Trenching vs. Open Access Regulation

by on August 30, 2007 · 4 comments

I thought I’d continue the conversation Tim started a few days ago about utility trenching and libertarian property rights theory by starting a new post since this issue is quite interesting to me and I’d like to keep the conversation going.

In response to Tim’s essay I argued that: “Property rights are flexible at the margins… They have to be to ensure a well-functioning society,” and that… “Similar flexibility is necessary to ensure that various types of networks get built (sewage lines, sidewalks, gas and power lines, and even communications systems).” Thus, we allow occasional trenching in people’s yards to ensure that that happens.

In response, Tim says:

I’m having trouble seeing a principled difference between that and the “open access” regimes we libertarians criticized in the 1990s. The only difference I can see is that the open access regulations of the 1990s infringed on the property rights of the ILECs rather than the property rights of millions of homeowners. It’s not clear to me why one would be less objectionable than the other.

My response: There is a world of difference between a utility (or a city) digging up one’s yard, sidewalk, or street corner every once and awhile and the open access regimes of the 1990s and the present, which demand the full-time surrender / confiscation of private property to achieve the hubristic goals of economic central planners. The former (trenching) is a short-term inconvenience with significant long-term benefit. That latter (forced access regulation) gives rise to a massive regulatory regime that requires ongoing policy interventions and price controls. Forced access destroys the incentives to innovate and invest in new networks or network expansion. Trenching–and the momentary inconvenience is causes–does not. It allows for network expansion. Forced access regulation discourages it.

When we were both at Cato, Wayne Crews and I wrote an entire book about these issues entitled “What’s Yours Is Mine: Open Access and the Rise of Infrastructure Socialism.” We go into these issues in greater detail in that book.

  • http://www.techliberation.com/ Tim Lee

    Well put. The role of easements is an aspect I hadn’t fully considered before. To the extent that AT&T is exercising its pre-existing rights under a utility easement, that definitely seems like an important principled distinction. Sometime I want to read more on where those easements originated and who has control over them.

  • http://www.techliberation.com/ Tim Lee

    Well put. The role of easements is an aspect I hadn’t fully considered before. To the extent that AT&T; is exercising its pre-existing rights under a utility easement, that definitely seems like an important principled distinction. Sometime I want to read more on where those easements originated and who has control over them.

  • Tom Coseven

    Tim’s original question about the policy ramifications of using eminent domain for public or private gain is far more interesting than whether periodically trenching the first 5 feet of Adam’s lawn is more intrusive than telecom open access. The fact that a government can take or encumber property (albeit for compensation) without purchasing it in a competitive open market, carries with it a responsibility that they are acting in the public interest.

    This activity removes the moral argument (for example a telco’s “property rights”) against regulation of “utilities” that use ROW (including spectrum). Now it becomes a policy question, and public interest policy goals could vary over time and by community. Too often we hear the argument that utility regulation is only morally justified by lack of competition when in fact the argument should be framed in terms of economics, social benefit, security, etc…

    Put simply… what are a utility’s “private” property rights if it’s existence depends on eminent domain? Can we apply private property morality to a public property centext?

    Tim, I am not sure why your question of easements and their origin. Does it matter whether it was originally government land, or a developer “donated” it to the government, or a government captured it by force via eminent domain? Now if AT&T bought ALL their easements in the open market from the private landowners. Then I think they would have a strong moral argument for private property rights.

  • Tom Coseven

    Tim’s original question about the policy ramifications of using eminent domain for public or private gain is far more interesting than whether periodically trenching the first 5 feet of Adam’s lawn is more intrusive than telecom open access. The fact that a government can take or encumber property (albeit for compensation) without purchasing it in a competitive open market, carries with it a responsibility that they are acting in the public interest.

    This activity removes the moral argument (for example a telco’s “property rights”) against regulation of “utilities” that use ROW (including spectrum). Now it becomes a policy question, and public interest policy goals could vary over time and by community. Too often we hear the argument that utility regulation is only morally justified by lack of competition when in fact the argument should be framed in terms of economics, social benefit, security, etc…

    Put simply… what are a utility’s “private” property rights if it’s existence depends on eminent domain? Can we apply private property morality to a public property centext?

    Tim, I am not sure why your question of easements and their origin. Does it matter whether it was originally government land, or a developer “donated” it to the government, or a government captured it by force via eminent domain? Now if AT&T; bought ALL their easements in the open market from the private landowners. Then I think they would have a strong moral argument for private property rights.

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