Let Them Eat Tech

Let Them Eat Tech

Tech-oriented solutions to rural poverty and underdevelopment have become hallmarks of Democratic Party policy thinking. We need an alternative that redistributes the wealth generated by the high-tech sector—and recognizes its limits as a development strategy.

In the final days of the 2016 presidential campaign, Bill Clinton paid a visit to the community of Whiteville, a struggling small city of about 5,500 people in southeastern North Carolina. Hillary Clinton was having a hard time establishing support among poor and working-class residents in rural areas, and Bill—who had once proclaimed himself the “ambassador to rural America”—was there to help. In fact, the former president spent much of that October touring communities like Whiteville across battleground states in the Upper South and Midwest, where he empathized with the economic hardships rural voters were facing. If elected, his wife had a plan for “connecting small town and rural America to the successes of the American economy,” he promised on these campaign stops. Above all, Clinton insisted, increased broadband service, cheaper rates for internet access, and more jobs in the tech sector would be the solution to rural America’s woes.

For residents of Whiteville, both the message and the messenger were familiar. As it happened, Whiteville had been the site of an important speech Bill Clinton delivered as president nearly two decades prior, which had also taken up the impact of the “digital divide” on rural areas. And it was no accident of fate that found him back there in 2016. Hillary Clinton—like Bill and many other leading Democrats before her—had made tech-centric solutions to rural poverty, disinvestment, and deindustrialization a key policy point in her ill-fated campaign. Whiteville, a town that suffered from all three, remained an ideal setting for laying out that vision. Or so the Clintons thought: on Election Day, Donald Trump won Whiteville’s Columbus County with 60 percent of the vote.

Neoliberalism is typically understood as both a conservative and urban-focused development of the last half century. Encapsulating an array of social and economic policies that emerged during the so-called Reagan Revolution, neoliberalism, according to this standard narrative, is most clearly associated with cities from New York to New Orleans, where governments deployed austerity measures, unregulated growth, and privatization to roll back the social welfare commitments of the New Deal. But the story of the Clintons converging time and again on Whiteville, North Carolina, points to a different and no less important aspect of neoliberalism—one that has played out mostly in rural locations and draws on a tradition of Democratic thinking, stretching all the way back to the New Deal itself, about how best to integrate rural spaces into the market economy. Hillary Clinton’s much-maligned plan to turn out-of-work coal miners into computer coders was not simply a late-in-the-game, desperate attempt to win over rural working-class whites. Her pledges of “tech-for-all” were the culmination of a more than four-decade effort to deploy the tech sector as a rural development strategy.

The tech-for-all agenda highlights key facets of what I refer to as Democratic neoliberalism. This approach has focused on building partnerships between government and the private sector, and offering market-based solutions to social inequality, rather than traditional Democratic measures such as direct investments in job creation, state-provided social welfare protections, or expanded public utilities. It has maintained a commitment to addressing the problems of poverty and racial discrimination, but argues that persistent structural problems could be met by the market forces that underwrote the growth and prosperity of the post-industrial economy—namely, the growing high-tech industries. Examining the evolution of these ideas and how they played out in a rural context reveals the ways neoliberal economic policies have emerged as much from the ideology, institutions, and social commitments of mainstream liberalism—and from the political agenda of the Democratic Party—as in reaction to them.

The Rise of the Atari Democrats

“Tech-for-all” campaigns build on a deep-seated tradition of modern liberals framing the problem of rural poverty in terms of the geographic and technological remoteness of rural areas. The famed Tennessee Valley Authority (TVA) hydroelectric infrastructure project was one of the more notable accomplishments of New Deal liberalism, in no small part by virtue of its success in more fully integrating struggling rural communities into the national economy. Franklin Roosevelt and his brain trust believed that one of the main problems of “underdeveloped regions” in Appalachia and the broader South was their physical isolation from urban centers of capitalist production. Many New Deal architects, beginning with TVA chairman David Lilienthal, saw the project as a way of spurring economic growth by luring industry to rural places. During the early Cold War, growth-oriented liberals also funneled billions of dollars of research-and-development funds into previously overlooked areas, transforming cities like Atlanta and Charlotte and building the modern Sunbelt in the process.

Nevertheless, by the 1960s, rural areas across the South began experiencing new waves of economic uncertainty. Decades of agricultural modernization resulted in fewer rural workers being supported in farming occupations, which led to an increase in outmigration to cities, where there were more job opportunities. State leaders from both political parties responded by implementing a model of economic development that came to be known as “smokestack chasing”: using public subsidies and the promises of a low-wage and non-unionized workforce to recruit manufacturers to rural communities. This approach produced a surge in one-company towns and cities throughout the rural South—places like Arkadelphia, Arkansas, and Rocky Mount, North Carolina—which generated jobs and provided momentary economic stability. But by the late 1970s, those companies were finding even cheaper labor outside the United States, and rural towns began to undergo debilitating rounds of deindustrialization and capital flight.

A new generation of Democratic Party politicians burst onto the national scene at the height of this crisis. These “New Democrats” or “Atari Democrats” went to great lengths to distance themselves from the party’s traditional associations with the industrial manufacturing sector and its powerful labor unions, shifting their focus to relentless high-tech growth instead. Many of them hailed from Southern or Midwestern states with large rural populations that were experiencing the devastating effects of rural disinvestment, including James Blanchard (Michigan), Al Gore (Tennessee), James Hunt (North Carolina), Charles Robb (Virginia)—and, of course, Arkansas’s Bill Clinton. Their vision for how respond to the coordinated crises of deindustrialization and the decline of the agricultural sector offered a clear departure from the recent past; as Clinton boldly announced to Forbes in 1979, his first year as governor, “smokestack chasing doesn’t work.” Instead, Clinton and the other Atari Democrats looked to the success of Silicon Valley and Route 128 outside of Boston, which had recently become bastions of tech-focused industrial activity.

The New Democrats who served as governors pursued strategies that fostered collaboration between government and business, touting public-private partnerships with the high-tech sector (which had already developed a reputation for being anti-union) as the best way to help struggling communities in their states generate economic activity. The Southern New Democratic governors were members of the Southern Growth Policies Board, a state-funded research agency and policy shop focused on creating new development plans for the region. In the early 1980s, the board began laying out plans to incubate tech startups throughout the region—both in already-established local markets, like North Carolina’s Research Triangle, and in previously untapped rural areas. Clinton oversaw the creation of the Board’s Southern Technology Council, which promoted the more efficient transfer of knowledge and research between academia and industry. Tennessee Senator Al Gore, meanwhile, spearheaded the passage of a series of laws that turned the research networks controlled by the National Science Foundation over to the commercial sphere, so that both public and private sources could fund and benefit from its growth.

Clinton and Gore’s shared Southern roots, and their shared commitment to a new technology agenda, became key pillars of their successful bid for the White House in 1992. In stump speeches throughout the country, they discussed the power of technology to connect people and transcend not just partisan but also rural and urban divisions. They pledged to create a “door-to-door information network to link every home, business, lab, classroom, and library by the year 2015.” In a ceremony held in Silicon Valley during the first days of their administration, Clinton and Gore unveiled a new initiative called “Technology for America’s Economic Growth,” which affirmed that “accelerating the introduction of an efficient, high-speed communications system can have the same effect on U.S. economic and social development as public investment in the railroads in the 19th century.” They requested expanded public funding for research and development work and called on the federal agencies and Congress to eliminate regulations that hindered the private sector from investing in such a network.

These efforts culminated in the Telecommunications Act of 1996, the most sweeping overhaul to U.S. communications policy since 1934. The act deregulated all segments of the industry, premised on the idea that a more competitive marketplace would help to make phone, cable, and internet service cheaper and more readily available. Taken together, these policies put into action the Democratic neoliberal faith that fueling the growth of the tech sector offered not only the clearest route to ongoing economic prosperity but also the surest means of providing a key social service.

It Collapses Time and Distance

The Clinton years were the golden era for the techno-optimism of the Atari Democrats. The internet was becoming ubiquitous in many parts of the country, the telecom giants were making huge profits, and tech stocks were soaring. But a 1995 government report put a damper on some of the more enthusiastic celebrations of the internet’s power. Entitled Falling Through the Net: A Survey of the “Have Nots” in Rural and Urban America, it painted a stark divide in internet usage and revealed that poor, rural people of color were least likely to have a personal computer or modem, followed by poor African Americans in central cities. Other studies conducted around the same time found that less than 5 percent of small towns were equipped with high-speed internet wiring or DSL service, and that where it was available, rural high-speed access cost up to seven times as much as it did in urban and suburban areas.

The Clinton administration immediately seized on the problem and pledged its strong commitment to closing the “digital divide” (a catchphrase they were instrumental in coining), especially as it pertained to rural areas. Administration officials interpreted the findings of these reports as proof that the lack of a comprehensive telecommunications infrastructure was preventing tech companies from moving to rural areas, which only compounded the economic hardship and isolation they faced. The administration also began to draw increasing attention to the way the digital divide was preventing out-of-work rural residents from accessing skill retraining courses, taking job opportunities that involved telecommuting, or selling their wares through e-commerce sites like eBay.

It was in this context that Bill Clinton made his first trip to Whiteville, North Carolina, to deliver a major speech in April 2000. The town’s name belied the racial composition of its population, which was just barely majority white. Like many of its neighboring communities in that part of North Carolina, it had suffered from an extended decline in commodity prices, which hit local tobacco farming hard, and the final shift of textile manufacturing overseas, which had left high rates of unemployment in its wake. The previous November, Whiteville Apparel, which for forty-seven years had been one of the best-paying blue-collar employers in the area, had closed its doors—sending its equipment to factories in Costa Rica and Romania and leaving 396 Whiteville workers out of a job.

Standing in front of an abandoned train depot, against the backdrop of a banner reading “Rural America: From Digital Divide to Digital Opportunity,” Clinton extolled the internet as the most important technological breakthrough ever to come to rural places (surpassing the railroad, highways, and air travel). “It collapses time and distance,” he declared, slapping his hands together repeatedly for dramatic effect. Clinton bemoaned the fact that “in the face of the longest, strongest creative economic growth in our history, there are people and places who have been left behind. And mostly they are in places that are physically isolated.” Better access to high-speed internet would bring “more jobs, more businesses, higher incomes, and more opportunity.” In sum, Clinton promised his audience of 2,000 assembled Whiteville residents, the internet had the potential “to move more people out of poverty and unemployment” in rural America than any previous economic innovation.

The details of Clinton’s proposals were far less inspiring than the lofty rhetoric. In keeping with the Atari Democrats’ longstanding belief that partnerships with the private sector would yield the greatest social benefits, Clinton did not make any pledges that access to the internet would be guaranteed as a free or government-provided utility. Instead, the administration was championing a series of tax credits designed to encourage telecommunications companies to take the lead in closing the digital divide. Two months earlier, it had unveiled a plan to provide $2 billion over ten years in private-sector tax incentives that targeted leading tech companies like Microsoft and America Online in exchange for them donating computers, sponsoring technology centers, and offering literacy programs to train those not yet connected to the internet. Clinton proposed $25 million in grant and loan guarantees administered by the Departments of Commerce and Agriculture, which were designed to further accelerate private sector deployment of broadband networks in underserved urban and rural communities. He also announced that the federal government’s Rural Utilities Service would expand its $670 million telecommunications loan program to companies that provided high-speed internet access to rural communities.

The Clinton administration’s approach to bridging the digital divide reaffirmed the positive role of industry actors and marketplace competition. Naturally, this approach had wide appeal among the sector’s leading technology companies, who appreciated not only the generous tax breaks but also the potential to substantially expand their customer bases. In fact, standing behind Clinton on the dais in Whiteville that day in 2000 were executives from Qualcomm, MCI, Sprint, and AT&T. Each company used the event to announce its commitment to Clinton’s agenda. MCI WorldCom pledged $2 million to increasing wireless internet access in rural communities across the South, while AT&T committed over $1 million to developing information and technology management training courses at North Carolina State. Qualcomm announced it would spend $1 million to provide wireless high-speed services to eight underserved rural communities—including Whiteville’s own Columbus County.

These investments amounted to only a minute fraction of the telecom giants’ overall spending, and they would only make the smallest of dents in expanding high-speed service. But they signaled an eagerness to partner with Clinton and other Democratic neoliberals in their persistent efforts to collapse the distinctions between the public and private sectors. Clinton was simultaneously pursuing a similar path in other realms of public policy, like the Empowerment Zone economic-aid program, the HOPE VI housing initiative (which sought to “end public housing as we know it”), and the administration’s failed healthcare overhaul plan. In each case, the federal government provided private companies with public subsidies, tax credits, regulatory rollbacks, and enhanced market access in exchange for delivering social functions that had once been the obligation and domain of the public sector.

Clinton’s efforts to close the digital divide also collapsed the causes and symptoms of rural poverty. They suggested that lack of access to computers and the World Wide Web—like lack of access to modern agricultural science, hydroelectric power, or industrial infrastructure before them—was the central factor behind growing rates of social and economic inequality over the course of the 1990s. Like other liberals before him, Clinton’s singular faith in technology’s ability to “collapse time and distance” had the unfortunate tendency to collapse not only the distance between places, but also the differences between them. Evocative though they may have been, descriptions of places like Whiteville as part of a single “left-behind” rural United States failed to account for the particular economic circumstances confronting different rural areas, and the unique social needs and political challenges they created. The consequences of that oversight proved substantial.

Rethinking the Digital Divide

Tech-oriented solutions to rural poverty and underdevelopment have become hallmarks of Democratic Party policy thinking. After Al Gore’s narrow defeat in the 2000 presidential election, the tech-for-all agenda shifted into high gear at a number of the major foundations affiliated with the Clinton wing of the Democratic Party. In 1997, Bill and Melinda Gates made their first foray into philanthropy through an initiative to donate computers to libraries in areas with high rates of poverty; over the next seven years alone, they helped install 47,200 computers in almost 11,000 libraries across the United States. The Clinton Foundation itself made access to technology and technological skills a centerpiece of its programming during this period. In an almost comical example of just how interchangeable rural poor people had become to Democratic neoliberals, however, the foundation applied this strategy mostly in the Global South, especially Africa. It worked in partnership with companies like Intel, which pledged to bring 5 million young women in sub-Saharan Africa online to simultaneously close the digital divide and the economic gender gap. By the time Hillary Clinton began her ascent to the 2016 Democratic nomination, these ideas were back at the very center of the party. In a high-profile speech delivered as Secretary of State in 2010, she channeled her husband—and FDR before him—in hailing the internet as a “great equalizer” and an “on-ramp to modernity,” one which “can create opportunities where none exist” and “help lift people out of poverty and give them a freedom from want.”

Yet, as the residents of Whiteville, North Carolina, could attest, the promise that Clinton and other tech-for-all promoters held out for the internet’s ability to solve problems of poverty and unemployment failed to match the reality. By the time Bill Clinton returned to Whiteville in 2016, the area had long since attained the broadband internet access it once sorely lacked. But, if anything, the economic fortunes of the community had only worsened since his first visit sixteen years earlier. More than one-third of its residents were living at or below the poverty line, and the town soon confronted further difficulties when Hurricanes Matthew and Florence battered it in 2016 and 2018, damaging a significant number of homes, destroying many of the remaining businesses, and leaving its oldest church underwater.

In other rural communities, meanwhile, broadband access remains a significant problem. A 2016 report revealed that of the 34 million Americans without access to broadband, over 40 percent reside in rural communities. The continuing unevenness of service—even after hundreds of millions of dollars spent and decades of legislative efforts—points to the shortcomings of a market-based approach to internet access. Without significant public incentives to offset their costs, private companies remain generally unwilling to provide new service to locations where cables are difficult to install and are not guaranteed to be profitable.

Nonetheless, contemporary descendants of the Atari Democrats continue to promote the tech industry as the savior for Whiteville and its rural counterparts. Representative Ro Khanna, whose district encompasses part of Silicon Valley, has been at the forefront of recent efforts to bring coding and tech jobs to rural communities. In 2017, he made a high-profile visit to the same Kentucky county that was the setting for J. D. Vance’s bestselling Hillbilly Elegy to outline a plan encouraging tech companies to “outsource” their coding work to Appalachia rather than Bangalore. A number of 2020 presidential candidates—including Amy Klobuchar, Beto O’Rourke, Bernie Sanders, and Elizabeth Warren—have also issued renewed calls of “broadband for all.” Meanwhile, a handful of states, including New York and California, have recently passed broadband-for-all laws, which direct funds and tax credits toward service providers in rural locations. Prominent centrist think tanks like Third Way have joined the clamor of late as well, declaring the ongoing digital divide in broadband access a “national emergency,” and calling on the federal government to eliminate remaining regulatory roadblocks and offer additional market incentives to providers in remote areas.

Rather than doubling down on a rural antipoverty and development strategy that has failed to do much of anything for the last forty years other than enrich telecommunications firms, the time is ripe for Democrats to come up with a new plan. First on the agenda must be breaking up the big tech companies, as Elizabeth Warren has proposed—which would prevent the reemergence of communications behemoths, like Comcast and Spectrum, that have been key impediments to increasing affordable service to rural areas. It should also entail a baseline commitment to making broadband internet access a universal right and public utility, as it is in countries like Switzerland, Finland, and Spain. Interestingly, some U.S. cities, like Chattanooga, Tennessee, already provide universal internet access through municipal telecommunications companies, at double the speed and half the price of national providers like Comcast. Research demonstrates that a “public option” for internet access has strong support from voters across the political spectrum and demographic groups—which suggests it could be a politically savvy idea in the upcoming election year.

At the same time, voters do not necessarily believe that a broadband public option is the only or best way to combat economic hardship, in rural areas or anywhere else. Internet access is an important public good with many crucial non-economic benefits, such as the ability to forge and maintain social networks and access information, but we shouldn’t see it as the sole route to employment, economic mobility, and placed-based revitalization. An alternative tech agenda therefore must recognize the economic gains that the rise of the high-tech sector has delivered to a minority of the U.S. population and demand that they be distributed more equitably across society—but not rely on them to singlehandedly repair the social welfare safety net that has eroded since at least the 1970s. The rhetorical frame of the digital divide obscures much broader problems of inequality and concentrated wealth and power. A new tech-for-all agenda means not just coming up with better solutions to the problems as presented by Democratic neoliberals like Bill and Hillary Clinton, but reframing the problems themselves.

Lastly, a reassessment of the tech-for-all approach to rural development must finally unlearn modern liberalism’s enduring tendency to treat rural America as a singular and amorphous space, defined only by its geographic remove from the forces of development and the activities of the marketplace. Instead, we need a rural development strategy that starts from an understanding of the particularities of different local communities and recognizes that the needs of Whiteville differ from Johnson County, Kentucky; Starr County, Texas; and Pine Ridge, South Dakota, which have varied histories of development, regional economies, and racial and ethnic compositions. We also need a rural development strategy that creates jobs with greater opportunities for the economic security of union membership than has ever been allowed by the tech industry. Such an agenda could begin the daunting challenge of collapsing the yawning wealth gap that exists between Silicon Valley executives and residents of places like Whiteville. It also might help the Democratic Party to begin to rebuild a powerful base in rural America.

Lily Geismer is an associate professor of history at Claremont McKenna College. She is the author of Don’t Blame Us: Suburban Liberals and the Transformation of the Democratic Party (2015), and the co-editor of Shaped by the State: Toward a New Political History of the Twentieth Century (2019).