Articles by James Gattuso 
James Gattuso is a Senior Research Fellow in Regulatory Policy in the Roe Institute for Economic Policy Studies at The Heritage Foundation. Gattuso also leads the Enterprise and Free Markets Initiative at Heritage, with responsiblity for a range of regulatory and market issues. Prior to joining Heritage, he served as Vice President for Policy at the Competitive Enterprise Institute and also as Vice President for Policy Development with Citizens for a Sound Economy (CSE). From 1990 to 1993, he was Deputy Chief of the Office of Plans and Policy at the Federal Communications Commission. From May 1991 to June 1992, he was detailed from the FCC to the office of Vice President Dan Quayle, where he served as Associate Director of the President's Council on Competitiveness. He lives in Alexandria, Virginia with his wife Dana, 8 year-old son, Peter (whom he relies upon to operate his VCR), and his four year-old daughter Lindsey (who does the DVD player.) He has no known hobbies, but is not nearly as boring as he seems.
The timing was eerily reminiscent of the SBC-AT&T merger announcement two weeks ago. A weekend of speculation and negotiation, followed by an early morning announcement of the merger. This time, the happy couple was Verizon and MCI, with MCI being purchased for $6.7 billion. Its still early to gauge the reaction, but so far the news has been met with a loud yawn. The stock markets barely moved, and the political reaction has so far been muted. That’s for good reason–although the merger looks to be a good one for consumers, as well as the firms involved, it really just confirms changes long underway in telecom, rather than setting any radically new direction.
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Is there an “e-waste” crisis? WIth tens of millions of PCs becoming obsolete each year, there’s been a lot of hand-wringing about where they (and other obsolete electronics) are going to end up. Under pressure from environmental groups, policymakers from Europe to California have passed (or are considering) laws to solve the supposed problem: ranging from consumer recycling fees, to “green design” mandates, to “extended producer liabiity” laws requiring manufacturers to collect and recycle their used equipment.
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FoxSports.com reports today that the FCC has once again received complaints about the Super Bowl. This time the complaints were about boredom. Seems some people were pretty disappointed with Paul McCartney (formerly of “Wings” and another band), compared to the excitement of Janet Jackson last year.
Of course, Fox goes on to disclose that only two such complaints were actually received. So it’s less than representative of the country as a whole. But then again, the same might be said for the thousands of FCC complaints ginned up by the Parent’s Television Council last year. Getting censorship right just isn’t as easy as it seems.
The Internet’s absence from the President’s State of the Union address, noted here yesterday, didn’t escape our friends at the Progress and Freedom Foundation either. In comments yesterday, PFFer Kyle Dixon mused hopefully that “the speech did not quite vow to continue such policies as the FCC’s efforts to promote investment and innovation in digital technologies by minimizing regulation. But it did not rule out those policies either.”
It’s only February, but Kyle gets my vote already for “Glass Half Full Statement of the Year.”
Actually, Kyle makes some good points, even if he himself admits he is stretching far for good news. See his full piece here.
Did anyone else notice that the Internet didn’t come up at all in the President’s State of the Union speech last night? Not a mention. Nada. Of course, you can’t mention everything in one speech. Presidents that have tried to do so end with speeches that are forgettable political laundry lists. Still, I would have hoped that somewhere the President could have mentioned the technology that is changing our lives, and his policies toward it.
Making things worse, Dem Senate leader Harry Reid did mention the Internet in his response–but only to give the government credit for “creating” it in the ’70s.
President Bush, of course, will have plenty of other opportunities in the coming months to show that he recognizes the critical role of Internet policy, starting with the selection of a new FCC chairman. Its not Iraq, but nonetheless an area where some bold thinking would help.
Forget paying for Iraq. Apparently, Congress is still worried about paying for that pesky Spanish-American War in 1898. In a report released last week, the congressional Joint Committee on Taxation suggested that the current three percent federal excise tax on telecommunications–originally imposed as a way of paying for the Spanish-American War–be expanded to all communications services to end user, including Internet access, VOIP services, and the telecom portion of cable and satellite telephone service.
The JCT proposal is, thankfully, only an “option” for taxation listed among many other options, and doesn’t necessarily mean Congress is going for the idea. Still, its telling that repealing this senseless tax was not listed as an option. Seems we need to keep an eye on this “anti-tax” Congress.
It’s official. After a week or so of speculation, SBC Communications announced that it is buying AT&T. The deal that Clinton FCC Chairman Reed Hundt once called “unthinkable” is now–pending regulatory approval–a reality.
The acquisition is a bit of a family reunion–SBC is, after all, one of the “baby bells” spun off by AT&T twenty years ago. A “Mother and Child” reunion, according to a Philadelphia Inquirer story last week. But does the deal signal a return to the old days of Ma Bell? Is the old Bell system family being revived?
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“Bush says he doesn’t favor censorship, but does think government should set limits.”
From an interview on C-Span, reported today on WALB.com
To his credit, Bush did stress that the first line of defense for children is parents, saying “They put an off button on the TV for a reason.” An important point. Parental limits are the best way to control what children see. Government limits are, er, well, censorship.
Heritage is hosting an event this Friday featuring bloggers from RatherBiased, PowerlineBlog and WizbangBlog, and hosted by Heritage’s Mark Tapscott. The subject: “Dan Rather is Retiring: Is the Blogosphere the New Media Establishment? Should be fun. If you are in DC, come on by. If you aren’t in DC, we applaud your common sense. And you can virtually attend here.
After four tumultuous years as chairman of the FCC, Michael Powell today announced his resignation, effective at the end of this month. To the general public, Powell was known–if at all–for his fights against Howard Stern, wardrobe malfunctions, and other forms of profanity on the web. But Powell’s–and the FCC’s–far more important work was in the far more boring–but economically critical–area of telecommunications regulation. Powell was–as Adam Thierer of Cato put it–as “the regulator who loved markets.” A fan of Hayek, Powell fought top reduce obsolete regulation of telephone markets, and to keep new regulations from being imposed on emerging telecom technologies. As a result, these markets are certainly freer–and Americans better off–than they would have been otherwise.
Nevertheless, Powell leaves with many of his efforts incomplete. Reform of forced sharing rules for telephone companies as yet leaves many of these senseless regulations in effect, and mired in litigation. And despite good first steps toward protecting Internet telephony from regulation, the final status of this revolutionary new service remains in doubt. Many blame Powell’s unusual (some say eccentric) personal style for impeding reform. Recalcitrant fellow commissioners certainly didn’t help. Nor did a White House that was often unhelpful on key telecom reform issues.
The key question now is who will replace Powell. One leading contender is current Commissioner Kevin Martin. Until recently, Martin was seen as a strong supporter of deregulation. But, in a critical 2003 battle over telecom rules, he broke ranks with Powell, and teamed with the FCC’s two Democrats to pass a significantly more regulatory set of rules. For Martin to be rewarded now with the chairmanship would raise more than a few questions.
Fortunately, there are a number of other candidates who could effectively take over the reform banner at the FCC. Among these: Peter Pitsch–Intel’s man for telecom policy in Washington, and a former chief of staff at the Reagan-era FCC. Combining a firm grasp of free-market principles with an intimate knowledge of how Washington works, Pitsch could be prove effective at leading reform. Similarly, Janice Obuchowski, who headed up telecom policy at the Commerce Department in the first Bush Administration would make an excellent choice. Another promising contender is Mike Gallagher, who is the current telecom head over at Commerce.
Historically, FCC selections have been a bit of an afterthought for presidents, sub-cabinet positions with little political consequence. For better or worse, that is no longer true: the FCC now sits front and center, regulating (or not regulating) key parts of the of the information economy. The selection will also say much about Bush’s attitude toward regulation as a whole during his second term. This is an opportunity that should not be squandered.
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.