Ronald Reagan was fond of reminding us of a fundamental economic truth: “If you want less of something, tax it.”
Of course, President Reagan wasn’t referring to broadband infrastructure at the time. But his observation is no less true in today’s digital economy. In fact, since the earliest days of the commercial internet back in the ‘90s, a bipartisan consensus in Congress has recognized the universal truth of President Reagan’s warning and worked to ensure that local taxes and fees didn’t become an impediment to the build-out of our national broadband infrastructure.
Congress enshrined this prohibition against local taxes on broadband in the bipartisan Internet Tax Freedom Act. Similarly, the Cable Act provides a national framework that encourages network deployment by limiting the power of local governments to impose investment-killing fees.
The success of this light-touch framework is self-evident. Since 1996, broadband providers have invested $1.6 trillion to build out our nation’s broadband infrastructure, deploying high-speed networks at a pace that far exceeds what European countries have managed. And while there are clearly deployment gaps still to be closed – particularly in rural America – the urgent necessity of closing these gaps argues even more strenuously for continuing to heed President Reagan’s warning.
But as sure as the sun rises in the East, there will always be high-tax local jurisdictions eager to treat private sector investments as their own personal piggy bank to be raided to fund big-spending government budgets. Despite the obvious historic success of the federal prohibition on internet taxes and fees – and despite the fact that world-class broadband infrastructure is increasingly become table stakes for any local community that hopes to thrive in the digital age – some localities have challenged the bipartisan pro-investment consensus in court.
Faced with these legal challenges, the FCC is about to kick off a proceeding to clarify its policies limiting how local jurisdictions can use local franchising laws to impose taxes and fees on broadband providers. We strongly urge Commissioners to defend the longstanding, bipartisan consensus pre-empting state and local efforts to add new fees or obstacles to broadband investment.
Make no mistake about it: The internet is an interstate service. Networks – and the packet of data that fly across them at the speed of light – don’t stop at state lines. If ever a technology existed that met the Constitutional definition of “interstate commerce”, it’s the internet. That means it’s up to federal policymakers to defend the (wildly successful) national pro-deployment framework against attacks from local jurisdictions more interested in grabbing a few short-term bucks.
As a nation, we want more broadband investment. It’s one of the few things Democrats and Republicans seem to agree on. So the FCC should remember President Reagan’s wise advice and preempt local governments from adding taxes and fees that will discourage the very investment we all agree is needed.
Here's some language we'd like to see in the appropriate section of the GOP platform. In case anyone's interested:
The Internet is a platform for disruption, allowing individuals, private enterprises and entrepreneurs to communicate and engage in commerce in new ways, breaking down walls of distance, size and established power. Regulators and tax collectors, threatened by the disruptive Internet that empowers people and private businesses, are pushing for their powers to regulate and tax to grow in the same way, across borders and reaching every corner of the Internet. The Republican Party should consistently support Internet policies that allow people and private enterprise to thrive, without providing new and expanded powers to tax and regulate so that the Internet does not become the vehicle for a dramatic expansion of government power. Maintaining fundamental principles of limited government in an increasingly Internet-enabled world is a critical role for the party that puts people ahead of government bureaucracies and regulators.
You could hardly have a more fluid situation than what is going on right now with regard to future Republican House leadership, so this blog may be out of date before it’s finished. But as I’m writing, several people are maneuvering for leadership positions, and the general grassroots mood is that they want a “real conservative.”
(Of course, what a “real conservative” is differs literally from activist to activist. If they agree with you down the line on every single issue, they are a “real conservative,” and if they disagree with you on anything, they are a RINO. Apparently. Which is the biggest problem the conservative movement has right now. It’s principles, people. Anyway . . . )
One candidate who some feel is the “real conservative” for Speaker of the House is Jason Chaffetz from Utah. Chaffetz is an interesting case. Is Chaffetz the “real conservative” option?
Well, yes, the Obama administration doesn’t like Chaffetz, but that’s largely because he chairs the House Committee on Oversight and Government Reform, and thus has been looking into Executive Branch.
But conservatives mostly define themselves by their principles, and one of the pretty bedrock principles is constitutional federalism. On that front, Chaffetz is troubling, for at least two reasons.
I've just received a copy of the lawsuit from the State of Tennessee against the Federal Communications Commission (FCC) for the FCC's order that attempts to overturn laws passed in states regulating municipal broadband networks in those states.
The argument is pretty clear and straightforward, as indeed I think it is. This is a most blatant violation of federalism. There is no constitutional grounds for a federal regulator to think it can overturn laws passed by the duly elected legislatures of the states.
In the Order, the FCC preempts Tennessee law pertaining to the operation of municipal electric plants, including the Electric Power Board of Chattanooga, an instrumentality of the City of Chattanooga, created and controlled by the State of Tennessee. In doing so, the FCC has unlawfully inserted itself between the State of Tennessee and the State's own political subdivisions. The State of Tennessee, as a sovereign and a party to the proceeding below, is aggrieved and seeks relief on the grounds that the Order 1) is contrary to the United States Constitution; 2) is in excess of the Commission's authority; 3) is arbitary, capricious and an abuse of discretion within the meaning of the Administrative Procedures Act; and 4) is otherwise contrary to law. . . . Accordingly, the State of Tennessee respectfully requests that this Court hold unlawful, vacate, enjoin, and set aside the Order, and provide such additional relief as may be appropriate.
This morning the Federal Communications Commission (FCC) voted to eliminate its sports blackout rule, which helped the NFL justify blacking out the broadcast of NFL games that were not sold out.
The blackout rule was always a case of the FCC getting government involved in the business model of a company/league, which is always a mistake. Policy and business models should never be confused. Government sets policy, and then people go out and create business models. Government should not be creating or distorting or assisting anyone's business model.
This past week I filmed an episode of the McCuistion program, a public affairs TV show that airs around the country, and the topic was net neutrality. It should air in a couple of months.
The program began with Tim Wu's definition of net neutrality, which is essentially the principle of non-discrimination: All bits have to be treated the same, with no discrimination. Essentially, the "dumb pipes" argument all over again.
This emphasis on non-discrimination reminded me of the first op/ed I wrote against net neutrality way back in 2006, in the early days of the net neutrality debate, entitled "Welcome to the Stupid Internet."
The piece is no longer archived on the San Jose Mercury News site, so we keep it archived here.
It's interesting to me that we are still at non-discrimination after all these years.
Here's what I think is interesting: For those eight years, we did not have net neutrality regulations, and the Internet blossomed. So . . . doesn't that mean that net neutrality proponents were wrong, and that the Internet was just fine without net neutrality regulations?
Oldie but goodie.
I was honored to speak at a panel discussion on Friday sponsored by the Congressional Internet Caucus Advisory Committee on whether transferring control of the Internet root zone functions from the U.S. Dept. of Commerce to some yet-to-be-determined multistakeholder organization is a good thing.
The briefing was televised on CSPAN, and the archive video can be seen here.
As an early opponent of network neutrality regulations, it’s tempting for me to characterize as a victory today’s DC Circuit Court decision throwing out some of the FCC’s network neutrality rules, and indeed it is a victory—in part, and for now. It’s true that the court threw out the most onerous rule on anti-discrimination, while also tossing out a symbolic anti-blocking rule that market proponents understand was completely unnecessary.
But the Court agreed with the FCC on its authority to regulate broadband services, which means Verizon lost on its core assertion that the FCC had no statutory authority to regulate broadband networks. This is underscored by new FCC Chairman Tom Wheeler’s triumphalist reaction to the case. Everyone spins the results of important court decisions such as this, but the early social media reactions that “Verizon won and the FCC lost” were an uninformed oversimplification.
“I would rather be exposed to the inconveniences attending too much liberty than to those attending too small a degree of it.” –Thomas Jefferson
Conservatives get off track on issues like privacy when they lose sight of the fact that government’s first priority is NOT to protect Americans’ security, but is rather to protect Americans’ freedom. If you assume that government’s first job is to protect national security, you are already on the thinnest end of the wedge that eventually leads to a surveillance state, which is simply the last bus stop just before a police state. Our system, including the justice system, by design correctly values freedom over security anytime the two come into conflict, which as it turns out is pretty often.
So public horror at the disclosure of widespread data collection on the activities of ordinary Americans by the National Security Agency is entirely warranted. People realize that, while there is always going to be a tension between security and privacy, discovering that the federal government is building massive databases of our phone communication, Internet activity, credit card transactions and God knows what else suggests that the government has crossed the line and is prioritizing security over freedom.
There has been a huge problem over the past few years with municipalities dragging their feet on approving permits to allow cell phone towers to be constructed, or even to allow new transmitters to be added to existing towers or to buildings.
Municipalities have been doing this on purpose, largely at the urging of consultants, who suggest the delays at least in part as a way to extract concessions from the wireless companies. It’s been a big problem, with municipalities complaining to the wireless companies about poor service coverage and then at the same time unnecessarily delaying permits to address the problem.
IPI has written about this problem several times, and one of the solutions we suggested was that municipalities should be put on a shot clock and given only a limited amount of time that they could delay such applications.
Which the Federal Communications Commission (FCC) did.
Upon which action the City of Arlington, Texas, which is just about 30 miles from where I sit, challenged the regulation, claiming that the FCC didn’t have the authority to regulate how they approved applications for cellphone towers.
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