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How Seniors Will Benefit from Broadband

Short term pessimist, long term optimist |


| The Big Companies Did It

December 08, 2005

How Seniors Will Benefit from Broadband

Michael Mandel

A very interesting new paper by Bob Litan lays out the economic benefits of providing broadband connections to senior citizens and disabled Americans.

Though it is widely understood that broadband technologies that allow rapid and “always on” connections to the Internet will provide significant benefits to the U.S. economy, this report is the first to estimate the economic benefits to the nation due to cost savings and output expansion resulting from the use of broadband technologies for an important specific sub-group of the U.S. population: the roughly 70 million Americans who are over 65 or under that age but have disabilities.

Three types of benefits from broadband deployment and use are addressed: lower medical costs; lower costs of institutionalized living; and additional output generated by more seniors and individuals with disabilities in the labor force. Considered together, these three benefits are estimated to accumulate to at least $927 billion in cost savings and output gains in 2005 dollars (with future benefits discounted for the “time value of money”) over the 25 year period, 2005 to 2030. This amount is equivalent to half of what the United States currently spends annually for medical care for all its citizens ($1.8 trillion). As large as these benefits may appear, they are line with previous estimates for the benefits of broadband for the population as a whole.

Policies designed to accelerate the use of broadband for these populations,however, could significantly add to the benefits, by cumulative amounts ranging from $532 billion to $847 billion (depending on the wages earned by the additional working seniors). The policy benefits are as substantial as what the federal government is likely to spend on homeland security over the next 25 years. Total cumulative benefits, under the right set of policies, could exceed what the United States currently spends annually for health care for all its citizens.

From "Great Expectations: Potential Economic Benefits to the Nation From Accelerated Broadband Deployment to Older Americans and Americans with Disabilities" by Robert Litan (New Millenium Research Council)

03:43 PM


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Good desision... But is it only variant of solving the problem or final project...?

Posted by: Tim at December 8, 2005 04:14 PM

Well, as more opportunities to make money emerge online, seniors and disabled people benefit from them.

The most obvious thing would be to have a tax credit for broadband costs, for seniors or disabled people. Maybe a rebate on BB subscription and PC costs as part of the Social Security check...

The problem is, the people that have the most to gain - less educated, poorer senior citizens - are the ones least likely to learn how to use BB, even if it is free..

Posted by: Kartik at December 8, 2005 04:59 PM

well, as someone who will soon be working with shut-ins, the education level and familiarity with BB, and internet access alone, seems to be the issue...

Posted by: f villanueva at December 14, 2005 03:23 PM

There is a near zero probability that persons living on limited fixed incomes ravaged by the ever increasing cost of medications necessary to prolong life will find room in tight budgets to pay exhorbitant fees for broadband internet connectivity. A senior whose primary income is derived from SSA would find it very difficult to pay his medicare premium, his prescription drug coverage premium, his medigap insurance premium, his deductibles, his transportation costs and costs associated with medical treatments not fully covered by Medicare Part B, buy groceries, pay utilities, rent or mortgage and still have the $60+ that Comcast, just to name one over priced competitor in broadband, is currently charging.

This study apparently believes that retired persons are primarily wealthy individuals when the statistical data show that a substantial majority live near the poverty line. Broadband Internet connectivity and indeed the cost of a personal computer to facilitate the connection is well beyond the means of any senior citizen whose health is less than optimal.

Don't add these dollars into the budget reconciliation as they have done for years with the anticipated revenues from resale of unused television broadcast frequencies - at least not until the money has undergone a transformation from "theoretical dollars" to actual greenbacks you can feel, see, touch, and take to the bank.

If Bob Litan proposes to "provide" Internet connectivity (and let's not forget the associated hardware and software costs to get them on the Internet and maybe a few CDs from the Video Professor because they may not know how to perform a "3 finger salute," in which case they will be lost when the blue screen of death appears as it inevitably must for all except those who tough it out and run FreeBSD.)

If we tax the bejabbers out of Internet connections with the aim of providing low or zero cost service to senior citizens on low fixed incomes and the equipment to connect them and perhaps a small amount of basic training so they know how to set up an email account and adjust the security settings Bill Gates plans to toughen in his next release of Internet Exploiter, the question then becomes: "What, precisely, does one suppose these people will do that generates economic value?" Face it, they are not the sharpest tools in the shed or they would not be living at the poverty line - a sure symptom of inability to engage in long term planning, delay gratification, save and invest so that the SSA check (mainly gobbled up by the costs associated with Medicare) is not the only money they have.

I for one do not envision a substantial population above the age of 70 with either the financial means or the technological expertise to utilize the rapidly evolving Internet for much more than exchanging greetings with children and grandchildren. One of the hats I wear is that of a Unix server administrator with long years of experience. It's all I can do to keep my head above water fighting the update war. Teaching old dogs new tricks is what Mr. Litan proposes and that rarely produces a satisfying or beneficial outcome. Typically it simply produces an irritated old codger who wishes the young whipper-snapper would go away and leave him/her in peace.

Does Bob Litan know any actual senior citizens, or is he writing about theoretical, imaginary "median senior citizens" that do not exist in my zip code?

Posted by: Dr. Zinegold at December 20, 2005 02:05 AM

Dr. Zinegold..

Thanks for the comments. You may be right..then again, I know plenty of senior citizens, including my dad, who have happily made the jump to cyberspace (although I can't get him off his dial up connection).

Posted by: Mike Mandel at December 20, 2005 10:45 AM

Case in point, my grandparents are absolutely opposed to using anything computer or internet related (all three sets of them). They made it through the great depression, raising many kids, and by gosh they don't need to pay for a virus filled smut line into their house now. They're interested when I bring my laptop over but scared to use it on it's own. Changing the perception that the Internet is full of smut & viruses is key to promoting adoption.

Views might change as time goes on but even my parents are somewhat avid users and still on dial-up. They refuse to pay the $10 extra a month for DSL.

Providing used computers to senior citizens free of charge is a winner. How many people have a 486 or Pentium 400 sitting in their basement unused? I wouldn't want to use it but that would be the perfect machine for a elderly couple to use to look at pictures I post on the internet from my trips. It would also temporarily assist in the problem of disposing of hazardous waste until better methods can be developed to handle the lead and heave metal filled machines.

It's probably our generation that will be computer users when we're senior citizens yet I have to wonder if one day I'll be passed by on the information highway and find myself just enjoying paper magazines again....

Posted by: Wes at December 20, 2005 02:57 PM

Dr. Zinegold & others mistakenly assume that much of the socioeconomic benefits of Dr. Litan's accelerated broadband deployment require the active engagement of seniors & the disabled. Quite the contrary.

Consider that the inexpensive "always on" monitoring enabled by broadband needn't require those it can benefit to actively engage it via a pc at all. Litan's thinking big here; thinking about the hurdles of keyboard use, or the piddling costs of broadband connections, is thinking far too small.

Posted by: GJ at February 12, 2006 04:37 PM

I for one and all for it, I am a disabled senior and have been borrowing freinds and public library computers for sometime but would love to have a computer at home (maybe even do a little ebay(;, but can't afford one, does anyone know where I can get one free or REAL Cheap?

Posted by: Bey at March 6, 2006 02:02 PM

Hello,...(From one of the "dullest tools") in the shed, "Dr." Zinegold.

Simply said sir, you are either a fools fool OR an UNCARING serf borne of VERY unfortunate circumstance.

My Uncle, DR. Harry Crawford, was Chancellor and finally President of Michigans "penninsular" located University, with a Campus at Souis Saint Marie. Forgive my memory and spelling, I regularly get Michigan State mixed up with the University of Michigan. DR. Harry, my Uncle, had a Phd. in Physics and Chemistry among other accolades of academia.

He was an ACADEMIC Dr. sir.

I, in my mid Seventies, am quite thankful that I have dealt with computers from the 50's, when they were the size of small Volkswagens, to today, on my rather sophisticated XP2 with half a gig of memory, 90 gigs of hard drive, (I don't play games,) and a 2.1 CPU., etc.

Having served my country as a US Marine, decorated, out as a Gunnery Sergeant, HDS, to you sir, Honorable Discharge, (not retired or drawing any pension,) I and my wife live on SSA and SSI. What I have NOW I earned BEFORE. I hold degrees, AA and BS, earned by very hard work while I was either serving the Corps or working in Civilian Life. UNFORTUNATELY, I am disabled. Don't like the distinction sir but fact is fact, as I am told by my children and grandchildren.

NOW, about YOUR COMMENTS regarding seniors, computing and Broadband or DSL use. They, unfortunately are TRUE. I, as well as others like me, cannot afford either, just "cheap dial up," if lucky.

With all your implied knowledge, I STRESS implied, as knowledge should contain at least SOME evidence of practical matters , you MUST be aware many cities and States provide broadband or similar FREE. I am not in one of them.

Is it your opinion sir that "old fogies" like myself who cannot afford fast Internet should avoid such free programs?

Lastly, yes, AGAIN you are correct. I put my Son through U.C.L.A., have given my Daughter well over fifteen thousand dollars for a husbands lack of ability to "earn," LOST my first Son at age 22, been free with my money to the Church - In simple language, I have tried my best to be a good parent, to be generous, and it has cost me my savings. MY FAULT.

I applaud your comment sir, no matter how flawed your previous exposure to life has been. (My best Friend is in a "chair,") with my luck you are impaired in some physical way also. If so sir, My apologies for any offensive remark.

My Zip Code is 92071 - Google it and you will know exactly my location. Sorry about yours, perhaps you should circulate with older folks also?

Billions for Iraq, zilch for Seniors.


Commewnts, of ANY kind welcome. If you can "dish it out," you should be able to take it also.

As a former "Explosive De-Armer," I can take it, easily.

Posted by: J.C. Lettow at May 6, 2006 04:27 PM

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