Capitalism

Video Double Standard: Pay-TV Is Winning the War to Rig FCC Competition Rules

Most conservatives and many prominent thinkers on the left agree that the Communications Act should be updated based on the insight provided by the wireless and Internet protocol revolutions. The fundamental problem with the current legislation is its disparate treatment of competitive communications services. A comprehensive legislative update offers an opportunity to adopt a technologically neutral, consumer focused approach to communications regulation that would maximize competition, investment and innovation.

Though the Federal Communications Commission (FCC) must continue implementing the existing Act while Congress deliberates legislative changes, the agency should avoid creating new regulatory disparities on its own. Yet that is where the agency appears to be heading at its meeting next Monday.

recent ex parte filing indicates that the FCC is proposing to deem joint retransmission consent negotiations by two of the top four Free-TV stations in a market a per se violation of the FCC’s good-faith negotiation standard and adopt a rebuttable presumption that joint negotiations by non-top four station combinations constitute a failure to negotiate in good faith.” The intent of this proposal is to prohibit broadcasters from using a single negotiator during retransmission consent negotiations with Pay-TV distributors.

This prohibition would apply in all TV markets, no matter how small, including markets that lack effective competition in the Pay-TV segment. In small markets without effective competition, this rule would result in the absurd requirement that marginal TV stations with no economies of scale negotiate alone with a cable operator who possesses market power.

Netflix CEO Reed Hastings Said Something Dumb about ISPs

A version of this post originally appeared on George Scoville’s blog.

 

Courtesy of Politico Morning Tech, here’s a real doozie of a quote from the head of the world’s premier video streaming service:

Some big ISPs are extracting a toll because they can — they effectively control access to millions of consumers and are willing to sacrifice the interests of their own customers to press Netflix and others to pay.

Woof. Charging a toll is exactly what ISPs are doing, not only because they can, but because they should:

Verizon can only supply a limited amount of mobile bandwidth on its 3G and 4G networks — just like a 12-volt battery can only supply a limited amount of power. When many users with no barrier to their consumption of data — or at least no barrier above a $30 per month fee — they have in effect incentives to over-consume the limited resource. This is a classic collective action/tragedy of the commons case, and the fact that, [when consumers face very low prices for network access], Verizon’s network experiences strain from lots of data-hungry consumers [and can’t keep up with demand], the current pricing system is inefficient.

Venezuelans Are Fed Up With Socialist President Maduro

Nicolás Maduro

Since February 4th, students have been protesting in San Cristóbal, Venezuela. Protesters have been strongly opposed to current President Nicolas Maduro and his heavy-handed interventionist government and have decided to take it to the streets, which ended up triggering waves of violent attacks that are mostly perpetrated by paramilitary forces. At least 6 people have died so far.

Before the protests, Venezuelans were experiencing soaring crime rates, an annual inflation rate of 320 percent and shortage of basic goods, which are all mostly due to protectionist policies and Hugo Chavez’s National Bolivarian Guard’s crack down on the ‘over-pricing’ the government accuses producers and merchants of practicing.

Product shortages range from vegetables to toilet paper.

In Venezuela, food is subsidized. The government has instilled an idea among its citizens that cheap gas is every Venezuelan’s right, so oil is heavily subsidized as well. The president of the Venezuela’s national oil company is also the vice president in charge of the country’s economy, has also acted as the government’s energy minister.

Rick Santorum: Unlikely Messenger in Culture War

Rick Santorum

Rick Santorum quoted Aristotle in his address to CPAC-St. Louis on Saturday: “Give me the storytellers, and I will control the country in a generation.” Santorum, now the CEO of EchoLight Films, was there to talk the culture war and plug his company’s new film, “The Christmas Candle.”

A common complaint on the right is that liberals control the entertainment industry and have unchecked power to influence the culture. Conservatives in the entertainment industry have been afraid of losing their jobs for so long that defeatism has taken hold; they find comfort in being a small minority unable to break through the iron grip the left has on every aspect of the business.

Free Market Organs: The Case for Capitalism in the Organ Transplant System

A 10-year old Pennsylvania girl by the name of Sarah Murnaghan could die within a few weeks if she doesn’t receive a lung transplant soon. There’s currently a petition on Change.org directed at HHS Secretary Kathleen Sebelius to alter the current policy so that Sarah is made a higher priority on the donor list because the clock is ticking at least somewhat faster than some who are ahead of her.

I’ll leave it to the readers to determine if this petition is the right way to go in the case of Sarah, but I think there is a much larger problem with the organ donation system that I believe could be addressed by the free market. Back in 2008, I wrote a post at The Liberty Papers about why a regulated, above board organ market would be superior and much more moral than the current “altruistic” system. Some of my examples might be a little dated (Hanna Montana is all grown up now) but my overall point stands. Though this post is mostly about live donations, compensation going to an individual’s estate would give Sarah and countless others a much better shot at living.

Free Market Organs (Posted January 24, 2008)

Last week, Doug linked a post about British Prime Minister Gordon Brown’s support for a policy that would allow hospitals to harvest organs without prior consent of the decedent or his/ her family. In essence, the organs of all deceased British citizens would belong to the government’s healthcare system except for those individuals who “opted out” prior to death. The policy in the U.S. is an “opt in” approach rather than “opt out.”

United Liberty Is (Cato) Unbound!

cato_unbound_fusionism

Every month, Cato puts out a new issue of Cato Unbound, an online journal that looks at various topics. This week, the topic is fusionism, something that has received quite a bit of attention here at United Liberty.

The format of Cato Unbound is quite simple. One writer contributes a lead essay, and then three other writers write response essays. Then, it descends into a furball as we all starting writing shorter response posts to each other. The discussion is not just there, however; blog posts elsewhere will be linked, and everyone—yes, including YOU!—is encouraged to join in the discussion.

Our lead essay this month is written by Jacque Otto, a friend of mine and a writer at Values and Capitalism, a project of the American Enterprise Institute. She writes:

Internet Analogies: Remember When the Internet Was the Information Superhighway? (Part 2)

In Part 1 of this post, I described the history of government intervention in the funding of the Internet, which has been used to exempt commercial users from paying for the use of local Internet infrastructure. The most recent intervention, known as “net neutrality”, was ostensibly intended to protect consumers, but in practice, requires that consumers bear all the costs of maintaining and upgrading local Internet infrastructure while content and application providers pay nothing. This consumer-funded commercial subsidy model is the opposite of the approach the government took when funding the Interstate Highway System: The federal government makes commercial users pay more for their use of the highways than consumers. This fundamental difference in approach is why net neutrality advocates abandoned the “information superhighway” analogy promoted by the Clinton Administration during the 1990s.

Conservatives: Ignore Taxes, Just Focus On The Spending Cuts

Editor’s note: While the larger point of the post is a good topic for debate, Fortenberry was a bad example. According to the scorecards released by the Club for Growth and FreedomWorks, Fortenberry hasn’t been a friend to the taxpayer on fiscal issues. Thanks to Matt Hoskins for bringing this to our attention.

Author’s note: Yes, kudos to Matt Hoskins. I’ve added an update below.

Last week, Rod Dreher at the American Conservative magazine wrote about John Fortenberry, a Republican congresscritter from Nebraska who is considering a run for the seat of retiring Republican Senator Mike Johanns. What has Dreher annoyed —understandably — is that the Senate Conservatives Fund has come out against Fortenberry. Why? Because Fortenberry is “too liberal” on taxes:

“We can already say that we won’t be able to support Congressman Fortenberry if he runs. His record on spending, debt, and taxes in the House is just too liberal. Republicans in Nebraska deserve better,” said Senate Conservatives Fund Executive Director Matt Hoskins. SCF, which was started by conservative Jim DeMint and involved itself in the 2012 Nebraska Senate GOP primary, is looking to identify a candidate it can get behind, Hoskins added.

Dreher argues that’s completely bunk. In an interview with the Congressman last year, he wrote:

US Sues Standard & Poor’s Over Credit Ratings, Forgets It Made The Mess Itself

Oh, what a tangled web we weave. The United States government has sued credit rating agency Standard & Poor’s over the ratings it gave to mortgages just before the financial crisis:

The U.S. government is accusing the debt rating agency Standard & Poor’s of fraud for giving high ratings to risky mortgage bonds that helped bring about the financial crisis.

The government said in a civil complaint filed late Monday that S&P misled investors by stating that its ratings were objective and “uninfluenced by any conflicts of interest.” It said S&P’s desire to make money and gain market share caused S&P to ignore the risks posed by the investments between September 2004 and October 2007.

The charges mark the first enforcement action the government has taken against a major rating agency involving the worst financial crisis since the Great Depression.

According to the government filing in U.S. District Court in Los Angeles, the alleged fraud made it possible to sell the investments to banks. The government charged S&P under a law aimed at making sure banks invest safely.

S&P, a unit of New York-based McGraw-Hill Cos., has denied wrongdoing and said that any lawsuit would be without merit.

It is without merit, but not for the reasons S&P thinks. See, this whole thing is hilarious, because the situation itself was created by the government. That’s right; if it wasn’t for government meddling in the credit rating market, this would never have happened:

Bobby Jindal Sandblasts the GOP: Thank God, Finally

Bobby Jindal

Chris Cillizza and Aaron Blake of the Washington Post’s “The Fix” blog—arguably one of the best blogs about politics today—have gotten a copy of Bobby Jindal’s speech to the RNC this Thursday. It looks like it will be a well-needed tongue-lasher:

Louisiana Gov. Bobby Jindal will deliver a forceful denunciation of his party’s Washington-centric focus in a speech to the Republican National Committee on Thursday evening, arguing that the GOP is fighting the wrong fight as it seeks to rebuild from losses at the ballot box last November.

“A debate about which party can better manage the federal government is a very small and short-sighted debate,” Jindal will tell the RNC members gathered in Charlotte, N.C. for the organization’s winter meeting, according to a copy of the speech provided to The Fix. “If our vision is not bigger than that, we do not deserve to win.”

Jindal’s speech — and his call to “recalibrate the compass of conservatism” — is the latest shred of a growing amount of evidence that the Louisiana governor is positioning himself to not only run for the Republican presidential nomination in 2016 but do so in direct (or close to it) opposition to his party in the nation’s capital.

In the speech, Jindal will repeatedly caution that Republicans in Washington have fallen into the “sideshow trap” of debating with Democrats over the proper size of the federal government.

 


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