Lessig on net neutrality

Enforcement of net neutrality is an exercise in eminent domain.

I was directed to this post by Lawrence Lessig on net neutrality, and wondered if he is channeling the ghost of Marx:

After 8 years of deregulating broadband in America (begun by Kennard, completed by Martin), both DSL and cable are free of any real obligation to protect the original neutrality of the Internet. Once some rules imposed in merger agreements expire, last-mile broadband providers will be free to pick and choose the content and applications they want the network to carry. They will use this power, as at&t Chairman Ed Whitacre explained, to tax the most successful content and application providers on the net. That tax, as I and many have argued, will effectively block the next generation greats.

The short answer is, yes, under the First Amendment, the media are under no obligation to carry or not carry any content. NBC is not compelled to broadcast Dan Rather and I doubt that NPR feels the need to carry Bill O’Reilly. Some, like your humble host, understand this as free speech.

Of course, the network owners would be fools not to connect to all sites, but that's a business decision. To enforce it by law violates the libertarian successes of the Internet as we know it.

Mr. Lessig needs to be reminded that the Internet is not a single thing, nor is it public property. The Internet is a set of privately built networks that have agreed to talk to each other. (Yes, the Internet grew out of gov’t research, but the Internet that you are using to read this was not built by gov’t.)

Mr. Lessig seems to believe that private companies have the ability to “tax”. Certainly he knows this is wrong, but chooses to use the word for emotive effect. The implication is that any company that charges for products is enforcing a “tax”. By that standard, I paid a latte tax this morning and a chino tax over the weekend.

Sadly, I believe that in using such terms Mr. Lessig hopes that his reader will conflate the Internet with the government, thus opening the door to greater intervention.

Now, some might argue that the government offered tax breaks and other regulatory favors to the big telcos and cable companies. All true. But these agreements did not stipulate later government seizure of privately-built networks. To enforce network neutrality (or any protocol) on privately-owned networks is simply an exercise of eminent domain.

The perversity of incentives created by government intervention will not be solved by further perversion of incentives. Net neutrality legislation is exactly such a perversion. Two wrongs do not make a right.

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Further, Lessig seems to be implying that net neutrality and broadband penetration have some sort of causal relationship:

Over these same 8 years, following this policy of deregulation, we’ve gone from 1st in the world to rivaling, as Kennard puts it, Slovenia. Broadband on average is slower in the US, and more expensive. In France, a triple play “Internet, Telephone, and TV” package is $32. Comcast offers less for $150.

How perfectly Keynesian. I've debunked the “French miracle” before, but allow me to do so again. The French pay much, much more than $32 for their connectivity. The companies offering such deals are doing so on top of billions of dollars of France Telecom’s assets. The taxpayers of France have paid (and are paying) multiple billions for this infrastructure, not to mention the pensions of former FT workers.

France succeeds in hiding the true cost from those who are unwilling to do the math. And, as strange as this connection may sound, the price for $32 connectivity is riots in the suburbs. The same state-directed economy that makes for “cheap” broadband is one that is incapable of creating jobs for its young people. As far fetched as it sounds, these are two sides of the same coin.

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On a more snarky note, I find it funny that he mocks those who accuse him of carrying water for big companies like Google:

It’s funny, I hadn’t realized I was a Google tool. I had thought we were pushing to reverse a failed policy because we wanted to enable the next Google (that was my point about YouTube). [...] I had thought these were important issues for the new economy — keeping the platform as competitive as possible, to keep prices and quality moving in the direction they move in the rest of the developed world.

...and two paragraphs later makes the same accusation of a former FCC chairman:

Even if America’s broadband strategy doesn’t make sense for America, it makes lots of sense for certain companies. Kennard knows this well, because he sits on the board of many of those who benefit most from this deregulation. His op-ed acknowledges his work with the Carlyle Group. He is also on the board of Sprint Nextel Corporation, Hawaiian Telcom and Insight Communications (a cable provider). These companies will benefit directly if Kennard succeeds in getting Congress to forget Network Neutrality.

Everyone is self-interested in the net neutrality debate, and that’s fine. As an Adam Smith-type, I believe that self-interest will drive us to where we need to be. Mr. Lessig’s opinion that network neutrality will make it easier for the next startup is a valid one, much as Keynes’ arguments for state intervention were valid.

But they happen to be wrong in this day and age. It is possible that some would-be startup may not exist without net neutrality. This is entirely speculative, and can neither be proved or disproved. To test this thesis, we would need enforce neutrality on the privately-owned networks that comprise the Internet, which to my mind is a combination of (federal!) eminent domain and the Fairness Doctrine.

Let me put it another way: if you believe that the government has a right to dictate what these networks carry, certainly it is within their power to seize the contents of the network, no? That’s your speech flowing over those wires. Does government have a good history of knowing its bounds?

As with socialist economies, it is possible that the government will direct resources correctly. However, a little empiricism (read: history) shows such decisions to be inexact as best, catastrophic at worst. The Internet deserves better.

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Update: Richard Bennett has more. He makes a number of important points, not least that simply because the Internet has a certain history, it need not be the only blueprint for the future.

The Internet has not historically had regulations on how to treat router queues, and even if it had we would be under no obligation to honor them in all future telecom regulations. The Internet is a part of our society that was devised by engineers to meet a set of objectives, not a perfect essence that descended directly from the Almighty into Bob Kahn’s head in 1981. In the beginning, we wanted it to be a plaything for academics, and now we want it to be much, much more. So we’re thinking about how to regulate it and how to stimulate it to make it grow into the kind of network we all want it to be. The argument from historical essence is garbage.

I find it very odd when technologists, or technology advocates like Lessig, would argue for limiting technological and economic possibilities. It’s simple change-aversion, and it afflicts too many debates. We need to be designing for the future, not simply replicating the past.

Comments

[wrestler]

Wells stated. Dude, it's time to come out of the closet. You're not a Republican, you're a libertarian (God bless you).

[Matt S]

You've caught me. Yes, I am more ideologue than party man. When I first started the blog, I didn't know much about the differences between "Republican", "conservative" and "libertarian". I don't spend much time debating terminology, but small-L libertarian is probably your best bet.

[Penty]

I will agree to the telcoms being able to charge what Prof. Lessig's calls a "tax" if they agree to give up their legal common carrier status. Remember they agreed to be content neutral in exchange for legal protections.

[Richard Bennett]

Telecoms aren't "common carriers", they're regulated monopolies. There's a big difference. Before offering a new service, the telecoms generally have to get regulatory approval and a tariff. They're love to be regulated as common carriers, because that would mean they could define and price their services as they see fit, providing they offered the same deal to everybody.

You might think UPS and FedEx are common carriers, but they aren't either. Law can be complicated.

[Osborne21Esther]

Various people in all countries take the credit loans in various creditors, because it is simple.