A recent announcement from the Department of Defense (DoD) should be concerning to any Americans hoping to benefit from a thriving and innovative fifth generation, or 5G, cellular network. A request for information from the department signalled its interest in retaining control of and operating a subset of 5G wireless spectrum for its own purposes, despite prior promises that it would auction these off to commercial entities.
Advocates of the DoD’s idea see it as a national security issue that the United States compete with China by retaining state control of its 5G network. This is entirely wrongheaded — not only does this proposal concentrate risk in a single network, but it also fails to leverage the innovative power of the free market.
After all, the way to compete with China is not to be China. As a group of 20 senators pointed out in a letter to President Trump, the United States became a 4G leader by embracing competition and limiting regulatory hurdles, not by relying on nationalization.
Failure to follow this lesson from the past is the true risk to American global competitiveness in broadband capability. 5G is not the end of the arms race, and the private sector’s ability to develop new technologies will be crucial to future competitions in 6G and beyond.
There are plenty of other reasons to be concerned about the DoD expanding into telecommunications. The Pentagon’s massive $740 billion budget makes poor use of taxpayer dollars, and legislators should be looking to reform it to better protect America, not just throw more money at it. But both DoD and the government’s official spending watchdog, the Government Accountability Office, have stated that the cost of the DoD’s proposal is, as yet, indeterminate.
Thus, it seems highly likely that taxpayers would soon find themselves on the hook for the costs of managing a nationwide 5G network. Without details on what the fiscal burden would look like for taxpayers both in terms of the establishment of the 5G network and the ongoing maintenance of it, such a proposal should be dead on arrival.
There are also legal concerns with the proposal. The Communications Act, which established the Federal Communications Commission (FCC), also gave the FCC the authority to auction off spectrum to commercial entities. Should DoD attempt to retain some of this spectrum for its own use, it could be seen as a legally dubious encroachment on the FCC’s purview. The proposal might also be seen as a violation of the Anti-Deficiency Act, which requires that Congress specifically dictate what funds federal agencies use and what these funds are directed to. Though wonky, these legal questions should be sufficient for DoD to reevaluate its proposal.
National security concerns are often cited as a reason to ignore what we know about smart policymaking, most notably in the case of international trade. But the truth is that the United States is strongest when it embraces a competitive market’s power to create wealth through new, innovative technologies. As such, Congress and the White House should make sure that nascent proposals to nationalize 5G are nipped in the bud.