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Network Neutrality — Without Regulation
boyko.at.netqos writes "Timothy B. Lee (no relation to Tim Berners-Lee), a frequent contributor to Ars Technica and Techdirt, has recently written 'The Durable Internet,' a paper published by the libertarian-leaning CATO institute. In it, Lee argues that because a neutral network works better than a non-neutral one, the Internet's open-ended architecture is not likely to vanish, despite the fears of net neutrality proponents, (and despite the wishes of net neutrality opponents.) For that reason, perhaps network neutrality legislation isn't necessary — or even desirable — from an open-networks perspective. In addition to the paper, Network Performance Daily has an interview and podcast with Tim Lee, and Lee addresses counter-arguments with a blog posting for Technology Liberation Front."
As long as companies are involved with some having more sway than others, you can expect them to abuse their position in the name of greed. It's simple human nature. Say all you want about how companies will police themselves or that the market will sort itself out. However, reality has shown us time and time again that this isn't the case.
This guy's the limit!
Surveying the wreckage of the credit crisis, Alan Greenspan says he made one very big mistake.
The free-market cheerleader and former maestro of the U.S. Federal Reserve Board conceded yesterday that he wrongly thought banks had an inherent interest in shielding their institutions and their shareholders from risk.
That assumption turned out to have been dead wrong as financial institutions brought the banking system to the brink of failure in recent months after loading up on exotic mortgages and risky derivative products such as credit default swaps.
"I made a mistake in presuming that the self-interests of organizations, specifically banks and others, were such that they were best capable of protecting their own shareholders and their equity in the firms," Mr. Greenspan bluntly told a U.S. congressional committee exploring the role of regulators in the financial crisis.
"Something which looked to be a very solid edifice and, indeed, a critical pillar to market competition and free markets did break down.
"And I think that ... shocked me. I still do not fully understand why it happened."
The staunch belief that banks could manage their own tolerance for risk underpinned Mr. Greenspan's aversion to heavy-handed banking regulation during his record 18-year tenure at the helm of the Fed.
Mr. Greenspan was an early devotee of author Ayn Rand, whose 1957 novel Atlas Shrugged inspired a generation of libertarian thinkers who believe in the right of individuals to live entirely for their own interest.
Since this comment was made by ValuJet, I'm going to stick my fingers in my ears and shut my eyes and scream "nyah nyah nyah" and hope that I don't hear anything that disagrees with my existing biases.
Another paper by the libertarian-leaning CATO institute also said this: Banks, financial lenders, and mortgage providers "work better" if they are responsible and provide only secure financial investments, and are therefore not likely to enter a worldwide financial meltdown. For that reason, financial oversight legislation is neither necessary nor desirable. QED.
Our recent meltdown is due to regulations that encouraged bad loans. Our future meltdowns will be due to the assumptions by banks that they don't need to be responsible because the government will step in with billions of dollars to bail them out if anything goes wrong.
It's silly to blame the current mess on lack of regulation when the banks, financial lenders, and mortgage provides were regulated.
I often don't like the choices people make, but I like the fact that people make choices. That's why I'm a conservative.
Please elaborate - what exactly were the banks coerced into doing that they didn't think was in their self interest? Because everyone that I know in the industry was thrilled to be offering easy loans to anyone and trading CDOs left and right, mainly because they saw massive returns on their investments while the housing market was booming, not because some Democrat held a gun to their head and told them they had to.
I know a lot of people that were in the middle of this, and many that are now unemployed as a result, and I have yet to hear any of them seriously claim that this was caused by anything but a bunch of risky and difficult to price assets spiraling off each other and running things into the ground...
You could call the US market an "Oligopoly."
But that's understating the case.
In >80% of the US market currently, the customer is functionally given three choices: Dialup, Monopoly ISP (Cox, Comcrap, AT&T, etc), or NOTHING. They don't have a "choice" at all.
For example: no DSL is built to my home. Verizon can't/won't build out FiOS because, they claim, they don't "own the physical phone lines" so while I could switch to them as my phone provider, they have no ownership/authorization to push FiOS. Functionally, I am limited to Dialup, Comcrap, or NOTHING and even the dialup companies are dying fast.
The 'net cannot stay neutral WITHOUT legislation when you have big companies like Cox and Comcrap that have monopoly status over far too many of their customers. Hell, that's how we got this fucking-stupid "250 GB" traffic cap setup as well.
In an actual competitive market, the customer can go to the best provider. In a monopoly market, the customer is inevitably given the "choice" of either crap service or no service. Unfortunately, government regulation to protect consumer rights (which was signed away by both Clinton and Bush, little by little) is necessary because otherwise the market devolves into monopoly control everywhere, and the only "competition" happens on the fringe edges where you might have two big mostly-monopolies trying to horn in on each other's monopoly turf.
Yes, it definitely was the CRA, passed back in 1977. It was a secret time bomb. It magically didn't cause problems for 25 years, but then *BOOM*, it wrecked the economy by forcing banks to give loans to poor people.. Er, even though most of the fishy loans went to middle class people.. in the last five years.
Okay. You sure convinced me. Blame Carter!!!