It’s Groundhog Day and Traverse City is closely imitating the plot of the movie of the same name by moving forward with a plan for a government-owned and -operated internet service provider. This despite the fact that similar attempts have failed time after time in other cities across the country.
According to the Traverse City Record-Eagle, the city’s public electricity provider is pushing forward with a $16 million plan to build out and run a fiber network. The utility board apparently believes that the government can offer better internet services than those already provided by the private sector.
The evidence shows otherwise. Studies from the Mercatus Center and the University of Pennsylvania show that virtually every time government-owned networks have been tried, they lose money and don’t meet their expectations, leaving taxpayers with a bill and little else.
Traverse City’s plan is supported by government employees and local business and tech workers. The local chamber of commerce says there is “already a lot of interest” in the project. That’s what the promoters of government internet in Sun Prairie, Wisconsin, and Lake County, Minnesota, said too. These small Midwest cities lost money, and, after extending huge subsidies to the effort, were forced to abandon their networks.
Technology moves too fast for government. If Traverse City wants faster internet, it should explore options that get government out of the way and increase competition among private providers. Markets will sort out what people are willing to pay for these services without having to force taxpayers to foot some of the bill.
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