Internet Analogies: Twice as Many Americans Lack Access to Public Water-Supply Systems than Fixed Broadband
After abandoning the “information superhighway” analogy for the Internet, net neutrality advocates began analogizing the Internet to waterworks. I’ve previously discussed the fundamental difference between infrastructure that distributes commodities (e.g., water) and the Internet, which distributes speech protected by the First Amendment – a difference that is alone sufficient to reject any notion that governments should own and control the infrastructure of the Internet. For those who remain unconvinced that the means of disseminating mass communications (e.g., Internet infrastructure) is protected by the First Amendment, however, there is another flaw in the waterworks analogy: If broadband Internet infrastructure had been built to the same extent as public water-supply systems, more than twice as many Americans would lack fixed broadband Internet access.
Beyond enforcing the antitrust laws, the Antitrust Division of the Department of Justice (DOJ) advocates for competition policy in regulatory proceedings initiated by Executive Branch and independent agencies, including the Federal Communications Commission (FCC). In this role, the DOJ works with the FCC on mergers involving communications companies and occasionally provides input in other FCC proceedings. The historical reputation of the DOJ in this area has been one of impartial engagement and deliberate analysis based on empirical data. The DOJ’s recent filing (DOJ filing) on mobile spectrum aggregation jeopardizes that reputation, however, by recommending that the FCC “ensure” Sprint Nextel and T-Mobile obtain a nationwide block of mobile spectrum in the upcoming broadcast incentive auction.
In the midst of the debates about banning firearms with certain features, Mayor Michael Bloomberg’s failed attempt to ban New Yorkers from drinking soft drinks he felt were too large, and the debate over whether or not same sex couples should have the ability to enter into a legal contract to have the same legal rights and responsibilities as married heterosexual couples, a thought occurred to me: “Gee there are a lot of people out there who just want to ban things!”
Why is this impulse so prevalent in our society? It seems that nearly everyone wants to be free to live their lives as they see fit. I haven’t met too many people who favor any notion of limiting their freedom because elected officials passed a law or majority of fellow citizens took a vote. When it comes to one’s own personal liberties, everyone is a libertarian! Consider that the Gadsen flag underneath the coiled rattlesnake reads: “Don’t Tread on Me.”
But far too many of these same people who jealously defend their own liberties are more than eager to limit someone else’s when that someone else engages in an activity that, for whatever reason, offends them. No, when it comes to other people, these people who don’t want their liberties tread on are not libertarian but majoritarian (i.e. political might makes right).
I was one of the millions of people who had seen the footage of the “flaming water” supposedly caused by fracking in Pennsylvania, but had never seen Gasland or really studied the issue in depth. When the opportunity to attend the Los Angeles premiere of Frack Nation arose, I decided to see what the fuss was about. Cinematically and content-wise, Frack Nation did not disappoint.
Frack Nation starts with the same flaming water shot from Gasland that has alarmed environmentalists and the masses and describes the anti-fracking movement’s complaints. What was helpful for a newbie like me was to have the fracking process described in detail.
McAleer interviewed many of the farmers of Dimock, Pennsylvania, the “ground zero” of this issue. The farmers almost unanimously want the ability to lease their mineral rights to the gas companies for fracking. Many of them are dairy farmers whose land has been in the family for generations. They passionately tell McAleer that they need this money to be able to survive, as farming is a money-losing proposition these days. It is what they love to do, and leasing mineral rights will allow them to do that instead of joining the ranks of the unemployed.
Just as passionately, they state they would never allow anything on their land that harms the environment. Their homes are on this land. Their dairy cows graze on this land. They’ve tilled this land for a lifetime. They are believable – they would not allow any process that harms their asset, the land, just for money.
At the Consumer Electronic Show two weeks ago, Netflix announced that it would block consumer access to high definition and 3D movies (HD) for customers of Internet service providers (ISPs) that Netflix disfavors. Netflix’s goal is to coerce ISPs into paying for a free Internet fast lane for Netflix content. If Netflix succeeds, it would harm Internet consumers and competition among video streaming providers. It would also fundamentally alter the economics and openness of the Internet, “where consumers make their own choices about what applications and services to use and are free to decide what content they want to access, create, or share with others.”
Ironically, Netflix’s strategy is a variant of the doomsday narrative spun by net neutrality activists over the last decade. Their narrative assumes ISPs will use their gatekeeper control to block their customers from accessing Internet content distributed by competitors. Of course, ISPs have never blocked consumer access to competitive Internet content. Now that the FCC has distorted the Internet marketplace through the adoption of asymmetric net neutrality rules, Netflix, the dominant streaming video provider, has decided to block consumer access to its content.
Given the rate at which telephone companies are losing customers when they cannot raise prices as a regulatory matter, it is preposterous to continue presuming that they could raise prices as an economic matter.
Today, the United States Telecom Association (USTA) asked the Federal Communications Commission (FCC) to declare that incumbent telephone companies are no longer monopolies. Ten years ago, when most households had “plain old telephone service,” this request would have seemed preposterous. Today, when only one in three homes have a phone line, it is merely stating the obvious: Switched telephone service has no market power at all.
The FCC already knows that plain old telephone service is no longer a “dominant” service (“dominance” is more likely when a service has a market share exceeding 60%). Last year, the FCC’s Technological Advisory Council found that the legacy, circuit switched telephone network “no longer functions as a universal communications infrastructure” and telephone service “does not provide anything close to the services and capabilities” of wired and wireless broadband Internet access services.
In an excellent piece urging that oral contraception become available over the counter that ran in this morning’s print edition of the Wall Street Journal (subscription may be required), Louisiana Governor Bobby Jindal, whose résumé includes a litany of health policy wonkery, sounded the death knell of both big government’s dominion over one aspect of reproductive health, and the pharmaceutical industry’s influence over that policy. Further, Jindal’s position masterfully bridges the gap between social conservatives and libertarians, as it accounts for both market-based health care (vs. Obamacare) and the protection of religious liberty and conscience (also vs. Obamacare). Here’s an excerpt:
I think I may have finally found the most bothersome, noxious piece of information of all time, thanks to the editors at Townhall.com. The emphasis in the next quote is mine:
It’s official. Taxpayers are no longer simply helping the poor, they’re subsidizing the lives of welfare recipients at a better rate than their own. The Senate Budget Committee has released a report showing households living below the poverty line and receiving welfare payments are raking in the equivalent of $168 per day in benefits which come in the form of food stamps, housing, childcare, healthcare and more. The median household income in 2011 was $50,054, totaling $137.13 per day. The worst part? Welfare payments are equivalent to making $30 per hour for 40 hours a week. The median wage for non-welfare recipients is $25 per hour but because they pay taxes, unlike welfare recipients, the wage is bumped down to $21 per hour.
When I read this, I threw up a bit.
I’m going to be honest with you and tell you a little bit about my personal life, which I don’t typically do in the pages of United Liberty. And I certainly don’t want to start a pity party over me. But here’s the facts: I currently have a paying job, but not a great one. I’m an intern in DC. I make $30 a day. Let me repeat that: I make thirty dollars a day. Yet even though I work hard, create value, and do my damndest to support myself without forcing others to support me, the average welfare recipient receives 5.6 times what I make, paid for with my tax dollars.
President Obama is adored by many on the left for, among other things, his supposedly high-brow and rigorous reading tastes. The Daily Beast ran a story saying “Obama has thrilled the intellectual classes with his frequent book talk from the days of his campaign onward.”
Like everyone else, President Obama obviously thinks some authors are beneath his standard. This week, in a Rolling Stone interview, President Obama gave his thoughts on Ayn Rand. When asked whether he’d read Rand, he responded “Sure.”
Replying to a follow-up question, Obama said this.
Ayn Rand is one of those things that a lot of us, when we were 17 or 18 and feeling misunderstood, we’d pick up. Then, as we get older, we realize that a world in which we’re only thinking about ourselves and not thinking about anybody else, in which we’re considering the entire project of developing ourselves as more important than our relationships to other people and making sure that everybody else has opportunity – that that’s a pretty narrow vision. It’s not one that, I think, describes what’s best in America. Unfortunately, it does seem as if sometimes that vision of a “you’re on your own” society has consumed a big chunk of the Republican Party.
I know we’re focused pretty intensely on the elections, which are only two weeks away, but we always need to focus as well on underlying principles and concepts that drive our economy and our government. Elections come and go; this stuff is forever. In that vein, you really need to take a look at a new paper from the Mercatus Center at George Mason University, by Randall Holcombe:
Crony capitalism describes an economic system in which the profitability of firms in a market economy is dependent on political connections. The term has been used in the popular press but rarely appears in academic literature. However, there has been a substantial amount of academic research on various components that, when aggregated, describe crony capitalism. This literature shows that crony capitalism exists only because those in government are in a position to target benefits to their cronies, and have an incentive to do so, because they get benefits in return. The ability to target those benefits is a result of the spending and regulatory power of government, so big government causes cronyism. One remedy often suggested for cronyism is more government regulation and oversight of the economy, but this remedy misunderstands the cause of cronyism. The substantial and well-established economic literature on the components of crony capitalism shows that big government is the cause of crony capitalism, not the solution.
By “crony capitalism,” of course, he refers to lobbyists, and big business using those lobbyists to get more power and take more wealth away from the public. It’s the reason we had Occupy Wall Street, and why many folks still cry out for “regulation” to “rein in” big business and the big banks.