How Robber Barons hijacked the "Victorian Internet"
arstechnica.com
arstechnica.com
Net neutrality, as it's currently setup, makes it too easy for companies to influence the law. Plug-in laws are at work in many developed economies, and are more subject to market forces due to the competition for bulk rate product.
All the problems mentioned arose because WU was a monopoly. But, why was WU a monopoly?
Telegraph lines could only be installed profitably along railroad lines. Thus, the railroad companies could create a situation where there could only be one telegraph company--a monopoly.
Why could telegraph lines only be installed profitably alongside railroad lines?
Well, one could lay telegraph lines through the countryside fairly cheaply, but the problem is: high taxes on the land you're using, government not allowing you to bury lines below roads and other obstructions, and similar regulatory issues.
In other words, there were no non-regulatory reasons one couldn't set up a competing telegraph company (at great profit, if it's true that WU charged exorbitant prices and spied on your messages).
Likewise, in the modern telco industry, there are government-granted monopolies to certain companies like AT&T and Time Warner through regulatory means. E.g. typically, only one company is allowed to install communication lines in a given area.
Doing away with government-granted monopolistic regulations is the solution. Consider what happens if the other route is taken.
The other answer is to have government more heavily regulate the existing monopolies - which will lead to abuse and corruption. If you allow for excessive regulation, you have the recipie for the problem cited in the article: government and certain companies will conspire with each other, to everyone's detriment. It's already happening with AT&T and the US government (consider the extra/quasi-legal spying AT&T has done for the government), and it will get worse under net neutrailty.
I have no prescriptions, but I do observer that the grantor and grantee are typically two hands of the same will. That monopolies are granted because the grantee wants it, and has found ways to make it so. How do you do away with that?
Capitalism is premised on the concentration of wealth to fund capital-intensive investment. Given the concomitant concentration of power, how do you prevent regulatory capture and the general perversion of government? How do you dilute power and preserve the system?
> Given the concomitant concentration of power, how do you prevent regulatory capture and the general perversion of government?
A govt that doesn't regulate isn't subject to regulatory capture. A "not govt" that tries to regulate can usually be ignored.
There is nothing to prevent a sufficiently influential grantee-to-be from creating a grantor. In fact, I believe this is the origin of many regulatory bodies and government powers.
The point is to make sure there is NOT a concomitant concentration of power. In other words, you have to have limited government.
In a free market system (capitalism), only government /actually/ has power. Corporations must compete.
In our mixed economy, corporations do gain power, but that is because we do not have limited government.
Then instead of abusive governments, we'd have abusive companies.
I mean the government takes certain powers away from private citizens in order to prevent us from abusing these powers (murder, fraud, etc).
I agree that there are probably regulations that impede competition from performing ideally, but sometimes it is necessary, like in the public utilities. Some of these things simply can't work as well if we have multiple companies trying to screw each other over.
Certainly the argument is valid, at least theoretically, that if we do not codify net neutrality, and deregulate the internet business, the companies that favor the consumers the most (most likely the net neutral ones) will dominate in the end, but there are other issues that come in practice. Who gets to create infrastructure (cables and stuff) through the ground when there are hundreds of them? Imagine if we privatized electricity. We'd have multiple powerlines everywhere. It'd just increase overall waste. Or perhaps radio wave broadcasting were to be deregulated. Nothing would function. There are potential problems if we don't regulate the ISPs and let them all duke it out. Sometimes the sum of the whole does not equal the parts.
Citation?
Honestly, I'd think that the main reason that telegraph lines could only profitably be installed along railroad lines would be because of maintenance concerns.
If there are no regulatory barriers to providing some service, someone will do it, when they are able to do it profitably. Which means that they'll do it when it's actually worth doing.
If there were no regulatory monopoly on creating telegraph lines, WU wasn't really that bad, and it wasn't really needed/worth it. (After all, the article does not make a case that WU successfully manipulated the election.) However, I think it's far more likely that there was a regulatory monopoly, as there is for modern telecoms.
Lines (power, telegraph, gas, etc) are generally run on easements purchased from the underlying landowner. Right-of-ways and property for railroads were often government-granted, so it was easier to negotiate with the railroad for an easement for a telegraph line than with a few thousand individual landowners, any one of which could easily raise your costs by refusing to allow you to go through their land.
"government not allowing you to bury lines below roads and other obstructions"
In the 1800's this was not really a big problem. Besides, telegraph lines generally ran on poles.
Really? What do you think guarantees freedom, if not the rule of law?
The FCC that would enforce "neutrality" also enforces "indecency" rules and has in the past required a minute-for-minute accounting and balance of political expression -- the "fairness doctrine". There is reason to doubt whether neutrality laws would be freedom-promoting or welfare-promoting, in the long run.
How well did "rail neutrality" work, in the long run? See:
edit: Thinking more about this, ISPs would just bury this information in the EULA in obtuse legalese so that normal users would ignore it or at least have a hard time understanding it. Then they would be in the letter of the law, but not the spirit and they would still get away with stuff. Though it would help in places like taking the ISPs to court (as right now what happens on their network is essentially a blackbox and when there's a problem they can just shift the blame to someone outside of their network and there's little you can do to prove/disprove that).
Laws are far from the only way to restrict what is sold to the public. Large corporations can leverage their market share to shut down competition in other areas. In order to maintain a healthy market place, you have to ensure that a market is not completely controlled by a few large corporations.
Maybe. But if so, that's an argument for antitrust enforcement, not net-neutrality type-and-price-of-service regulations.
As the example of regulatory capture in many industries should make clear, regulations often turn out giving an advantage to the few large operators who can play at Washington rulemaking games -- with large staffs of lobbyists and big donations at election time -- no matter what the regulators' initial rationale.
I'm not saying I don't agree with Net Neutrality, because I do, I'm just torn about _why_ I agree with it.
But governments are run by individuals, so saying that they aren't allowed to pass such-and-such a regulation means interfering with the individual's ability to run their government the way they see fit.
The notion of "absolute freedom" suffers a stack overflow if you actually try and think about it. Any action whatsoever, not merely government regulation, reduces the freedom of some people and increases it for others.
Yep. But this isn't neccessarily about 'absolute,' it's about "minimal as possible," at least in my eyes. As I said to someone below, I prefer to fix problems after the fact, rather than before, but I feel like this will almost certainly be a problem, so why not just cut to the chase?
EDIT: Holy crap, everyone. Please refer to my two responses just below about the reason I said "Ideally." This statement is in response to "what possible ways are there to guarantee it other than a meaningful amount of regulation." So I gave one.
I'm sorry but the idea that the market will solve every problem the world could ever dream of is a ridiculously out-of-touch-with-reality idea. Though the idea that Congress can come up with laws to solve even one problem without creating side-effects is equally naive.
The 'market' can be gamed, and there are plenty of people that make a career out of it. As long as you can bury the truth in bureaucratic nonsense and hide behind diffusion of responsibility you can get away with practically anything.
"Ideally, grapefruit would just take care of it."
But there's a reason for the first word of my statement.
There's a whole set of well-defined problems in which everyone following their individual interests, the "invisible hand" so to speak, lead to a clearly terrible situation -- monopolies, prisoners dilemmas (collusion), tragedy of the commons (pollution, resource extraction, public education)..
Talking about how "ideally the market would take care of those problem" is just silly, the market will categorically not care about those problems -- it's not an intelligent force, just a sum of individual actions.
I hate my health insurance company, cable company and cell phone company -- what are my options here in this supposedly free market, start my own multi billion dollar nation-spanning infrastructure?
So, to say that "the market" will take care of something is equivalent to saying that a set of human beings interacting with each other freely, voluntarily, and without coercion will take care of it.
For example, there's cases where cities have been forced to remove their free wifi networks.
The technology exists now to make (slow, but) free wifi mesh networks among citizens. If anyone can make An internet, then who cares if The internet is no longer neutral?
But more people seem to be behind net neutrality, so it's more likely to get passed...
I wonder how he'd feel after we make murder legal, and then I shoot him in the face. Have him see how much freedom he has when he's dead.
My point is that it's a gray area. It's not all freedom or nothing.