

How Robber Barons hijacked the "Victorian Internet" - alecco
http://arstechnica.com/tech-policy/news/2009/12/how-the-robber-barons-hijacked-the-victorian-internet.ars/1

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nickpinkston
Why is no one here mentioning plug-in laws? With proper governance (ie: laws)
we can remove the market externality that exists in the natural monopoly of
telecom infrastructure. These laws force all infrastructure owners to sell
access at bulk rates (like a T3) that allow new ISPs, etc. without any burdens
(ie: throttling). Most people would pick the independents without
restrictions.

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.

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javert
I smell a straw man here.

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.

~~~
pradocchia
> Doing away with government-granted monopolistic regulations is the solution.

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?

~~~
anamax
Of course the grantee wants it. However, if there's no grantor, it doesn't
matter what the grantee wants.

> 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.

~~~
pradocchia
I don't see how this answers the question.

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.

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steveklabnik
Very cool article. As someone who's very much for small gov't, net neutrality
has been a really hard issue for me, personally, as it's making another law to
ensure more freedom? Those two concepts are kind of hard to fit together
sometimes.

~~~
RyanMcGreal
> making another law to ensure more freedom? Those two concepts are kind of
> hard to fit together sometimes.

Really? What do you think guarantees freedom, if not the rule of law?

~~~
gojomo
Laws enforced against deceit and theft and murder help freedom. Laws dictating
what's legal to sell, at what price, not at all.

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:

<http://www.nytimes.com/2006/08/03/opinion/03lee.html>

~~~
weavejester
> Laws enforced against deceit and theft and murder help freedom. Laws
> dictating what's legal to sell, at what price, not at all.

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.

~~~
dpatru
A simple way to do this would be to limit some of the advantages of a
corporation, which is itself a state-created entity. I've no problem with
government limiting the freedom of its own creation which enjoys unlimited
life, limited liability, tax advantages. I do have a problem with government
restricting the freedom of individuals and partnerships to contract freely in
the marketplace.

~~~
weavejester
I think the problem still remains; a free market does not necessarily mean it
is an optimum market, and the government is not the only factor that can
adversely affect a marketplace.

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chrischen
"Freedom is not a zero sum game, where taking it away from some gives more to
others. Taking away freedoms of some takes away freedom from all."

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.

~~~
gills
Some might see your analogy as backwards, especially if they view individual
freedom as having natural bounds which are easily identifiable to mentally
stable humans. I have a feeling that's why you were voted down (not by me,
sorry). An example of this line of reasoning:
<http://en.wikipedia.org/wiki/A_Theory_of_Justice>

