Most of the world still isn’t online, and that’s a problem

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According to the United Nations’ International Telecommunication Union, 4.2 billion people –nearly two-thirds of the world’s population – have no internet access. This massive untapped population – largely low-income, illiterate and rural – are thus unable to interface with online markets like eBay or Amazon, or information platforms like Wikipedia or Google.

Congress currently is considering a bill, H.R. 5537, which seeks to address this inequity. Passed out of committee July 14, the measure would redirect U.S. international development infrastructure to encourage improvements in the regulatory environment for broadband and mobile-internet investment, with the aim to spur internet access in the developing world. To accomplish this, U.S. Agency for International Development programs will be revised and the Peace Corps and State Department will pivot to focus on using American diplomatic power to streamline the development of internet infrastructure, including through a new assistant secretary for technology, international communications and cyberspace. This new State Department official would take the diplomatic lead on policy related to internet access, internet governance and internet freedom, as well as policy relevant to cybersecurity and telecommunications networks and infrastructure.

While conservatives long have debated the proper role of government in foreign aid and international development, this bill at least would move existing resources to more productive uses – potentially benefiting American economic interests by opening new markets for U.S. goods and services. The bill explicitly aims to bring more people online in developing countries by aligning incentives and streamlining regulatory barriers to private-sector investment in broadband and wireless infrastructure. Private initiative is vital for economic growth and the recent failure of Free Basics in India is just one example of the serious policy challenges involved in bringing more people online.

The tremendous economic and social benefits of internet access are obvious. A study by the McKinsey Global Institute found the internet accounts for about 3.4 percent of the gross domestic product of large economies and that its global contribution to GDP surpasses that of the agriculture and the energy sectors. In economies such as China, India and Brazil, the internet has contributed more than 11 percent to GDP growth in the past five years. Furthermore, McKinsey found increases in internet “maturity” – such as the one observed the past 15 years in advanced economies – has the same impact as 50 years of development after the Industrial Revolution. Small and medium-sized businesses benefit the most, as they gain access to previously inaccessible markets. In 2009 alone, the consumer surplus generated by the internet ranged from $10 billion in France to $64 billion in the United States.

The benefits of bringing more people online globally are significant not only for local and global economies, but also for international trade and individual liberty. Allowing billions more people to gain access to the corpus of global information offers incalculable possibilities. To take just one example, farmers can get advice on their crops and data on prices and methods of production. Here in the United States, the Knox County Farm Bureau in Ohio has created a free app to help farmers comply with laws and regulations regarding the treatment of their crops, resulting in healthier and more efficient production. The ability to bring people together through social networks and to broadcast information rapidly to remote parts of the world empowers local communities to take hold of their own future.

Regardless of one’s feelings on the extent to which the United States should be involved directly in international development, the benefits of bringing the next 4 billion people online are undeniable, as are the tangible benefits that could be reaped for the U.S. economy, liberal democracy and global markets. As long as we’re in this business, it makes sense to direct U.S. resources to help develop global internet infrastructure.

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