The Truth About Net Neutrality Job Loss

snydeq writes "Robert X. Cringely investigates recent claims that passing net neutrality regulations will result in nearly 1.5 million lost jobs by 2020, finding the report at the center of these claims suspect. The report, put forward by The Brattle Group, conjectures that net neutrality adoption would curtail broadband growth by 16 percent, costing 342,065 jobs in that sector alone. The 'total economy-wide impact,' however, of such a policy would result in five times as many job losses by 2020, they say. The study is the latest of several weighing the economic impact of net neutrality, including those by law schools (PDF) and free-market think tanks alike. The Brattle Group report (PDF), however, should be met with skepticism, Cringely argues, in large part because the lobbying firm who paid for the report, Mobile Future, is anchored most notably by AT&T. Moreover, the report is 'based entirely on a single assumption: Regulating US telecoms in the late 1990s and early 2000s hurt them to the tune of about 15 percent per quarter, relative to the cable companies.' Yet, as he points out, regulation was not alone in causing this sector shrinkage. In fact, the Baby Bells' own bureaucratic intransigence was much to blame."

Comments

How can maintaining the status quo cause job loss?

[Com2Kid]

So how exactly would passing a law that basically codifies current practices cause job loss?

I have yet to hear of any ISP charging Youtube extortion money. My files are still downloading at 2MB/s. Net neutrality legislation would just prevent future abuses by ISPs.

Outlawing all forms of traffic shaping technology, sure, I can see how that might cause a hit to ISP's profits, but the majority of proposed net neutrality legislation allows for some traffic shaping, it just prevents "pay up or else we'll make sure no one can access your website" levels of manipulation.

Are they really making a point?

[Dalzhim]

People learning more than one language in school cause job loss in the translating field. People learning how to cook cause job loss in restaurants. Free trade costs a lot of jobs at the customs. I mean, I can create a shitload amount of jobs by having people work on many stupid things. It doesn't make those things worth working on.

Re:How can maintaining the status quo cause job lo

[CyprusBlue113]

It costs them jobs the same way minimum wage, hours regulations, vacation time, health insurance, OSHA, and all of the other restrictions on whatever the hell you want to do business do. Just because its true doesn't mean its the right answer.

a simple idea

[phantomfive]

Maybe they can take those people and switch them away from throttling people's bandwidth, and put them on the job of installing new fiber. It's a win-win situation. No jobs are lost, fiber is installed. Unless somehow these people aren't actually going to lose their jobs......

Re:How can maintaining the status quo cause job lo

[NeutronCowboy]

So how exactly would passing a law that basically codifies current practices cause job loss?

Not to mention that it isn't even job loss that they're talking about. They're merely speculating that growth will be 15% less than without regulation - and somehow, that translates into 300000 jobs that will not be created.

Can we please, please stop talking about not getting what you think you should get as being the same as a loss or theft? Because if we're going to go down that route, I'm gonna argue that a lack of net neutrality regulation will cost me 2.74 gazillion dollars, and sue the Federal Government for that amount.

Then again, we're talking about lobbyists here. If the money is right, they'll argue that cigarette smoke freshens your breath and turns babies into geniuses.

Re:How can maintaining the status quo cause job lo

[PopeRatzo]

It costs them jobs the same way minimum wage, hours regulations, vacation time, health insurance, OSHA, and all of the other restrictions on whatever the hell you want to do business do.

So in other words, it does not cost jobs.

Remember, all those laws and benefits were in effect during a time when we had 4% unemployment (aka "full employment").

Minimum wage does not cost jobs. Vacation time, benefits, OSHA, etc do NOT cost jobs. In fact, after OSHA went into effect, total employment in the US went up for decades. Vacation time and health insurance started showing up in benefits packages after the big war, and the most prosperous decades for the US and for the middle and working-classes generally were yet to come.

Maybe it sounds "truthy" to you to say those things, CyprusBlue113, but that doesn't make it so.

Re:How can maintaining the status quo cause job lo

[zifferent]

May cost actually jobs but ends in a net increase of jobs.

Follow along, you might learn something.

Thought experiment:
Assume that we got rid of min wage, and according to your argument instead of hiring one person at min wage the business could get away at hiring 2 people at half minimum wage (it would never happen in the real world. ITRW a business would just cut wages and keep the employment the same; keeping the resultant increase in efficiency for themselves but whatever) Those two people would be earning much less and could only realistically afford to live in shanty-towns with barely enough money left over to feed themselves, much less add any utility to the greater economy. Hence, the money doesn't move around the economy. Hence, no multiplier; no extra goods bought and sold and importantly no jobs created upstream of the way-less-than-poverty wages.

It might even be argued that wages below a certain level have a negative utility to the economy. The externalities not picked up by the slave-wage employer are passed on to society as a whole contribute to a net-loss of real jobs. Obviously this kind of thing can snowball and pick off previously higher paid jobs as it goes, pushing wages further down as unemployment rises. Creating a real world with haves and have-nots without a buffering middle-class.

Keep believing that the free market fairy will come and magically make things right; leaving goodies under your pillow as you sleep.

Re:How can maintaining the status quo cause job lo

[PopeRatzo]

Thought experiment:

Well said, friend.

I only wish I could have made the point so clearly and convincingly.

Conservatives just don't want to admit that the years of greatest growth and economic strength across class lines occurred in the US after some of the strictest regulations, most socialistic programs, and widest influence of organized labor were in effect. Social safety nets, strong regulation, public works and collective bargaining make for a better, more equitable society, but they also make for a more dynamic and successful private sector.

Re:How can maintaining the status quo cause job lo

[Daniel Dvorkin]

I'll type this on my computer that goes through the internet, then i'll leave work, drive in my car, to my apartment, eat some nice food, ect ect. Why? because of the market. Not because of some stupid belief that we can regulate success and a better life.

Oh, this is fun! Let's take this piece by piece:

my computer

... based on technologies developed for government contracts ...

that goes through the internet

... that used be called ARPAnet ...

then i'll leave work

... at a company that relies on the courts to enforce its contracts ...

drive in my car

... in a car that probably won't kill you because of DOT safety regulations, on roads built with public funds ...

to my apartment

... that would be an unsafe rat-trap if not for housing regulations, and where you have a reasonable assurance that you'll be able to continue living because the government won't let your landlord throw you out on the street any time he feels like it ...

eat some nice food

... that's been certified by the FDA ...

ect ect.

... well, okay, clearly there are some failings in your education, but that's probably your fault, not the fault of the underpaid and overworked public school teachers who tried to drum some knowledge into your thick skull. The rest of it, you enjoy courtesy of your local, state, and federal government whether you are capable of understanding this or not.

Re:How can maintaining the status quo cause job lo

[NeutronCowboy]

The fact that no one would return to a grocery story that consistently served spoiled food, keeps that from happening. The fact that no one wants to live in a horrible apartment, keeps the apartments nice.

Unless, of course, you were working at Walmart in Mexico prior to 2008, or in mining and logging towns in the 19th century. You might want to look up the concepts of company towns and scrip.

Obviously, I bow down to your superior intellect.

I don't know about your intellect, but your knowledge seems to be a bit lacking.