As a consumer attorney, my job is to look out for the rights of consumers. The First Amendment is no more, or no less important than the Second Amendment, for example. The internet was already bought and paid for by the American people. The government does NOTHING to make it better. NOTHING. There are no road crews on the information superhighway, there are no potholes that need fixing, no public employee unions going on strike, nor are there lawsuits for dangerous conditions on public property, and there are even stronger protections for third party platforms that republish slander against someone.
There has been a delicate involvement by government to protect the net, not by taxing it, but by keeping suits to a minimum, preventing huge monopolies from over-capitalizing upon it. A huge reason that the net has grown, is precisely because we the people have decided its fate and not some academic in Washington DC. It is for all intents and purposes the equivalent of the pristine old west, “a home where the buffalo roam.” Now this is being threatened in a devastating way by the very progressives and so called conservative politicians, both of whom receive large sums of money from Cable TV lobbying interests.
The purpose of this article is not to be political, but simply explain the history and hypocrisy that has occurred here. Many of us will recall that president Obama appointed an anti Net Neutrality FCC head, and since then, we have been seeing incessant attacks by the government against the internet, to start taxing and controlling our information online. Although the president says he disagrees with corporatizing the web, his FCC chair, a former cable TV lobbyist, who lobbied the Obama admin, is moving full steam ahead to do just that, by placing the internet under an archaic law from the 1900’s, that in effect, allows the net to be controlled by partisan politicians in Washington DC.
I discussed the FCC head Thomas Wheeler long ago, and encouraged all of you to oppose the FCC’s efforts to end Net Neutrality. But irrespective of what the majority of the people wanted – keeping the internet free – approximately 90 percent of American’s could see a rise in taxes for Internet service. The Federal Communications Commission is debating a decision that could see the price increase, since the agency would like to make Internet service a public utility.
If Internet service becomes a public utility we would see taxes and fees on a government, state and local level. The FCC would like to place broadband Internet service under Title II of the regulation of the Communications Act of 1934. Doing this would have significant consequences for taxpayers along with the reclassification of broadband that would allow new state and local taxes and fees applied to the public utility.
According to the according to the Progressive Policy Institute (PPI), the new tax levies would be about $15 billion dollars making the cost for the average consumer approximately $67 more for landline broadband and about $72 dollars more for mobile broadband annually. This can be seen in the PPI’s calculations and with the fact that charges will vary from state to state. The Progressive Policy Institute has also found reason to believe the proponents of broadband reclassification including Free Press who claim taxes and fees will not be higher is incorrect.
The proponents believe if the FCC determines broadband can be an interstate service it will prevent the extra cost. PPI explains that when the “jurisdiction” of Internet traffic has been debated that this traffic was “largely interstate”, however “jurisdictionally mixed.” Jurisdictionally mixed services are generally taxed by states, such as wireless services, which might not be regulated by state public utility commissions, but are subject to state and local taxes and fees.
President Barack Obama commented on Internet services last year stating it should be treated as a public utility. Critic’s of this change in classification claim it would reduce the investment in infrastructure resulting in inferior service for consumers. They stated that reclassifying broadband service as a telecommunications service would restrict the Internet and hold back innovation.
Since 1996 the telecommunication industry has invested over $1.2 trillion dollars on infrastructure for broadband providing about 87 percent of U.S. consumers to have broadband access to the Internet. Critics note that changing this would discourage the investment required to maintain, improve or expand broadband infrastructure, since it would be regulated by a 1930’s Act and it would penalize consumers using the Web.
The change in regulation would be bad for the economy critics claim, since it would burden individuals, families and employers disposable income. Former John Locke Foundation president John Hood explains by keeping the state and local tax and regulatory fees low promotes economic growth. Hood analyzed this topic with 681 peer reviewed academic journal articles beginning in 1990. He found the lower level of taxes the stronger the economy.
William McBride a Tax Foundation economist studied academic literature for the past three decades and found consistent data to show negative effects of taxes and economy growth even with controlling other factors including government spending and business conditions. McBride’s reviewed 26 studies that dated back to 1983 and found negative effects on growth due to the effect of taxes with the exception of three over the past 15 years.
During the past six years during the Obama Administration there have been over 20 tax increases signed into law (Source.) The Federal Trade Commission expects to make their decision on Internet regulation within the coming months that could result in American consumers paying more in taxes and fees.
Of course, once they have their foot in the door with these internet taxes, you had better believe there will be all kinds of new “thought taxes,” and penalties. Just watch. Mark my words. Keep the internet free. Your party will not always be in power. Hands off the internet. No taxing it.
At the end of the day, it must be understood that it is large corporations that benefit, along with those politicians who are in their pockets. We all talk about how we should not let big money run elected officials. But getting cable companies and the government in bed together simply hurts us all. This is precisely the type of government our founders warned us about.
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