How Can the Stimulus Plan Help the Internet?

Wired is running an article raising the question of how a US economic stimulus plan could best help broadband adoption and the internet in general. We discussed President-elect Obama's statements about his plan, which would include investments in such areas, but Wired asks how we can avoid the equivalent of the New Deal's "ditches to nowhere" without more data about where the money would actually make a difference. Quoting: "... the problem is that no one knows the best way to make the internet more resilient, accessible and secure, since there's no just no public data. The ISP and backbone internet providers don't tell anyone anything. For instance, the government doesn't know how many people actually have broadband or what they pay for it. ... In September, the FCC found that its data collection on internet broadband was incomplete and thus ruled that AT&T, Qwest and Verizon could stop filing some reports — because the requirements did not extend to cable companies, too."

Comments

offtopic question re. slashdot

[gcnaddict]

Totally offtopic, but what does the red titlebar mean for a story on the index which just went up? I didn't see any reference to this story being a story "in the future" so I'm not quite sure what it is.

Re:offtopic question re. slashdot

[corsec67]

That happens when the future is now.

Look people

[Anonymous Coward]

The internet is like a night market in a third world country. Who knows how it started and you'll be damned if you try to regulate it. You guys all bitch about net neutrality and the loss of your birth-right to download free music and movies. For the last 8 years. But guess what, the net is still neutral and you are still downloading free music and movies. Just let it be and go with the flow. The net is to nebulous and decentralized to be regulated. You'll still be able to infringe your precious movies and music for years to come. When $pirate_site[0] gets closed down, don't worry - $pirate_site[1] is there to supply you with your fix.

Premise guarantees failure

[MSTCrow5429]

Central planning will always lead to ditches to nowhere. Without an ability to perform rationale economic calculations, an economy cannot function. Any effort by the State to manipulate or direct economic planning will lead to increasing economic irrationality and inefficiency. The only way to maximize the efficient use of resources is to remove government coercion from the marketplace, and let voluntary cooperation and aggregate individual choices locate the closet to optimally possible solution to any problem.

Re:Premise guarantees failure

[giorgiofr]

E.g: get rid of the regulations and red tape preventing communities from building mesh networks and most cities will be covered faster than you can say "gov't managed central planning always fails".

Re:Premise guarantees failure

[Rinisari]

Exactly. The consumer will direct the market based on the availability of competing, cheaper services.

The $200 billion that the telecoms got in the 1990s to wire America was squandered, and very little was actually done with it (arguably kept prices for existing services at the same level instead of having them go up, but not more than that).

This is where municipal government--boroughs, villages, city sections--could play a hand in essentially buying groups--"aggregate individual choices"-- for broadband service, but still allow residents to choose their own provider.

Re:Premise guarantees failure

[Rakshasa Taisab]

Existence of rampant corruption is is not a reason to discard economic theories... Get rid of the corruption and try again.

Re:Premise guarantees failure

[wizardforce]

except of course intervention in the case of protection of property rights, prosecution of fraud and antitrust... after all there is no competition when a single entity uses its economic power to destroy potential competitors... right now I can see *fraud [unlimited access where that isn't true] *anticompetitive practices [locking out competitors as in fairpoint] the market isn't free in a complete absence of government intervention, only through minimal intervention to protect rights could the market ever be truly free and right now it's far too encouraging of trusts and competition destroying due to a large part of the fact that these are natural monopolies...

Re:Premise guarantees failure

[burnin1965]

The $200 billion that the telecoms got in the 1990s to wire America was squandered, and very little was actually done with it (arguably kept prices for existing services at the same level instead of having them go up, but not more than that).

Actually, looking at historical rates before and after the 1996 telecom act show that local telecom rates increased at the same rate as the CPI, long distance telecom rates started to increase but remained at very competitive rates for consumers, and the local cable rates continued their rocketing out of control increases well above the CPI.

There are two messages that can be derived from the trends. 1) Creating a competitive market as was done with long distance telecom results in huge benefits to consumers, both individuals and businesses. 2) When a market has little to no competition they will at the very least increase their rates on average with the CPI or if they can get away with it they will gouge the consumer for every penny they can get.

The two sad outcomes of the telecom plans of the 1990s is that we never received the nation wide broadband that was envisioned by the government and the broadband that has been provided does not meet the peer to peer asymmetrical data transmit rates as envisioned by the government.

For all the justified complaints about the governments poor job of meddling in business the telecom industry is one area where there was a powerful vision and direction provided by the government that was quashed by corporations who are more interested in that rates trend for cable companies than they are about building a technologically advanced telecom infrastructure that provides economic benefit to many instead of a few.

Re:Premise guarantees failure

[hedwards]

Right because people don't choose to pay for Windows over Linux, a more expensive carrier of cell service over a less expensive option or reward monopolist misbehavior.

Seriously though it really depends greatly upon the situation. Central planning is very important when the service needs to work coherently across myriad municipalities providing that it is done in a sane way.

Assuming that market forces are going to work all the time is what got us into the current meltdown of both the economy as well as the internet hardware.

And even without that, there's no particularly good reason to believe that infrastructure building is going to result in anything other than additional spam and larger DDOSes.

Re:Premise guarantees failure

[Anonymous Coward]

It might be different if the state were composed of a mesh of all citizen communities.

Though of course, that opens up the tricky question of how to regulate the internet when the internet itself is doing the regulation. Might cause some chicken-egg issues. :)

Re:Premise guarantees failure

[Timothy Brownawell]

Central planning will always lead to ditches to nowhere.

[citation needed]

Without an ability to perform rationale economic calculations, an economy cannot function. Any effort by the State to manipulate or direct economic planning will lead to increasing economic irrationality and inefficiency.

The perfect efficiency that markets try to approach is short-sighted (this also makes them unstable, with a tendency to collapse to monopoly/oligopoly). Some diversion of resources towards longer-term goals is useful, why do you think any country has a public education system?

The only way to maximize the efficient use of resources is to remove government coercion from the marketplace, and let voluntary cooperation and aggregate individual choices locate the closet to optimally possible solution to any problem.

You also have to eliminate all other forms of coercion and tying and collusion, and provide everyone with perfect information and zero transaction costs. And you still end up with that short-sightedness.

Re:Premise guarantees failure

[sjames]

Yeah, I don't know why they don't just dynamite that useless Hoover Dam and those useless interstates.

I fully agree that a centrally planned economy doesn't work well, but that doesn't mean that centrally planned projects or public works don't work. Sometimes when a market settles into a local minimum, only a swift kick from outside can get it seeking an optimal solution again.

Another case for a public project is when the market players are too localized. The telecomms will never in a bazillion years sacrifice even a fraction of a percent of their profit even if it would double the profitability of every single player in every single market but theirs. Not even if after 5 to 10 years it would probably come back and double their profitability as well (you see, a voluntary loss of .0002% profitability wouldn't look good on the quarterly report).

One of the axioms of any market based economy is that entities ALWAYS make rational economic decisions. I have my doubts. Actors in the economy mostly make knee-jerk heard mentality decisions.

It may be that a market solution IS better in this case, but 'market=good, public work=bad" is not a reason, it's an unsupported conclusion.

Re:Premise guarantees failure

[gad_zuki!]

>This is where municipal government--boroughs, villages, city sections--could play a hand in essentially buying groups--"aggregate individual choices"-- for broadband service, but still allow residents to choose their own provider.

You mean the municipal morons who gave comcast or at&t a monopoly in their towns and these companies promptly stopped building out infrastructure and improvements because they had no competition all of a sudden?

I know here at slashdot the myth of the liberarian/unregulated everything is strong, but in practice the local government is usually the most inept and most in the pocket of corporations. They dont care about your choice. They care about Comcast's contributions to their re-election campaign and enough HDTV channels to keep people happy.

Re:Premise guarantees failure

[MSTCrow5429]

Assuming that market forces are going to work all the time is what got us into the current meltdown of both the economy as well as the internet hardware.

This quite simply is a canard. The main impetus of the current state of the economy is the boom and bust cycle created by the Federal Reserve, the central planner of the monetary supply in the US. The Fed greatly inflated the money supply through artificially low interest rates, reserve rates, and the direct creation of new money. Combined with Congressional pressure to lend money to noncredit worthy borrowers, an artificially high demand for goods and services was created, leading to overexpansion and overconsumption based on an illusory increase in real wealth. No illusion can mold reality forever, and the bubble popped.

There is also a popular misunderstanding that the alleged propensity of the Bush administration is somehow to blame for the current situation. Since 2001, there has been a 70% increase in new regulations that are "economically significant" (compliance costs per rule will cost at least $100 million per year), and the number of pages in the Federal Register listing all new regulations reached an all-time high of 78,090 in 2007, from 64,438 in 2001. From 2002 to fiscal year 2009, the federal regulatory budget increased 65% in real terms, to ~$17.2 billion. More recently, the inept SEC was unable to detect Madoff's ponzi scheme until it had collapsed, once again showing that the SEC gives investors a false sense of security, and while fully capable of distorting securities markets, is incapable of policing them. More regulation is not the answer, it is the problem.

Seriously though it really depends greatly upon the situation. Central planning is very important when the service needs to work coherently across myriad municipalities providing that it is done in a sane way.

The rise and existence of de facto standards, which are brought about by voluntary cooperation and individual choice, belie the need for any such central planning. There are many examples of such attempts to bring a service that works coherently "coherently across myriad municipalities," but as the general topic at hand is the internet, that of Minitel is sufficient. As most no doubt are aware, Minitel was an effort by the French government to create a standard and build a networking infrastructure for the use of all French citizens. Unfortunately for it, the internet then came along, and the increasing abilities of personal computers and networking hardware and software in the closer to free-market economy of the US made Minitels dumb terminal network look, well, rather dumb. One may attempt to argue that the internet was created by the US government, which is true, but it existed for decades as a small, mostly closed research network until commercialization began in the 1980s. What is being proposed by the uber-parent is taking the internet, and applying the Minitel doctrine to it. This is a very bad idea, and can do nothing but supply corporate welfare to entrenched constituencies while bleeding resources from the functioning private sector, leading to a damaged networking infrastructure being applied to the current network, and greatly retarding the emergence of newer and better networking technologies.

Re:Premise guarantees failure

[slysithesuperspy]

Assuming that market forces are going to work all the time is what got us into the current meltdown of both the economy as well as the internet hardware.

No, the current meltdown is due to central planning and then calling that central planning the market. If you have a central bank on one side putting interest rates down to 1% in early 2000 and then on the other hand deregulating some bits and on top of that encouraging people to buy houses they can't afford you have a recipe for disaster. Thinking the market is powerful enolugh that it won't get distorted is wishful thinking, presumably what Greenspan deluded himself into thinking. So, in that sense I aggree with you.

It's pretty damn hard to have sane central planning---it is politics, it will always be political.

Re:Premise guarantees failure

[the_one(2)]

How the hell did this troll get modded +5? Yes I know there isn't much love for the federal government among a lot of Americans but this i just stupid. I really don't know if your government is as incompetent as you say that they are but to say that central planning will always lead to ditches is ignorant at best. A reasonable government would delegate the work and make sure it gets done. I'm not saying this is the best solution but it's probably a good way to create jobs and get some good out of it.

It obviously can work... just look at Sweden

Re:Premise guarantees failure

[Rakshasa Taisab]

Reply for a mail regarding my comment:

If the central planning continuously evaluates the input, output and outcomes. Market economics is just one of the ways in which this can be performed.

I do agree that centralization is not optimal for many tasks involving increasing efficiency. However, your example with the government giving telco's money to build out infrastructure is not an example of centralization.

Rather, it is a very good example of privatization and decentralization failing. Not because those are bad ideas, but rather due to corruption and lack of control. Thus, 'giving the telcos a lot of money and hoping they'll spend them in a rational way' is a very capitalistic point of view.

It involves a trust in 'the market', rather than a distrust of human nature, something that requires tight control on what infrastructure actually gets built for that money.

Re:Premise guarantees failure

[Anonymous Coward]

Power corrupts.

The only way to get rid of corruption is to get rid of power.

Thus, reduce the power of government and corruption is reduced.

Re:Premise guarantees failure

[nine-times]

The only way to maximize the efficient use of resources is to remove government coercion from the marketplace

First, that assumes a real free market. Most people think that the important part of a "free market" is that there are multiple providers, and say, "Hey, there's cable and the phone company. You have 2 companies, so you have competition!" However, those two companies have a duopoly over the infrastructure, and so aren't really subject to the market forces that exist when you have a "free market".

The real important part of the "free market" is the low barrier of entry for newcomers, i.e. the ability for a new company to come along and set up their own ISP. You might be thinking right now, "What are you talking about, there are plenty of ISPs! There's not just Verizon and Comcast (or whoever your local phone and cable companies are), but there's Speakeasy and Earthlink and lots of other people!" Nope, there aren't. Those ISPs are providing rebranded service over Verizon's network. The fact is, even if you had the resources to start a company and string fiber optics everywhere, you wouldn't be allowed to do that. So if Verizon doesn't want to string fiber to an area, then you'll never get fiber connections in that area.

Now you might say, "That's what I'm talking about, remove the 'government coercion' that prevents people from stringing fiber everywhere!" Ok, great, now you'll end up with laws that allow any numnuts with a shovel to dig up the streets and other people's yards because they're "laying down cable". It'll be a mess.

Sorry, but really the Internet is "infrastructure". It's like our highway system. Is our highway system a failure, because it's nothing but "ditches to nowhere"? Should we turn over our highway system to Verizon for them to decide where they want to build roads?

Re:Premise guarantees failure

[Brandybuck]

Friedrich Hayek won a Nobel Prize demonstrating the impossibility of central planning to obtain necessary market information, yet we still haven't learned. The market process is far from perfect, but it's nothing compared to the ineptitude of central economic planning. Sure the government can pay people to dig ditches, but dig them to where? And how much to pay them? Should we recruit diggers from technology fields or manufacturing? What level of education should diggers have? How much is a ditch worth? A market can offer useful answers to these questions, but a government cannot. A government can only make arbitrary pronouncements, and damn anyone who gets in the way.

Central economic planning got us into the predicament, with its manipulation of credit and nationalization of risks, so why would anyone look to the same government to get us out? The question is not what government can do to help us, but rather what government can undo.

Re:Premise guarantees failure

[dargaud]

Since 2001, there has been a 70% increase in new regulations that are "economically significant" [...] and the number of pages in the Federal Register listing all new regulations reached an all-time high of 78,090 in 2007, from 64,438 in 2001.

Why isn't there something in the constitution (no less) that states that when you vote a new law, you need to remove an old one ? I mean who can seriously be expected to know the law ? Even experts can only have a vague idea of what is in those 78 thousand pages.

Re:Premise guarantees failure

[MSTCrow5429]

Why isn't there something in the constitution (no less) that states that when you vote a new law, you need to remove an old one ?

No. There is a course in law schools called "Conflict of Laws," although I think that deals with conflicting State/State and State/Federal laws, not conflicting Federal/Federal laws. I honestly don't think any of the Framers, even Hamilton, ever thought the Federal government would end up what it is today.

Re:Premise guarantees failure

[MSTCrow5429]

Oh, oops, thought that read "isn't there something..." not "why isn't there something..."

Re:Premise guarantees failure

[westlake]

Central planning will always lead to ditches to nowhere.

The legislation that launched the TVA was signed in 1933.

In ten years the TVA was generating the limitless amounts of electric power demanded by Oak Ridge and Alcoa.

Oak Ridge alone drawing down as much power as New York City at its peak - 1/6 of all the electric power being generated in the U.S.

The TVA was about rural electrification, flood control and conservation. None of which promised a quick return to commercial developers then or now.

The only way to maximize the efficient use of resources is to remove government coercion from the marketplace, and let voluntary cooperation and aggregate individual choices locate the closet to optimally possible solution to any problem.

The market solution often has a way of shifting its costs to the public.

That is why you can't breathe the air in Beijing.

The market solution assumes that you are part of the decision-making process.

That is why you sometimes get a glimpse of an invisible economy built on peonage and child labor.

Why the WalMart worker doesn't get a bathroom break.

The market has no memory and no imagination. It lives wholly in the moment.

That is why when there is a lock-up or a crash the damage cuts so deep. There are no inherent safety mechanisms.

The optimal solution for - a - market is not always the optimal solution for society as a whole.

Re:Premise guarantees failure

[Iamthecheese]

You're right! We need an immediate return to communism!

Re:Premise guarantees failure

[MtViewGuy]

Sometimes when a market settles into a local minimum, only a swift kick from outside can get it seeking an optimal solution again.

A great example of this is the Tennessee Valley Authority, which built a series of dams on the Tennessee River to provide irrigation water for farms and hydroelectric power. Indeed, much of the industrial revival of the US Southeast couldn't have happened without those TVA dams.

Re:Premise guarantees failure

[Anonymous Coward]

I fully agree that a centrally planned economy doesn't work well, but that doesn't mean that centrally planned projects or public works don't work. Sometimes when a market settles into a local minimum, only a swift kick from outside can get it seeking an optimal solution again.

It's called profit seeking.

Re:Premise guarantees failure

[dragonturtle69]

But the Hoover Dam, TVA, and Interstate system is not the same as broadband to every home. Those are true public works, greater than private business could create and serving the common good, not individuals directly. Federally built trunks across the country would be close in comparison, and let local ISP's spread out from there. The FCC is a more fair comparison to a "broadband for every home" project. The FCC controls who gets what, and how what they get may be used.

With federal planning comes federal control, and government control will always be a "one size fits all" thing. Couple that with broadband access not equaling improved educational or economic opportunities, only enabling them (if there is a PC available). What we have now is good because it is not centrally run/monitored/censored.

With those concerns mentioned, I would really like for an OC3 or better equivalent to exist for every home. I just don't see how we get around an FCC type org. to rule it, or regulated monopolies to push regulated data to it. The internet becomes broadcast TV when that happens.

Re:Premise guarantees failure

[Anonymous Coward]

Assuming that market forces are going to work all the time is what got us into the current meltdown of both the economy as well as the internet hardware.

You are getting your news from an unreliable source. This might help. Better yet, read Economics in One Lesson.

Re:Premise guarantees failure

[mcrbids]

Any effort by the State to manipulate or direct economic planning will lead to increasing economic irrationality and inefficiency.

This sentence entirely ignores a reality of economics: economy is a product of government.

Economy is a balance; on one hand you have private efforts which maximize personal profits at cost of the public good (see the tragedy of the commons and on the other hand you have social "public entities" like governments which seek to preserve the commons.

In truth, there is no such thing as a "free" economy - a "free" economy requires a government which provides infrastructure for operations. Infrastructure can include things like a universal currency, a set of laws which establish the rules of a market, physical commodities which can be used for commerce (such as roads, highways, information conduits) and a well-educated population.

The reality is that economy is a product of a well-managed government. Take a look at the most obvious: the Internet.

AOL tried to create an online universe. So did Compuserve, and countless others. They all failed because they were all tried to establish public infrastructure through private enterprise, which never works. That's the role of government, which establishes the public infrastructure that private enterprise takes advantage of.

The government establishes public infrastructure (such as roads and highways) that private companies then exploit (such as Arco, ATT, Ford, NetZero) to make profits, which are then taxed by the government as a return on investment.

This isn't "bad", it's a form of socialism that you exploit every day as you drive to work. And yes, I know that "socialism" is a bad word (tm) in the United States, but it's a reality that we all enjoy.

Without this infrastructure, without a solid monetary system, without highways, clean water, roads, phones that work, etc. the modern economy would collapse overnight. Yet the modern economy didn't establish any of these - they all came from our government.

The United States has one of the purest, most "open source" governments ever in Human History - it's just idiotic that so many Americans treat it with suspicion and contempt!

Re:Premise guarantees failure

[sjames]

The best answer would be a network of last mile fiber and a mesh of inter area fiber. A nice thing about fiber is that it can carry many channels at different wavelengths at the same time. Perhaps a default frequency would peer you with the government provided ISP but leave the option to use other frequencies to connect up with various private carriers you might sign up with.

So, much like you sign up for cable internet or DSL and they send you a 'connection kit', you sign up for fiber internet and they send you an appropriate GBIC. With the right gear, you could connect to more than one and use policy routing. The idea being to route around any government or corporate damage.

The recent debacle of the NSA conducting domestic spying with the help of telecoms providers and current events in Australia demonstrate that leaving it to private corporations doesn't necessarily grant us uncensored and unmonitored communication anyway.

As long as private contracts with ISPs are not forbidden as part of the rollout, a public internet access option can help you even if you don't use it simply by setting the bar. If the public ISP will give you 50Mbps for $10/month, other providers would have to fall in line to compete. They couldn't likely go cheaper, so they'd have to offer some combination of less censorship or greater bandwidth if they wanted to stay in business.

Re:Premise guarantees failure

[Anonymous Coward]

Don't forget perfect rationality (the game-theoretic term for unbounded computational resources), since the efficient market hypothesis only tells us that a suitable strategy exists; in reasonable circumstances it can be intractably hard to compute.

Furthermore, it's also important that trades in the market happen without latency in continuous time, or circumstances can arise in which the equilibrium is never reached even with perfect information/perfect rationality.

Finally we should remember that such perfect markets optimise pricing (ensuring that a fair price is computed for goods traded); it is unclear to me that this is necessary or sufficient to optimise the quality of life of the market's participants. One can after all have a very efficient market full of miserable traders...

The best way to help...

[LynnwoodRooster]

...is to get rid of the whole "stimulus plan" to start with. Lower taxes rather than collecting them and redistributing to chosen pet projects (with an appropriate cut for the voracious appetite of Government to waste).

Re:The best way to help...

[Anonymous Coward]

Haha you guys just elected the Democrats, if you think they'll lower taxes you're insane.

Re:The best way to help...

[LynnwoodRooster]

Excuse me, but I did not elect them; I did not vote for Obama nor the Democrat Federal representative of my district.

Re:The best way to help...

[isdnip]

Then, when the Second Great Depression leaves a 40% unemployment rate, you and your few remaining rich friends with their inherited cash and other still-liquid assets will have a really easy time getting lots of servants to work for you for a pittance!

Re:The best way to help...

[pha3r0]

Drat mod points expired so I will just post in support of your opinion. I will also say that that just is not likley and we should all probably stock up on canned goods and ammo

Re:The best way to help...

[Anonymous Coward]

Except that the problem is deleveraging - on a net basis "money" available to be used in business (ie the total of currency and outstanding debt) is being withdrawn from the private-sector economy due to fear of widespread insolvency. Loans are being withdrawn or repaid and new projects are not really getting funded. This impacts the people who would have sold stuff to build those projects.

As a result, any reduction in taxes would have a muted impact (no taxes are paid on losses) and the cash saved would probably go into paying down debt.

Now paying down debt is in general a good idea, but if it all happens suddenly in H2 2008 and through 2009 then the amount spent on consumption will crash, which will cause the very bankruptcies that people are worried about and that are causing them to deleverage. The problem is therefore a rational one, similar to the prisoner's dilemma.

The two possible responses are monetary (increase the amount of currency to offset the private-sector deleveraging) and fiscal (government spending substituting private sector spending).

The first solution has the problem that interest rates are already at 0%, and so it is hard (although possibly not impossible) to make credit more available.

Therefore they are resorting to fiscal stimulus. However the government is already a big part of the economy, so it is not clear if it can really ramp up enough to have a significant impact - many of these theories were designed in the days when the public sector was more like 10% GDP than 30%.

Re:The best way to help...

[Firethorn]

Unless we control spending, lowering taxes won't help. The 'first' world is reaching the capacity for other nations to support our borrowing. Note: I blame MOST first world nations because most all are carrying similar debt to GDP levels as the USA.

It's one thing to borrow money to build a dam that will produce revenue generating electricity, that will prevent floods causing millions/billions of dollars of damage. It's quite another to fund operating costs that way. Right now we're funding stuff like police and medical care on loans. This can't go on.

Re:The best way to help...

[jwiegley]

So you suggest that instead I be punished for managing my affairs well?

For saving my money, for doing my investment research, for planning my retirement, for getting good grades, for sticking with jobs, being competent and all the other items that I put personal effort into making my finances secure I should pay for other people's mistakes? That I should shoulder a larger tax burden than another man? I should be legally coerced to support and fund organizations and corporate strategies that I fundamentally disagree with? Is that it?

People that think that's better is why we're in this problem in the first place.

See my sig and learn a lesson.

Re:The best way to help...

[isdnip]

The majority of wealth comes from one choice alone: Choosing wealthy parents. I choose not to reward that.

Go back to your Objectivist reading club.

Re:The best way to help...

[Anonymous Coward]

Just ask the white South Africans how well ignoring their fellow poorer (black) men worked out. (Hint: They now all live in compounds guarded by professional mercenaries who make Blackwater look like amateurs.)

Re:The best way to help...

[jcnnghm]

The majority of wealth comes from one choice alone: Choosing wealthy parents. I choose not to reward that.

Go back to your Objectivist reading club.

Perhaps you should return to your Liberal propaganda club first. 80% of the millionaires in the United States are first-generation affluent, according to the New York Times. The reason you aren't as successful is because you're lazy and/or stupid, not because you didn't have wealthy parents. The facts among millionaires are as follows:

Only 19 percent receive any income or wealth of any kind from a trust fund or an estate.

Fewer than 20 percent inherited 10 percent or more of their wealth.

More than half never received as much as $1 in inheritance.

Fewer than 25 percent ever received "an act of kindness" of $10,000 or more from their parents, grandparents, or other relatives.

Ninety-one percent never received, as a gift, as much as $1 of the ownership of a family business.

Nearly half never received any college tuition from their parents or other relatives.

Fewer than 10 percent believe they will ever receive an inheritance in the future.

Re:The best way to help...

[LynnwoodRooster]

Herbert Hoover, is that you?

Re:The best way to help...

[gpuk]

Maybe in Johannesburg. But where I am, whites, blacks and coloureds all live in close proximity to each other in a non-gated community (granted many homes have ADT armed response cover but that's because the police service is incompetent).

Re:The best way to help...

[CodeBuster]

Amen, but us savers have to watch out. The incoming Obama administration is about to pull the inflation ripcord big time in an ill fated attempt to devalue our existing national debts and spend our way out of trouble (which too much credit and spending got us into in the first place). Now is the time to invest money in tangible assets when prices are low and before the coming inflationary government spending policies. It is tempting to hold on to cash like everyone else, but the Fed is going to shake that cash loose with another round of spend it or lose it expansionary monetary policy (i.e. if you sit on your cash and refuse to spend it back into the economy, then they will punish you by inflating away a percentage of your hoard...call it a tax on saving). The best investments, IMHO, are probably in the commodities based businesses which produce metals, chemicals, energy, and other raw materials that are necessary to produce goods and services in the economy. Commercial real estate also has some attractive values right now, provided that one can take a longer than 5 year outlook on the investment.

Re:The best way to help...

[roman_mir]

I am very sorry for the people, you know, I feel terrible that such bad times are coming. But they are coming, there very very close and no amount of regulation and spending by the government can do anything about it.

Government can never do anything about economy except for making things worse. For some reason, which still eludes me, many people believe that government must have a role in economy. This is perplexing, after all, the government is not supposed to be a for profit outfit. They are supposed to do things that will not normally be done by private enterprise, for example building interstate roads and such (I am not American, I can't be certain of all the things that government really is doing in the States.)

One of my points is that it is nonsensical to expect any entity in this world to be able to control the uncontrollable. Economy is like weather, it has a billion variables and they all change all the time. Economy is not a static system, it is constantly changing. Any new born human, any new store, any closing restaurant, any new shipping company, any new invention, any new efficiency, any war, any incident, all of those things have an effect, nothing can control those incidents.

But on the grand schema of things, you know, on the macro-economic level, the government can do things. Bad things. They do them for their own purposes with their own understanding. Artificially pushing interest rates down, printing new fiat dollars, removing the backing of the dollar by the gold, coming up with legislation for 'fairness'. Attempting to meddle with economy in any way, will always always always always always be to the detriment of the economy.

Now, government can force environmental standards, prohibit illegal use of monopolies for killing competition and such. This is also detrimental in one sense, but can be beneficial in another. However flooding market with phony dollars, that is definitely going to have a detrimental effect.

Imagine this: the dollars are understood to be phony by the outside to the US world. The world that lends money to the US. US owes tens of trillions in debt and this debt cannot be repaid.

From point of view of a single citizen (you know, they used to be citizens before they were all changed to consumers), this is a catastrophe. No more money is given on credit, whatever can be borrowed will have enormous interest rate. If the interest rate is not pushed up, the dollar will fall to 0. Simply to 0. It will happen the way it happened in many countries for the past 100 years.

Imagine buying a loaf of bread for $100 in the morning, and by the evening realizing that now bread costs $1000. $10000 in 5 days from then, $1,000,000 in a month, $1,000,000,000 in half a year. That is not impossible. That is what happens when government gets their hands into economics. They don't actually understand economics, even worse, it is not in their best interests to act upon understanding of economics.

Don't expect a man to understand something, is his job relies on not understanding it.

So why am I saying this? Well, recession is here. Government will attempt to maintain the phony dollar and will create hyper-inflation by pushing interest rates down. People will freak out and will stop buying everything except food and probably energy (you know, for heating and such.)

Goods will become scarce, as lender countries will stop lending. The problem is, once they stop lending, the US will have nothing to buy outside products with. This is bad news, at that point it is going to be a depression and probably a deflation of resources and goods that are of not essential value (not food).

In a situation like this the following will happen:

1. Government will fix prices. Obviously this will cause shortages, nobody in their right mind will want to sell for nothing. USD will be nothing.
2. Shortages will cause panic and probably hunger and anger.
3. Whoever has any means left will attempt to flee the country. O

Re:The best way to help...

[Anonymous Coward]

Yes. You either want to help your fellow man in time of need, without asking for anything in return, or you're a selfish asshole. I know this sounds sarcastic as it's 2 extremes, but that's pretty much what it boils down to. You didn't pick yourself up off your bootstraps as you self righteously claim. You used the public funds and taxes of people from every class from every generation before yours. The money and blood and sweat that was used to make the roads you've traveled on, the hospitals you've been to, the schools you've attended, the police services which have kept you safe, and on and on. You're not an island. You were born with a silver spoon in your mouth just by being born in the United States or by being born in a position where you could come to the US and not in some starving third world town, and it is that silver spoon that gave you your education and your means of living. Do you work harder than the common farmer struggling - not because he's lazy but because of a recession he fell into through the poor choices of others? Probably not. And as such, you should have some sympathy for your fellow man. And I'm not saying this as a poor student who wants a handout. I also studied hard, did better in school than most of my classmates and now have a good paying career. I don't need any handouts, but I'm willing to pay more in taxes than those who are more in need so that I could help them. What I don't like the government doing is taking money from me and giving it to those who are even in less need than I so it could finance their poor decisions and let them ride off into the sunset with their golden parachutes. That just pisses me off.

Re:The best way to help...

[An Onerous Coward]

It's very lazy or stupid of you to assume that the poor are poor because they are lazy or stupid.

It's also lazy or stupid of you to attribute these fishy statistics to the New York Times. What you linked to was actually a book excerpt that the Times merely reprinted. They would be more appropriately attributed thusly: According to "The Millionaire Next Door: The Surprising Secrets of American's Wealthy" authors Thomas J. Stanley, Ph.D and William D. Danko Ph.D...

But two random doctorates who wrote a book congratulating millionaires for being millionaires just doesn't have the same ring of progressive credibility as "according to the New York Times," does it?

Regardless of the statistics you cite (which are cherry-picked, and may or may not be properly collected), it doesn't change the fact that sociologists cannot find a better predictor of a person's socioeconomic future than their parents' socioeconomic background. It's a stronger predictor than race, gender, IQ, or scholastic achievement (individual or parental).

It's also true that the highest performing children of poor people graduate from college at approximately the same rate as the lowest-performing children of the wealthy. I don't remember exactly how the statistics broke down, but it was something like being in the most talented 20% of all children in the lowest income quartile gave you about the same graduation rate as being in the least talented 20% of children in the highest income quartile.

Being the idiot child of a rich person is a more secure route to success than being a bright and talented child of a poor person. In such a society, chalking your own success up to hard work and everyone else's failures up to stupidity is a cruel and narcissistic sort of stupidity.

Re:The best way to help...

[An Onerous Coward]

I'll see your sig, and raise you a "then you're a hypocritical bastard":

"When someone works for less pay than she can live on - when, for example, she goes hungry so that you can eat more cheaply and conveniently - then she has made a great sacrifice for you, she has made you a gift of some part of her abilities, her health, and her life.

The 'working poor,' as they are approvingly termed, are in fact the major philanthropists of our society. They neglect their own children so that the children of others will be cared for; they live in substandard housing so that other homes will be shiny and perfect; they endure privation so that inflation will be low and stock prices high.

To be a member of the working poor is to be an anonymous donor, a nameless benefactor, to everyone else. As Gail, one of my restaurant coworkers put it, 'you give and you give'" (Barbara Ehrenreich, Nickel and Dimed, New York: Metropolitan Books, 2001, p. 221).

You claim that nobody lives for you. Tell that to the guy who made way less than minimum wage picking the fruit you eat, or the woman who cleans your office, or the guy who bags your groceries, or the sweatshop worker who made your shirt. Each of them makes a tiny contribution to your own happiness, success, and comfort, and each is rewarded with a lifestyle that ranges from boring and degrading to borderline slavery. You take their contributions without hesitation or thought, while whining and sniveling about how unfair it is that you should be asked to give back in a small measure.

If that isn't asking somebody else to live for you, then what is?

Re:The best way to help...

[shlashdot]

Except prices are falling. You haven't accepted that. Others have. "They" will try to inflate, but your own post admits they will fail for (perhaps) 5 years. Telling people to buy stuff now is simply bad advice.

Re:The best way to help...

[Anonymous Coward]

Maybe the biggest issue is how success is measured in your quoted but not cited study...

Re:The best way to help...

[CodeBuster]

"They" will try to inflate, but your own post admits they will fail for (perhaps) 5 years. Telling people to buy stuff now is simply bad advice.

The P/E ratios are getting so low and the yields on dividends so high that you can justify the purchase price based almost entirely on 5 years of dividend payments alone. For example, I have a REIT in my Roth IRA that has paid regular dividends for a 7% anualized yield for the last 5 years and lost no principle (not too shabby, wouldn't you agree?). Some stocks have so much upside and so little left to lose that there are great values to be had if one has the nerve to persue them. As Warren Buffet says, "be fearful when others are greedy and greedy when others are fearful". Most of us Slashdot readers are still on the younger end of the scale and given that we are (or should be) investing in our IRAs and 401ks for our retirements with yearly contributions it makes sense to take advantage of good equity buying opporutnities rather than earn miserly returns in the cash funds and miss the best buying opportunity to come along in decades. I agree that there is a window here on the order of months or even years, but unless you are trying to engage in market timing (something which cannot be done reliably), now is a good time to start dollar cost averaging into some good long term positions.

Re:The best way to help...

[Anonymous Coward]

Excuse me, but I did not elect them; I did not vote for Obama nor the Democrat Federal representative of my district.

Don't worry, they'll help save you from Bushonomics anyway.

Re:The best way to help...

[shlashdot]

Could be. All stocks have the same amount "left to lose" though, if the company doesn't survive. Oh right that could never happen.

Re:The best way to help...

[CodeBuster]

The stock can only go down to zero so the loss is limited in that regard (unlike some other financial instruments, short options for example, where the loss is theoretically unlimited because while a stock cannot be worth less than zero there is no upper limit on increases in value). If you have zero tolerance for risk than no amount of potential reward would offset even the smallest chance of loss and if that is the case then by all means open yourself a savings account and buy CDs and T-Bills. Right now, the yields on safe investments are so low (because lots of investors want them to shore up balance sheets for accounting reasons) that you probably will only be able to limit your losses (it is like paddling against the current, but not fast enough to make any headway. You may not fall behind as quickly, but you are still falling behind).

AT&T

[mi]

Because we need telephone to reach the poor and the rural communities... Because market is failing to address this need...

We must centrally plan this vital piece of national infrastructure. (Oh, and Libertarians are all lunatics.)

Re:AT&T

[shutdown -p now]

Oh, and Libertarians are all lunatics.

Reading the first 10 comments to the story - well, maybe they aren't, but they sure do try hard to make such an impression!

Re:AT&T

[Anonymous Coward]

huh? Does your use of italics indicate irony or sarcasm? The point of your post fails me.

Re:AT&T

[ScrewMaster]

We must centrally plan this vital piece of national infrastructure.

That's not really correct. There was no "central planning". At that was done in the Communications Act of 1934 was to require that AT&T provide universal coverage as a cost of doing business, and as a condition of being granted the national telephone monopoly. The buildout itself was planned and executed by AT&T, not Congress.

Good regulation, not central planning.

Re:AT&T

[mi]

The buildout itself was planned and executed by AT&T, not Congress.

It does not have to be Congress to be "central". As long as it is a monopoly, it qualifies as "central planning".

Good regulation, not central planning.

Good?!? You, actually, consider AT&T's monopoly — which, you know, had to be forcibly broken up decades later — an example of "good regulation"? Wow...

Re:AT&T

[ScrewMaster]

It does not have to be Congress to be "central". As long as it is a monopoly, it qualifies as "central planning".

Not in this context. The term "central planning" refers to totalitarian states that centrally control all economic development. That is simply not the case here.

Good?!? You, actually, consider AT&T's monopoly â" which, you know, had to be forcibly broken up decades later â" an example of "good regulation"? Wow...

Yes. You're sadly misinformed, I'm afraid. The Federal Government, at the time, knew that a government-implemented solution would be inefficient and ineffective. So a compromise was reached: AT&T would provide the buildout, with the understanding that it would operate under specific conditions (including universal coverage) with QOS standards and stiff penalties for violating them. By and large, AT&T did exactly what it was chartered to do: America had the most reliable phone system in the world for nearly a century. The government likewise did what we pay it to do: enforce the regulations.

So yes, that was an example of good regulation. It allowed the government and the private sector to each work from their strengths. It worked, and worked well, for a long time. We all had phones, even those in remote locations, and they were reliable. That's a hell of a lot more than most countries could claim back then.

Yes, times change ... and if you're trying to tell me that we're better off now with a largely unregulated phone system operated by the likes of SBC (who took over AT&T) and Comcast, then I think you're goofy. Look at what's happened in recent years. The original government-granted and controlled monopoly has been thoroughly re-established through repeated acquisitions of the original Baby Bells. The worst of those companies, SBC, is firmly in the driver's seat, only now without most of the government oversight that used to exist. Judge Greene erred in his understanding of technology, and the relevance of the old-line telcos in the packet-switched world we have today. Personally, I think a more measured response would have been appropriate: for example, rather than breaking up AT&T, just eliminate their stranglehold on subscriber equipment. That alone would have made a huge difference in terms of the technologies available to consumers: Judge Greene's big complaint about AT&T was that it stifled innovation. His solution was excessive and brutal, and ultimately made matters worse for everyone.

Furthermore, multiple competing networks to the old telcos have been built now, which means that the ironclad monopoly that AT&T used to enjoy disappeared anyway. That's not even counting technologies such as VoIP.

The judge should have been more patient. There was no need to break up AT&T, not back then.

On the other hand ... there is now.

Re:AT&T

[mi]

Not in this context. The term "central planning" refers to totalitarian states that centrally control all economic development. That is simply not the case here.

I know, what "central planning" means — and I maintain, that it does not have to be governmental. Nor is it limited to totalitarian states (though one can argue, that deliberately bringing it into being is a measure of totalitarianism).

The Federal Government, at the time, knew that a government-implemented solution would be inefficient and ineffective. So a compromise was reached

Yep. A single company was given a monopoly over a huge and lucrative new market... And you are defending that as a wise decision... As Rahm Emmanuel is on record quipping, you should never let a good crisis go to waste. Illiberal politicians of 1930ies didn't waste the Great Depression, and now their brethren are set to saddle us with Internet-era federal monopoly.

America had the most reliable phone system in the world for nearly a century.

Somehow, America was able to achieve the same sort of leadership in other areas — such as railway, for example — without giving a single company a monopoly... You'll need to present evidence, that our phone system's success was thanks to, rather than in spite of AT&T's monopoly.

I, on the other hand, just need to remind, that such monopolies are unfair regardless of whether they are efficient or not — America's Capitalism is derived not from efficiency, but from inalienable rights of people to pursue happiness by any means (not harmful to others right to same), including engaging in business activity. That this Capitalism happens to be the most efficient way to evolve also, is just gravy on top...

Legally barring competition to AT&T, as the federal government did in the 1930ies, was a gross violation of freedom regardless of whether or not that was the most efficient way to build national phone grid. And even that efficiency is doubtful.

Judge Greene erred in his understanding of technology, and the relevance of the old-line telcos in the packet-switched world we have today.

Oh, yes, it was that judge's fault. But there was no problem placing the regulation of the entire telephone service in the hands of a handful of bureaucrats for decades. Nor was there anything dangerous handing a decision over the break-up of a multi-billion dollar company to on judge either. People defending past Statism are quite amazing...

Demand Side Economics

[pilsner.urquell]

How Can the Stimulus Plan Help the Internet? It can't! Already more money has been dumped into this stimulus plan that has been spent on all the major wars this country has fought.

Demand side economics is not the right solution at this time.

Re:Demand Side Economics

[Anonymous Coward]

The internet "in general" doesn't even need help. It will work fine, even without the US.
The only problem is that some people where given money to build broadband networks, and then didn't. Giving the _same_ people more money and hope for the best sounds like it has something to do with politics.

Re:Demand Side Economics

[An Onerous Coward]

Where are you getting your statistics?

Adjusted for inflation, the cost of WWII was about 5 trillion dollars.

The Iraq war has already cost nearly 600B, with some estimates of the eventual costs being upwards of 3 trillion.

The best estimate I've found of bailout spending claims that 2.7T has been spent. But that does include a lot of collateralized loans, equity stake purchases, etc., so the taxpayers may be able to recoup quite a bit of it.

I'm not convinced that the bailout is being handled properly, or that it's having the positive effect that it's supposed to. But I don't see how any of this constitutes "demand side economics." Not even the $168B in economic stimulus, which mostly got given to the wealthy and middle class, and then went to paying off existing debt, not increase consumer demand.

Had there been a real increase in private spending, it would have eased our economic troubles some. I think it's okay to give public spending a shot. At least that way, we know that it will lead to new demand.

Keynesian economics worked well in WWII*. Trillions of dollars in artificial demand, mostly spent on things which had little or no post-war use (as opposed to good infrastructure spending), and the deaths of over 400,000 of our future workforce, and somehow all that waste led to impressive post-war prosperity.

Imagine if the same sort of heroic spending was undertaken in the pursuit of new infrastructure, health and education initiatives, ecological restoration, alternative energy research, and the like. That is, spending on things that will provide for our needs in the future, rather than munitions**.

* It hadn't been properly tried during the Great Depression, though even the limited attempts by the New Deal met with success, until 1938 when Roosevelt listened to detractors, cut spending to reduce the deficit, and crashed the economy for a while.

** As someone wittier than me explained, bombs are economically strange things. Rather than producing goods and services, they destroy what is already made. Worse, they are delivered at no small expense to people who do not want them.

Internet Question on the Census

[kabloom]

It's time to start lobbying for an internet question (or two) on the census.

Re:Internet Question on the Census

[Anonymous Coward]

It's time to start lobbying for an internet question (or two) on the census.

Will the last option have "CowboyNeal" in it somewhere?

What?

[canuck57]

.. the problem is that no one knows the best way to make the internet more resilient, accessible and secure, since there's no just no public data.

I dispute that. The internet is a collective effort by many technical people past and present that develop it's potential. The only hinderance is politics, useless patents, corporate monopolies and the like. It is a truly free media, unencumbered by undue influence by anyone or any special interest group.

Keep the internet free, and it will serve mankind very well. The interent does not need stimulus, it needs net equality of access not dominated by any one.

Any solutions for reliability, useability will be provided as needed. Very efficient model too. For example, it does not depend on any one operation system for it's existance, even though some would have it otherwise. Maybe even open up some of that TV channel bandwidth for the internet without the ownership and licensing issues, allowing any company to provide WAN access.

The internet is truly a democratic collective. Work with it and don't let secular forces pervert it. Doesn't cost much either to do this.

Re:What?

[nine-times]

The interent does not need stimulus, it needs net equality of access not dominated by any one.

Sorry, but the Internet infrastructure in this country does need some stimuli. If you think broadband Internet is doing well enough on its own, then I think you're not paying attention. The "fast" Internet connections in this country generally aren't fast enough, and they certainly aren't ubiquitous enough. It's not strange in this country to live in a major city today and still be unable to get an upload rate above 512kbps for under $100 a month. That's retarded.

We can argue about where you want to place blame or what should be done about it, but certainly *something* should be done.

Re:What?

[canuck57]

....It's not strange in this country to live in a major city today and still be unable to get an upload rate above 512kbps for under $100 a month. That's retarded.

I agree. But that is because in North America we operate unregulated monopolies and pay the price. Oh, they may say they are being regulated, but not for us, for city profits, franchise fees. It is the system of how they operate that is not in our interests.

New Deals in modern times...

[Anonymous Coward]

Call me a skeptic, but I have strong doubts about any infrastructure programs being as good for unskilled meat-and-bones workers as it will be for the unskilled owners of major government contractors. If the government isn't in charge of these infrastructure projects, internet or otherwise, then all we will have is a handful of companies fighting for the lowest bid, fulfilling obligations in the cheapest way possible, and spending the rest of the money they get either paying off old debt or dividends.

Stop Telecoms and Cable Cos from Squandering it.

[Zombie Ryushu]

Right now, we have a serious problem with Telephone companies and cable companies attempting to squander and rip apart the Internet. The Internet would only continue to expand and new innovations would take root. But the problem is that local monopolies are standing in the way of that. There are entrenched intrests on many sides that want to fragment and censor the Internet, and people are too lazy and stupid to stand up and protest these actions. Its not government regulation thats the problem, and its not the "free market libertarians" that are the solutions. Its a couple of very corrupt, very ARROGANT shareholders that need to go to PRISON for what they are doing.

The Internet like Water, like Electricity, is becoming a public utility, it should be transparent in an transparent manner like one. And to the Cable Cos and the Telcos, no its not your network anymore.

no just no public data

[Anonymous Coward]

"since there's no just no public data."

there aint none of it ya hear!

Slashdot's short memory

[NaCh0]

For instance, the government doesn't know how many people actually have broadband or what they pay for it

Wait, I thought telcos giving the government open access to their records was a bad thing.

Come'on folks. You know anything the government touches will be abused. Stop giving these appointees more power for next to no real gain.

Re:Slashdot's short memory

[Timothy Brownawell]

For instance, the government doesn't know how many people actually have broadband or what they pay for it

Wait, I thought telcos giving the government open access to their records was a bad thing.

Come'on folks. You know anything the government touches will be abused. Stop giving these appointees more power for next to no real gain.

You don't see a difference between "Here's a log of all calls to/from 555-1234, registered to Joe Nacho" and "here's a list of how many subscribers we have at each speed in each zip code"? I tend to see personal information as rather different from statistics.

Re:Slashdot's short memory

[Anonymous Coward]

Providing statistics about broadband distribution is not the same thing as records of individual users' activity. Or do you think the NSA will start inspecting big cities more closely because they have "suspiciously high network activity"?

Re:Slashdot's short memory

[Anonymous Coward]

In dealing with any person, government or not, give an inch and they will take a mile.

LAST MILE, LAST MILE, LAST MILE

[pyite69]

It is ridiculous that we let the telcos drag their feet so much.

We need to understand the failure of the Clinton/Gore attempt to wire the country with fiber, and make it happen for real. This will mean a lot of shared sacrifice for the local phone monopolies.

Re:LAST MILE, LAST MILE, LAST MILE

[ScrewMaster]

This will mean a lot of shared sacrifice for the local phone monopolies.

Yes, well, they're not very good at that.

Re:Look CEOs

[burnin1965]

(you seem to be a confused AC, here I fixed your comment for you)

The internet is like a night market in a third world country. It sprang from a government funded project and, contrary to short sighted corporations, individuals discovered and utilized the value in it. You'll be damned if you try to regulate it. You guys all bitch about the new corporate kid on the block who is making huge profits providing value customers want and the loss of your birth-right to over charge for sub par services on a monopolistic network governed by price fixing schemes. For the last 8 years. But guess what, the net is still neutral and individuals are still finding value in the internet all the while paying you for the service you market to connect them to the businesses and other individuals that provide that value. Just let it be and go with the flow. The net is to nebulous and decentralized to be regulated. You'll still be able to rake in reasonable profits as long as you maintain a marketable service offering for years to come. When a new content provider starts up and makes a profit by delivering the content over the network for which you've already been paid to provide, don't worry - the free market is always there to supply you with your investment ROI fix, that is if you still remember what investment is.

Just say NO

[larry bagina]

I guess the bank bailout, auto bailout, hedge fund bailout (it's coming), and credit card bailout (it's also coming) aren't enough, we need a pork bailout (aka "stimulus").

Remember the .bomb bubble? People bought overpriced stocks on the theory they'd be even more overpriced later. That didn't work out, so to soften the landing, the federal reserve kept interest rates low, which moved money into housing.

  Remember the housing bubble? People bought overpriced houses they couldn't afford on the theory that they could sell it for even more before their interest-only mortgage came due. That didn't work out, so to soften the blow, the president, congress, the treasury, and the federal reserve borrowed trillions to bail out dying companies on the theory that they had to do something, even if it was stupid and not well thought out.

The federal government (and debt apologists) have justified excessive borrowing and spending on the theory that it will grow the GDP. That's the same kind of thinking that caused these problems for individuals and the economy as a whole. History has shown that you (we) will need to pay for it eventually, and it won't be pretty.

Re:Just say NO

[DoofusOfDeath]

Remember the .bomb bubble?

Yeah, a bunch of Hamas guys in Palestine followed that career path last week, and look where it got them.

Worst. Bubble. Ever.

Don't let the ILECs ruin it

[isdnip]

The problem with current telecom policy is that it presupposes that the old incumbent telephone companies (ILECs) "own" the wires that they installed with monopoly-ratepayer money, but due to the presence of nominal competition (cable), they no longer need to be regulated as utilities. So giving them more money simply raises their profits. It raises the price they pay to buy each other up. Right now the going rate is around $3000/subscriber to buy up a rural telephone company that gets >50% of its revenue from government subsidies. They're simply bidding on the present value of these entitlements. It goes straight to the investment bankers (Goldman Sachs has been making a lot off of the subsidized-ILEC business.)

The FreePress plan is awful too. It simply ignores the ILEC networks and supposes that a few billion dollars could create a "third path", another closed, propertarian network. Of course they also want Internet content to be regulated, so their plan loses on both angles. They just hate the cable industry and collaborate with the Bells against it, consumers being a low priority.

So what might work? I suggest that the feds use the money to finance the spin-out of the ILECs' outside plant -- the loops and short-haul links between their central office buildings -- into neutral "LoopCos". They would provide wholesale access to any LEC, ISP or cableco, including their former owners, on vendor-neutral terms. LoopCos would be strictly regulated utilities (like telcos 25 years ago), forbidden from competing with their customers. Then the stimulus money could be used to finance (low interest loan, subsidies in high-cost areas) an upgrade of their legacy networks to provide (dark) fiber to the home.

The old legacy LEC (ATT, VZ, Q) shareholders would win, because a lot of their debt would move to the LoopCos, where it would be diluted by stimulus money. The Internet and its users would win because we'd have real open-entry competition, not a duopoly.

Re:Don't let the ILECs ruin it

[ScrewMaster]

"third path", another closed, propertarian network.

I don't know that word. Does it mean "Proprietary Libertarian"?

Re:Don't let the ILECs ruin it

[isdnip]

Propertarian: A belief that private property has primacy over public good. In telecom it is the notion that because the wires on the poles are the nominal property of the telephone companies, those companies should be free to do with them exactly as they feel. Utility regulation and hundreds of years of related laws (bailment, etc.) are discarded in favor of declaring everything to be somebody's property, and thus theirs to use as they feel free.

That is the philosophy that Kevin Martin and Michael Powell followed at the FCC, deregulating the incumbent telephone companies in spite of the law.

Re:Don't let the ILECs ruin it

[SiliconFiend]

I think you've nailed it. That's essentially the solution I've been in favor of for years (although I like the idea of local government ownership, but that should at least be an option in your "LoopCo" plan). The ILECS (and cable co's) are a major obstacle--how can you have effective competition when the existing last mile connections are owned by monopolies and the barrier to entry for new competition is essentially infinitely high: no municipality is going to give carte blanche to dig up all the streets to lay out fiber (and don't think that wireless can solve all those problems, either).

Peace dividend

[michaelmalak]

The best thing that happened to the Internet was when Clinton exploited the Peace Dividend and starved the military, and thereby the defense contractors, and they (and their employees who sometimes left to form their own companies) had to figure out how to produce for civilians rather than for the military. Without government interference and malinvestment, the people will figure out the most useful and profitable businesses.

Re:Peace dividend

[jcnnghm]

The best thing that happened to the Internet was when Clinton exploited the Peace Dividend and starved the military

And also the intelligence community, which directly lead to the largest terrorist attack in this nations history.

Re:Peace dividend

[swillden]

The best thing that happened to the Internet was when Clinton exploited the Peace Dividend and starved the military

And also the intelligence community, which directly lead to the largest terrorist attack in this nations history.

Which was a flea bite that killed fewer Americans than die on the highways every three weeks, and did less property damage than a single large hurricane.

Re:Peace dividend

[Anonymous Coward]

While plausible, I don't think the CIA would stage an attack just to restore funding. They couldn't have anticipated the extent of the secrecy and illegality that the Bush administration would condone. Unless Bush wrote CIA a blank check when they helped get him elected.

Re:Peace dividend

[jcnnghm]

And started a war, caused about $640 Billion in economic damage, and could have been easily prevented for pennies on the dollar. In comparison, Katrina cost less than $300 Billion. It's much cheaper to track what your enemies are trying to do to hurt you and kill them before they get the chance, than to try to clean up the mess afterwords.

Re:Peace dividend

[jcnnghm]

That's not what I'm saying. What I'm saying is our Foreign Intelligence spending was cut, preventing the intelligence community from expending the necessary resources to learn of and prevent the attack.

Re:Peace dividend

[couchslug]

"The best thing that happened to the Internet was when Clinton exploited the Peace Dividend and starved the military, and thereby the defense contractors, and they (and their employees who sometimes left to form their own companies) had to figure out how to produce for civilians rather than for the military."

Except that he didn't starve the military, which had been living on the boost it got in the Reagan Era and was drawn down starting during the reign of Bush the Elder prior to Desert Shield.

BTW:
The bipartisan AND senior military leadership choice not to follow the retirement of obsolete Cold War systems with systems and training more suitable for the new era meant that we "went to war with the Army we had" in Iraq Part II and weren't ready for the kind of urban warfare we should have been ready for in Mogadishu. I'll even use a heritage.org graph (they are hardly Clinton fans, nor am I):

http://www.heritage.org/research/features/budgetchartbook/images/fed-rev-spend-2008-boc-S7-Despite-War-Costs-Defense.gif

Re:Peace dividend

[swillden]

And started a war, caused about $640 Billion in economic damage

That was our irrational overreaction. We did that to ourselves.

Re:Peace dividend

[techno-vampire]

We did that to ourselves

Actually, we did it to Afghanistan and Iraq.

Re:Peace dividend

[swillden]

We did that to ourselves

Actually, we did it to Afghanistan and Iraq.

They got the worst of it, of course. But we the GGP was talking about the economic cost, which is ours to bear.

Lay fibre

[AmiMoJo]

The government should get fibre to every home. Doesn't matter if they do it or they help/force the incumbent telco or a cable provider to do it, it is just what the economy needs.

It would stimulate the construction industry. Lots of digging and laying cables, building up local offices.

It would help IT with new equipment being required and migration of customers from older systems.

It would help broadband companies who now have a new, faster platform to sell.

It would bring new business opportunities like HD video on demand, DVD/BluRay download stores, even more random TV channels etc.

In the long run, it will bring the country into the 21st century.

Re:Lay fibre

[isdnip]

What good is fiber to the home if it's closed?

The Bush FCC (Powell/Martin) deregulated fiber to the home, even if the incumbent Bell pulled it and cut the old copper wire. So the telephone company is the sole ISP, the sole content provider, and the sole telephone service provider. They have (for various legal and political reasons) not exercised their full rights yet, but they are studying ways to make fiber to the home about as useful and free as the WAP browser on your wireless handset, just with better resolution on the movies they sell you.

The fiber has to be open (not "network neutrality" of ISPs, but open to multiple ISPs) or it will be less useful than old copper. Freedom of the press with black-and-white pamphlets is better than a full-color broadsheet (with comics!) monopoly of Izvestia.

Re:Lay fibre

[DoofusOfDeath]

I think the problem with your idea is that it while it would add to the internal busy-ness of our country, and to our own entertainment, you haven't listed anything that would help us with international trade.

I think with our unimaginably huge year-to-year trading deficits, we should focus on building infrastructure that actually helps our country get out of foreign debt, which means the investments should help us produce products or services that other countries want, or let us produce products/services for ourselves that we currently buy from overseas.

Re:Lay fibre

[AmiMoJo]

Obviously the fibre has to be open to any ISP that wants to use it. BT has already been forced to open it's copper network and the government has stated that it would expect a fibre network to be the same.

Re:Lay fibre

[AmiMoJo]

A high speed BB network would help develop products that are wanted world wide.

Look at mobile phones. Why are all the leading phone manufacturers based in the far east or Europe? US mobile phone systems are well behind the curve, so phone manufacturers target the leading markets and everything trickles down to the US. We have a similar problem in the UK.

There are exceptions though - Apple's iPhone and the Blackberry. Neither of those would be possible if it wasn't for the networks developing to they point they have done. A high speed BB network would allow companies to develop things that make use of it, and that there will be international demand for.

Colour TV was the same.

Re:Lay fibre

[isdnip]

Yes, BT's model is good. It's functional separation, not structural: They're separate subsidiaries of the same corporate shell, so the debt is consolidated under the same stock. But it still is open and accountable, so the infrastructure could be done by an OpenReach-like operation. BT seems fairly happy with it; it actually improves bottom-line profits.

The American phone companies, of course, are totally aghast at the idea. They're more into control than profitability.

Re:Look CEOs

[cdrguru]

You miss the point - delivering the Internet to conumers is only profitable for a company if they are a near-monopoly. Having a couple of customers here, a couple there doesn't work - there are labor-intensive resources that are tied to geography. Like fixing wires when they break.

So what we have been seeing for the last 10 years or so is just a pure market penetration play. If AT&T gets to take people away from Comcast they "win" and Comcast will pretty much cease operations in that area. And so the battle goes on and on. Each side offering better numbers (speeds, etc.) and lower prices - utterly unsustainable prices that make no sense but designed to capture market share. Once the competition is eliminated prices can return to that which actually pays for the service, but not until.

Trying to fight that mindset is impossible and it is the way anyone with substantial physical resource requirements operate from WalMart to Verizon.

Another side effect of this is the consumer isn't paying for access - they are paying some token amount that is less than their competition. Price fixing? I suppose you could call it that because if someone drops their price to gain more market share it is immediately matched by everyone else. Pricing has nothing to do with reality - especially when you can get a DSL connection for $14.95 a month. This sort of silliness leaves the providers in a quandry - can they afford to take such big losses or do they look for revenue elsewhere?

Obviously they can't raise prices to the consumer - they would lose market share and therefore in the end just lose completely. Hence the ISP approach to Google which does nothing, makes nothing and has nothing but is utterly dependent on the ISP to deliver the customer to them. And Google is raking in billions because of it. Neutrality? Ha. The only way you get "neutrality" out of this is for the customers to be paying for access. That means parity with "business rates" where they aren't fighting for market share. Your $14.95 DSL line goes to $149.95 in that case.

And for the most part, people aren't interested in the ISP as a "service". It is a vehicle to access services. Sort of a necessary evil for which there is no justification other than it seems to be necessary. I don't see any marketing campaign for the ISP which will gain them anything. All then can hope for is possibility of 70-80% market share and driving out all others because of it. Until then, they offer a service at a loss because they have to - the alternative is to just give up.

Think people are comfortable with the idea that the current ISPs are running at a loss and just hanging on with the hope of driving everyone else out? This isn't a long-term business strategy and only works if you have some other business to make payroll with. This is why there are no "independent" ISPs left and why all the ones that tried either got bought or failed. Answering the question of what comes next is why people talk about regulation because it alone holds the possibility of not having the country carved up into ISP fifedoms.

It can only help if the banks

[Orion Blastar]

loan part of that 700 Billion package to Internet companies to lay down more broadband.

Right now nobody knows what the banks are doing with that money. Could be spending it on hookers and booze for all we know. :)

Re:Stop Telecoms and Cable Cos from Squandering it

[Anonymous Coward]

Was it ever really their network? It was built with your tax dollars lol.

Obligatory

[Yvan256]

[Watching "Spaceballs: The Movie". They reach "now" in the movie.]
Dark Helmet: What the hell am I looking at? When does this happen in the movie?
Colonel Sandurz: You're looking at now, sir. Everything that happens now is happening now.
Dark Helmet: What happened to then?
Colonel Sandurz: We passed then.
Dark Helmet: When?
Colonel Sandurz: Just now. We're at now now.
Dark Helmet: Go back to then.
Colonel Sandurz: When?
Dark Helmet: Now!
Colonel Sandurz: Now?
Dark Helmet: Now!
Colonel Sandurz: I can't.
Dark Helmet: Why?
Colonel Sandurz: We missed it.
Dark Helmet: When?
Colonel Sandurz: Just now.
Dark Helmet: When will then be now?
Colonel Sandurz: Soon.

Alternative link for kids who can't read good.

Re:Look CEOs

[roc97007]

There's two "o"s in "too". :-)

Your deffinitions presume your conclusion

[MarkusQ]

Any effort by the State to manipulate or direct economic planning will lead to increasing economic irrationality and inefficiency.

This is undoubtedly true, as long as you define "rational and efficient" in terms of the non-colluding well informed self interested rational agents that make up this hypothetical market. It's the same as saying:

Any effort by the User to manipulate or direct the flow of electrons in the CPU will lead to increasing the operating system's irrationality and inefficiency.

So, obviously, true.

But if the assumptions behind this implicit definition break down--if the market participants are themselves irrational, inefficient, short sighted, gullible, or just too damn busy to read every piece of fine print they are faced with--then your conclusion falls apart. The market will become unstable and result in a few players subjugating all the rest, and the system as a whole will cease to do anything beyond satisfying the whims of its masters.

Unless you are foolish enough to fancy yourself as one of the eventual masters, you should not be rooting for this outcome.

--MarkusQ

P.S. One way to resolve the problem is to impose some sort of progressive dampening on the system which recirculates wealth. But doing it by fiat (e.g. welfare) generally damages the value of the currency (loosely, why work if you can get money for free?) so demanding something in exchange (job creation programs) is much better. Even better is when these programs can produce something of lasting value, and better still if it's something of widely acknowledged long term value that "the market" would never have produced since it wasn't in anybody's short term interest.

Fixing our infrastructure, obtaining energy independence, building a permanent moon base, bringing global CO2 levels back to normal, any of these things would be ideal--no private entity could accomplish them, but collectively we could, and be much better for it.

Re:Your deffinitions presume your conclusion

[Anonymous Coward]

That's great. Just let me opt out of the ones I don't support. Oh, I can't? How convenient for the special interests.

Government isn't the solution....

[leereyno]

...government is the problem.

Government regulation and got us into this mess. There is no reason to believe that more of it will get us out.

Re:Government isn't the solution....

[Anonymous Coward]

Government regulation and got us into this mess.

Wow, where are you from - bizarro world? Lay off the Ron Paul, dude, the stuff's fucking with your brain.

Who do economic stimulus plans really help?

[macraig]

My unscientific analysis caused me to conclude that the intent of economic stimulus plans is to help the wealthiest people get back on their feet, so that then they would once again feel generous enough to not fire people or reduce their wages and the like (a sort of reverse trickle-down, if you will). Us poor folks are supposed to be thankful for their crumbs and hand-me-downs, so we should rush to send them gifts when they're not feeling the love? Doesn't that sound a bit like the baronies our ancestors were trying to escape in the first place?

I refused my $300 stimulus check from the IRS early this year, for exactly this reason on principle: it wasn't really intended to help me in the first place. I despise disingenuousness [disingenuity?], especially if it's perpetrated by my own government.

I frankly don't see what such an economic stimulus plan has to do with furthering broadband availability. It sounds like someone promoting their own brand of pork.

Re:Who do economic stimulus plans really help?

[Anonymous Coward]

when people say "this economic plan helps the wealthy" the truth is "this economic plan helps businesses and corporations." the more money businesses have, the bigger they get, the more people they hire, and the more efficient they produce. if you were to take money from the weathly (who own these businesses and invest in these businesses) and give it to the poor, the poor would have a $300 check waiting for them, but businesses would have to money to employ them. also, forcing up the minimum wage will benefit those with jobs, but will put more people out of jobs (consequently, the benefit the people with jobs gain is outweighed by the negative impact of unemplyment. take an into economics course to explain that to you)

oh, and sory about the AC comment

Many Many improvements possible...

[SimplyFearless]

China, Japan, and Korea all have better internet service than the USA. Some part of India, Europe, Russia and Brazil as well. For starters, the internet could be revamped to: - offer security to the users, choking off hacks and threats in transit instead of at the desktop or at the handheld - be more resilient, designed to withstand major outages without loss of service to anyone - be more accessible and more useful, sure, TCP/IP is ubiquitous, however, it leaves much to be desired as a protocol - integrate with phone, tv, radio media by law, anything on the "public airwaves" being required to also be on the "public internet" - treat business use as a guest instead of as an owner - businesses do NOT own the internet, and never should - treat government use as a guest instead of as an owner - government should NOT own the internet, the people should own it - by law, require all government meetings to be posted on the internet, transmitted live, and to accept discourse from the voting public - government utube plus live transmission plus interaction with the voters - by law, require all product recalls, safety issues, hazards, storm warnings, flood warnings, wildfire notices etc etc to be posted on the internet in an easily accessible and publicly available way (structured, easy to find, maintained, current to the minute) - by law, require that any pleas for assistance, from hurricane or other disaster relief efforts to simple local church calls for volunteering be posted on the internet - IF any claim of offset or tax deduction is made by anyone regarding the publication or distribution of such calls for assistance or volunteering (TV and Radio get tax breaks for broadcasting such; I say require these broadcasts to be simultaneously made on the internet AND stored for posterity) There are lots of other ways the Internet can be enhanced. Some local. Some world-wide. In truth, the Internet is as much in it's infancy as mainframe computers were in the mid-1950's, when no one dared believe desktop or portable computers that are commonplace today, and cheap, would ever be possible at anything like the quality and value that exists today.

easy

[thephydes]

give money to people who are getting their stimulation from the internet so that they can go out and buy the real thing.

Re:Look CEOs

[Anonymous Coward]

(you seem to be a confused burnin1965, here I fixed your comment for you)

The intarweb is tubez. tubez of pr0n. u cant stop pr0n lol.

Sometimes it is investment in novel bussiness

[fermion]

I look around the united states and see that the places that are doing OK use the money of the 90's to diversify, while the places that are not doing so well are still making cars. It makes me think that what the money is spent on specifically is not so important so long as it is not spent on refurbishing buggy whip factories.

We wasted huge sums of cash in the 90's, but we came out the other end with many profitable long term ventures that set up growth or the US economy. Of course some people, comfortable with their 10 million dollar a year jobs did not embrace such a path to growth, and spent most of the past decade fighting or perverting the change that would cost them their jobs and often fraudulent pay checks, so the path to the next big thing is not clear. It never is, especially when we just do the same old thing . What is clear is that we are wasting out money helping old line and fraudulent businesses. For instance, for the amount of money we are giving to the automakers, who knows how much will just go to bonuses, and accounting costs for the planned elimination of half the line workers jobs, we could have a lottery to give away coupons for 80% discounts on American cars for at least 200,0000 people, thus clearing the backlog. You see, innovative ideas for innovate futures, but of course such an idea has not bonuses for the bosses.

The United states has technology for renewable energy, but very little money. Someone is going to make a lot of money on this, and the oil comapanies will lose a lot of money, unless they stop selling buggy whips. Even now I wonder if there is well in the US that can be profitably drilled for $40 a barrel. Someone is going to make a huge amount of money delivering content using TCP/IP, but the broadcasters and cable will lose money, unless they get off their butts and do it. The nice thing about this is that the middle man can be cut out, and the US can distribute to the world, if we have the bandwidth to not only deliver such content to the US population, but also to the world, which we don't.

I don't know what else the US can do, but it has to be more than selling poorly engineered cars and fraudulent financial services. Of course a work ethics that promotes such innovation will have to encouraged, which means that some of he easy jobs, the ones like the we heard about prior to the collapse of the USSR where people got paid to sit around, play chess, and drink vodka all day, will have to go.

Re:Sometimes it is investment in novel bussiness

[SoulRider]

the middle man

The middle man has just shifted from providing the trucks to providing the trunks. Akamai is an example of the new middle man. Anything that can be digitally shipped no longer needs to be physically shipped. Yet we insist on supporting businesses that have no right to be in operation any longer. All I can see us doing is stifling progress. How are these dinosaurs convincing our law makers that the economy would fold if they left the market? Where are the young guns promoting the new business models that are needed to keep us moving forward? For example, why are we bailing out a bunch of automakers who want to keep us tied to oil instead of investing in newer automakers who want to create more energy efficient cars? I actually agreed that Tesla should have gotten a chunk of the money instead of Ford and Chrysler, but only if they promised to create an electric car that everyone could afford.

Re:Look CEOs

[burnin1965]

You miss the point - delivering the Internet to conumers is only profitable for a company if they are a near-monopoly. Having a couple of customers here, a couple there doesn't work - there are labor-intensive resources that are tied to geography. Like fixing wires when they break.

Wow, you pulled all that out of the AC's post? You can definitely read more between the lines than I can.

Anyhow, the facts disagree with your belief that a monopoly is required to be profitable. I'm not surprised by this as you are among the majority who have either lost faith in free market and competition or never believed in it in the first place.

In reviewing the latest 10Q SEC filing for Comcast and AT&T, two opponents of net neutrality who arguably are engaged in a competitive market for broadband internet, they are making a tidy profit on their internet operations.

Comcast had an operating income of $1.7 billion after expenses, depreciation and amortization on revenue of $8 billion for their cable segment for the last 3 months.

AT&T had an operating income of $2.7 billion after expenses, depreciation and amortization on revenue of $17 billion for their wireline segment for the last 3 months.

And so the battle goes on and on. Each side offering better numbers (speeds, etc.) and lower prices - utterly unsustainable prices that make no sense but designed to capture market share. Once the competition is eliminated prices can return to that which actually pays for the service, but not until.

Welcome to the free market where ROI includes risk. It is sustainable and works for many other industries. Take a close look at electronics manufacturers, probably the most cut throat competitive industry around. Electronics manufacturers compete, some win some fail, the market continues and consumers get awesome products at great prices. When competitors lower their prices below sustainable levels in an attempt to gain market share and drive competitors out of business they are breaking the law, very much like breaking the law when competitors scheme to fix prices or use other illegal tactics to build or maintain monopoly positions so they can gouge consumers.

Another side effect of this is the consumer isn't paying for access

See the SEC reports, consumers are paying, providers are profiting. Reality trumps theory.

especially when you can get a DSL connection for $14.95 a month

That would be awesome! :) Unfortunately you picked the minimum data point for broadband access with nothing to explain exactly what you get for $14.95, the truth is that average broadband access rates are $53.06/month in the United States.

Think people are comfortable with the idea that the current ISPs are running at a loss and just hanging on with the hope of driving everyone else out?

Please, read some of the financial statements for the corporations who are fighting net neutrality and who want to tax other companies who profit by providing valuable services over the network the ISP is already profiting from.

Re:Look CEOs

[Anonymous Coward]

I think the thing people get most upset about is that once the company du jour manages to come in and take over, the quality of access degrades quickly. Monopolies don't care because they don't have to.

Take Southern California. It is a prime example of the business practices you described. Comcast was here for a long time. So was Adelphia. There was competition, and while I had Comcast, I never had television or internet outages. I rarely even had slowness issues.

Then, enter Time Warner, the crappiest cable company on earth. They take over the services of Comcast and Adelphia with their financial might. Not six months later, and my television starts going to pure snow every evening hour a couple hours. I ask Time Warner to come out 3 times over 2 months to fix it. They try everything they can - replacing DVR, replacing cabling everything. Still no good. Totally incompetent.

I ask for those 2 months in credit for my TV service, and they refuse. I canceled my TV service on the spot, of course. Nice customer service.

Then my internet starts bogging down to practically 56k speeds during the evening. It takes me nearly 8 months of calling, pestering, and complaining before someone FINALLY notices that the hub node in my area is way over-booked. They split the node and things are okay for about 5 months. Then Time Warner, as of about a month ago, starts having HTTP issues. It's not total routing (Steam continues to work just fine!) but I cannot access anything over the web. It still happens. They're clueless, and they don't care.

I understand the economics involved in the ISPs - the problem is that once they get their monopoly, their service goes in the shitter. I would switch away from Time Warner in an instant if there were ANY other reasonable broadband option in West Los Angeles. One of the biggest economies in the world, and we can't even get fiber here. Amazing.

MOD PARENT UP

[dlcarrol]

EoM

rephrased shorter: Re:Look CEOs

[bugi]

Look to the market to see its wants -- then give them that. Nobody wants to be extorted.

The extortion that you see is only the tip of the iceberg. The real corruption hides.

Re:Stop Telecoms and Cable Cos from Squandering it

[nurb432]

The Internet like Water, like Electricity, is becoming a public utility, it should be transparent in an transparent manner like one. And to the Cable Cos and the Telcos, no its not your network anymore.

True, but do you really want it to become the 'governments' network again? Setting it free is what made it the resource it is today.

manual censorship

[bugi]

Many of those poor out of work bankers etc who lost my retirement funds could be put to work watching the content. That would please all the upstanding citizens of decency trying to reign in the pesky civil liberties those hippies won over the years.

Put it in tv format with two buttons, yea and nay. Add a third button for buy, and everybody wins.

The real stimulus: cut taxes

[John Jorsett]

If you want more efficient allocation of funds and avoidance of make-work projects, use the 'stimulus' money to cut taxes on capital gains, preferably to zero. Even at zero, people aren't going to purposely throw money at loser investments. You'll get the most efficient allocation of that money possible (i.e. no bureaucracy scraping its take off the top and deciding who gets the money based on political considerations), and to those things that will yield the best returns.

Re:The real stimulus: cut taxes

[john.picard]

Hey dude. I have an even better idea than cutting capital gains: it's called the FairTax plan. Look at fairtax.org for more info. This 300 page bill, if passed, would replace nearly 70,000 pages of convoluted tax code. No income taxes of any kind, including capital gains, income, payroll, the death tax, all that stuff. Sound too good to be true? It replaces those taxes with a 23% nationwide sales tax. Yes, it's high. But unless you're a business that sells products or services, you won't need to file any tax forms. You'll simply pay the tax when you choose to go shopping. Several books have been published about it. I think it's a really great idea. We elected Obama because we wanted change. Well getting rid of this ridiculous tax system and replacing it with the Fairtax would be the most radical change this country could make. You have to tell people about it and more importantly write to your new president, senators, and congressmen. Otherwise if we all just sit around and hope our government does the right thing, talking about taxes is a big waste of time.

Then you propose extermination

[SuperKendall]

Existence of rampant corruption is is not a reason to discard economic theories... Get rid of the corruption and try again.

So your proposal is to eliminate all human life, for as long as you have humans by any definition of "human" we have now, you will have corruption.

If you want to eliminate rampant corruption, you should try compartmentalizing the potential damage from the corruption of one person, and that means elimination of central planning where power naturally coaleses into the hands of a few.

Any other notion of merely "eliminating corruption" by pretending any group of humans can be trained to not be corrupt - well that's just a fantasy that ignores all of human history and observation.

who cares?

[roman_mir]

This story is asking an irrelevant question.

A more correct question would be this: in the world where the main currency is failing, dying actually, in the country where government regulations have destroyed the monetary system, the education system, created the credit bubble, helped creating a number of generations of people, whose only purpose seems to be the sense of entitlement in itself, in this world and country, how can the existing Internet be used finally to remove this crappy government from power and to start using logic and rationality where there is none so far.

What can the Internet do to save the people from their government?

Re: A lot more research, dood

[sgt_doom]

Talking points, talking points, talking points. Blah...blah...blah...yada...yada...yada!!

Cut the crapola, already, you don't sound even moderately educated when you repeat the mindless corporate blather. The list of colossal financial fraud is most obvious: Commodity Futures Modernization Act, InterContinentalExchange (And Ice Futures, formerly International Petroleum Exchange), SwapsWire, Markit (which later purchased SwapsWire, renaming it MarkitWire, collusion of Standard and Poor with the Bush Administration's lackeys at the Office of the Comptroller for the Currency, etc., etc., etc.

Read the Air Transport Association's excellent report on the oil/energy speculation.

Study the uses of offshore finance centers in the area of "money laundering" and why fewer and fewer taxes paid by the corpations in America and Europe have corrosive effects everywhere. Read, study and learn. Ignorance can be cured, stupidity....doubtful.

Good central planning worked during WWII with FDR, and had he passed all his programs it would have worked even better. Had JFK not been assassinated by Dulles/Bush/Harriman gang, things would definitely be different today.

Stimulate my what?

[Larryish]

The stimulus plan will go the way of the last cash-injection-for-infrastructure... it will disappear down a lot of corporate rabbit holes and the U.S. will still have substandard broadband.

I wonder if we will receive any disclosure as to the recipients, or will it be another "disappearing money" trick like the $700 billion shenanigans.

The national stimulus PowerBall lottery

[PolygamousRanchKid]

Cutting taxes would mean, that the government would have to admit, that it has no idea what to do with all that money, that it is fleecing off the taxpayers, in order to fix the economy's problems.

Ain't gonna happen.

And giving *all* taxpayers *some* chump-change back as a check, didn't work either.

So I propose, that instead of giving a bit back to everyone, the government should give *a lot* back to a few. With a national PowerBall lottery. You don't need to buy any tickets, having a Social Security number will be enough. Every week, the government will pick one Social Security number, and that person gets one million dollars to stimulate the economy, in whatever way he or she chooses. No strings attached. Piss it up a wall, or build a school.

Repeat as necessary, until the economy is fixed, or until the government is broke (I mean, like Chapter 11).

The excitement of the weekly drawing show will keep people's minds off the sorry state of the economy. Jennifer Aniston will host.

More bandwidth.

[john.picard]

More trunk lines. More switching stations. Perhaps a plan within the country to reduce the number of hops from every city to every city by providing many more direct fast links between them. This will cost a fortune and will require millions of additional miles of trunk lines to be installed and it will cost billions of dollars but the government is going to blow that money anyway and at least this way it will be worth it as bandwidth needs are skyrocketing. People want to transfer video, files in the hundreds of megabytes, telecommunications will gradually move away from more "traditional" systems to IP based, more applications will run client-server fashion, I think eventually that families will have private servers in their home holding all their data which they will be able to access from anywhere. In short, the more bandwidth the better.

First step

[PPH]

Define exactly what you mean by "The Internet", "Internet Service", "Broadband", etc. Then worry about funding it. Otherwise, we'll end up pouring cash down some proprietary, filtered (i.e. not Net Neutral), marketing channel run for the benefit of a few corporations.

While you are at it, make sure you identify the difference between the common carrier bits of the 'Net (which should be subsidized), directory and similar support services (which also should be supported), and commercial services that use the 'Net (which should be run as for-profit entities and funded on their own).

Whatever we fund with public cash, the results of the development should be kept in the public domain. If the public pays for it, the public owns the patent rights.

musket, fifedom, and drum?

[reiisi]

I think you meant fiefdom?

I kid.

However, no, $15 is not ridiculously low for ADSL to most homes. Hmm. Individual homes with a geek in the basement and/or attic, maybe a little low, but not ridiculously so. For ADSL to apartments, it's a bit high, really.

$150 is too high for most businesses. Way high for most small businesses whose primary access is maybe posting their current specials of the week and taking a small number of e-mail inquiries from customers. For businesses that depend mostly on the internet, maybe $150 is too low.

If the connectivity providers can't provide connectivity at that price, the product isn't worth it, and the whole thing should just go back to basic telephony and 56K modems. We don't need what the internet provides that much.

The implementation models of the US connectivity companies are screwed up and that's what pushes their costs through the ceiling. They are deliberately trying to design the pipes so they can maintain their monopoly, and that is why it costs so much. Monopoly is impossible to maintain, so they have to keep pouring more money into the digital equivalent of fancy toll booths.

And yet they can't stop spam. Or the botnets.

While it is true that Microsoft muscled in with tech that was not (and still is not) ready for the job, they were able to do so precisely because AT&T and others were dragging their heals because they couldn't figure out how to monetize it all, in other words, how to keep their monopolies.

On thing that we keep forgetting, the telephone system should have been considered to be under the same Constitutional mandate as the postal roads. If the internet is really all that important, it should be so because it is a replacement for the old phone system. If it has to go back to being a monopoly in the end, the government should take it over and regulate it. But it doesn't have to, just like the mail doesn't have to travel only on mail roads.

And that's where the big connectivity companies are failing. They aren't letting local community efforts shoulder the burden of the last mile, which is how it is with roads, water, and sewage.

They can't monetize (ergo, monopolize) it without controlling the last mile on both ends. Instead of realizing that they should focus on the backbones and get out of the way, they keep trying to monetize (see? monopolize) it.

But the reality is (I repeat myself) they can't really control the last mile. Period. Unless they run all the CAs and the name servers and so on, all the semantic side as well, and if we let them do that, well, they would become another governmental body, so we'd have to vote the guys running it in and out of office just like (we should) with every other government agency.

Re:musket, fifedom, and drum?

[Nuitana]

$14.95 DSL from AT&T is what got me to upgrade from dial-up a couple of years ago. That rose to $19.95 not too long ago, and I changed my phone service to measured local service to make up some of the cost addition. I'd love faster internet, but the highest service I can get from AT&T in my location is Express. I wanted Pro. What I have is worth $14.95, and I wouldn't want to pay more than I'm paying now, but when the cable company charges $57 monthly, the decision is not that hard - especially when I hear about how cable internet gets slow and other problems with it. The DSL has been consistent for me.

economic theories and corruption

[reiisi]

I know what you mean, but in this case many of the theorists are promoting theories that allow their brand of corruption.

Three mandates and a subsidy should do it

[symbolset]

Power utilities are authorized to provide communications services.

No more power wires. All wires strung or buried must be composites with fiber as well as electrical conductors.

Power meters must report usage over the fiber internet - no more meter readers.

The subsidy should cover the difference in price for composite cables, and some switching equipment, less the savings in meter reading.

That and retrofitting fiber on existing poles should fix the rest, which is a jobs program.

you are not living in a vaccuum

[aepervius]

Despite whatever economic propaganda you might subscribe to, there is always a "socialist/wealth redistribution" component in the most stable society, a redistribution of wealth from the richest to the poorest, and yes, you can see that as a punishment for your success to reward the loss of other. Society which do not do that, create a split between the poorest (which will tend never to accumulate wealth, live day to day and are at the mercy of any conjuncture change, loss of job etc...) and the richest. Once this gap increase beyond a point where the strain on the society are too much, you know what happens ? Societal breakdown. Possibly followed by civil war and / or revolt/revolution. And at THAT point, you will regret bitterly not having given enough from the richest most successful to the poorest, when you are put in a guillotine or put to the wall. In other word it is in your interest to share a bit of your success, to make sure you KEEP being successful (and alive). Now call me a kook if you want, but I tend to keep my eye open to the truism "the truly desperate has nothing to lose". The successful instead has everything to lose. Keep that in mind next time you grumble you don't want to share your success.

Re:you are not living in a vaccuum

[SoulRider]

there is always a "socialist/wealth redistribution" component in the most stable society, a redistribution of wealth from the richest to the poorest, and yes, you can see that as a punishment for your success to reward the loss of other

This is pretty much part of the definition of "Society".

Unfortunately there is always a segment of the wealthy in every society that this seems to allude and they think that they are somehow entitled to horde all that the society they live in has generously given them, hence the need for revolution.

You'll not get what you paid for

[Anonymous Coward]

Depending upon which plan is implemented, you might get WPA volunteers working on your Internet for two months after one month of boot camp, or you might get them working on your Internet for one month after a month of boot camp and a month of training. Then the next batch of equally well trained volunteers will try to fix what the first batch did. Then they'll redo pieces after Central Planning gets convinced that their first design was wrong.

Re: A lot more research, dood

[cayenne8]

"Study the uses of offshore finance centers in the area of "money laundering" and why fewer and fewer taxes paid by the corpations in America and Europe have corrosive effects everywhere. Read, study and learn."

Got any links on this? Is this available to the normal small guy or small business?

:)

On the effectiveness of fiscal stimulus

[TheSync]

To date, the only effective government mechanism to help the economy in a time of recession has been monetary policy (such as FDR's devaluation or Paul Volker's fight against stagflation).

There is no evidence that fiscal spending stimulus has ever been effective in helping the economy.

Christina Romer, Obama's pick to chair the Council for Economic Advisors, has done research that shows that tax cuts can provide some short-term help to the economy.

So for short-term help to reduce joblessness, I suggest lowering taxes on jobs, the payroll tax. This could be paid for with an offsetting carbon tax. By keeping the tax cuts general and not targeted, it would allow the economy to properly shift jobs and resources to where they are actually needed for economic growth instead of where lobbyists think they should go.

I think it is important that we stick to evidence-based economics rather than what "feels good", otherwise we will end up with the economic equivalent of creationism.

Re:On the effectiveness of fiscal stimulus

[amabbi]

So for short-term help to reduce joblessness, I suggest lowering taxes on jobs, the payroll tax. This could be paid for with an offsetting carbon tax.

Right. Your plan would have the ultimate result that the few of us that have jobs left would pay less taxes. Brilliant.

Look, I know that there's a strong anti-business sentiment, probably deserved. But you're not going to fix it by raising taxes on businesses and then assuming that giving those savings to someone else is going to make anything better. A recession is NOT the time bump up the tax rate, despite what NYC mayor Bloomberg thinks.

market_forces == regulations

[TapeCutter]

"Assuming that market forces are going to work all the time is what got us into the current meltdown of both the economy as well as the internet hardware."

Exactly, market forces are defined as "the interaction between supply and demand". That interaction at it's most basic level is provided by "property rights" (ie: market_forces == regulation). The word "free" in the term "free market" does not mean free of regulation since that would translate to "regulation free regulation" which is either anarchy or a tautology. I'm not sure which but it's obviously not an answer that can sustain a civilization.

The opportunity for personal wealth is only part of the equation, but for some people the existing "market forces" that provided that wealth are the answer to everything, unsurprisingly a large proportion of people who think ths way are rich and/or powerfull. I'm not saying that I have the answer just that the tradgedy of the commons and the fact that average income is always much higher than median income tells me "trickle down economics" has always been a miserable failure. If we don't want our grandkids to become goat hearders we have to at least somehow include "the commons" in the economy. To do that we need a system a tad more elaborate than the simplistic dog eat dog regulations typically expoused by over zealous libertarians.

"Free to participate": short of becoming a self-sufficient hermit living undetected in some forgotten wilderness you are forced to participate in the prevailing system. A few generations ago that was still a practical option but there are now so many of us that the entire biosphere is forced to participate in our system.

Re:Look CEOs

[Anonymous Coward]

One of the biggest economies in the world, and we can't even get fiber here. Amazing.

You are looking at it from the wrong end, ... not from the "Great" end. Great profits are sign of great economy, and great profits come from, well, caching on the product/service more then they're worth. In short, bluntly, great economies arise from availability of wast supply of suckers.

If banker bailouts are any indication ...

[Anonymous Coward]

They'll probably just use it to buy of the riaa or their other friends, er lobbyists

No data?

[Blairius]

What data are they looking for? Most of the broadband data can be found easily on the annual reports of the publicly traded ISPs. The actual customer counts have always been something ISPs have publicly bragged about. It seems like there are several sources for the data if they want to look for it. Internet usage is prone to fashion and trends so any spending should just be based on dumb fast reliable pipes to as many people as possible.