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Measuring the Cost of the Digital Divide for Lower Income Families

Little Rock   We continue to struggle with cable companies promising to offer affordable digital access to lower income families.  Comcast, Cox, Time-Warner, and others promise, while failing to deliver in any meaningful way.  The FCC claims to be engaged in the fight with us, but lumbers along ineffectively.  Ironically, when the recent FCC chairman stepped down, the reports focused on his advocacy of increased access, while not making much of his ineffectiveness; as head of the Federal Communications Commission, most of us would think he was in a position where he could stand and deliver and not simply speak from a bully pulpit.  The new nominee is a former trade association lobbyist and Obama fundraiser, but hope and hard work spring eternal.

            Eduardo Porter in the New York Times may have stumbled onto part of our problem in fighting the persistence of the digital divide by pointing out the inability of standard gross national product measurements to calculate the real value of improved technology and information access for workers and consumers.  To the degree they can’t measure it, too often business and government don’t think it really counts.  Sure if technology allows business to cut cost – and workers – then it’s swell, but that doesn’t say that everyone should have access to information technology since the measurements for how it increases value are vague.  For example I have often argued that business shouldn’t complain about the public school system in New Orleans, because their lack of support created exactly the school system they wanted to bind workers to low paying jobs in the hospitality industry making beds and washing dishes.  Without understanding why people with more access to information make better workers, consumers, and citizens, business and government continue not to be willing to step up and put real money down.

            Porter marshals some numbers that help give a clearer picture to the out of pocket cost to workers of not having equal access to information.  One economist he cites argues that information access increases annual income by 2%.  Porter’s own figures calculate an average worker’s wage and argue each worker loses $500 a year without information access.    The impact on consumers is even greater.  Consumer surplus from on-line information seems to be growing at $34 billion per year.  Interestingly television still delivers a consumer surplus 5 times higher than that from free information!

            We should be able to value access to information as an intrinsic good, contributing to more informed citizens in the overall electorate as well.  Although on second thought, reading some of the positions being argued in Washington, maybe that’s actually part of the problem.  Too many of those yahoos probably don’t want a better informed and educated citizenry.  Nonetheless, 2% here,$500 dollars there, and soon we’re talking about real money and citizen wealth, making it all still worth the fight.

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