Joining the ranks of the Underserved

In early November, after more than a year in the making, the Minnesota Ultra High-Speed Broadband Task Force released its report to both the Legislature and the Governor. And as the Task Force member appointed by Governor Pawlenty to represent rural citizens throughout the state, I was particularly pleased with both the focus and priority the Task Force placed on meeting the broadband needs of rural Minnesotans who find themselves in areas of the state that are both unserved or underserved by incumbent broadband providers.

But the real irony that unfolded shortly afterwards makes these issues quite real and personal for me. For you see, after spending a decade as a high-speed broadband user and a telecommunications researcher, I moved out to a beautiful farmstead in early December just a few miles from the campus where I work. But the consequence is now that I am 2 miles down the gravel road; I am just out of the reach of both the incumbent telephone and cable companies that provide the majority of the broadband services in the region.

Now don’t begin to feel too sorry for me as I still have my mobile broadband card, so I’m not completely offline. But both the connection speed (well under 1Mbps) and the reliability are far from ideal. So now that I have personally joined the ranks of the broadband underserved, I am counting on the Minnesota Legislature to carefully read and begin to implement the Task Force’s recommendations. And with that in mind, allow me to share with you the elements of the broadband report that give me hope.

A Focus on Ubiquity – One of the areas that the diverse Task Force members found complete unity and consensus on was that high-speed broadband service must reach every home and business across Minnesota. Not just the homes in town; but every home everywhere in Minnesota. It’s a very clear, unambiguous and positive statement for rural Minnesotans all across the state.

Setting a Minimum Connection Speed – For the residents of the last farmstead at the end of the gravel road, few concepts are more important than defining a minimum connection speed. That’s because you can bet that that’s the speed they will likely receive. Accordingly, it’s important to set a minimum speed that is sufficient for those remote residents to access telehealth services, engage in distance education services and functionally access many of the essential services that broadband allows us to access. For you see, people who live in remote places and have poor access to broadband services typically have poor access to a variety of other services as well. It’s simply the disadvantage of distance. But broadband is a unique technology that often allows us to transcend the disadvantages of distance, by bringing services right into our homes.

So ensuring a minimum connection speed is vital; and for the Task Force, that minimum speed was 10-20 megabits per second. But equally important, the Task Force set an adjacent goal for Minnesota to be in the top 5 states in both connection speed and broadband penetration. So in fact, that minimum connection speed is really a moving target that must regularly be increased if Minnesota hopes to achieve and then maintain a “top 5” ranking.

Prioritizing the Unserved First – A final element of the report that is equally important to rural Minnesota is the focus on prioritizing public investments in broadband deployment. The truth is that there simply isn’t enough money, public or private to “fiber up” the state as many would like. In fact, the costs are somewhere between enormous and staggering! So the development of public/private partnerships will be required to effectively finance these projects. But where to begin? Where the need is highest? Where the return on investment will be highest?

Well, in this case the Task Force was once again clear and unambiguous when they noted that we should first address the needs of the residents living in unserved areas of Minnesota, where broadband currently has no reach; next address the needs of the underserved areas; and finally address the remaining needs of the state. With this priority in mind, the Task Force is clearly placing rural Minnesotans at the front of the line.

So when the Minnesota Legislature once again convenes in February, there will be many who will help breathe life into this new report and help encourage the Legislature to implement many of these recommendations. And rest assured that I will be one of them because this time it’s personal!

The Problem with Universalism

The Minnesota Hi-Speed Broadband Task Force has now spent the past few months listening to a variety of public officials and others who have provided comment and testimony regarding broadband deployment throughout the state. And through this process it’s become clear that for a growing number of Minnesotans, ubiquitous access and universal adoption of broadband is a significant goal. But when you really think about it, this notion of universalism increasingly permeates much of our public policy today. Within the current public debate about health care reform, universal coverage is a goal that both Democrats and Republicans publicly seem to embrace; and in our national discussion about public education we want to ensure that absolutely no child is left behind.

It’s interesting that in a capitalist culture that focuses on competition, product differentiation and market share that we seem to be romancing the values of universalism. For example, for many years economists defined the term “full employment” to actually mean an unemployment rate of 5 percent or less. I simply don’t ever recall back in the 1990s seeing public officials at the state or federal level wringing their hands over the 3-5 percent of the work force that were jobless. And public schools with a 90 percent graduation rate used to be a source of pride and held up nationally as an example of what is right with our public school system. Sure, we aspire to100 percent graduation rates, but there just seemed to be an understanding that while no one wants to leave a child behind, that reality often trumps aspiration.

Returning universal adoption, I am reminded that virtually all former innovative technologies still have yet to reach the goal of universal adoption. This is true for even some of our most mundane technologies. For example, we have yet to achieve universal adoption of a telephone in every home, a microwave in every kitchen, or a car in every garage. For the simple reality is that there are a variety of factor that help explain why people choose to adopt some technologies and take a pass on others. Age, income, culture, tradition, religion, education and awareness all come into play.

The late Everett Rogers wrote the seminal book on the adoption and diffusion of innovative technologies. Rogers was an Iowa farm boy who earned his doctorate in the 1950’s trying to understand why some farmers adopted some obviously beneficial technologies while others did not. A decade earlier when agriculture was transitioning from planting varietal seed corn to hybrid seed corn researchers understood that both the yield and the drought-resistant characteristics of the hybrid seed made it far superior. Yet it took many years for farmers to adopt this new technology. From these and other studies, Rogers argued that the adoption of any new technology actually occurs in a series of predictable stages which culminates in an “S-shaped” curve, where the adoption of a new innovation starts out very slowly until it reaches a critical mass; at which point the adoption rate soars, only to tail off and stabilize. Most importantly however, was that Rogers never suggested that any technology will achieve a 100 percent adoption rate. In other words, regardless of the benefits of the innovation there will always be some non-adopters. A good example is the recognition that even today; some parents choose not to immunize their children against a variety of serious and contagious diseases.

So how do we rationally address this increasing attention to universalism in policy when all the evidence suggests that such universalism is unreasonable and unattainable? Well, first we need to recognize that defining anything less than 100 percent as failure makes a fine aspirational goal, but it makes poor public policy. Whether defined as a zero-tolerance drug policy, universal adoption, or no child left behind; policy is always best implemented when it is guided by rational discretion over aspirational ideology.

I'm no techno-genius

Well, I finally managed to get back into my blog after months of trying. For some reason I just couldn't remember my password and instead of simply utilizing the password assitance technology offered by Google, I was sure I would be able to evenutally remember it. Now after 4 months, I finally gave up and used the technology assitance.

Needless to say I have months of commentaries backlogged, so I will post them over the next few weeks.

Wanted: Health Care Finance Reform

During a recent town hall-style meeting in Colorado to bolster support for his health care initiative, President Obama was asked why he had changed his rhetoric from using the term “health care reform” to the term “health insurance reform.” In my opinion, it was a smartly-asked question that required a more thoughtful answer than the president provided. For if I were to lay my cards out on the table, I would admit that for me it’s never been about health care reform but rather it’s about health care finance reform.

Whether we realize it or not, here in Minnesota and throughout the entire upper Midwest region we are blessed with the best health care delivery system in the nation. We are fortunate to have some of the most talented physicians, nurses and health care practitioners, working in state-of-the-art hospitals, clinics and health care facilities. A large percentage of our care is delivered through large multi-specialty clinics and integrated health care systems that lead the nation in quality; achieving efficiencies that other parts of the nation can only dream about. When we talk about our health care systems up here names like Mayo, Fairview, Allina, Avera, Sandford, Altru, Meritcare, Gunderson and Marshfield are all recognized for their quality, efficiency and effectiveness. Simply put, we don’t need to nor want to change our health care delivery system.

On the other hand, the way we finance and pay for all this great care is a total mess. This is just as true for our public payers as it is for our private payers. It’s too expensive, excludes more than 40 million Americans and is financially unsustainable. Here are some simply examples of the illogic of the current financing system:

· A physician working in a highly efficient, multi-specialty clinic in Minnesota who sees a patient for a routine office visit; or a hospital in North Dakota that admits and elderly patient with a simple uncomplicated case of pneumonia, will receive a much lower Medicare reimbursement than a physician or hospital treating a similar patient in Dade County, Florida. In other words, Midwest providers get penalized for their efficiency, while physicians and hospitals in other regions of the country get rewarded for their uncoordinated and inefficient care.

· An uninsured patient who enters an emergency room with a deep gash to their leg will receive a significantly higher bill for services in the E.R., than a similar patient whose insurance company has negotiated deep discounts with the hospital for their enrollees. In other words, those who can afford it the least get charged the most.

· A 24-year old patient with a serious chronic disease is virtually uninsurable in the health insurance marketplace, when he/she leaves their parent’s family insurance plan upon their 25^th birthday. In other words, health insurance often is unavailable to those who need it the most.

· More than 14,000 Americans lost their health insurance each day during 2009 due to being laid off by their employer. For you see, we are the only industrialized country where if you lose your job, you lose your health insurance.

So when the president was asked about this change in his rhetoric, I wish he would have plainly told the questioner that the reason he now uses the term health insurance reform is because that’s where the problem lies. That we want a health insurance market that doesn’t deny you coverage if you have high blood pressure, diabetes, or other pre-existing conditions. That if you lose your job you sure as heck have enough to worry about; and keeping your health insurance shouldn’t be one of them. For you see, unemployed people get sick too.

Unfortunately, those who try to characterize this as a government takeover of “health care” are just trying to scare you. For you see, the most universal federal health care finance program we have is Medicare, which covers millions and millions of elderly Americans. So if this is the socialistic takeover of health care where are the Medicare-employed doctors and nurses? Where are the Medicare hospitals and clinics? Where is the federal takeover? Well, as we all know, this is all political hyperbole. Medicare beneficiaries get to choose their doctor or change their doctor just like you and me. They use the same private clinics we do; and the same private hospitals we do. Medicare is simply a publicly funded insurance program; nor more … no less.

So let’s dial down the rhetoric and scare tactics and let’s dial up some of our best ideas. Whether we need a “public option” or not is certainly open to an honest debate. But wouldn’t it be great if we ended up with a decent basic health plan that all Americans would have equal access to (let’s call it the Basic American Plan) that all insurance companies would sell for the same price. If insurance companies want competition, well let them compete on quality and service; but not by cherry-picking the healthiest among us, and denying coverage to those who need it the most. Now wouldn’t that be something!

Is it ever really all or nothing?

As a member of the Minnesota Hi-Speed Broadband Task Force I have spent the past few months listening to a variety of public officials and others who have provided comment and testimony regarding broadband deployment throughout the state. And through this process it’s become clear that for a growing number of Minnesotans, ubiquitous access and universal adoption of broadband is a significant goal. But when you really think about it, this notion of universalism increasingly permeates much of our public policy today. Within the current public debate about health care reform, universal coverage is a goal that both Democrats and Republicans publicly seem to embrace; and in our national discussion about public education we want to ensure that absolutely no child is left behind.

It’s interesting that in a capitalist culture that focuses on competition, product differentiation and market share that we seem to be romancing the values of universalism. For example, for many years economists defined the term “full employment” to actually mean an unemployment rate of 5 percent or less. I simply don’t ever recall back in the 1990s seeing public officials at the state or federal level wringing their hands over the 3-5 percent of the work force that were jobless. And public schools with a 90 percent graduation rate used to be a source of pride and held up nationally as an example of what is right with our public school system. Sure, we aspire to100 percent graduation rates, but there just seemed to be an understanding that while no one wants to leave a child behind, that reality often trumps aspiration.

Returning universal adoption, I am reminded that virtually all former innovative technologies still have yet to reach the goal of universal adoption. This is true for even some of our most mundane technologies. For example, we have yet to achieve universal adoption of a telephone in every home, a microwave in every kitchen, or a car in every garage. For the simple reality is that there are a variety of factor that help explain why people choose to adopt some technologies and take a pass on others. Age, income, culture, tradition, religion, education and awareness all come into play.

The late Everett Rogers wrote the seminal book on the adoption and diffusion of innovative technologies. Rogers was an Iowa farm boy who earned his doctorate in the 1950’s trying to understand why some farmers adopted some obviously beneficial technologies while others did not. A decade earlier when agriculture was transitioning from planting varietal seed corn to hybrid seed corn researchers understood that both the yield and the drought-resistant characteristics of the hybrid seed made it far superior. Yet it took many years for farmers to adopt this new technology. From these and other studies, Rogers argued that the adoption of any new technology actually occurs in a series of predictable stages which culminates in an “S-shaped” curve, where the adoption of a new innovation starts out very slowly until it reaches a critical mass; at which point the adoption rate soars, only to tail off and stabilize. Most importantly however, was that Rogers never suggested that any technology will achieve a 100 percent adoption rate. In other words, regardless of the benefits of the innovation there will always be some non-adopters. A good example is the recognition that even today; some parents choose not to immunize their children against a variety of serious and contagious diseases.

So how do we rationally address this increasing attention to universalism in policy when all the evidence suggests that such universalism is unreasonable and unattainable? Well, first we need to recognize that defining anything less than 100 percent as failure makes a fine aspirational goal, but it makes poor public policy. Whether defined as a zero-tolerance drug policy, universal adoption, or no child left behind; policy is always best implemented when it is guided by rational discretion over aspirational ideology.

Horses & Broadband on my Mind

Today I'm in Winona, Minnesota at the Minnesota Equestrian Center watching my daughter compete at a regional horse show. If you've ever been to a large regional or national horse show, you truly know the meaning of the phrase "hurray up and wait!" We started the day at 5:30am and it is now around 4:30pm and we're still waiting for the first riding class. I'm figuring that the riding classes might be completed around midnight - but we're used to it. So I bring the laptop and a broadband card and spend much of the day working and writing in the trailer.

I've mentioned in an earlier post that I serve on the Governor's Broadband Task Force, which is good as broadband has been a longstanding research interest of mine. And coincidentally, I've just completed a study of 689 businesses throughout rural Minnesota, examining their adoption and utilization of the Internet in their business. So I'm sitting in the trailer writing up the findings and getting it ready for publication and release in a few weeks. I will release the final report through the EDA Center website at www.umcedacenter.org

But until then, let me give you a short sneak preview of a couple of the more salient findings:

• 89.7% of rural businesses are now online. This compares to 65.5% in 2004.
• 96% of rural businesses online connect with a broadband connection. Again, this compares to 61% back in 2004.
• The median price paid for a broadband connection was $50; not much more than a residential connection. That's likely because the majority of rural businesses are very small businesses with fewer than 10 employees.
• And as a result 71% of businesses characterized the price they pay for broadband as "very affordable" or "priced about right."
• 85% of businesses reported that their current Internet connection speed is adequate for their business needs; however, only 37% had confidence that their current connection speed would meet their needs 24 months from now.

Well ... that's enough for now, as I can't spill all the beans. But needless to say that I believe that this new study provides an interesting update and tells an informative story of how rural businesses continue to utilize and integrate the Internet into their business strategy.

Better get back to the horses ...

What's Wrong with Socialized Medicine?

This week aside from the protests in Iran, the news and Sunday political shows were filled with a variety of opinions on Obama's desire for a national public health care plan. While the advantages of such a plan are simple; i.e. universal access and coverage, opponents suggest that the disadvantages are too numerous to mention. However their primary concerns are (1) keeping government out of health care; and (2) arguing that no one wants or needs socialized medicine.

For quite a while I bought into these arguments as my natural inclinations are capitalistic. But after following this issue for a while I have made a 180 degree turn; and my logic is rather simple.

First, for those who want the government out of health care, the reality is that ship sailed more than 40 years ago. If you simply add up Medicare, Medicaid, Indian Health Service, Veterans Administration and Railroad Retirement expenditures, you will discover that the government already pays more than 45% of the entire U.S. health care bill. Do we really want government to bail out of these programs? I don't think so.

But what about socialized medicine? We certainly don't want that, right? Well, I'm not so sure about that. What exactly is socialized medicine?

From my perspective, socialism is when the government controls industrial resources, or what Marx called the "means of production." So back in the 1970's we laughed at the Soviet Union's inefficient government-run agricultural cooperatives, where production was low and there were no incentives to increase production or efficiencies. Through examples such as these, we came to conclude that government was incompetent and couldn't organize a two-car funeral procession!

But clearly, there are many other services we want our government to control; right? When we call 911 do we want an emergency dispatch operator to first ask us whether we have "police insurance" and if so, what our policy number is? Heck no ... get the cops here right now!

But then why is it OK for such an exchange to occur in the hospital emergency room, but not on a 911 call? Does this suggest that we actually want socialized police protection, socialized fire protection, socialized national defense and socialized roads and bridges, but not ... socialized medicine? And if so why?

Well the answer seems to be simple. While the free markets are optimal for the exchange of most goods and services, they don't really work well for society's essential services. Services such as police and fire protection, clean water, roads and bridges and national defense are so central to our collective well-being, that we decided to exempt these services from the marketplace. Rather, we prefer to collectively tax ourselves to ensure that we all have access to these important services regardless of our ability to pay.

So the real question here is when will enough Americans come to the conclusion that access to health care is an essential service? And when we arrive at that point we just may begin to wonder ... So what's so wrong with socialized medicine?

The Midwest Rural Assembly

I received an email from Eleonore Wesserle from the Institute for Agriculture and Trade Policy in Minneapolis with further information about the upcoming Midwest Rural Assembly, August 10-11 in Sioux Falls. It appears that slowly but surely they are putting together the agenda for this first ever event.

Click here to view the preliminary agenda. It is my understanding that they plan to fill in the blanks in the agenda as they go along. So viist their website regularly to see who's coming and what will be happening in Sioux Falls.

For further information contact about the Midwest Rural Assembly contact Elenore at ewesserle@iatp.org

The Rural Policy Forum

Today I moderated a legislative panel of 4 legislators at the Minnesota Rural Health Conference here in Duluth. The day turned out to be outstanding with bright sunshine all day, which clearly brightened everyone's mood. The 4 legislators in attendance were Rep. Tom Huntley (D-Duluth); Rep. Mary Ellen Otremba (D-Long Prairie); Rep. Steve Gottwalt (R-St. Cloud); and Sen Yvonne Prettner Solon (D-Duluth).

There were few partisan fireworks to report from up here. Rather, there was a sense (or hope) by many that this was the year meaningful health care reform was going to occur at the federal level. While they were all quite hopeful, it was equally clear that they all have a great deal of faith in President Obama's ability to deliver. We'll see ....

Job Losses Linger

I'm taking off for Duluth, Minnesota later today to attend the state Rural Health Conference on Monday and Tuesday. Hope the weather is decent as it can be anywhere from 50 to 90 degrees in Duluth this time of year.

I should also mention that on Friday of next week (June 19) the Governor's Broadband Task Force is meeting in Grand Rapids, MN. This is the first time they are holding a meeting out in my neck of the woods (i.e. rural Minnesota), so I have agreed to coordinate the meeting. Two additional meetings in rural MN are scheduled for July and August in Mankato and Fergus Falls. As a member of the task force I can tell you that we are now at the stage where the rubber is meeting the road (some may suggest that the gloves are coming off). The reality is that the task force is comprised of folks from a variety of constituencies that don't always see things the same way. But in my view that's the way it should be. So if you around Grand Rapids next week, stop by and check out the Task Force at work. And here is my June article for Prairie Business Magazine.

Two Upcoming Events

Two upcoming events that I would recommend for those who care about the future of rural places are the annual Minnesota Rural Health Conference June 15-16 in beautiful Duluth, Minnesota; and the first ever Midwest Rural Assembly August 10-11 in Sioux Falls.

The Annual Rural Heath Conference is an event that I have attended every year since its inception and have never been disappointed. The idea of once a year having health care providers, academics and just plain folks who care about rural health come together and share their ideas and knowledge is a great concept. In addition, I will be facilitating a legislative panel with 5 or 6 state legislators (both GOP and DFL) to discuss the fiasco that occurred in St. Paul this year. That alone is worth the price of admission!

As I stated above, the Midwest Rural Assembly is a first-ever event. It will be held in Sioux Falls. South Dakota on August 10-11. I really don't know much about it except that it is a spin-off from the National Rural Assembly which I attended a few years ago outside of Washington, DC and was sponsored by the W.K. Kellogg Foundation. While I don't know many of the details about this event, I'm going to go because that's what THE RURAL GUY does! The rule is simple, when a group of rural folks come together --show up. It's a rule that has seldom disappointed me; besides, I'm sure the Assembly will make great fodder for my magazine columns.

So if you take a chance and check out either of these events, please find me and say hello. It's the only way I would know that anyone is actually reading this dribble!

A Bathtub Recovery

As I mentioned, I like to write about the economy, politics and rural Minnesota. Here is a copy of my June column that appears in Minnesota Valley Business and discusses my views on the state of the economic recovery. If you click on the article it will enlarge and make it much easier to read.

Let's Get Started

This is my first attempt at a blog ... so please be patient and forgiving. I've been an active researcher/writer and hope to use this space as a launching point for views on issues that I care about. I named this blog "The Rural Guy" because over the years I have found myself at the Minnesota State Capitol and often being recognized as "the rural guy." After a while the name kinda stuck and now I wear it as a badge of honor.

I write a monthly column in two regional business magazines, Minnesota Valley Business and Prairie Business magazine. I hope to bring these resources to this blog as well. But most of all, I hope to use this blog to engage in an active dialogue with others who care about the issues that I do. We'll see ...