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Posted on 01/03/2005 1:43:19 PM PST by FreeMarket1

CBS’ BIG DAY - DAWN OF INTERNET REGS?

Many thought taxation would be used to suppress the Internet; however another threat is government regulation backed by big media and political agendas. By Chris Mack, FMNN Technology and New Media Correspondent

FreeMarketNews.Com, Jan. 3, 2005 - One of America’s most treasured rights is that of free speech including liberty of the press. Yet regulatory threats to the Internet – which have received little or no coverage in the mainstream media - are serious, credible and even imminent.

Recently, US Reps. David Price (D-NC) and Mike Castle (R-DE) introduced bill H. R. 4985 Stand By Your Internet Ad Act of 2004 that would force all audio and video activity on the Internet to be regulated by the Federal Election Commission (FEC) as other mass media is.

Representative Price has a formidable funding machine backing him. The University of North Carolina, GlaxoSmithKline, Intl Brotherhood of Electrical Workers, NCSU, and the Association of Trial Lawyers of America all donated to Price in order to sponsor HR 4985, according to OpenSecrets.org.

Price’s backers are apparently not satisfied with the federal rationale for FEC Internet regulation that has existed since the 1990s. The Center for Technology and Democracy (CTD) explains: “The FEC has found that an individual may have to report to the government in order to create a Web page expressing support for a candidate, that hyperlinks may constitute political contributions, and that providing free Web sites to all candidates is a prohibited corporate contribution.”

As long ago as 1998, the FEC ruled that if Internet users were affiliated with campaigns as “volunteers,” then they would not be required to file with the FEC because volunteers are excluded from FEC regulation. However, if Internet users post political material by themselves with no affiliation, then they are not considered volunteers and are obligated to file with the FEC if their total cost to post their material on the Internet is more than $250 including the costs for maintaining a website.

THE FCC TOO

The Federal Communications Commission (FCC) is another government agency concerned with the unregulated status of the ‘Net. According to “The Internet's biggest foe” by Lawrence Spiwak, “FCC Chairman Michael Powell has done everything in his power to restrict American citizens' choice of information and entertainment.”

The Telecommunications Act of 1996 opened the door for free market competition saving both consumers and businesses billions of dollars, however Powell fought to dismantle the Act and impose new regulation. This led to a number of telecommunications companies such as AT&T to abandon the marketplace.

As Spiwak further explains, Powell’s path of destruction is now moving into the competitive telephone industry and “is going to wipe out the act's market-opening provisions - in many cases within six months.”

Powell has publicly promised to help small business grow; yet his actions have curtailed small business and have cost a countless number of jobs. For example his rules for high-capacity lines are cost prohibitive for any small business to provide.

Regulation is sold to the public for the benefit of the general public, however the real use of FCC regulation has been to “let the Bells dictate whatever terms they want and kill their competition.”

Even more worrisome is that the use of FCC regulation has started to spread into the Internet. For example SBC recently attempted to charge 4 cents a minute in order to terminate VoIP (Internet phone) calls, which is even higher than current long distance rates.

CBS’ BIG DAY

The coverage above has delineated governmental efforts to regulate the Internet. But on December 8, 2004, those efforts received support from a surprising quarter. A leading reporter for one of America’s most prestigious and powerful media conglomerates published an article that seemingly argued for Draconian regulation of the Internet.

David Paul Kuhn, CBSNews.com chief political writer wrote a story that began: “Internet blogs are providing a new and unregulated medium for politically motivated attacks …” and then provided even stronger commentary such as: “Like all media, blogs hold the potential for abuse. Experts point out that blogs' unregulated status makes them particularly attractive outlets for political attack.”

The proximate cause of Kuhn’s bellwether editorial was, of courses, the “outing” of newscaster Dan Rather by Internet bloggers who established quickly that he had used forged documents to try to smear President George Bush as a draft dodger. But what is apparently upsetting Kuhn and his bosses is the idea that the Rather flap is not an isolated incident but the beginning of a genuine power shift.

The real power shift is from mass media to new media and the real motivation of Kuhn’s statements is to stir up support for defining content one way for “responsible media” like CBS and another way for the Internet.

Content (considered to be news by virtue of its dissemination via mass media) is exempt from FEC regulation according to Federal Election Campaign Act of 1971 (2 U.S.C. 431(9)(B)). Thus the intent of CBS is obviously to regulate and suppress Internet communication, while holding their own news content immune from the same government regulation.

UNCONSTITUTIONAL? …

The 1st Amendment of the Constitution states “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

Simple enough? Yet through a gifted judiciary’s ability to spot assorted convenient “penumbras” of meaning surrounding otherwise clear statements, the United States has fairly recently been blessed with not one but three different kinds of speech: a superior, free – or “protected” speech and two increasingly inferior kinds of speech, commercial and political.

The idea that the founding fathers intended for government to separate “free speech” from “political speech” and “commercial speech” is seemingly absurd. Yet that is just what occurred in the 20th century – and CBS and its allies apparently hope to encourage this trend in the 21st century.

There are some positive portents as well as negative ones. The Internet Freedom Protection Act (S. 1747) was introduced by Sen. Bob Bennett (R-UT) in 1999 to protect the Internet by making exempt "any communication or dissemination of material through the Internet (including electronic mail, chat rooms, and message boards) by any individual" as long as it not associated with payment such as an advertisement, and doesn’t solicit payment. The bill is still pending, though no action has been taken.

Support for leaving the Internet alone has also come from the Supreme Court of all places. In Reno vs ACLU the Supreme Court seemed to discourage overambitious regulation of the Internet. The court ruled the Internet is a unique form of communication distinctly different than mass media (tv, radio, print) calling it a “never-ending world-wide conversation.” The justices also recognized that its low cost of entry and two-way interaction is unlike mass media.

A little thing like a Supreme Court ruling won’t stop an alphabet soup of regulators from trying to inoculate the American public against the viral ideologies and wrong thinking increasingly present on the Internet. And it is perfectly possible that freedom on the Internet – as it exists in the West, anyway - will be nibbled away by precedent, regulation and cynically-manipulated public outrage, on both sides of the Atlantic. Yet the Internet’s best protection against all this is technological innovation that makes regulation increasingly hard to write and impose.

It took Gutenberg’s Press 100 years to blow up the interlocking power nexuses of the Middle Ages. But once the bible could be read by more than a privileged few, it was only a matter of time. Luther nailed up his condemnations and the Church shook. Royal families throughout Europe were suddenly seen as suspect and the fiction ................. For the full article visit us @ www.FreeMarketNews.com

FMNN's Technology and New Media Correspondent, Chris Mack received a degree in economics and artificial intelligence at Carnegie Mellon University, and then worked as a software engineer and consultant to a number of different organizations ranging from startup companies to large corporations such as IBM and Lockheed Martin. Early in his career, Chris worked with Nobel laureate Herbert Simon, helping create artificial neural networks to predict time series of stock market patterns. Today, he looks for patterns and emergent properties to aid in the understanding of economics, human behavior and technology.

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