In 1996, the Telecommunications Act made clear the roadmap for how government would interact with the Telecommunications market space moving forward: simply put, it wouldn’t. The bundle of policies called for drastic deregulation and dialed the executive oversight of Telecommunications way back. Somehow the FCC never got the message. A look at the FCC’s Gross outlays shows that regulatory spending has not declined. In fact, as the chart below shows, since the Act was passed, FCC spending has increased three times faster than the rate of inflation. In other words, as the cost of living elsewhere in the economy increase, the FCC is costing taxpayers even more. This seems suggests that old regulatory costs don’t go away, but continue to growth.
This graph shows the alarming trend, a mirror image of what was detailed by policymakers in 1994. Perhaps more alarming still, the graph cuts off at 2009, just at the precipice of two of the most costly FCC programs to date – the national broadband plan and net neutrality.
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Comically, proponents of net neutrality in Congress have gotten a stay of execution of sorts as they argued last week that we ought to focus our time on job creating measures before plans to override net neutrality. The irony of that request wasn’t lost on everyone, thankfully, as a handful of anti-net neutrality legislators fired back. Led by Congressman Upton and a few cohorts, the anti-net neutrality forces have demanded some evidence that a net neutrality policy would have positive ramifications for consumers. “Please point us to the specific paragraphs and language in the order analyzing the impact of your rules on the economy and the creation or loss of jobs,” demanded Upton in a letter to the FCC.
I’ll save you the suspense… No such evidence exists. Instead, a net neutrality policy stands to punish consumers, private companies, and innovators, and will almost certainly do more to limit access to the Internet than any other policy to date. Perhaps Rep. Marsha Blackburn put it best in an interview with The Hill this week. “Net neutrality is not the government protecting Americans from greedy ISPs,” argued Blackburn, “it is an arrogant bureaucracy imposing its vision of the Internet on innovators and job creators.” The evidence certainly points that way.
According to one of the most comprehensive econometric analysis done on the subject to date, net neutrality would cost the US economy over 500,000 jobs in its first ten years. A microeconomic analysis of the issue found that the policy, in defraying costs from content providers to consumers, would show up as an up to $55 monthly increase on the average high-speed internet bill.
The Democrat call to focus on job creation is good advice. We should heed their advice and save the US 500,000 jobs and its consumers $55 a month by keeping the focus on defunding net neutrality.
I do think the FCC can make a compelling argument that moving forward with a net neutrality policy will save one ever-growing sector of jobs: their own. Beyond that, I think its time that Chairman Genachowski finally heeds the mandate of the Telecommunications Act of 1994 and begins to streamline his operation. With a recently reinvigorated call to deregulation to the betterment of consumers, his burdensome services are no longer needed. If there’s one place that we can stand to see job loss, it might be in the FCC.
Zack Christenson is a Chicago-based digital strategist who writes on tech policy.