Government subsidies give government officials a license to order the recipients around:
- Spend on this.
- Merge with that.
- Get rid of this CEO.
You take our money, you take our orders. Strings definitely attached.
But there are other kinds of bullying, often more subtle than formally enacted laws and regulations applied to otherwise independent firms.
Some government goons toss their weight around in the private sector entirely outside any legislative or regulatory process. How? By “conversing” with private firms about how they conduct business.
Recently we witnessed Senator Chuck Schumer chatting with Time Warner Cable about its test of broadband metering in Rochester, New York. The cable company’s notion was to price different levels of service. Customers using huge amounts of bandwidth were charged extra for that extra usage.
In normal markets, buyers constantly communicate happiness or unhappiness with what sellers are selling, both verbally and through buying patterns. No politician had to chat with Coca Cola to convince it to bring back “Coca Cola Classic.”
But politicians like scoring political points. And companies subject to such persuasive efforts know that more than persuasion is involved. There’s also the threat of force if the company doesn’t knuckle under to the politician. So Time Warner dropped its price-tier trial.
And we’re all just a little less free today than we were yesterday.
This is Common Sense. I’m Paul Jacob.
6 replies on “Schumer Should Shut It”
Politicians like to find ways to look busy and have things to point at and say see what I did! This justifies their perceived presence as full time legislators whether it is at the state or federal level of government.
Thanks for subscribing me again. I go to Italy every summer because my wife inherited a farm in Italy and the local gov’t is communist-socialist. My wife applied for farmer’s benefits and was told she is too old to join. Then she wanted to sell her grapes and had to join a vinyard coop. They came over to inspect and told my wife she couldn’t join because the rows were too far apart. We have been experiencing socialism for years. You have no idea what the US will be going through. We could write a book – a tragic comedy.
As bad of a senator as this clown has been, he has no business playing as if he knows the first thing about “broadband. The only place he is an expert is at “flatlining”, which has what he has helped do to our country.
Normally I agree with your argumenets, but not this time. Time Warner isn’t an independent company striving to compete in the free market. Time Warner has local monopolies in nearly every city it’s based in. If the customers in Rochester don’t like Time Warner’s new pricing scheme, they don’t have the option to change cable internet companies.
Time Warner’s “huge amounts of bandwidth” were five gigabytes per month. That’s just one high definition movie download. It’s just six CDs of music. It’s just 20-40 hours of YouTube videos. Time Warner says that the “average” user is under 5 GB per month, but that’s because of a big subset who use e-mail but rarely surf the net. The typical user is in the 5-10 GB range and would fall into Time Warner’s more expensive pricing scheme. The real killer was overage gigabites: TW wants to assess big fees if you exceed your limit. The higher fees were not based on actual costs for the higher usage. In fact, the higher usage costs almost nothing. That’s why there were strong objections to this plan (that recently was tried in Texas).
You write “You take our money, you take our orders.” That concept should be applied to Sen. Schumer and the other Senators and Congressmen as well. They each take our money, but they rarely take our orders. I support a two-pronged approach to solving this problem: (1) raise the pay of members of Congress to a level where anyone could afford to serve (maybe $750,000 per year) and (2) limit the terms of all of them: four for Representatives and two for Senators.
To Dr. T…..there are no monopolies. You can go to phone, satellite or cable for these services. There are at least two choices in the vast majority of all communities. We are in an isolated Sierra Nevada town and at this time have three choices: SBC (phone), any of the satellite services, and a land-based hi speed from a company named Digital Path. You do not like one service here, and we are isolated and small, you can go elsewhere.