Labour's Broadband Programme

Labour has made a big, new policy announcement that it will provide 1Gbps fibre broadband to every household in Britain by 2030, for free. It caught both the Tories and Liberals on the hop, and their response to it comes over as simply sour grapes, and the same old scare tactics, and appeals to blind faith in a market solution that has itself palpably failed to deliver over the last 30 years. 

The real problem with Labour's proposal is that its not bold enough. Marxists do not support nationalisation, as I have set out many times here. However, there are clearly some types of service that only make sense to be provided on, at least, a national basis. That is true not just because of the savings that can be made from economies of scale, standardisation and so on, but because these services are themselves used by people from all parts of the country. 

For example, it makes sense to have a national rail service, because people from Scotland travel to London on a railway line that runs continuously between the two, and vice versa. It makes sense to have a national health service, because, people move around the country, so that someone from Stoke may have an accident, or be taken in whilst in Cornwall, and will require healthcare, and so on. Its sensible to have a national road service, so that roads link different parts of the country, allowing free flowing movement along those roads. Attempts to go back to having privately built and operated toll roads, such as the M6 Toll, have proved to be failures. 

The fact that the Tories have not pursued the idea of having privately built and operated toll roads, shows what is wrong with a large part of their objection to Labour's broadband proposal. The broadband infrastructure is the 21st century equivalent of the railway infrastructure, and road network of the 20th century. Just because the state builds, maintains and finances the road network out of taxes, does not mean that it also owns and controls all of the traffic on that network. Yet, that is what the Tories are saying is implied by Labour's proposal to provide a modern broadband infrastructure. They claim it means the end of Virgin Media, Sky and so on. Absolute nonsense. They do not seem to understand the difference between platform and content. 

It is quite possible for private vehicles to use the country's nationalised road system, for example. It is quite possible also, for Virgin, Sky and others to produce programmes, or to buy in programmes produced by other companies, which they package up, and sell to customers, for a monthly subscription, and for them to deliver those packages, to their customers, down a fibre optic pipe. Indeed, the business of Virgin Media, Sky etc. will be greatly enhanced by the provision of such a modern, and efficient broadband network to every household, because it means they are likely to get more customers for their programmes etc., in just the same way that it is beneficial to a haulage company for the state to provide a comprehensive, efficient, and well maintained road network, which its lorries require in order to transport goods across the country. 

Both the Tories and Liberals have attacked Labour's proposal as being very costly. Nonsense. They make the same false argument that conservatives in the US are making against the proposals of Sanders, Warren and others for Medicare for all, which essentially means creating a US version of the NHS. The argument the US conservatives make is that provision of Medicare for all means a big increase in state expenditure and so of taxes. That's true, but what they fail to also say, is that currently, US citizens, where they can get healthcare, already pay for it via private insurance premiums. Obviously, if you get Medicare instead, there is no need to pay private insurance premium as well, unless, of course, you want to do so, in order to get access to other services such as cosmetic surgery and so on. The conservatives present it as though Medicare for all means a large increase in the costs of providing healthcare, because they only take into consideration the tax, whilst not taking into consideration the removal of the need to pay the insurance premiums. In fact, all studies show that the provision of healthcare via these private insurance schemes is vastly more costly, because more inefficient, than a national socialised healthcare system, funded via a national social insurance scheme. 

The Tories and Liberals, here, are making the same false argument in relation to the provision of an efficient and comprehensive national broadband network. The cost to society, and to individuals of providing such a national broadband system will be much cheaper. But, more importantly, as with private healthcare, the fact is that millions of people simply don't get the service when it is provided privately. In the US, it is only workers in the large, well unionised businesses that have been able to get good, private healthcare insurance provided by their employers. For these workers, the healthcare they get is very good, which is why they want to hold on to it. But, for many more millions of US workers, they get no such company provided health insurance. Wal-Mart, a very large company, but which still operates on the small company mentality of its owners, the Walton family that they had when they started out decades ago, is virulently anti-union, and is well known for not providing a health insurance scheme for its workers, many of whom are low-paid, and have to rely on the state provided Medicare system. At the same time, the large US companies that do provide health insurance for their employers, themselves see private insurance as expensive, and a cost imposed on them that their European competitors do not have to face. 

Around 25 million people, in the US, get no health insurance cover at all, and for those with existing medical conditions, even if they could get it, it would be prohibitively expensive. The same is true with broadband in Britain. Thousands of small villages across Britain get no effective broadband. In the village where I lived until recently, the broadband speed was around 2 Mbps, and very unreliable. The telephone lines it came along were not even copper, but old aluminium cable from before WWII. But even that is better than in some parts of the country, where no broadband is available at all, and where, because of the location, if it were possible the cost per household would be prohibitive. 

The fact is that, over 30 years, private companies have failed to provide the national, fast, efficient and reliable broadband infrastructure we require. In most cases that is because it is only profitable for them to do so in large conurbations, where main fibre trunks can service a large number of nearby households. They are not going to spend millions of pounds laying cable to the Scottish Highlands to provide cable to a handful of households. The Tories have claimed that Labour's proposals would put workers from Virgin and Sky out of a job. Nonsense, there would be more than enough work for them working for National Cable in laying down this infrastructure that currently the private companies are failing to do. 

But, the real problem with Labour's proposal is that it is not bold enough. It promises to provide this 1Gb cable to every household by 2030. That is way too long a roll-out period. Who knows what technology will be that far in the future, given the pace of change. In 1990, the few mobile phones in existence, for example, were like bricks, with aerials poking out of them. Within ten years, they had become a quarter of the size, and offered a range of other facilities. In Singapore, they have had 1 Gb broadband, to every household, for many years now. They are moving to 2Gb. Even if Labour could roll out its programme immediately it would only be catching up with where Singapore has been for some time. 

Moreover, Singapore is moving quickly to 5G mobile networks. It may well be that, in ten years time, fibre will be old, 20th century technology, with ultra fast 5G wireless networks being the way that communications are undertaken. After all, you are not going to walk around with a fibre cable attached to your smartphone or tablet, which is the way computing, and access to media is going, away from fixed personal computers, and so on. If Labour's proposal was to have any real merit it would be to offer free 2Gb broadband to every household by no later than 2025, and with 90% of the country getting that within two-three years. Otherwise, there is a prospect of making the same mistake as was made with railways in the 1950's, when, having delayed too long in scrapping steam power, Britain went over to inefficient and costly diesel engines, rather than having a large-scale, intensive programme of electrification, as most countries in Europe undertook. 

Of course, this failure to make investments in the right types of technology or production is what the proponents of the market always raise against state intervention. Again, it is nonsense. The people who make decisions about what technology, what production, might take off, employed by the state, are no worse than those made by private business people. People remember Sinclair for the ZX Spectrum computer, whilst his C-5 is forgotten about. Branson is known for the successful companies he's been involved with, but all the companies he set up to begin with that went bust are not mentioned. There are 5 million small business in Britain, but of these, 75% that are established go bust within the first five years, meaning that millions of these business people had bad ideas that failed, and all of the capital and resources that went into those businesses was essentially wasted. 

The reason the state tends to get a bad rap on these investments is that it usually gets involved in very large projects that private capitals will not risk. Forestry, for example, because it has such a long turnover period, has usually been undertaken by the state, rather than private capitals. The space industry would never have been started had it not been for the state undertaking that research, development and investment. But, where this state involvement is undertaken, what is crucial is that it is undertaken with gusto and determination. The USSR led in the space race for two decades, because its central planning system enabled it to focus resources on a rapid development of it; China's central planning system enables it to concentrate resources on building infrastructure on a large scale, and to do it quickly, and so on. 

The reason that a nationalised broadband provider could be effective is precisely for that reason that it could plan centrally and divert all the resources necessary to roll out fast broadband quickly, without concern for short-term considerations over profitability. But, as with many other of Labour's proposals, instead it is timid and half-hearted. If Labour rolled out an effective 2Gb fibre network by 2022-23, it would bring Britain up to the same kind of standards as Singapore. It would facilitate productivity and efficiency. It might well then be the case that by 2030, such an infrastructure was itself out of date, if 5G networks, or by that time 6G networks became the cutting edge, but, at least, it would provide Britain with a modern infrastructure for the intervening period, and would mean that it creates space before needing to upgrade again in the mid 2030's. As it is, Labour could be just rolling out this technology at the point where it becomes redundant. 

But, from a Marxist perspective the question then also arises as to the nature of the ownership and control of this National Broadband company. Given that the workers in BT, Open Reach, Virgin, Sky etc. do not currently exert control over those companies, and would need to achieve that before they could be effectively merged, the proposal for such a state owned national broadband company is a step forward. We should, of course, demand, from the beginning, that the company be run under workers control, though we can expect that the state would resist such a demand. We should, therefore, continue to demand that industrial democracy be extended, so that the boards of all companies be elected solely by the workers and managers in those companies. We should seek, at the earliest opportunity, that this nationalised company, as with all others, be transferred to the ownership of the workers in that company. 

But, it also again shows why opposing Brexit is vital. If we look at railways, already its apparent that a national rail network is itself insufficient. High speed rail already requires the linking together of the rail network in Britain with that in France, which in turn is connected to the rail network across the EU. A national broadband network is again constricted, when what is required is an EU wide broadband network, just as we need an effective EU wide mobile network. A broadband company owned and controlled by its workers, not by the state, could join with similar cooperatives across the EU, to provide the kind of infrastructure required for this century. 

Labour needs to be bolder, and more determined in its policy proposals.