Net Neutrality: Don’t have it your way

Net Neutrality has been disposed of, and somehow everyone seems to have survived.

Part of the problem is that “net neutrality” doesn’t seem to have a solid definition. It’s merely a term everyone thinks means something nice and desirable.

In thinking about it, it seems to me that we had “net neutrality” in the form of every bit being equal back before Earthlink started offering “all you can eat internet” — all the internet access you wanted for a fixed monthly price. In other words, if we were serious about treating every bit equally, ISPs would charge for every megabyte transmitted between any two points.

I have a feeling that’s not what the net neutrality advocates have in mind.

The Heartland Institute looks at Burger King’s take on Net Neutrality:

The problem with the video – from the perspective of BK and its media cheerleaders – is it is supposed to tell us why massive government regulations under the banner of Net Neutrality are so vital.

What the video actually, accidentally does – is demonstrate (yet again) how dumb and unnecessary Net Neutrality regulations actually are.

The video begins with man-on-the-street interviews – where no one included has any idea what Net Neutrality is. They shouldn’t feel bad – because after watching BK’s video…they still won’t know what Net Neutrality is.

The video then shows a computer screen and typing. Which claims BK will now explain what Net Neutrality is using their famed BK burger – The Whopper. By showing just how awful a world without “Whopper Neutrality” is.

The video’s theoretical BK store – sells three different speeds of “Whopper Pass.” You can pay $4.99, $12.99 or $25.99 for your burger – with the higher prices ensuring you increasingly fast delivery.

The customers are incensed. Oops – and there you have it: The first reason why this video is dumb. And why Net Neutrality regulations are dumb and unnecessary.

That reason is: The customers are incensed. Internet Service Providers (ISPs) – are in the customer service business. If they don’t service their customers – they will very soon be out of business.

ISPs strive mightily to deliver an incredibly fast, ever-increasing speed. Which is how and why we have gone in just two decades from the sloth of 14K dial-up – to massively-fast 1GB of speed…and up.

Which is why no one – save for the most radically ridiculous of multiple-HD-movie-downloading-at-once or incessant-gaming freaks – runs into any speed impediments to anything they wish to do online.

Oh: And any ISP stupid enough to slow down anyone as an extortion effort – would run afoul of several existing consumer-protection laws. And be swiftly dealt with by the Federal Trade Commission (FTC).

Thus there is zero need for any Federal Communications Commission (FCC) regulations – such as the massive ones imposed in 2015 by the Barack Obama Administration. Which were in December rightly, reasonably undone by the Donald Trump Administration.

All of this and more is why – in the two-plus decades without the FCC having any say in any of this – nothing like what BK depicts in its ridiculous video….ever actually happened.

Another reason the BK video is stupid: ISPs do charge more for even more bandwidth – because everyone on the planet charges more for more of anything.

Ask BK why they charge more for a Double Whopper than they do for a Whopper Jr. Where’s their Whopper Neutrality?

In fact, BK violates these Neutrality principles all over the place – beyond just their tiered-prices for tiered-burgers. They engage in all sorts of non-neutral exclusionary practices.

BK won’t sell you a McDonald’s Big Mac or a Wendy’s Single, Double or Triple. Where’s the Neutrality?

BK won’t sell you a Pepsi or an RC Cola – because they have an exclusive contract with Coca-Cola. Where’s the Neutrality?

And to further flesh out the utter stupidity of the one-size-fits-all model of bandwidth speed – where “all bits are treated equal”:

“What’s a truer depiction of Burger King under Title II utility regulation? A Burger King menu with only one product at one price – an expensive all-you-can-eat meal. For those ordering 10 triple-Whoppers and onion rings, with extra large milkshakes, it might be a good deal.

“For those seeking one salad or one chicken sandwich, and in a hurry, the high-priced all-you-can-eat plan would be a terrible idea. The all-you-can-eat subsidy would attract all the gluttons in town and discourage the customer seeking a quick snack.

“Gluttons would clog the line with their huge orders, and others would have to wait. The supplier of niche content – the small salad in this case – would suffer, too.

“The ad thus had the congestion problem exactly backwards. Diverse products at varied price points encourage economical consumption and incentivize investments in faster, more capacious networks.

“Everybody wins – Internet user, network provider, and content creator. Yes, in the future there will be some forms of priority service for real-time applications – think telemedicine and virtual reality – but the higher prices for these services will help pay for more capacity overall.

“Consumers across the diverse ecosystem of digital services will benefit.”

A grandma who only emails her kids and grandkids – should not be force-fed way-too-much-bandwidth for way-too-much-money – to subsidize the Web gluttons.

The late, great Robert Conquest wrote more than a dozen books about the Soviet Union – so he eminently understood Net-Neutrality-esque collectivism. He created his Three Rules of Politics – the first of which is:

“Everyone is conservative about what he knows best.”

Burger King knows the burger business. And in their burger business – they don’t want any part of Neutrality.

Burger King knows nothing about the Internet bandwidth business. So they ignorantly clamor for the Neutrality they would never, ever impose – or have the government impose – on themselves.

The price of everything is everything

Donald J. Boudreaux: Economists’ insights can be mundane & surprising

At first glance, the core insights of economics seem mundane. As something’s cost rises, consumers buy less of it. Producing more clothing requires transferring more resources to textile factories and, hence, away from other uses. When Jen buys a pear from Al for a dollar, she does so because she values the pear more than whatever she otherwise would have purchased with that dollar — and Al values what he will buy with that dollar more than he values the pear.

Pretty straightforward. But what economists do with such “obvious” observations is often mind-blowing.

An important counterintuitive insight was vividly conveyed long ago by my late colleague Gordon Tullock. Asked in the 1960s what government should do to maximize reduction in traffic fatalities, he replied, “Mandate that the steering column of each car be mounted with a steel dagger pointed directly at each driver’s heart.” Initially, that sounds crazy. Yet when you think about it, you realize such daggers would cause drivers to dramatically increase the care they exercise behind the wheel.

Instead of really wanting government to mandate mounted daggers, Gordon was warning government against going too far in mandating safety features such as airbags, seat belts and collapsible steering columns. Just as mandated daggers would lead to more-careful driving, mandated safety features lead to less -careful driving. Safety features truly might reduce highway deaths, but keep in mind the possibility that mandated safety features might have surprising opposite effects.

David Friedman explains another counterintuitive insight: “Economists are often accused of believing that everything — health, happiness, life itself — can be measured in money. What we actually believe is even odder. We believe that everything can be measured in anything.”

What Friedman means is that each of us routinely makes trade-offs among things that seemingly can’t be compared. Consider your enjoyment from going to a concert. Getting there conveniently requires driving. Yet by doing that instead of staying home, you raise your chance of being killed in an auto accident. If you nevertheless drive there, you conclude that the added enjoyment you expect from the concert is worth more than the added safety you’d experience by staying home. That is, you compare the experience of a concert to the risks of driving. Obviously, if the risk of being killed while driving there were high enough, you’d decide to stay home.

Another example: You buy a jacket, telling friends it “cost” you $100. But your statement is inaccurate. When you gave, say, five $20 bills to the clerk, what you really gave up wasn’t five pieces of paper engraved with Andrew Jackson’s portrait. What you really gave up is whatever you otherwise would have bought with those five pieces of paper.

Suppose that, had you not bought the jacket, you would have bought a meal at a nice restaurant for you and a friend. In this case, you compared a jacket to that restaurant meal.

We humans constantly compare apples to oranges — and choose sensibly between them.

Teen Unemployment and Minimum Wage

From the Mercatus Center at George Mason University

The labor force participation and employment rates of young adults in the United States have declined sharply in recent years, especially among teenagers. The overall decline in the rate of labor force participation since the Great Recession has received a great deal of attention from researchers and policymakers, who focus in large part on trying to gauge whether this decline is permanent and what it implies about how tight the labor market is. However, the decline in labor force participation of young adults has been going on for much longer and does not coincide with swings in economic activity.

David Neumark and Cortnie Shupe consider three possible explanations for the decline in teen employment in the United States since 2000, with a particular focus on those age 16–17: (1) a rising minimum wage that could reduce employment opportunities for teens and potentially also increase the value of investing in schooling; (2) rising returns to schooling; and (3) increasing competition from immigrants. The higher minimum wage is the predominant factor explaining changes in the behavior of teens age 16–17 since 2000. Additionally, no evidence was found to suggest that higher minimum wages for teens leads to higher future earnings; if anything, the evidence points to the opposite effect.

  • Prior literature shows that teen employment has declined much more than the employment rates of those age 20–24 since 2000. These changes were larger for teens age 16–17 than for those age 18–19. The percentage of teens not in the labor force who reported wanting a job fell by almost half between 1994 and 2009, from 24 percent to 13.2 percent.
  • The decline in the number of teenagers in the workforce was owing to increases in teens being exclusively in school, rather than combining school and work.
  • In new results presented in this paper, the authors find that higher minimum wages are associated with a lower share of teens age 16–17 both in school and employed, and a higher share in school and not employed.
  • There is some evidence that changes in the return to schooling and an increase in the share of immigrants employed in the workforce may have contributed to the observed changes in employment and enrollment of teens age 16–17, although these effects are considerably smaller than the estimated minimum wage effects.
  • The study found no positive relationship between higher minimum wages for teens and higher future earnings. The evidence, if anything, says that teens exposed to higher minimum wages since 2000 had acquired fewer skills in adulthood. Thus, it is more likely that the principal effect of higher minimum wages since 2000, in terms of human capital, was to reduce employment opportunities that could enhance labor market experience.

 

Seven principles about immigration

I imagine people will hate these principles taken from a Donald Trump speech.

…seven principles is taken verbatim from his speech:

  1. Illegal immigration is wrong. A primary goal of comprehensive immigration reform must be to dramatically curtail future illegal immigration.
  2. Operational control of our borders, through significant additional increases in infrastructure, technology and border personnel must be achieved within a year of enactment.
  3. A biometric-based employment verification system with tough enforcement and auditing is necessary to significantly diminish the job magnet that attracts illegal aliens to the United States and to provide certainty and simplicity for employers.
  4. All illegal aliens present in the United States on the date of enactment of our bill must quickly register their presence with the United States government and submit to a rigorous process of converting to legal status and earning the path to citizenship, or face imminent deportation.
  5. Family immigration is a cornerstone value of our immigration system. By dramatically reducing illegal immigration, we we can create more room for family immigration and employer-based immigration.
  6. We must encourage the world’s best and brightest individuals to come to the United States and create the new technologies and businesses that will employ countless American workers. But we must discourage businesses from using our immigration laws as a means to obtain temporary and less expensive foreign labor to replace capable American workers.
  7. We must create a system that converts the current flow of primarily low skill illegal immigrants into the United States into a more manageable and controlled flow of legal immigrants who can be absorbed by our economy.

Did I say Trump?
Well, it was actually someone else.
My bad…