Thursday, November 13, 2014

Obama and Net Neutrality

By Robert Wenzel

President Obama said on Monday that a free and open Internet was as critical to Americans’ lives as electricity and telephone service and should be regulated like those utilities to protect consumers.

Is this guy out of touch or what? Does he realize that phone service improved and prices dropped once ATT was no longer protected by government from competition?

Does he realize that the incredible growth in mobile telephone technology is because of competition, not government regulation?

 "For almost a century, our law has recognized that companies who connect you to the world have special obligations not to exploit the monopoly they enjoy over access into and out of your home or business. It is common sense that the same philosophy should guide any service that is based on the transmission of information — whether a phone call or a packet of data,” said Obama.

And he went on to call for "net neutrality," which is not neutral at all. It is the heavy hand of government determining use rather than free market competition,

I originally discussed this in January of this year:

Net neutrality is the idea that internet service providers should be forced by government to treat all data on the internet equally, that is, the government plays the role of enforcer by not allowing  ISPs to discriminate or charge differentially by user, content, site, platform, application, type of attached equipment, and modes of communication.
The libertarian position is pretty clear cut here. Government should keep its hands off ISPs and allow them to operate any way they want. The ISPs, using their own equipment, are providing a service and should be allowed to use their equipment and provide their service in any fashion they choose without interference from the government...
The interventionists are up in arms...Betsy Isaacson at HuffPo under the headline, Why You Should Be Freaking Out About The End Of Net Neutrality writes:
1. No more net neutrality means ISPs can now discriminate against content they dislike.
Well yeah, but what web site is going to use the service of an ISP that blocks content that users want?
She goes on:
No more net neutrality means ISPs can now force websites to PAY for faster content delivery.You know how some sites you go to just load slower than others? Usually, that’s just because the slower site is image heavy, poorly coded, or dealing with intense server load. But with net neutrality gone, ISPs can now start charging hefty fees to websites that want quick content delivery — shifting the long load times to poorer sites that can’t pay up.
Isaacson’s “logic” here is just free market hate. Some content will be slow in delivery under any rules, it is just a case of which content. It will either be content where there is huge demand, which allows content suppliers to pay for fast delivery, or poorer sites, with heavy demand on the servers with little public demand for the service, which is why they are poorer. The free market would favor sites that can pay for the services they are using.
And there is more, she writes:
Destroying net neutrality is bad for small businesses. If ISPs force website owners to pay for faster load times, tiny retailers and personal websites will be the ones to suffer from slower content delivery.
This is not necessarily so. If a small business has a strong following, it will be able to pay for faster downloads. Again,this is all about the allocation of delivery speed. It has to be allocated in some fashion. The non-interventionist manner is to allow the highest bidders to get the prime speed, small or large.
Net-neutrality law can be compared to law that would force out of retail malls top retailers to be replaced by, say, a greasy spoon diners in the name of “mall neutrality.”
Bottom line: Net neutrality is evil government meddling. Let the markets rule!
This comment on net neutrality resulted in more commentary from me in response to commenters:A Further Comment on Net Neutrality

Robert Wenzel is Editor & Publisher at and at Target Liberty. He is also author of The Fed Flunks: My Speech at the New York Federal Reserve Bank. Follow him on twitter:@wenzeleconomics


  1. I'm still waiting for open roads, post offices, DMV, etc. I can only assume that an "open" internet will take 30 minutes to load a site, or maybe just block access. Open = closed. Typical doublespeak.

    The state is doing a great job of proving it is an anachronism. 20+ years of charging for different speeds, and not only is it just now a "problem," but they just now noticed?

    Even if I were to believe their story, and not that they're up to a crony scam, then they're telling us, in their own words, that they're 20+ years behind the times. That may as well be 1,000 years to the up and coming generation that was born and raised with smartphones.

    Soon enough, they'll be trying to bail out the postal service, and kids who have never seen mail will be asking what the hell that is and why they should care.

  2. Keep in mind that net neutrality is a patch to mitigate the undesirable results of internet service being yet another defacto cartel thanks to government regulation. So long as government dictates who may run their wires where and allocate frequencies and give permission to use them for wireless there is no free market in providing internet service. Removing net neutrality but leaving the regulated cartel in place could have disastrous effects. With big corporate players being the only choices in many areas it could quickly become impossible to access anything that isn't approved/sponsored/whathaveyou.

    This should not be construed as agreeing with treating internet service like a utility. That seems to be using the opportunity to grab more power for the government and its closest friends in the industry.

  3. "Net Neutrality" never existed in the first place. ISPs have always had the ability to block websites and shape traffic. The internet has worked with "fast lanes" literally since its inception. Its just more propaganda. After the NSA leaks this "regulation" is really worrisome.

    This blog is worth the read :)