Freedom Line Blog

A government-owned broadband scheme in Lafayette, Louisiana, is more than $160 million in debt and is losing $45,000 a day, according to Lafayette’s independent auditor. The city’s broadband business is struggling to compete with cable, telephone, wireless and satellite service providers in terms of price, performance and service options, according to a study by the Reason Foundation.

Of course, none of this should come as a shock to anyone who understands basic economic principles or the value of competition.

The government simply lacks the incentive to provide quality service or spend money wisely. After all, if a government-owned/socialist-style enterprise fails, investors don’t lose money, taxpayers lose money. As a result, time and time again, when the government enters an arena already filled by successful private companies, it’s just a matter of time until the government’s offering goes belly up and taxpayers are left paying the bill.