Concerning Development in the Heartland

Small businesses throughout the country have been burdened by the impacts of the COVID-19 pandemic. In fact, many businesses have been forced to close or lay off their employees. As these small businesses are hanging on by a thread, one Midwestern municipality decided to hand tens of millions of taxpayer dollars to Google to help the Silicon Valley giant rollout a service which residents and businesses already have access: high-speed internet.

The West Des Moines (Iowa) City Council agreed to use taxpayer money to build Google a city-wide conduit network to help the trillion-dollar company avoid spending its own money. The Council is pledging property, sales, and hotel tax revenue to secure the more than $40 million cost of constructing the project. If you are wondering why a company with a market cap hovering north of $1.1 trillion needs to have its business underwritten with over $40 million of local tax dollars, while so many small businesses are struggling to survive, you are not alone.

To justify this massive expenditure of tax dollars, the City Council claims the publicly-owned network will spur competition. This claim makes no sense for two reasons: 1) When it decided to build the network, the City handed Google exclusive rights to the network for years to come; and 2) the exclusive agreement shuts out multiple existing providers, putting them at a competitive disadvantage.

The West Des Moines City Council is clearly not interested in fair and free competition in the marketplace. For the next several years, Google will effectively have a monopoly over most of the city-owned network. They’ll have a major advantage over existing companies that have already invested millions of dollars of their own funds to provide the City’s citizens with high-speed internet, and who merely want to play by fair rules, not change them to one company’s advantage. This sets a dangerous precedent.

Corporate favoritism is wrong no matter how you slice it. Instead of signing taxpayers up to foot the bill with little to no input, the West Des Moines City Council should focus on helping small businesses hurt by the pandemic, fixing roads, and providing affordable housing.

Now would be an important time to contact your councilmember, demand greater transparency, and ensure hard-earned tax dollars are put to better use.