Governments Mandate Monopolies, Lament Lack of Competition

Governments Mandate Monopolies, Lament Lack of Competition
March 17, 2014

Seton Motley

Seton Motley is the president of Less Government, a DC-based non-profit organization dedicated to... (read full bio)
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The solution to government – isn’t more government.  But that’s exactly what governments proffer all the time.

They pass a government-expanding law – which warps, distorts and otherwise damages the private marketplace.  They don’t offer to repeal the law – of course not.  They instead pass another government-expanding law – to “fix” the mess they made with the last one.  Lather, rinse, repeat.

Just wait – soon the Democrats will propose as the “solution” to the disastrous ObamaCare…all-government-all-the-time single payer.

But we already had Huge Government health care – Medicare and Medicaid.  Which face tens of trillions of dollars in looming shortfalls.  Did the Left proffer less government reform?  Of course not.  They gave us government-expanding ObamaCare – and stole (at least) $741 billion from already-broke Medicare to do it.

You know why the federal government is the only entity delivering First Class Postage?

The Postal Service has a legal government monopoly on delivering first-class mail…. (Prospective competitors) are required by law to charge a high minimum price and cannot undercut USPS rates.

Nothing like the government gaming the system – to favor the government.  And how’s their monopoly working?

Postal Service Loss Of $15.9 Billion Sets Record

And guess who’s screwing up cable and Internet delivery?  Why, it’s government.

Don’t Blame Big Cable. It’s Local Governments That Choke Broadband Competition

Game of Kickbacks

Local governments and their public utilities charge ISPs far more (for building rights) than these things actually cost. For example, rights of way and pole attachments fees can double the cost of network construction….

These (government) incumbents – the real monopolists – also have the final say on whether an ISP can build a network. They determine what hoops an ISP must jump through to get approval.

This reduces the number of potential competitors who can profitably deploy service.… The lack of competition makes it easier for local governments and utilities to charge more for rights of way and pole attachments.

It’s a vicious circle…(A) system of forced kickbacks….(also) includ(ing) ISPs…building out service where it isn’t demanded, donating equipment, and delivering free broadband to government buildings.

How bad does it get?

Video franchises are the revenue-sharing agreements that cable TV companies sign with local governments in return for the exclusive right to offer video services to customers.

Get that?  It’s the government creating the monopolies – not the (very un-free) market.  The answer?  Less government.

Video Franchise Reform Would Support Competition and Consumer Choice

Because (private providers) were able to go directly to the state capital for permission to deploy video services anywhere in the state, they were able to accelerate their rollout. Consumers saw quick results.

Amazing what happens when you can bypass all the local governments and their myriad shakedowns.

The Left’s response?  More government.  They want local government broadband – ObamaCare for the Internet.

The Promise of Municipal Broadband

Municipal Broadband Networks Bridge the Digital Divide

To Help Connect the Two New Yorks, Bill de Blasio Should Build More Community Broadband

Municipal Broadband Would Provide the Competition Necessary to Make Seattle’s Broadband Market Function

Government mandates create private monopolies – government then decries the dearth of competition as justification for government broadband.

Government taxes private broadband companies – and then uses their money to fund competitors to their businesses.

And imagine these private companies trying to set up service – having to ask the permission of the governments that are competing with them.

The people wanting this nonsense are the same ones demanding Network Neutrality imposition to prevent Comcast-NBC from slowing Netflix so as to favor their video service. Which has never happened – and never will.  Because their customers would freak – and fire them.

Will government block private companies to favor their service?  Of course.  See: Medicare.  And the U.S. Postal Service.  Because no matter how much we “customers” freak – we can’t fire them.  Government law says so.

President Barack Obama loves the local government broadband approach.  It’s community broadband organizing - building single-payer government-only service from the ground up.

“(T)he ultimate goal is to get rid of the media capitalists in the phone and cable companies and to divest them from control.

The 2009 “Stimulus” law contained a $7.2 billion down payment towards it.  How’s it all worked?  Predictably – terribly.

The Internet ‘Stimulus’-Just as Destructive as the Rest of the ‘Stimulus’

Yet Another Terrible Internet ‘Stimulus’ Project

Despite Glossy Reports, Muni Broadband is Still a Net Money Loser 

Provo’s Failed Muni Broadband Purchased by Google for $1

Google did not assume the thirty nine million dollar debt already hanging over the project. The city is still on the hook for that….

Google will be subsidized in Provo by the citizens, some of whom in delusion think that they are getting ‘free’ internet….

A citizen who opts for a competitor will be paying the fee for the service, and also the elevated taxes and fees the failed municipal broadband project has left behind.

Hard to fathom why Google favors government broadband.

North Carolina Taxpayers Face Bailout of Muni Broadband Service 

Burlington, Vermont Broadband Mess Haunts Northland, Minnesota

It’s so bad.

20 States Now Have Restrictions on Municipal Broadband

Is the Barack Obama Administration thinking less government?  And federalism?  Of course not.

FCC Thinks It Can Overturn State Laws that Restrict Public Broadband

“The Commission will look for opportunities to enhance Internet access competition,” (FCC Chairman Thomas) Wheeler said in a statement.

“One obvious candidate for close examination was raised in Judge Silberman’s separate opinion, namely legal restrictions on the ability of cities and towns to offer broadband services to consumers in their communities.”

According to this Administration, the “solution” to government-mandated monopolies and disastrous government broadband is…more government broadband.

And if they have to unConstitutionally steamroll the states to do it – so be it.

[First published at Human Events.]

Seton Motley

Seton Motley is the president of Less Government, a DC-based non-profit organization dedicated to... (read full bio)