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Wireless auction a win for taxpayers?

By Grover G. Norquist and Kelly William Cobb
Politico.com

WASHINGTON — Voters sent a clear mandate to Washington on Election Day: cut government spending and end the culture of fiscal profligacy.

Yet, one big reason for higher spending has been inefficient and costly investments in public safety and national security. If lawmakers on both sides of the aisle are serious about providing this vital government service while passing real savings on to taxpayers, there is an important solution that both parties can embrace: auctioning spectrum.

Fiscally responsible lawmakers should support the Federal Communications Commission’s plan to auction the 700MHz D Block of spectrum. The money from an unrestricted auction could help pay for building and operating a network dedicated to public safety on a different block already set aside for first responders.

While the FCC’s plan has broad bipartisan support in both the House and Senate, some in Congress want to reallocate the D Block directly to first responders. This could forfeit as much as $3 billion in projected auction revenue.

By reallocating instead of auctioning, the spectrum is likely to cause further federal, state and local deficit spending - governments would have to appropriate funds to build and run a network on the D Block for public safety. This is in addition to building a network for the spectrum already allocated to public safety.

The FCC now estimates that if public safety officials insist on building a government-run, stand-alone network, refusing a partnership with private companies, it could cost as much as $16 billion.

Similarly, maintaining a public-private partnership network over 10 years would be far less expensive than operating a government-run public safety network. Auctioning the D Block and then building the broadband network that public safety needs in partnership with private carriers could save taxpayers $22 billion - compared with a stand-alone, government-run network.

On top of this, Congress should work with the FCC to establish voluntary incentive auctions to open up unused, or inefficiently-used, spectrum crucial to the exponentially increasing demand for mobile broadband.

These voluntary auctions could allow incumbent spectrum holders to get some of the proceeds if they auction their spectrum license. The remaining money - potentially tens of billions of dollars - could help cover any remaining cost of a public safety network, and then pay down the deficit.

Lawmakers must also find ways to free spectrum from federal agencies. They now have exclusive or shared ownership of more than half the spectrum ideal for mobile broadband. But they have zero incentive to relinquish unused or inefficiently-used frequency bands.

The Commerce Department’s evaluation of 2,200 MHz of spectrum for broadband is encouraging. Yet less than a third of the spectrum under review is held exclusively by federal agencies - and 60 percent is above the ideal range for mobile broadband.

One solution is a commission that could review all government-held spectrum and have the authority to adjust it or give it to the FCC for auction. Another carrot-and-stick solution would be incentive auctions for federal agencies.

A vast majority of proceeds would go toward deficit elimination. A smaller, one-time cash infusion could upgrade agency technology to reduce their spectrum usage, thereby shrinking government and realizing more efficient use of taxpayer dollars.

The nation’s fiscal health and the security of its citizens are not mutually exclusive, and both should be top priorities for the next Congress.

The FCC’s plans for incentive auctions and the D Block provide opportunities to improve public safety - while putting spending in check, shoring up the deficit, and galvanizing greater efficiencies in telecommunications. But this is only if policymakers realize their interests intersect in doing more with less.

Grover Norquist is the president of Americans for Tax Reform. Kelly William Cobb is the executive director of its Digital Liberty Project.

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