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High-Speed Waste


Brandon Arnold
February 28, 2013

Some politicians in DC have been complaining nonstop about the sequester’s “draconian” spending reductions. By contrast, the House Energy & Commerce Committee’s Subcommittee on Communications & Technology has effectively highlighted why additional spending cuts are very much warranted. 

At a hearing yesterday, the Committee examined the roughly $7 billion the federal government allocated to broadband internet grants and loans as part of 2009’s so-called “stimulus” bill. The broadband funding was supposedly one of many “shovel-ready” projects included in President Obama’s plan to jump-start the economy. Four years later, it appears these projects were neither “shovel-ready” nor stimulative. By and large, this massive expenditure was yet another colossal waste of taxpayer dollars.

Take for instance the $4.7 billion given to the National Telecommunications and Information Administration to implement the Broadband Technologies Opportunity Program. Roughly four years later, $1 billion of these funds -- more than 20 percent -- have yet to be disbursed. 

Perhaps even worse, much of the money that has been spent has been wasted. A New York Times article from last year highlighted just a few of the program’s many highly questionable expenditures: “In Illinois, for example, a $12 million broadband grant was sanctioned when a subcontractor was caught routing fiber optic cable through neighborhoods where its project engineers lived. A $39 million grant in Arizona was suspended over questionable expenditures on travel, transactions that appeared to involve conflicts of interest and other unbudgeted activities. Broadband grants in Alabama and Louisiana, totaling $140 million, were terminated over undocumented expenditures and failure to adhere to construction plans and schedules. Four other grants, worth $42 million, returned the money before even getting off the ground.”

These anecdotes are particularly relevant as the President and some Members of Congress decry the “disastrous” effects of the sequester’s 2.4 percent cut to the $3.5 trillion federal budget. And unfortunately, these examples of waste are only the tip of the iceberg. So keep them in mind as politicians tell you that the sky is falling because of minor reductions in government expenditures.


 

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