to be worthless to the true Rural Market.  As such, the US Citizen’s federal tax dollars are spent without a true return to America – shame on our government!

Due to the red tape and cronyism within these federal departments, the funds never make it to the marketplace that it was supposed to be targeted for, Rural America!  To believe that the major carriers and MSOs will take these funds and build into the low-density markets, Rural America, shows a major failure of the Federal Government to understand capitalism.  Unlike the 1936/1949 model of recognizing that rural cooperatives will provide this needed service to Rural America, the Federal Government focused the loans and grants to the larger carriers!

These carriers are using the funds to expand their networks in the “NFL” and Tier 1 & 2 cities, and then providing pseudo services to the Tier 3 cities, but to Rural America – goose eggs!  Yes, good for the carriers as it improves profits and services to the city dwelling people, however, the whole concept was to ‘emulate’ the REA thus getting broadband services to nearly 100% of Rural America.

Per the FCC Jan 2016 report, 39% of Rural Americans (over 23 million people) lack access to 25Mbps/3Mbps service, which is the new metric for broadband service.[1]  If you look at this statistic it does not seem so bad, right?  However, what it does not show is the number of Americans that, due to poor infrastructure, have left Rural America to go to the ‘cities’ which may not seem like a bad thing.  But as Americans leave Rural America, so does the ability for America to grow its own food, vegetables, fruit, and meat!  Additionally, this creates a job market demand in the cities that might not be able to meet that demand, thus increasing the growth of unemployment or under-employment.  Once the dominoes begin to fall, it is very difficult to predict the total impact to the US Economy.  Besides the economic impact to America, this mobility also degrades the family unit, which can be seen as no longer is the family a key focal point within the USA.  Why is the breaking up the family relevant?  It is normally the younger generation that demands the broadband service to participate in the ‘Information Age.’  As such, the more they depart Rural America due to substandard infrastructure, the quicker the ability of the US to provide for its own food requirements is seriously degraded.

Additionally, the failure to have the broadband services in the true Rural America, education is degraded.  In the ‘cities’ broadband services are available thus improving the knowledge and information access for educating America’s future.  However, due to the substandard infrastructure in Rural America, ‘rural’ children are not getting all the benefits in education that the ‘city’ children are.  This causes parents to move into the cities to provide for their children.  While items such as the federal government’s ‘E-Rate’ structure have been established to attempt to bring broadband services to schools, truly rural schools are not able to benefit from this offering.  Even if the school has broadband offering that does not mean it is in the rural household, thus still limiting the children.

The Federal Government has spent billions of US taxpayers’ dollars under the premise of providing broadband to Rural America.  However, this has proven to be a complete fallacy, because the funds have been misappropriated, used to pay off debt, or to build out networks in higher density cities, with limited to no funds spent in the true Rural America.  Unlike the 1936 and 1949 acts to address Rural America, the Federal Government focused not on the cooperatives that are serving Rural America, but rather made the rules to receive the funds so onerous that only the larger carriers and MSOs could be eligible for those funds.  And then making the accountability for proof of usage of those funds so limited that these carriers and MSOs have been able to spend it however they felt with limited proof of serving the true rural market.

As such, Rural America cannot and should not count on the Federal Government to bring Broadband communications to them.  It is now time to realize that the government is not and should not be the solution, instead it is the residents of Rural America.  We can be and ultimately will be our own solution.

This paper reflects a ‘Call to Action’ because if Rural America is going to get Broadband, then waiting, or depending upon the government to ‘make it possible’ will only result in the continued degradation of the rural lifestyle.  With the number of rural utility cooperatives, electric and telephone, the ability to band together makes Rural Broadband not only viable but desirable.

We have seen companies, like Google, thinking they could enter the high-speed broadband marketplace but even they failed to view the Rural marketplace as desirable.  They wanted the larger cities and have now failed even in that marketplace due to the lack of comprehension of what it takes to deliver services.

Rural cooperatives do understand how and what it takes to deliver service in these rural markets, and with combining forces the build out of the hybrid fiber/wireless infrastructure to meet the high-speed broadband market can be achieved.

We have seen this model growing with the Indiana Fiber Network (IFN), Iowa Communications Network (ICN), South Dakota Network (SDN, etc. where rural cooperatives and companies have banded together to create a state-wide fiber network.  This model then allows for cooperatives to provide fiber-to-the-X and backhaul for remote wireless hubs in a more cost-efficient manner.

It is these models of out-of-the-box thinking that will bring broadband service to Rural America, not the Federal Government.  Keeping government out of the model is better as it keeps our taxes down, and allows the focus of our neighbors helping one-another model to thrive as it did in the late ‘30’s.

The Rural Utilities Cooperative models use of federal government loans to meet the members needs has proven reliable and a larger percentage of loan debt retirements occurs from the cooperative model then these prior broadband loans and grants, as such the recovery model is also better for the US Taxpayer!

As such, my call to action, is for the US Federal Government to stop giving funds to the larger carriers and MSOs for rural broadband and to make these funds available through a loan program to the rural cooperatives that have proven track record of truly provide service to the rural marketplace!