The Biggest Lie in the FCC's Net Neutering* Actions

When I write about the dangers to innovation, competition, and price discovery from the FCC's decision to regulate the Internet into Ma Bell, supporters of net neutering are quick to point out that the FCC promised to only use a fraction of the power it is giving itself.

Ha!  When has this happened, ever, with the government?  If they have the power, they are going to use it.  In fact, to call the FCC as somehow careful about staying within bounds of their power is a joke anyway, since this entire regulation likely exceeds their legislative mandate.   Even if the current commissioners are honest that they will never use all this new power, how can they possibly bind future commissioners?

I am reminded of the income tax, which was sold to the country with the promise that it would only ever apply to the top few percent of earners.  In other words, they were asking for the power to tax everyone but promised only to use a fraction of that power

when initially imposed, the income tax, despite its progressive rates, appeared rather straightforward and not all that burdensome—almost benign. Of course, appearances can be deceiving.

There were, of course, warnings about the dangers of a progressive tax structure. But people supported the income tax because it was originally meant to impose only very low tax rates on only the highest incomes. Proponents argued that the 16th amendment to the U.S. Constitution would force the so-called “robber barons” to pay taxes. It was not supposed to provide a mechanism for Washington to reach into most Americans’ pockets.

...

The original income tax was obviously not meant to be paid by most citizens, nor were rates high enough to significantly undermine the spirit of enterprise. For example, under this system single taxpayers today would pay no tax on any earnings up to almost $45,000 and married couples on earnings up to almost $60,000. A one percent tax rate would be in effect on incomes up to about $300,000. The top rate of 7 percent would not take hold until earnings hit almost $7.5 million.

 

* "Net Neutrality" is an Orwellian term that bears no relationship to what is actually going on.  I will use "net neutering" going forward.

  • Jess1

    If one is willing to cede power to others, then one should not be surprised when that power is exercised. I eagerly await the day when "internet access" is at the quality level offered by the Bell System for decades...
    (for those too young to know, that last bit is sarcasm. Tinted with rage.)

  • Nehemiah

    I wonder how much an email stamp will cost?

  • Matthew Slyfield

    In an effort to halt the disintegration of the US Paste Orifice, email postage will be set to twice the snail mail postage rate.

  • Cardin Drake

    My biggest complaint about this is the continuing encroachment of the Regulatory State. It
    should bother everyone that they are using regulations passed before the
    internet was even thought of to regulate it. If Obama wants to regulate the Internet, man up and pass the Internet Regulation Act of 2015. It is ridiculous for unelected bureaucrats to add 330 pages of laws to a telecom act passed in 1934. Regulatory bodies were
    never meant to pass new laws, and it highlights the misuse and abuse of
    almost all federal regulatory agencies.

  • randian

    In what sense did the "robber barons" not pay taxes?

  • http://devilish-details.blogspot.com/ mesaeconoguy

    That's a fantastic unintended consequences question.

  • randian

    How do you know it's unintended?

  • http://devilish-details.blogspot.com/ mesaeconoguy

    And that is the answer.

    Absolutely frightening. Cross-government enterprise taxpayer subsidization.

  • http://devilish-details.blogspot.com/ mesaeconoguy

    Touche.

  • http://devilish-details.blogspot.com/ mesaeconoguy
  • Matthew Slyfield

    I forgot to mention:

    The government will tell the people that (shades of the SSA trust fund) the revenue from the email postage will be earmarked for balancing the USPSs budget and improving USPS service, but when the regulations are actually written, all the money will go to the general fund.

    Despite the now enormous cost of email, people will continue to prefer email over snail mail due to near instantaneous delivery provided by email.

    Since the money ends up in the general fund and people continue to prefer email, the USPS will continue to slowly bleed to death and will finally be abolished in 2030.

    Despite the end to the original purpose of the email postage requirements, rather than eliminating email postage, the rates will be increased in 2031.

  • Matthew Slyfield

    In the same sense that they were "robbers" and "barons", which is to say it is a bold faced lie told by socialists to make capitalism look bad.

  • Joe

    I wish he started with the year 1930 (pre New Deal) instead of 1950.

  • SDN

    I don't think we'll have to worry about it, because enemies of the state won't be allowed access at all.

  • jhertzli

    It took a century to get rid of the ICC and decades to get rid of the CAB. How long will this last?

    The best way to fight this might be to try to repeal the phone regulations it was based on.

  • Me too

    At first it will be tiny. Think $1 per 1000 emails. And then you turn up the heat. In a few years you have a nicely roasted frog.

  • Matthew Slyfield

    You are humor impaired. I hear that they have meds for that these days.

  • Me too

    I miss the joke now and then.

  • davesmith001

    Isn't this what the future Emperor said in Star Wars?

  • Matthew Slyfield

    The fact that I called it the "US Paste Orifice" should have been a clue.