A Libertarian Take on Net Neutrality

by STEPHAN KINSELLA on NOVEMBER 4, 2009

The cool, hip techno-pundits are usually reliably Obama-liberal/libertarian-lite types. A

bit California-smug, engineer-scientistic, anti-principled, anti-extreme. But okay
overall. A soft, tolerant, whitebread bunch.
On the last This Week in Tech, I was pleasantly surprised to hear the always interesting
Jason Calacanis voice support for nuclear power; and even more surprised to hear soft-
liberal host Leo Laporte echo mild agreement with this. Good for them!
But then they had to revert to form when they, along with Natali Del Conte and Patrick
Norton expressed unanimous disapproval of McCains Internet Freedom Act, since they
are allof coursein favor of net neutrality rules imposed by the FCC. McCains
proposed statute would block the FCCs proposed net neutrality rules, which would
forbid network providers (e.g. cable companies, telcos, and wireless carriers) from
selectively blocking certain types of Internet use.
Got that? The techno-pundits are against regulation (by cable companies) so they
favor regulation (by the FCC) of the cable companies so they oppose government
legislation regulating a government agency. They sit there fuming about how disgusting
McCains draft legislation is. So they see that the state is terrible. Yet it doesnt occur to
them that it might be a bad idea to trust the government to oversee the Internet. They
are against regulation of the Internet, so they support ceding power to the government
to decide how and whether the Internet should be regulated. It doesnt occur to them
that we should simply favor property rights, individual freedom, and the free market.
The closest any of them come to this position is John Dvorak, who has a libertarian and
contrarian streak, and who often observes on TWIT that theres nothing wrong with
tiered pricingcharging more for a fatter pipe, etc.

Is no regulation of network providers the libertarian position? It clearly would be if

the network providers were purely private. In the libertarian view private property
owners determine how their property may be used. There is no right to access the
Internet. A private network provider ought to be able to offer service on whatever terms
he wants; and consumers to accept or reject it. Tiered services, deep packet inspection,
prohibition of certain types of uses or even certain types of contentthats up to the
providers and customers and whatever deal they agree to. We libertarians believe in
capitalist acts between consenting adults, to use Nozicks phrase (see
Rothbards earlier formulation).
But because of various degrees of corporatismstate favors and protectionism, tax
funding of infrastructure, etc.the service providers are arguably not 100% private. But
the solution is not to regard them as essentially part of the state and thus fair game for
regulation, but to pair our call for no state regulation of the Internet (no net neutrality
regulations) with a call for the abolition of all forms of corporatism, such as various laws
that work out protecting larger companies (tax funded subsidies, IP law, wage and hour
legislation, mandatory worker benefits, labor union legislation, minimum wage,
incorporation statutes [note: this does not mean I think that limited liability is a
privilege conferred by the state on corporations], and so on).
This is my take, anyway. I am not aware of much informed libertarian analysis on the
net neutrality issue. Kevin Carson pointed me to Jim Lippard as one of the better
libertarian writers on net neutralityIll have to take a deeper look, but from a quick
glance Im not sure hes a libertarian; here he writes, e.g., providers shouldnt be able to
block access to competitors servicesshould be able? This seems to presuppose the
legitimacy of an overarching state regulation, which is certainly not libertarian.
Update: Leo Laporte must have gotten a lot of flak in the past week for supporting the
FCC imposing net neutrality rules on Internet network providers. In TWIT 220, he
expresses genuine concern with this. And he seems to get that the issue is not what rules
the FCC should imposewhich most of his technocratic guests in that episode focus on
but the issue of the danger of empowering the state itself to regulate at all. Most of the
panelists at least seem leery of state regulation, but are concerned there is not enough
competition in the network provider industry to ensure self-regulation. This concern is
understandable, but the pundits should pause to ask: what is the states role in causing
the industry to be the way it is? In addition to being leery of state regulation of the
Internet, they should oppose state policies that subsidize and prop up large companies
or reduce competition; one of them even brings up the issue of how utilities are given
monopoly status by municipalities. So they are almost there. It might help if we
libertarians could elaborate the various state regulations and laws that have given
current network providers more market power than they would have on a truly free
markettaxes, minimum wage laws, implicit and explicit subsidies, the legacy of
government-granted monopolies, pro-union legislation, and various other regulations
that disproportionately shackle and hamper smaller companies and potential
competitors; regulations that help the existing, larger companies by increasing barriers
to entry into that field; state taxes, IP laws, and regulations that stifle dynamic change,
innovation, and competition.
Laporte also mentions some kind of split on this issue among EFF board members. I
looked at the EFF site and cant find much explicit about net neutralityno categories,
etc. They seem to be trying to keep a low profile on this issue, maybe because they have
some pro-state-regulation board members. I did find this recent EFF article by Corynne
Mcsherry, Is Net Neutrality a FCC Trojan Horse?, which expresses the concern that if
the FCC just grabs ancillary jursidiction to impose net neutrality regulations, who
knows what other regulatory powers it might just unilaterally decide to assme the power
to impose regulations pursuant to an Internet Decency Statement. But though
McSherry here seems to display healthy skepticism of state regulation, she is obviously
trying to leave open the door that some state regulation of network providers might be
favored by EFF: e.g., McSherry writes, If ancillary jurisdiction is enough for net
neutrality regulations (something we might like) today, it could just as easily be
invoked tomorrow for any other Internet regulation that the FCC dreams up (including
things we wont like). Note the bolded language. And she notes that one possible
solution to the FCCs ancillary jurisdiction power grab is: Congress could limit the
FCCs power by authorizing to regulate only to ensure network neutrality.
The EFF, if it is to remain principled and a proponent of individual, Internet-related
freedoms and digital rights, must be clear on the enemy of such rights: the state. The
moment EFF supports any state agencys regulation of private companies or the
Internet, they have succumbed to their leftist confusions and statist sympathies and
become worthless as principled defenders of individual freedom.
[Mises blog cross-post; against monopoly cross-post]
Update: For more recent posts/discussion of these issues, see:
Net Neutrality Developments
Kinsella on This Week in Law discussing IP, Net Neutrality (KOL104)
KOL122 | Ed and Ethan Show: Net Neutrality, Aereo and copyright, Patents in
Texas
KOL064 | The Katherine Albrecht Radio Show, discussing Net Neutrality (Dec.
22, 2010)
Reply to Adam Thierer on Net Neutrality and IP
Harvards Yochai Benkler on Net Neutrality and Innovation