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Comment by barkerja | Hacker News Reader

I live in a small village in central NY and we are months away from rolling out municipal broadband.

For years, Spectrum has had a stronghold on this region with prices they set without any competition. The citizens of this region have pleaded with numerous carriers to bring better internet, but all balk at the prospect.

We finally said enough is enough and decided to rollout FTTH for every resident, without a single penny spent of tax dollar money. We've been fortunate to get enough grant money from both state and federal to get this off the ground. The service will be fully subscriber-funded and end up making the town money in several years.

There is absolutely nothing about this service that is:

1. A handout from government. You must pay for the service.

2. Expanding the role of government.

3. Increasing taxes

4. Hostile. The only hostility until now has been Spectrum bullying the competition.

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"without a single penny spent of tax dollar money. We've been fortunate to get enough grant money from both state and federal to get this off the ground."

How are state and federal grants not made up of tax dollars?

> How are state and federal grants not made up of tax dollars?

State is different because the funding situation of state and federal governments are not equivalent, but marginal federal spending is not tied to marginal increases in tax revenue even in principal, so quite literally changes in federal spending do not come from tax dollars.

If you assume that (1) the lifespan of the federal government is finite, and (2) the federal government will have no unpaid, transferred, forgiven, or externally covered debt from now until and including the eventual final shut-down, then it follows that any spending must eventually be covered by taxes, but while (1) is a reasonable assumption, (2) is...less clearly justified.

I am still confused how this isn't tax payer funded. If it comes from the government, it's tax payer funded.

> I am still confused how this isn't tax payer funded

Because federal government spending doesn't depend marginally on taxes.

> If it comes from the government, it's tax payer funded.

This would be true if changes in government spending were tied to changes in taxes, but it isn’t because they aren’t.

For state government operational spending its closer to being a general truth.

That’s ridiculous. Why have taxes at all if spending is not dependent on them?

Because you need to pretend the spending does depend on them. Otherwise the magic of Fiat currency starts to waver

> Why have taxes at all if spending is not dependent on them?

In aggregate, to offset, to the extent viewed desirable, the money supply effects of the creation of money in spending, and in terms of specific distribution of taxes to effect a desired (re)distribution of net income.

Also, though the above would be sufficient on its own, because prior to the abandonment of commodity-representational currency for pure fiat, the metaphor of the fisc, a finite purse (from which we get the adjective “fiscal”) was a reasonable model of government finances, and there is a lot of inertia in popular models of the world. So, even though it is no longer an apt model, lots of people — both in the electorate and even in government — still view the world through a framework in which that is exactly how things work, which affects their decisions as electors or government decision-makers.

Ok, so we're at the point where we just create money I guess. I didn't understand any of this mumbo jumbo but I'll follow for a second.

Even if this is all true and it's effectively free - we're saying the tax payer isn't paying for it. However isn't there still an unfairness when it comes to who BENEFITS from said broadband?

In MMO's they have a concept called a "gold sink" where in order to fight inflation they create very expensive things and methods/payments that essentially waste money to keep the economy from crashing.

If most money nowadays is calculated digitally (which it is, most transactions are spreadsheets and databases instead of actual cash or goods) and the way most new money that is created is created in similar fashion (it is). Then the constrains of money creation are limited to faith in the system, value speculation (mostly by other countries for what they can trade it for) and inflation. Most monetary systems crash due to overprinting of money and excess inflation which causes a lack of faith in the system. Having something akin to "Gold Sinks" is part of keeping things running, taxes are a perfect way to do that, though the distribution could use some tweaking to get better results, especially if one cares about wealth redistribution.

To incentivize certain things and disincentivize others.

Because jobs and income streams depend on their calculation, collection and regulation.

It appears you have defined the taxpayer out of existence. Assuming that the government goes to extremes and does away with the idea of taxes as the primary source of funding, what term will you accept to pithily describe "someone has to give up the resources that were used for this project, despite not personally wanting the project to happen"?

Well, any Federal funds are categorically not tax payer funds. The Federal government spends money into existence as it is a currency issuer (through the Federal Reserve).

Wait, what? No; that's not how that works at all. Where did you read that?

The shortfall between Federal government spending and tax receipts is the deficit. The government has to borrow that money, which it does by having the Treasury issue debt securities.

This is correct. I attempt to provide references here: https://news.ycombinator.com/item?id=27685631

Not sure where these claims come from either.

Federal government deficit=private sector surplus. The money is conserved. Federal surplus=private sector surplus. People who want to balance the federal budget either don’t know what they are talking about, or are cynically trying to redistribute money to the wealthy.

Wonderful. Than I suggest that we cancel all taxes and just use the printed money to fund everything.

Then what the hell are they doing with all the money I send them?

Taxing your money away is a means of fighting inflation. Taxes and tax breaks also shape behavior. Sugary beverage taxes, tobacco taxes, mortgage interest deductions.

Federal taxes also legitimize the currency by providing stable demand for the currency.

Hopefully helping our poor and needy.

Lining their pockets.

This is (mostly) untrue.

US Federal Taxes go to the Treasury[1][2], which then spends it on Federal government programs. If spending is more than receipts, the US Federal Reserve issues securities (ie, sells bonds) to raise money[3].

Quantitative Easing by the Federal Reserve does cause money to "appear", but this is different to the general process for funding federal government programs[4] (Note that the money can disappear if/when the Reserve chooses to resell those assets).

[1] https://fiscaldata.treasury.gov/datasets/monthly-treasury-st...

[2] https://www.reuters.com/article/us-usa-trump-taxes-revenue-e... ("Of the $3.46 trillion in receipts taken in by the U.S. Treasury during fiscal 2019")

[3] https://www.stlouisfed.org/open-vault/2019/november/where-fe...

[4] https://www.forbes.com/advisor/investing/quantitative-easing...

Also, municipal broadband is often funded by issuing bonds that are paid back with revenue from providing Internet service.

Which is how we get those socialist big government monstrosities like water delivery and sewage handling.

It’s doubly confusing when you see signs up on the highway claiming “your tax dollars at work” next to highway projects when they come from fed and state taxes, but apparently those are not tax dollars...

The government is using its power of taxation to convince lenders that it can cover its debt. If that isn't taxpayer funded, then nothing I charge on my credit card is funded by my salary. Saying federal spending isn't "taxpayer funded" because there is a deficit is sophistry.

They are, but you are either being ungenerous in your question or missing vital context that anyone familiar with a city council meeting would already know.

OP is bragging that the municipality is paying for a service without increasing local taxes to pay for it. Increasing local taxes is the obvious way that municipalities typically pay for something like this. But increasing local taxes also generates predictable and often persuasive complaints from old cranks who never want to increase local taxes. OP's muni is thus circumventing those complaints by using grant money for the rollout.

While it's true that state and fed grants use tax dollars, it's irrelevant to the OP's brag. E.g.,

Old crank at meeting says, "I don't want to pay more money for a service I don't need." Applause break.

Old crank at meeting says, "I don't think it's right to take a grant created with state and federal taxes which I don't believe in paying." Awkward silence.

Edit: clarification

I really don't get how it's an ungenerous reading. It's funded by taxes.

Grants are paid for by taxes.

Many tax pennies were spent.

Just because it didn't come out of the city council pot makes no difference.

I agree with you. I think it is perhaps a great use of tax revenues, but at the state level all that tax revenue came from taxes. At the federal level it is possible to create money from nothing, something fans of Modern Monetary Theory would emphasize. Tho for the most part that is also tax dollars.

Could be a good use of taxes but I don’t think it’s correct to say “not a penny of tax revenues spent”.

^THIS. The fed govt prints more money. Cities and everyone else cannot,until every town starts to mine their own coin. Would you rather mine dodge coin or ‘new York’ coin that is backed by a municipal bond issue?

Someone above explained exactly how and why a state/Federal grant is different than local taxes.

It does, because this is ultimately a discussion about allowing municipalities to operate their own broadband. The questions of whether the state and federal governments should be handing out grants to build out these issues would be separate legislative issues.

The article mentions that municipal broadband networks in Ohio are now explicitly banned from applying/receiving new rounds of state grants. That’s part of this package.

> municipalities and electric cooperatives in the state do not have access to the proposed $250 million broadband expansion grant program that will be established

This is getting a bit frustrating

He literally said 'no tax pennies were spent'.

They obviously were, what he wrote is factually incorrect, taxes are taxes, just because they didn't have to rise council tax is totally irrelevant.

He also claimed "There is absolutely nothing about this service that is a hand out from the government".

That is also completely WRONG if as he claimed they received state and federal grants. A lie. It is subsidised.

i.e. You're completely wrong, the original poster woefully misunderstands taxes and grants if he's claiming no handouts and and taxes, please stop now.

I think broadband should be a public utility, this has got nothing to do with my politics, it's simply pointing out the original comment is factually incorrect in its claims.

His town's broadband was subsidised, it was built using tax payer pennies and it did require a handout.

Now you're just getting hung up on semantics, when the posters actual intended meaning was clear to several others here.

If you want to go down that road, however, grant dollars are already allocated and could thus be considered already spent.

Do you really want to be having an argument about what spend means?

Probably should have been phrased

"without a single penny spent of local tax dollar money. We've been fortunate to get enough grant money from both state and federal to get this off the ground."

That will get local support as local anti-tax people know that if they don't spend the state/fed money, other towns will. They won't get lower state/fed taxes.

But they could have lowered taxes by that amount. The argument here seems to amount to scoring one over political opponents by mis-framing the situation. Money is being taxed and spent on broadband. The fact that the opponents of that plan can be made to look ridiculous with rhetorical tricks isn't really a factor in deciding what is happening.

If the tax dollars aren't necessary & the vision is profitable, why does it need to be municipal? Can't these people just start their own company? Something here seems a bit weird.

Looking at it a different way, it’s entirely possible that those grants are the same ones that the companies would have applied for to roll out broadband to rural areas. In that sense, it doesn’t spend tax dollars in excess of what would have been spent anyway if they got the cable company to do it for them.

The post office has been around for a very long time, and is an example of the government providing a service which people pay for by using the service.

There are numerous examples of this. Your water supply might be one of them.

Municipal broadband is also usually pay-for-use, and you could fund it with bonds, which is also common.

You could argue against how a municipality decides to implement their own broadband service. But saying that no municipality should be able to provide any service - or even particular services - seems a bit odd. Since that's the majority of what local governments do...

The police, education, water, roads, parks, etc...

The reason other broadband providers have balked is because of the large investment needed to offer a competitive broadband service. Your town is instead funding that investment with state and federal grants, which are pretty much the definition of a government handout.

However, there is an unspoken assumption here that broadband belongs to the private sector. That’s an assumption worth thinking carefully about.

Many of the types of arguments against muni broadband have also been raised against other government infrastructure programs like public roads, bus routes, subways, etc. Many of those programs compete directly with private companies and displaced private investment.

Yet we know now that government-funded or subsidized infrastructure, done right, becomes a common platform that the rest of the economy can grow on.

It seems increasingly likely that broadband falls into this category. We just had a national year-long demonstration of the critical importance of connectivity to our economy.

The GOP argument is kind of highlighted here. Your city didn't have to spend any of its own money. while a business would have had to spend millions to build then to maintain. A business must have ROI and profit to survive(due to inflation). Your city doesn't need to any of that.

> profit to survive

If only they stopped their greed at ... enough profit to survive

That's not true though. The gov pays the providers as well.

>There is absolutely nothing about this service that is...

Your implementation may be good.

Living in NY it should not stretch your imagination to think up what an implementation that meets all those criteria would look like.

Municipal broadband is the hip new thing right now so nobody half-asses it. I expect in time (like over the next 80yr) it will follow the model of other government services and everywhere that can afford the graft, boondoggles and BS will have the graft, boondoggles and BS and the Detroits and BFEs who simply can't afford to do it wrong it will be the only ones left with municipal broadband done right.

That said, if a town or city wants to do their own broadband they should be able to do so without state interference. Local government is best government. Allowing the towns to have a "well we could DIY it and not buy your services at all" option as a backstop when negotiating with ISPs furthers competition in a market that is otherwise mostly devoid of it IMO.

Municipal fiber is a far easier service to provide than almost anything else a municipality does. One tiny plastic cable into the house. It can be run on telephone poles. Plumbing, sewer, and roads are many orders of magnitude more complex and expensive to build and maintain.

Fiber optic cables contain glass strands. That’s what’s what’s used to transfer the signal. The plastic sheet is just mechanical protection.

Not to be confused with the plastic ducts the fiber optic cables are often placed in.

> I expect in time (like over the next 80yr) it will follow the model of other government services and everywhere that can afford the graft, boondoggles and BS will have the graft, boondoggles and BS and the Detroits and BFEs who simply can't afford to do it wrong it will be the only ones left with municipal broadband done right.

so, basically what we have now for non-muni net in most places with telco+cableco duopoly?

I have no problem with public broadband as long as commercial broadband is allowed as well. Let the best format win.

The ideal situation would be to run the fibres (or maybe just ducts) centrally and allow different ISPs to run their own equipment.

Makes perfect sense for the last mile to be run by the government, just like the last mile of roads are.

Then you can have choice of ISPs. Or run your own.

if you want to an ISP which gives you a real IPv4 address, a guarenteed service and known contention ratio -- say they buy a couple of 10G lines from two diverse upstream providers like HE or Tata to a central location, land on a 52 port switch, and use it to serve their customers with 400mbit each way guaranteed and upto 10G if there's capacity.

On the other hand if you just want basic broadband with contention meaning that you could run into problems if everyone is pulling 50mbit, even though you can burst upto 1G, and perhaps you have CGNAT, you'll be paying less for it (the 10G uplink is spread out over more people), but that's your choice

This empowers the customer and ensures competition in the market, while the basic costs of fibre from a central internet exchange point are borne by either taxes or access charges (if you use the circuit you pay $5/month)

This is the correct idea. It maximizes competition while minimizing barrier to entry. Micro IPSs become extremely affordable, and all you have to do is have each ISP pay a set fee for each customer for line maintenance and expansion.

This is inspiring to hear. I'm a recent transplant to a small city in Western NY (20k residents). Are there any studies or documents available from your village's deployment? I'm interested in getting involved in this issue in my own city. Thanks!

5. There are also several examples of municipalities rolling out Municipal broadband at great expense to taxpayers, then failing, and then cities giving them away for-profit companies.

similar to sports arenas ? If you are looking for red-hot local government corruption, there are long lists available .. be warned they look reasonable on the surface, and will self-report positives.. thats the nature of the beast there

Does the municipality have any role in the administration of the service? If so, did they have that role last year? If yes and no, respectively, how is that not an expansion? (And if the municipality has no role in the service, in what way is it municipal broadband?)

It may very well be a good program and if it is, I'm in favor of it, but it seems like it's clearly spending taxpayer-funded grants and likely has an expansive (even if slight) force on government.

> Spectrum has had a stronghold on this region with prices they set without any competition.

> Spectrum bullying the competition.

Curious how did Spectrum bully out the competition.

Outside of major urban areas, there is often no bullying required. It was not economical 20+ years ago for there to be more than one physical cable or telephone provider in an area. Moving away from dial-up and DSL (which sit on top of phone lines which anyone can buy access to) toward cable (and fiber in the past decade) has put the power on the cable companies who physically own and maintain the lines. Since, in contrast to phones, cable has not typically sold access other than direct-to-customer, they maintain that same model. They don't sell access for someone who buys a fast fiber connection to then connect to the cable network and then their cable customers "dial into" that person's box. Instead, you only get service through the cable company itself.

Because cable requires a massive financial outlay, we end up with regional monopolies unless cable companies are forced to open up their physical platform to others. Which is rare.

" It was not economical 20+ years ago for there to be more than one physical cable or telephone provider in an area. "

It was(is) more than that. Those companies were granted a franchise/local monopoly on providing the service. By law, nobody could compete with them, whether it was economically possible or not.

> By law, nobody could compete with them, whether it was economically possible or not.

Why not just fix that law now though. OP is stating that it is a profitable business. If they fix that law wouldn't there be new entrants, fixing original problem.

I heard it costs a lot of money to do these builds, for low return. You might even call it a natural monopoly, if you believe in such things like basic economics.

how does that contrast that with what GP said

> The service will be fully subscriber-funded and end up making the town money in several years.

seems like an a business lots of private operators would be interested in building.

Not a lot of private operators may be interested in a business that (is projected) to break even in say seven years.

Not sure what OP meant by "several years" but avg business like restaurents/bars take "several years" to break even but OP is saying its actually going to turn profits. 7 years isn't a long time at all to become profitable.

Acquisitions mostly. They've gotten into trouble with the state over their acquisition of TWC when they failed to uphold the conditions of the merger which required them to improve and expand service.

> small village in central NY

What village? Would love to learn more about it. I'm from upstate and Spectrum absolutely has a hold on many cities. Them + Verizon have a duopoly on areas, and access can change block by block. It's insane.

Edit: did a google search and I found Parish, NY posted something asking residents to fill out a survey about their internet. But nothing else.

>> For years, Spectrum has had a stronghold on this region with prices they set without any competition. The citizens of this region have pleaded with numerous carriers to bring better internet, but all balk at the prospect.

So why did the other carriers not want to participate?

Could removing barriers that prevented the other carriers from contributing be a better solution than replacing the one bad carrier with a government bureaucracy?

Welfare city.

You are welcome.

And you're welcome for your welfare roads.

Welfare fire department, welfare police.....

I pay for these. The city didn't pay for the internet, I did.

That's hardly a fair comparison they are calling it welfare as the town in question didn't pay a cent to get it's own broadband.

And most small municipalities don't/didn't pay a cent toward the highway construction, either

With the 50k I pay in taxes per year, I'm sure I can pay for toll roads.

What? My state pays more into taxes than we get out. And my high income is definitely what funds welfare.

That's part of the cost of living in a democratic and capitalistic country. You are free to move where taxes are lower.

I recommend the rugged beauty of Antarctica for anyone who believes "taxes are theft".

What's wrong with welfare, "the health, happiness, and fortunes of a person or group" ?

[1] https://www.oxfordlearnersdictionaries.com/us/definition/eng...

Look at definition 2 and 3. Don’t be obtuse.

"practical or financial help that is provided, often by the government, for people or animals that need it"

"money that the government pays regularly to people who are poor, unemployed, sick, etc."

I still don't see the problem? A social safety net is good for everyone. Human compassion and lofty ideals of a just government aside, the rich are benefitting from it, too, in the sense that you can't have a functioning economy if there's no one to actually do the labor, rather than just collect the dividends.

And that is a valid argument that could lead to a discussion. Deliberately misinterpreting the word to pretend someone said they hate health and happiness is not.

I am sorry, but I genuinely do not see a difference in meaning between the first example and the second two. They all concern the social well-being of the whole (in fact, they’re all part of the _same_ definition).

Nevertheless, I just picked the very first definition that came up (literally, the one that Google presents on search), without any editorializing. Maybe you’re the one who is deliberately picking and choosing a narrow reading?

I am with you, my issue is that 740 billion dollar a year drain on the the taxpayer known as the Department of Defense. We could just privatise it... Defense as a Service, think of the possibilities! /s

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