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Illinois Giving Away Millions to Risky GONs While Healthcare and Pension Debts Go Unpaid

February 13, 2013

Dennis Byrne, a columnist with The Chicago Tribune, had an excellent opinion piece on government-owned networks in yesterday’s edition. (The full article is available by signing up for a free account on The Chicago Tribune website.)

Before outlining Byrne’s thoughts, it’s worth noting that the fact that Illinois has fiscal problems is no secret. According to SunshineReview.Org, “Illinois is the 48 worst run state taking into account debt per capita, budget deficits, unemployment, median household income, and the percentage of the percentage of the population below the poverty line.”

But even though the state can barely pay its bills, according to Byrne, it’s getting into the broadband business. He explains that Governor Pat Quinn recently “announced the award of $1 million in state bond money to Evanston and Northwestern University for a ‘fiber optic gigabit’ GON” that would “link 400 ‘access points’ on the university’s two campuses and ‘in surrounding Evanston’ …”

The grant is part of a larger, multi-million dollar effort by the state to provide money to municipalities for GONs. The governor recently announced an expansion of the program in his state of the state address. The federal government, Byrne notes, has also provided significant funding for GONs.

Byrne questions why local, state and federal governments are spending these funds at a time of fiscal strain, and when the vast majority of U.S. consumers (nearly 95 percent) have access to broadband through private providers. Byrne suggests it is right to question why the government is setting up “duplicative service.” He also cites GON failures, including a $6 million GON in Akron, Ohio that still isn’t finished, to argue the “investment” won’t have much of a return for taxpayers.

In his conclusion, Bryne comes down firmly on the side against government-owned networks. He says even though these networks are just a “sliver” of total public expenditures, they represent larger fights. First, is the broad philosophical question of whether the government should be allowed to compete with the private market, or to provide broadband at all.

But more importantly, for Illinois certainly, it is a fight over responsibility rather than philosophy. Byrne concludes, it is “extremely irresponsible that Springfield is handing out millions for any experimental, risky or non-urgent new program while it fails to pay billions of dollars owed to health care, social service and other suppliers, and public employee pension funds unravel.”