Report: Net Neutrality Would Harm Economy
(The following is re-posted by permission from Info Tech and Telecom News. IT&T News is a project of the Heartland Institute.)
By Phil Britt
As the economy continues to struggle with unemployment near double
digits, allowing the Federal Communications Commission to impose network
neutrality regulations could cause the loss of another 300,000 jobs,
according to a report from the Washington, DC-based Phoenix Center.
It's
not just any jobs that would be affected, the authors observe. The
average earnings of a communications sector employee are approximately
45 percent higher than the typical U.S. private-sector job. Thus each
job lost or gained in communications is equivalent to about 1.5 average
jobs lost or gained, in income terms. So far, employment in the sector
has remained relatively robust during the downturn.
Report
authors George S. Ford and T. Randolph Beard warn proposed network
neutrality regulations could result in a 10 percent decline of capital
expenditures in the information sector.
"At a time when
unemployment is high and the economy is faltering, anti-investment
telecom and broadband policies are ill-advised," says Phoenix Center
President Lawrence J. Spiwak, "The heavy-handed regulatory mindset of
the current FCC is not good for investment, so it is not good for jobs.
Moreover, there is no evidence that the proposed regulations are good
for consumers."
'Investment, Jobs Will Flee'
"Net
neutrality tasks the government with the regulation of business," notes
Bennett Kelly, founder of the Internet Law Center in Santa Monica,
California. "The Internet will be regulated anyway. Without net
neutrality the Internet is regulated by cable and telecom providers
under the standards they choose."
There was plenty of grassroots
support for net neutrality a few years ago, but that has largely waned,
according to Kelly. He says former proponents of the policy are now
concerning themselves with more important issues such as the overall
economy.
"The Phoenix Center report underscores and puts the
exclamation point on what has been the central and most obvious reason
that FCC regulatory intrusion would be a disruptive rather than helpful
force: That it will badly damage, if not outright crater, one of, if not
the only, parts of our economy that continues to expand on the back of
billions of dollars of private investment," said Bartlett D. Cleland,
director of the Institute for Policy Innovation (IPI) Center for
Technology Freedom in Dallas, Texas.
"As IPI has been writing
for years in relation to the network management debate, if government
seizes control, then investment, and hence economic prosperity and jobs,
will flee," said Cleland. "If the market is allowed to function as it
always has been, then we can expect growth, opportunity, innovation, and
jobs."
Market Solution Offered
Steve Titch, a
telecom policy analyst for the Reason Foundation in Los Angeles, says
the FCC's concerns can be addressed without harming investment and
cutting jobs,.
"The ball is in the FCC's court," Titch said. "The
framework proposed by Verizon and Google seems acceptable to most-it
guarantees that no Web sites will be blocked, yet allows ISPs to manage
their networks effectively, especially on the wireless side.
"The
FCC would be wise to declare victory and go home," Titch added. "What
it really comes down to is how much they want to regulate business going
forward."
Phil Britt (spenterprises@wowway.com) writes from South Holland, Illinois.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.