NetCompetition, an organization dedicated to improving competitiveness in the internet market, held a panel discussion and debate on April 4th on the topic “Thinking and Starting Anew: Modernizing Communications Law for American Consumers.” Scott Cleland, Heartland Institute policy advisor and president of the Precursor consultancy firm, was the first of the five guests to speak.
Cleland explained how regulations in the communications market have become increasingly obsolete due to the speed of innovation in the sector and that, rather than replacing the old regulations, new rules are simply layered on top of the old. Cleland likened these layers of regulation to an archeological site; the historical layers become lose stability over time as external forces work their way into them.
Cleland asked the question, “How do you take something that obsolete and that dysfunctional, how do you make it work?” The answer is simple and elegant: “You want to build it on a lasting foundation of enduring American values.” These values, according to Cleland, are competition, consumer protection, universal connectivity, and public safety. By enacting a new regulatory regime that allows for innovation in the ever-shifting marketplace, the communications and technology industries will be able to grow and thrive.
Most of the panelists agreed in large part with Cleland’s analysis. Gene Kimmelman of Public Knowledge even acknowledged the detrimental effects of extremely complex regulation. Kimmelman proposed that a bipartisan be established to reach agreement on what the “shared values and principles” are.
Hal Singer of the centrist Progressive Public Policy Institute likewise condemned the current regulatory regime as one that stifles innovation and beneficial competition, saying that, “many of the existing regulations are no longer justified.”
The only panelist rigorously opposed to Cleland’s ideals was Mark Cooper, the researcher director of the Consumer Federation of America. Cooper contended that, “The layers we’ve added, that Scott laments, are, in fact, progress. And every time we’ve had a major revolution in America, in terms of the economy, we’ve expanded the rights of individuals, because that’s what progressive societies do.” Cooper also argued that the market would not solve in some areas and that some subsidies in the market would be essential.
The American Enterprise Institute’s Jeff Eisenbach struck back at this criticism, explaining that Cooper’s argument amounted to an upholding of “the tyranny of the status quo.” Eisenbach added a new layer of criticism of that status quo, arguing that a principle of zero-base regulatory budgeting would solve many of the problems of obsolete and overly-constricting regulations. In zero-base budgeting, the regulator must ask one question: “If we weren’t doing it, would we start?”
Eisenbach contends that this question could transform the regulatory regime: “If you asked that question about the vast majority of what the Federal Communications Commission does today, the answer is no.”
The arguments presented by the panelists show a growing movement in favor of cutting our and streamlining the grotesque regulatory regime of the communications sector. Communications technology is one of America’s most cutting-edge industries, but that can only remain the case if onerous regulations do not stifle it.