The FCC, for example
The FCC is a regular target here and its provides many examples for how bad the regulatory monster in DC has become. Reason magazine, in its July print edition has a very good article which demonstrate, through the example of the FCC, the fundamental problems with the regulatory system we created:
The commission is corrupt. I don’t just mean the sort of corruption where the chairman loosens his tie, puts his feet up on his desk, and doles out favors to the companies that scratched the right backs—though you’ll find plenty of that in the commission’s history. Even when the body is being relatively transparent and above-board, it is beholden to politically connected lobbies. The FCC controls an important economic resource. Naturally, important economic interests try their best to influence its decisions.
The most flagrant example of this might be the welcome the commission gave to FM radio. The technology was an enormous leap forward: It allowed stations to broadcast without static, and it allowed more signals to coexist on the spectrum. It also worried RCA, which was investing heavily in the development of television; the company fretted that consumers might not pay for both a new FM radio and a new TV set. RCA didn’t control the patent on FM, so it pressured the FCC to favor the other technology. The regulators obliged, and a series of roadblocks appeared in FM’s path. The most destructive decision came in 1944, when the commissioners suddenly reassigned the FM broadcasters’ portion of the ether to television, instantly rendering every FM receiver obsolete.
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The commission is sanctimonious. For seven decades, the nation’s scolds and censors have used the FCC as a tool to shape the sounds and images allowed on the airwaves. In 1952, for example, then-commissioner Paul Walker announced with satisfaction that his agency had “surveyed the programming of some of the television stations in operation, and found that some of them had reported no time devoted to broadcasts of a religious nature. We felt in view of this fact that regular renewal of their licenses would not be in the public interest.” The stations quickly revised their schedules, and the commission agreed to renew their licenses after all.
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The commission is technocratic. The next time someone tells you central planning is dead, remind him that there is an arm of the federal government that decides in advance how different chunks of the electromagnetic spectrum will be used, and that it also reserves the right to determine which entities will be allowed to use it. It’s true the commission has adopted several market “mechanisms” in the last few decades: FCC-approved broadcasters now have the right to sell their licenses to other FCC-approved broadcasters, and spectrum is usually distributed by auction rather than pure fiat. But even an auction can be bent to the planners’ will.
And if we talking about the FCC I can only repeat my recommendation about the book: Law and Disorder in Cyberspace: Abolish the FCC and Let Common Law Rule the Telecosm.
Tags: Central Planning, FCC, RegulationsRelated posts