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‘Net Neutrality’ Is a Problem, Not a Solution

The oldest trick in the collectivist playbook is to create a problem through government regulations, let it stew for a while, and then propose even bigger government as the only possible solution to the “crisis” it planted, nourished, and harvested.

We watched government tinkering in health care make it more expensive and complicated, year after year… until the time was ripe to stuff the biggest, sloppiest, most poorly-thought-out Big Government power grab of the modern era down our throats. Are we really going to fall for that again with the FCC’s new Net Neutrality regulations?

Net Neutrality is a problem, not a solution, and it won’t take long before we’re told that even more extensive and intrusive government control of Internet service is necessary to address all the “unintended consequences” it produces. The big difference between the government takeovers of health care and the Internet is that the latter will happen much faster, because everything happens faster on the Internet.

Mark Cuban, a longtime critic of the Net Neutrality push, went on Glenn Beck’s TV show Tuesday to talk about those “unintended consequences,” which one suspects are going to come as a surprise to the suckers who think the Obama Administration is heroically trying to make their telecom bills lower by fiat, rather than huckstering them into with a massive con job:

“What it comes down to is, the net has worked,” Cuban said. “We’re not in an industry where the technology has become stagnant and there’s no more enhancements so we need regulation to try to make things happen. We’re not there. And so as long as the technology is allowed to advance, we’re OK.”

Cuban said the uncertainty and legal challenges of having the government regulate the Internet will be enormous, and predicted that it will slow down innovation. He also said there are many unexpected issues that will arise from such an enormous change.

“If net neutrality is taken to its logical extension … if there’s no priority for television and it’s just part of the open Internet and delivery, your traditional television, watching the evening news, it’s over,” Cuban said. “If there is no such thing as a prioritized bit, then all that digital television going through the same pipe, all those voters who like to get Fox News or MSNBC, they’re going to freak out because you’re going to have to go to their website to get it or you’re going to have to get a special box that identifies the channels and brings it to you.”

Cuban said television networks will likely begin buffering, which will force people to buy new equipment. But there are even more possibilities that aren’t being discussed.

“There’s going to be someone that comes along and says, ‘We need decency standards applied to all the content on the Internet because now that is coming through the same pipe and it’s open to everybody,’” Cuban remarked. “[Or], ‘We need educational requirements.’ Remember Bill Clinton said you have to have a certain amount of educational content?”

“This goes into the law of unexpected consequences, or unintended consequences, that you don’t know what’s going to happen when all these things change,” he said. “You would think companies like Twitter and Facebook have thought through the technological aspects of it. I don’t think they have.”

He’s certainly right about that.

For the mid-range companies pushing Net Neutrality, this is all about bringing the government Goliath into the market to stop the telecom giants flat. It’s a crony capitalist arrangement, and like most other cronies who have used coercive government power to control the free market, they’re going to learn that Big Government makes a far less friendly and cooperative business partner than they anticipate. Political agendas will be forced down the tubes of compulsion our Net Neutrality boosters want to implant in the Internet; it won’t be long before baffled supporters are wondering why websites with dissident political views are having such a hard time obtaining government licenses. They’ll be absolutely astounded at how much web content suddenly runs afoul of the “decency standards” Cuban warns about.

But most of all, they’re underestimating how energetically Big Government will use its control over the Internet to deliberately create crisis that only Even Bigger Government is allegedly capable of resolving. It’s the same damn thing that happens every time citizen-suckers fall for the price control fantasy, which is probably the most persistent delusion available for sale in the Left’s endless carnival of broken promises. It’s incredibly tempting to believe that nice, selfless, wise bureaucrats can impose lower, more “reasonable” prices on desired goods and services, injecting a dose of vitally needed human compassion into the brutal free market. Why can’t the government just pass a law that makes things cheaper?

What Cuban is alluding to in his “unexpected consequence” forecast is the same thing that happens every single time price controls are imposed: quality and supply suffer. It’s the most predictable unexpected consequence in the world.

These new FCC regulations will oblige Internet companies to begin de-packaging and de-bundling the services they offer now, for incredibly reasonable prices. You won’t get anything for free any more. It’s the same thing that happens when price controls are slapped on food, real estate, medicine, and everything else. You’ll be amazed at how much the “free and open Internet” costs, once a few years of Obamanomic voodoo have been worked upon it. And you’ll be told to suck it up and pay those prices with a smile, because at least Comcast stock is down.

You can already see some Net Neutrality advocates short-circuiting when confronted with extremely sensible questions about why companies would be more eager to make titanic investments in a marketplace frozen by government regulations and chopped into pieces by redistributionist ideology. Here, watch Tumblr CEO David Karp crash harder than a Windows Millennium box and admit he doesn’t know what the hell he’s talking about when his Net Neutrality rant is interrupted by Capitalism 101 questions from a CNBC panel:

With all due respect to dissenting FCC Commissioner Ajit Pai, I do believe Mr. Karp is the most effective critic of Net Neutrality I’ve ever seen. No one has ever done a better job of conveying the impression that advocates of the secret FCC scheme are like children playing with loaded guns. They have absolutely no idea what they’re about to inflict on the American people. They just have a naive faith that nice and good people from selfless mommy government will make everything cheaper than greedy Big Business tycoons who want a return on their investments.

Another thing you’ll pick up from watching the entire CNBC segment above is that some of the more thoughtful Net Neutrality boosters are starting to realize they’ve unleashed a monster. The FCC’s secret plan is a massive bait and switch operation, with the Obama Administration claiming the enthusiastic support of people who actually expressed tentative agreement in principle with earlier plans that were far less heavy-handed. Get a load of the Electronic Frontier Foundation suddenly realizing that the regime of government controls it advocates is going to include quite a bit more control than it bargained for:

According to the FCC’s own “Fact Sheet,” the proposed rule will allow the FCC to review (and presumably punish) non-neutral practices that may “harm” consumers or edge providers. Late last week, as the window for public comment was closing, EFF filed a letter with the FCC urging it to clarify and sharply limit the scope of any “general conduct” provision…

Unfortunately, if a recent report from Reuters is correct, the general conduct rule will be anything but clear. The FCC will evaluate “harm” based on consideration of seven factors: impact on competition; impact on innovation; impact on free expression; impact on broadband deployment and investments; whether the actions in question are specific to some applications and not others; whether they comply with industry best standards and practices; and whether they take place without the awareness of the end-user, the Internet subscriber.

There are several problems with this approach. First, it suggests that the FCC believes it has broad authority to pursue any number of practices—hardly the narrow, light-touch approach we need to protect the open Internet. Second, we worry that this rule will be extremely expensive in practice, because anyone wanting to bring a complaint will be hard-pressed to predict whether they will succeed. For example, how will the Commission determine “industry best standards and practices”? As a practical matter, it is likely that only companies that can afford years of litigation to answer these questions will be able to rely on the rule at all. Third, a multi-factor test gives the FCC an awful lot of discretion, potentially giving an unfair advantage to parties with insider influence.

My God, you preposterous rubes. Did you really think Obama’s agents in the FCC were going to apply a “light touch” to anything? Did you seriously believe they’d pass up on the opportunity to insert toxic clauses that would give them open-ended power to regulate content later, once it’s too late for you deluded activists to do anything about it? How can you possibly think the prospective expense of this scheme would deter them in the least?

“It is likely that only companies that can afford years of litigation to answer these questions will be able to rely on the rule at all… A multi-factor test gives the FCC an awful lot of discretion, potentially giving an unfair advantage to parties with insider influence…” Yes, children, that’s the point. That’s a feature, not a bug. That’s the reason statists are so interested in Net Neutrality.

They’ll use that discretion to impose super-heavy burdens on political adversaries, but they’ll be dumping plenty of cost burdens on everyone… and then they’ll blame what remains of the free market for those costs… and present an even more onerous set of New Deal regulations to an anguished public as the only solution.

The mainstream media is risibly attempting to portray Net Neutrality as a David-vs.-Goliath victory of the Little Guy over evil mega-corporations with a regulatory slingshot. It’s more like David inviting Godzilla into the ring to take out Goliath, without much thought for what Godzilla’s going to do afterward.

They’re about to find out that Godzilla’s appetite for power will be whetted, not sated, by the meal they’re offering. Activist government uses its power to create crises that can be exploited to accumulate more power. It’s the most reliable process in the world, but smart people keep fooling themselves into being surprised by it.

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