This post has been updated. See the bottom of the post for details.

Senate Republicans should offer Senate Democrats a deal:

(1) Kavanaugh is rejected.
(2) Feinstein resigns or is expelled.
(3) Expedited hearing schedule for Kavanaugh’s replacement… or no hearings for a nominee who has been through Senate hearings during this Congress.

Kavanaugh was always my third choice for the Court, and I have serious concerns about some of his testimony Thursday. As far as I have read, nobody, not even in 1982 Virginia, ever defined “boofing” or “devil’s triangle” the way he did. Even a single lie under oath is disqualifying and impeachable, even if the question asked was inappropriate or irrelevant—something I have held since the Clinton impeachment.

Combine this with Kavanaugh’s record on the D.C. Circuit, where his reasoning was (in my opinion) just a bit too politically motivated, and with the damage his confirmation would do to the legitimacy of the Court and/or John Roberts’ willingness to be part of the conservative majority… and I just don’t think he belongs there. That’s before considering my serious doubts about his innocence. (It is implausible that he was never blackout drunk, as he maintains, and it would be awfully strange that Dr. Ford started telling her friends Kavanaugh assaulted her in 2013, when Obama was just starting his second term, simply to lay the groundwork to make a charge in 2018… but her charge remains unsubstantiated.)

My conservative friends are, of course, correct that Kavanaugh deserves the presumption of innocence. But the presumption can be rebutted by evidence, and I think there is sufficient evidence to draw at least a tentative conclusion that Kavanaugh deliberately deceived Congress, whether or not he committed the assault in question. To my conservative friends who still doubt this, see Nathan Robinson’s comprehensive (if overconfident) analysis in Current Affairs, “How We Know Kavanaugh Is Lying.” I think we can only say Kavanaugh is probably lying, but that should still be enough to end his nomination.

At the same time, Republicans are correct that we can’t legitimize the outrageous tactics the Democrats cynically used to derail this nomination. I don’t like Lindsay Graham (a devoted moderate and lover of the military-industrial complex), but his explosion at the Democrats was both justified and a sign of just how egregiously they’d crossed the line. If Republicans simply reject Kavanaugh without concessions, this will happen again. Democrats will uncover (or fabricate) some explosive charge which they’ll sit on during hearings then detonate just before the confirmation vote, doing maximum damage to the nominee, to the Courts, and to the Republic as a whole—all in an attempt to run out the clock on the lame duck session and protect their sacrament, abortion, from judicial review by judges who follow the Constitution. (Remember: they did the exact same thing with Clarence Thomas. Whatever you think about Anita Hill, the Democrats sat on her allegation until the last minute.) They have to pay a price, one that makes clear this will never happen again.

To my progressive friends who still doubt this, see Andrew Sullivan’s piece in NYMag, “Everyone Lost at the Kavanaugh-Ford Hearings.” (And if you don’t like Sullivan, progressive friends, bear in mind I just made all my conservative friends read Current Affairs a couple paragraphs ago.)

Feinstein’s a good sacrifice. She was at the center of this thing. The hearings revealed what she knew and when, and it was damning. She is highly culpable for what happened here, whether she acted out of malice or sheer incompetence. The Left is already ticked at her for her relatively conservative voting record. Her departure bears zero risk for Democrats, because California’s jungle primary system has locked Republicans out of the general election this November. Feinstein’s only opposition is a significantly more progressive candidate, who will win by default if Feinstein is knocked out. But her expulsion makes the Senate’s displeasure with her actions crystal-clear, and creates a cost that will hang over any senators who try shenanigans like this ever again. Expelling Feinstein is a win for the progressive Democrats that simultaneously allows the GOP to save face in withdrawing Kavanaugh.

The Democrats then must allow the Republican rejection of Kavanaugh to be equally risk-free. Thus, expedited hearings for the replacement. Democrats lose a Senator but keep her seat in the party (and actually get a better progressive out of it); Republicans lose a SCOTUS justice but keep his seat for conservatism (and possibly even a better conservative). In both cases, the guilty are punished and the legitimacy of both institutions is preserved, perhaps even reinforced.

The odds of this happening are basically zero. I can’t even think how you could start negotiating it in the current climate without immediate leaks undermining each side’s capacity to negotiate. But it seems to me like the only way forward anyone has suggested that gets us through this without wrecking the Supreme Court confirmation process forever. The process was abused here by Democrats to destroy the reputations and to some extent the lives of both Judge Kavanaugh and Dr. Ford. That abuse nevertheless exposed some issues with the Kavanaugh nomination that make him unsuitable for the Court. If everybody pays a price for that, we can get back to where we were six months ago. And I think what I’ve proposed allows everyone to de-escalate while saving face and not paying too painful a price.

Otherwise, barring some extraordinary discovery in the FBI investigation, political calculus on both sides will ensure Kavanaugh’s confirmation.

UPDATE: I hold people to a very high standard of truth when they testify under oath. I supported the impeachment and conviction of President Clinton for perjury. I supported the arrest and prosecution of James Clapper for the same crime. Lying is a grave crime against those lied to, one we do not take nearly seriously enough as a culture.

And so it was that I was willing to deny Judge Kavanaugh a seat on the Supreme Court in no small part on the basis of a few “small” lies about his yearbook quotes. Specifically, he claimed that “boofing” was a reference to flatulence and that “Devil’s Triangle” was a drinking game, whereas my own knowledge of those slang terms suggested darker meanings, and I could find no corroboration for Kavanaugh’s version. When the New York Times found classmates who claimed that, at Georgetown Prep in the 1980s, both terms had the darker meaning, I accepted their claim and decided Kavanaugh was probably lying about his yearbook. If he was lying under oath — even about this stupid ridiculous question that probably should never have been asked — then Kavanaugh could not be fit for the Court.

But, as it turned out, Kavanaugh was probably not lying about these things after all. Devil’s Triangle seems to have been a drinking game. Six classmates attested to that, under their own names, under penalty of law, in two separate letters to Congress. (The classmates the Times cited to attack Kavanaugh’s position were anonymous.) Precisely because I hold people to such a high standard of truth, I take witness testimony very seriously. (I also believe the sworn declarations by friends of Dr. Ford who said that she identified Kavanaugh as her attacker in 2012 and 2013.) But the Devil’s Triangle case was further boosted by a close analysis of the rest of the yearbook, which contained a number of indications that it referred to a drinking game and that the name was “founded” at the Prep — which all but rules out the possibility that it shared the same meaning as the general-use slang term.

As for boofing? At the time I wrote this article, I was aware of no corroboration of Kavanaugh’s claim that it had ever referred to flatulence in any context, anywhere. But, in fact, “boof” is listed as a synonym for flatulence in 2004’s The Art of the Fart, and the earliest article I could find using the term (from 1993) seems to support the claim — if “boofing” had a particular sound, it could hardly refer to anal injection of alcohol, as Kavanaugh’s detractors insisted… but it makes a great deal of sense if it refers to farts.

Did I expect to end up carefully litigating flatulence when this confirmation began? No. Is it pretty ridiculous? Yes. But it is important to vet the truth of what our judges say under oath… and I’m happy to say that, on this point, at least, Judge Kavanaugh has been seemingly vindicated.

Not all of my readers were tuned into judicial politics back in the days of Miguel Estrada and the Gang of 14, so let me explain that tweet a bit before I get to the exciting stuff.

Harriet Miers was George W. Bush’s original nominee to fill the seat of retiring Supreme Court justice Sandra Day O’Connor. Miers was the White House counsel and a close adviser to the President… a President who had recently won an election thanks to Catholic and evangelical “values voters.” Calling her “a pit bull in size 6 shoes,” President Bush vouched for her integrity, her legal chops, and her work ethic.

The problem was, Miers had a very thin record. She’d worked as a commercial litigator before becoming the personal lawyer of then-Governor Bush. She was an able lawyer for her clients, but there was no public record showing what she herself thought about the Constitution, the judicial branch, or the pressing issues of the day. President Bush believed that his personal assurances would suffice.

They did not. Republicans had been burned several times before. Sandra Day O’Connor, Anthony Kennedy, and David Souter had all been nominated by Republican presidents who gave assurances that the nominees would turn out to be excellent, judicially conservative judges.* Once on the Supreme Court, all three showed their true colors… and those colors did not have much to do with the Constitution.

All three supported (and, in fact, crafted) the plurality in Planned Parenthood v. Casey, which Michael Stokes Paulsen rightly called “the worst constitutional decision of all time.” Kennedy is famous for declaring same-sex marriage a constitutional right in Obergefell, a decision which, even if you agree with its conclusion, is totally incoherent both internally and in light of Kennedy’s own precedents (especially Casey!). O’Connor struck down a modest law against partial-birth abortion in 2000’s Stenberg v. Carhart and personally saved affirmative action from history’s dustbin in the bizarre Bollinger decision. And Souter simply joined the Court’s left wing outright, voting reliably with Justices Ginsburg, Breyer, and Stephens for most of his tenure.

So President Bush’s personal assurances did not reassure the thrice-burned right wing, especially the pro-lifers, however well-liked he was. Activists had trusted the words of Edwin Meese, John Sununu, and George H.W. Bush decades earlier, let nominees slip by with little paper trail, and so lost their chance at the Court for a generation. There was simply nothing out there to demonstrate Harriet Miers’ bona fides as a textualist who followed the Constitution. There was no way of knowing whether she would be another Scalia… or another Souter.

Conservative martyr Robert Bork called Miers’ nomination a “slap in the face” to the conservative legal movement. Unable to sell the nomination to the very demographic who had just re-elected him, Bush was forced to “allow” Miers to withdraw a few weeks after nominating her. The seat went to Samuel Alito instead.

Which brings us to Thomas Hardiman. Judge Hardiman sits today on the Third Circuit. He has shown up on President Trump’s Supreme Court shortlist twice in a row, losing out to Judge Gorsuch in 2017 and Judge Kavanaugh in 2018. He has faced some important issues in his time in the judiciary, and he has often acquitted himself as a textualist. His work on the Second Amendment is particularly well-regarded among conservatives. It is believed that he appeals to President Trump in part because of his phenomenal biography: Hardiman is one of too few federal judges who come from outside the Ivy League, with an undergraduate degree from Notre Dame and a J.D. from Georgetown, which he paid for by working nights as a taxi driver.

However, I have concerns about Judge Hardiman, as do some others. As with Ms. Miers, though I bear Judge Hardiman no ill will, I am not confident that Justice Hardiman would adhere to the Constitution on the issues that matter most. (P.S. As with everything in our utterly dishonest judicial politics, that’s code for “Roe v. Wade.”)

And, as you can see, I said as much on Twitter! So far, so regular Thursday. But my night was about to take a surprising turn.

A few minutes after my tweet, I got an email with no body but a heck of a FROM line:

(I’ve obscured the full email address because, while I’m sure it isn’t a state secret, Judge Hardiman’s professional email address is also not, as far as I know, public knowledge.)

I wrote back with my phone number, and, 90 seconds later, I got a call from the 412 area code. The man on the other end introduced himself as Thomas Hardiman, and said he wanted to touch base with me.

I am not a smart blogger, so I did not record the call. I did start writing this blog right away, so the call would be fresh in my memory, but this is still reconstructed from my scant notes, not verbatim. Please bear that in mind. Throughout our conversation, Hardiman was friendly, gracious, and respectful. If he was at all frustrated with me or what’s said about him, it didn’t come through in his tone or his words. While my account may read like Hardiman talking a lot and me listening, we had a good give-and-take. (It’s just that what I said isn’t really newsworthy, so I’ve omitted much of it.)

Judge Hardiman said he had seen my tweet and wanted to register his polite disagreement with my assessment of him. The idea that he is some kind of a David Souter, Hardiman said, has been in circulation in certain parts of the Right, and he doesn’t think it accurately reflects his record. In particular, Hardiman said that the Wall Street Journal had said some things that were not altogether fair to him… particularly once the Journal became enthusiastic about Judge Kavanaugh.

And, fair enough. Once it picks a side, the Journal certainly has been known to throw spitballs. I remembered a piece the Journal ran in July which was, indeed, quite critical of Judge Hardiman:

The biggest gamble would be if Mr. Trump went beyond those three to choose Thomas Hardiman of the Third Circuit Court of Appeals. Mr. Hardiman is said to be easier to confirm because he had a hardscrabble upbringing. But that’s the Souter trap of putting biography over a legal record. Our reading of Judge Hardiman’s opinions is that they are not as impressive or extensive as those of either Judges Kavanaugh or Kethledge.

I suspect that wasn’t their only piece promoting Kavanaugh or Gorsuch at Hardiman’s expense.

I chimed in, though, that there’s a lot of suspicion of Hardiman on the Right because he is strongly supported by Judge Maryanne Trump Barry. Judge Barry serves with Hardiman on the Third Circuit and (according to reports) personally pushed Hardiman’s name forward when President Trump was considering Justice Scalia’s replacement. This may have carried a lot of weight, because Judge Barry is President Trump’s older sister. Unfortunately, while a George W. Bush appointee, Judge Barry is widely reviled on the Right (or, at least, in my corner of it) because of an aggressively pro-abortion rights opinion she wrote in 2000, which not only struck down a New Jersey law against partial-birth abortion, but went beyond what the Supreme Court required in Stenberg v. Carhart and dripped, frankly, with contempt for the pro-life cause.

Now, I did hasten to add that, as Ed Whelan pointed out in 2017, Judge Barry’s very bad decision in Planned Parenthood v. Farmer and the very poor comportment of her little brother does not mean everyone Barry likes is terrible forever. After all, Barry was a big fan of Samuel Alito (her colleague who dissented in that case), and he’s turned out wonderfully. But, still… if she thinks Hardiman’s the right guy for the Supreme Court, with her very problematic views on at least abortion law, how much can those of us with different views feel confident that Hardiman’s our man?

Judge Hardiman answered that his relationship with Judge Barry, as well as the other judges on the Third Circuit, is a sign of his ability to build strong relationships with others, regardless of party or nationality or religion, and to win their respect despite frequent disagreements. Judge Barry respects him, and he likewise, but this doesn’t mean they’re of the same judicial mindset.

Hardiman called my particular attention to the case Busch v. Marple Newtown School District. Hardiman called his opinion in this case — gosh, I wish I’d written this down — but it was something like, “A dissent that really goes to the heart of who I am as a judge.”

In Busch, the parents of a kindergarten boy, one Wesley Busch, had been invited to Wesley’s class to participate in “All About Me” week. Each student’s parents were invited to a kind of parental “show and tell” where they would share “individual interests,” perhaps taking the form of a “small craft or story.” Young Wesley asked his mom to read a short passage from his favorite book, the Bible. The school principal barred this, saying that it would violate the “separation of church and state.” The parents disagreed, arguing that this violated their First Amendment rights. The school won the case, with Judge Barry joining the decision in separate concurrence.

Judge Hardiman, however, dissented. In his conversation with me, he described the school’s (and the court’s) position as “straightforward viewpoint discrimination,” which is simply inimical to the First Amendment. It’s a dissent he is proud of, and nicely illustrates his view of the Constitution. I had to admit I had not read the case in my previous review of his work.

Judge Hardiman also commended to me his decision in Pennsylvania v. Trump, where he ordered that the Little Sisters of the Poor be permitted to join an ongoing lawsuit over Affordable Care Act regulations in order to protect their hard-won right to conscientious objection from the ACA’s contraception mandate. I told him I had read this opinion and liked it, but, now that I’m looking at it, I’m realizing I have never read this; I had this confused with one of the other contraceptive mandate cases. Shoot.

Above all, Judge Hardiman wanted to emphasize to me that he takes the Constitution very seriously. The Constitution, its structure, the republic it gave us: these things, Hardiman said, are what attracted him to the practice of law and the judiciary in the first place. He mentioned that he wants all the best for Ray Kethledge and Amy Coney Barrett, both of whom he counts as friends and both of whom would make, in his view, excellent Supreme Court justices, but contended his own view of the Constitution comes through clearly in his written opinions.

Here I interjected. When I compared him to Harriet Miers, I wasn’t trying to say there that Judge Hardiman would necessarily be a bad Supreme Court justice. He might very well be a great one. There are certainly reasons to think so. Harriet Miers might well have been a great justice, too. There were reasons to think that, too.

The trouble, for me, is that I don’t see in Judge Hardiman’s public record adequate assurances that he thinks the way I do about the constitutional issues that matter most to me.** He may very well think as I do, but I haven’t been able to prove it to my own satisfaction. Although, I had to admit, I am not nearly as familiar with Hardiman’s body of work as he is, I couldn’t look in his history and find a really reassuring case like Garza v. Hargan, the case where Judge Kavanaugh argued convincingly against a government duty to facilitate an abortion for an unaccompanied minor who illegally entered the country. Kavanaugh did his duty as a lower-court judge, obeyed the Casey precedent, and did not expand his argument beyond what was necessary, but his interpretation of Casey was narrow and relied on language that pro-lifers found as encouraging as pro-choicers found it alarming.

Of course, not every issue comes before every court. Hardiman has no record on abortion, he noted, because he has faced no cases that are directly about abortion. I said, “Well, Judge, what I really want to ask you is: if named to the Supreme Court, would you be a reliable vote against Roe versus Wade? But, of course, I can’t ask you that question, and you can’t answer it, and, if you did answer it, you would never be confirmed to the Supreme Court.” Chuckling, Judge Hardiman agreed: I could definitely not ask him that question.

But, while he hadn’t ruled on abortion directly, he did point out the closest thing he’d had to an abortion case, United States v. Marcarvage, where Hardiman joined an opinion protecting an anti-abortion protester who had been convicted of violating a protest permit by protesting outside a designated area. He also mentioned other areas where “the Left” had pressed hard on the Constitution, but where he had stayed true to it, which he thought was enlightening about his overall approach to law. He pointed me in the direction of his Second Amendment jurisprudence, which has indeed earned him a sterling reputation among judicial conservatives. In that jurisprudence, particularly his dissent in Drake v. Filko, Hardiman has been one of relatively few lower-court judges who have been willing to read Heller and McDonald in (what I consider) an honest fashion, contending that the individual right to bear arms recognized in Heller was improperly subjected to a “justifiable need” test by the state of New Jersey.

Hardiman also said that, for a fair overview of his work as a judge, not written by a conservative but by someone who was very fair-minded in assessing him, I should look up Amy Howe’s 2017 profile of Hardiman for SCOTUSBlog. Now, of course, I read all the SCOTUSBlog profiles voraciously whenever a vacancy opens up, because SCOTUSBlog is great… but I will definitely be rereading this one now that I know it isn’t just Amy Howe’s take on Hardiman. It is, in Hardiman’s own opinion, one of the best public overviews of his judicial thought out there.

Overall, Hardiman considered my comparison to Miers somewhat unfair, or at least inaccurate, for this reason: Harriet Miers had been a corporate lawyer, and never really had the opportunity to express her judicial philosophy during her career. As I characterized it, we were asked to take her on faith. But Hardiman is a federal judge. He’s been there for a while. Between majorities, concurrences, and dissents, he has over a hundred written opinions to his name, to say nothing of all the opinions he’s joined over the years. “Once you have that many opinions, you can’t hide what kind of a judge you are.”

At this point, I offered to take down the tweet that had started all this. Twitter not being a good place for nuance, I had dashed off the tweet rashly, without expecting that anyone on Earth would read it, much less that Judge Hardiman himself would bump into it. I mean, he has a point! Whatever my reservations about Hardiman, he does have a paper trail, and, by historical standards, it’s fairly thick. Comparing him to Harriet Miers was glib. It got my point across, but, like so many glib tweets, it also wasn’t fair. Talking to the man himself made me realize that. It’s not the first time I’ve been too quick off the block with a hot take on Twitter.

However, Judge Hardiman insisted that I feel under no obligation to take down the tweet. “You have every right to your opinion,” he said. “I’m a big believer in the First Amendment.” Even when people express very bad ideas, Hardiman believes they generally have a right to say them. Hardiman called to have a chat with me about how he sees his own record, not to argue with me for tweeting a criticism of him. (I still plan to delete the tweet.)

I eventually wondered, “Why me?” I’m surely not the only person on Twitter who’s talked about Judge Hardiman in the past few days, especially with how rocky the Kavanaugh hearings have gone. Hardiman said that he reached out to me because he had taken a look at my blog after seeing my tweet and thought it showed I was a “deep, intelligent” guy with some interesting ideas. There are a lot of fever-swampy areas on the right-wing blogosphere (he didn’t use that specific term), where reaching out would not be productive, but Hardiman expressed that he thought he could have a conversation with me, given what I’d posted on the blog. Of course, some might argue that liking my blog is a sign of bad judgment! But I, for one, am flattered.

Soon thereafter, we thanked one another for our respective time, I wished him well in his career prospects, and we hung up the phone. All told, I figure we talked for about 15 minutes. Feel free to critique my interview technique. There are many questions I should have asked but was too discombobulated to work out. But that’s on me.

I spent the rest of the night kicking myself for failing to ask Judge Hardiman about his feelings on Justice Anthony Kennedy. Longtime readers of this blog will know that I think Kennedy is the worst Supreme Court justice, worse even than more consistent ideological opponents of mine like Ginsburg and Kagan. (Jeffrey Rosen is no ally of mine, but his take on Kennedy for The New Republic is more or less right.) But Judge Hardiman, like Judge Kavanaugh, clerked for Kennedy, and I understand there’s considerable personal and professional affection between them. I’d love to have gotten some insight into that relationship, and particularly how Judge Hardiman would compare and contrast himself with Justice Kennedy. But I didn’t! Sorry, readers.

So what are my takeaways?

In one sense, nothing has changed. Hardiman didn’t reveal anything shocking to me. His record is still exactly what it was before our conversation, and that record is still missing enough to make me uneasy. You can call me a paranoiac if you like, and you’d probably be right, but the specter of O’Connor and Souter and Kennedy haunts my dreams. It takes a very high standard to put me at ease about a judicial nominee, and, until I actually sat down and read Garza v. Hargan and a few other cases, I was pretty worried about even Judge Kavanaugh’s conservative thinking.

With Kavanaugh, though, I could always look for reassurance to his strong score on the Clerk-Based Martin-Quinn scale, a test that infers a judge’s ideology based on the ideology of Supreme Court justices for whom the clerk has worked. Hardiman has no CBMQ score, because his clerks have not gone on to the Supreme Court, so we’re left with his Judicial Common Space score. Hardiman’s JCS score is crap, placing him firmly in the Kennedy centrist region… but the JCS is kind of a crap measurement to begin with. (It measures the ideology of the people who appoint judges rather than anything done by the judges themselves.) So I’m not going to hold Hardiman accountable for the people who appointed him. But it does deprive me of a source of reassurance.

If I wanted reassurance with Gorsuch, I could just go read his book or his marvelous paeans to Justice Scalia. With Barrett, I could just go rewatch Senator Feinstein’s bigoted “dogma lives loudly” attack on her, or look at her very thoughtful writing on the dangers of overreliance on stare decisis**. With Hardiman, I never knew where to go to find clear declarations of his judicial philosophy.

But that, at least, has changed somewhat. Hardiman has personally pointed out to me the opinions he thinks are most useful to commentators trying to suss out how he views the Constitution: Busch v. Marple Newtown, the Little Sisters of the Poor intervention in Pennsylvania v. Trump, and his Second Amendment jurisprudence. I can now read (or re-read) those opinions, knowing that they are central to Hardiman’s thought, and judge him again in their light. Whether I’ll be impressed or left sharing the Wall Street Journal‘s impression, I don’t know, but I’ll give his thinking a fair second look before I draw new conclusions. I owe him that much, after his respectful call.

Speaking of which, another thing that’s changed: it’s hard not to be charmed by someone who calls you out of the blue to politely debate your thoughtless tweet. And Judge Hardiman was charming and honest throughout.  Before tonight, I neither liked nor disliked him. He was a guy from the news whose writing I needed to judge. Now, I like him. He seems like a nice guy, and he apparently shares my weakness for late-night Twitter — but at least has the fortitude to not actually tweet. (Never tweet, kids.) If he’s ever in the Twin Cities area, I’d love to grab a drink with Judge Hardiman.

Moreover, I think it’s revealing that Judge Hardiman is sensitive to my comparison of him to Harriet Miers or the even less kind comparison to David Souter that’s out there. (He did actually use the word “sensitive.”) If he does see himself as a more moderate or left-leaning judge, it would a bit strange of him to call up (let’s be honest here) an obscure blogger who characterized him that way to dispute the point. He is determined to be seen as a judge who is faithful to the text of the Constitution, even by folks like me who don’t really wield any influence. He stands to gain very little from convincing me he really is a judge who adheres closely to the Constitution, which suggests that the reason he was trying to convince me adheres closely to the Constitution is that he actually does adhere closely to the Constitution as a matter of conviction.

I’ll note that it is intriguing that we had this conversation last night, a few hours after the Kavanaugh-Ford hearings, and leave it at that. I’m not sure what, if anything, to read into that, so I won’t.

I think we learned tonight that Judge Hardiman follows @asymmetricinfo; otherwise, I can’t imagine he would have seen my tweet at all. That is an excellent choice that speaks well of him personally and professionally.

Which leads me to my last takeaway from tonight: be kind on Twitter. You never know who might be reading.

*In the parlance of the times, they were called “strict constructionists.” Strict constructionism has been rightly critiqued and the conservative mainstream evolved into textualism.

**This is, again, always, code for Roe v. Wade.

There’s a lot of net neutrality stuff going on right now, and since that’s an issue I’m rather interested in, there might be two or three posts about it over the next few days. For now, just a quick li’l reminder:

The cable companies (not to mention FCC Chairman Pai) are screaming right now that the FCC never, ever dared regulate Internet Service Providers during the early days of the Internet. They claim that the modern free Internet grew up on top of an equally free infrastructure market where ISPs benevolently expanded their networks and increased speeds in order to earn a bigger profit–the perfect capitalist love story–until the Evil Obama Administration released the first-ever ISP regulations mandating net neutrality in 2015. You may even see this story repeated in outlets like the Wall Street Journal, which could never resist such a perfect free-market fable.

Well, I say “fable.”

The more accurate word is “lie.”

Remember that. The cable companies are lying to your face on this one, and they’re hoping you don’t know enough about the ISP regulatory regime of the ’90s and ’00s to gainsay them. So let me give you a quick refresher on what we discussed in these pages a few years ago:

The FCC has taken action to compel Internet Service Providers (ISPs) to comply with some form of net neutrality regulation for 23 out of the 28 years ISP’s have existed.

15 of those 28 years have been spent under the so-called Title II regime–the strictest form of regulation available to the FCC.

This is not new. And the telecoms know it.

In 1934, Congress passed the Communications Act, which created the FCC. Title II of the Communications Act placed phone companies (among others, such as radio operators) under a scheme of comprehensive regulation.

The first commercial ISP launched in 1989, 28 years ago. Back then, the Internet operated on phone lines. Accordingly, ISPs were regulated by the FCC under Title II of the Communications Act. Since the Internet communicated across phone lines, many ISPs were actually phone companies… although they had far more competitors back then than they do today.

In 1996, the “Republican Revolution” Congress under Newt Gingrich passed a massive update to the Communications Act in light of the new Internet Age. The Republican bill was called the Telecommunications Act of 1996, and it modernized the 1934 Communications Act to make sure that it wouldn’t interfere with the development of the infant Internet. Congress created a new category of regulation for online “information services”–that is, content providers like Google or Reddit or my blog (although back in ’96 they were more thinking about “your local library and maybe Yahoo!”). These information services were in fact exempt from Title II regulation. (And still are today!)

However, the Gingrich Congress left regulation for ISPs (that is, the phone companies) completely intact. Since ISPs did not provide content (where competition made sense) but rather provided infrastructure (where natural monopolies prevailed), ISPs continued to be subject to strict FCC oversight of many aspects of their operation, particularly their interconnection agreements (for example, the FCC forced big ISPs to exchange data with small ISPs at non-monopolistic prices) and their development of internet infrastructure for rural customers. This is exactly how phone companies had been regulated for 60 years, and nobody batted an eye. This regulatory regime prevailed for the rest of the dial-up era.

You may also notice that it is exactly the type of regulation the cable companies insist the Internet never ever had back in the day.

A few years after the Telecommunications Act of ’96, DSL was invented. This was cool. The FCC examined DSL and declared that it fell under Title II regulation, because it was (for all legally relevant purposes) identical to the dial-up system — just faster and occasionally on a different wire. A DSL provider was still emphatically a common carrier, which is the key test for Title II regulation. Again, nobody batted an eye.

Finally, cable broadband internet began rolling out to consumers. The FCC examined it… and a remarkable thing happened. In 2002, the FCC ruled that cable broadband was neither a “telecommunications service” nor a “cable service.” (If cable broadband internet were either of those things, it would subject to Title II regulation.)

Instead, the FCC decreed, cable broadband was solely an “information service,” with no telecommunications or cable element included. (As I have written before, this was an insane decision which the Supreme Court upheld only narrowly, and then only by accepting an extreme standard of deference to executive agencies that is becoming rightly disfavored. The Telecommunications Act, properly read, grants the FCC no legal authority to stop regulating cable broadband providers under Title II). Since information services can not be regulated as common carriers under Title II, this freed cable broadband providers from all those regulations.

This lasted until 2007, when the net neutrality wars began in earnest. That happened because of the Sandvine BitTorrent controversy. Because of the anti-consumer nature of that action, the Bush FCC ordered Comcast to stop. Comcast did stop voluntarily, but sued the FCC, saying that the FCC did not have authority to give that order to Comcast since Comcast was officially an “information service” and not a “cable service” or “telecommunications service.” In 2010, the courts agreed, and Begun The Neutrality Wars Had.

I’ll spare you the details, but over the next several years there was a series of lawsuits between the FCC and the cable companies. Of course, throughout that 8-year period of court fights, all ISPs more or less stopped violating net neutrality. Whether for fear of being found liable, or just for fear of angering the courts, or because of a temporary injunction or similar court order, the FCC’s net neutrality regulations prevailed in practice from 2007 to 2015. Comcast even tried to get publicity credit when it “voluntarily” suspended its cap-meter-and-throttle program on its customers’ data.

In the final lawsuit, Verizon v. FCC (2014), the court pretty near straight-up told the FCC, “Look, you can just officially reclassify broadband as a telecommunications service, and then you can use Title II regulation. But you can’t claim it’s an information service and then regulate it like it’s a telecom. Stop it.” They then vacated yet another FCC net neutrality order.

The FCC spent all of 2014 trying to work around that–they wanted to get net neutrality without reclassification, exactly what the courts said they couldn’t do–and they ended up releasing a half-measure policy that would have knee-capped net neutrality. That was what caused the gigantic online protest in mid-2014 over net neutrality.

The FCC (and, perhaps more importantly, the White House) heard that outcry and decided to change course and just do what the court had been telling them to do all along: they reclassified cable broadband under Title II and commenced net neutrality regulations in 2015. That brings us up to today: ISPs are still regulated under Title II, as they have been for most of their history, and FCC Chairman Ajit Pai is trying to change that… while claiming (he has to know this is a lie, doesn’t he?) Title II regulation is somehow a new thing for ISPs.

So, in reality, ISPs were regulated by the FCC from the birth of the Internet until 2002.

They were unregulated from 2002 to 2007, when abuses led the FCC to reassert itself.

From 2007 to 2015, the regulations were legally disputed but more or less effective because the lawsuits kept the ISPs from stepping much out of line.

And from 2015 to 2017, ISPs have been regulated the same way they were before 2002.

So, actually, over the 28-year history of the World Wide Web, ISPs have been under some form of FCC net neutrality regulation for 23 of those years. The 5-year unregulated period from 2002 to 2007 was an anomaly… and it ended in exactly the kinds of abuse we are going to start seeing again if the new FCC order isn’t stopped in court.

In response to the United fiasco of this weekend (read up here if you’ve been living under a rock, or are an Internet archaeologist reading this post from the 23rd century), I’ve seen more than one person call for the airlines to be “re-regulated.”

It just so happens that I was flying this weekend, so this was on my mind already. Also, the fact that I have hated United for many years is a matter of public record (look at the date on that one! PRESCIENCE!), so I really can’t resist posting about this.

Besides, airline regulation isn’t as simple as either “side” makes it out to be. Rolling back the Reagan-era reforms of airline regulations, as some left-wingers want to do, would be a disaster. But, then, so would eliminating all airline regulations, as some right-wingers want to do. Airline regulation is a tricky business, and deserves a tiny bit of close scrutiny before we pass judgment.

When people talk about how great flying used to be, and how airlines ought to be “re-regulated,” they’re usually referring to regulations from the Civil Aeronautics Board. Before Congress mandated airline deregulation in 1978 (two years before Reagan, actually), the federal bureaucrats of the Civil Aeronautics Board ruled the skies. Under the CAB’s administration, planes were spacious, checked bags were free… and tickets were twice as expensive in inflation-adjusted dollars. Flying was great, but nobody outside the top 5% or 10% of Americans could actually enjoy it, because the rest of us couldn’t afford it. The CAB imposed price controls, awarded route-based monopolies, barred airlines from opening new routes (it took Continental eight years to get approval to fly the San Diego-Denver route… and it only came with a court order), and imposed barriers to entry for new competitors trying to enter the market. It was a textbook case of regulations strangling the free market and annihilating competition. Rich people liked it; airlines (which were guaranteed profits under CAB price controls) loved it. But average consumers suffered under these suffocating regulations… as liberal Supreme Court Justice Stephen Breyer, who worked on the deregulation project, is happy to explain.

Today, of course, airlines are still regulated, but the regulatory regime is very different. Modern airline regulations generally permit competition and avoid messing around with specific routes and prices; instead, they focus on imposing a certain minimum standard of safety and (yes) comfort across all flights and all airlines. A good example of modern airline regulation is the Passenger’s Bill of Rights, which the Department of Transportation published on 30 December 2009 under the name “Enhancing Airline Passenger Protections.” This rule limited the amount of time passengers could be stranded on the tarmac (among other things). As someone who was once stranded on the tarmac for six hours (we watched Coach Carter twice and Sideways once) at O’Hare–and, yes, it was my first-ever flight with United–I support these very modest State interventions in a market where sellers otherwise exert overwhelming influence.

However, it was a regulation that (arguably) permitted the United fiasco to happen*. 14 CFR 250.5 provides that a passenger may be involuntarily denied a flight he or she has paid for if the airline pays compensation equal to 400% of the fare to the passenger’s final destination, up to a maximum of $1,350. This regulation is reflected in Section 25 of United’s contract of carriage. The incident on this weekend’s United flight generally* followed the process laid out that regulation: first, United called for volunteers; then, they called for volunteers and offered compensation; then, they gradually ratcheted the voluntary compensation up to 400% of the fare price; and then, finally, they exercised their right to involuntarily “bump” passengers–a right provided by the current regulation.

So the problem here is not that there’s a lack of regulation over this. The problem is twofold:

1. the current regulation is stupid, and
2. arguably, United did not follow the regulation.

Problem #2, unfortunately, can only be answered through litigation, and I suspect that the customer forcibly deplaned is going to be a millionaire very soon.

Problem #1, however, could be addressed through revising the current regulation. If I were given that power, I would eliminate the caps on compensation, and let the free market loose on overbooked planes. If airlines want to buy seats back from their customers, they should pay whatever the heck price customers want to charge them for their tickets, no matter how high the price is.

And hey, just about everyone has a price: I wouldn’t have missed my plane (to a cousin’s wedding) for $800, but, if the offer were $10,000 (times two, since my child was with me), I hope my cousin would forgive me for taking it. Heck, at that price, I could probably charter a private flight, still make the wedding, and have money left over! But the bid probably wouldn’t reach that high, because surely someone not going to a wedding would accept it if the airline offered $1300 or $2000 or $5000.

That’s the free market: I have a ticket I bought from you, you want it back, so I’ll sell it to you, but I set the price–not you and not the federal government. 14 CFR 250.5 should embrace this.

Now, some regulation of airlines is necessary. As common carriers benefiting from network effects and economies of scale, the airline industry is prone to natural monopoly. Without some regulation requiring minimal standards of service and non-discrimination between carriers, we’d end up with monopolies. Competition would die off, prices would rise, and customer experience would worsen. We’d end up in worse shape than we did during the Civil Aeronautics Board era. That’s why I say that 14 CFR 250.5 should be revised, not eliminated. If 14 CFR 250.5 were deleted entirely, airlines would have strong incentives to eliminate all compensation in these cases. They could (and would) simply “bump” passengers on overbooked flights, at their own whim, with impunity.

We see the same thing in the ISP market, where Obama-era net neutrality regulations (unfortunately opposed by President Trump) helped shore up the Internet’s defenses against monopoly. I explained the risks of natural monopoly and the necessity of gentle, prudent common-carrier regulation at very great length in my post on net neutrality.

However, the “re-regulation” desired by some liberals would mean a return to the Civil Aeronautics Board’s pre-1978 regulatory regime. That regime was full of price controls and government-imposed monopolies. It would do a lot of damage to the accessibility of air travel… and it would not actually fix the problem on this weekend’s United flight, which arguably happened because of government price controls, not in spite of them. CAB regulation was a very bad idea in 1978, and it remains a very bad idea today.

*I say “arguably” and “generally” because 14 CFR 250.5 says it applies to “involuntary denial of boarding” — but, in United’s case, the passenger had already boarded, so United’s actions may have been illegal; also the United flight may not have been overbooked, since the demand was for the passenger to surrender his seat to a crew member, not another paying customer. It’s not at all clear to me that this was legal.

**Somehow–and probably just by posting it I’m going to ruin it–“Fly the Unfriendly Skies” is available on the Internet Archive right now, along with another excellent episode of Bob Newhart, “Tracy Grammar School, I’ll Lick You Yet.” Catch it while you can! Bob Newhart is also available on Hulu.

Nobody seems to have pointed this out yet, so I guess I might as well put something up quick.

President Trump is not a big fan of net neutrality, and his new FCC commissioner, Ajit Pai, is, uh… really not a fan. Mr. Pai is already working on rolling back the FCC’s net neutrality rules, which were passed under President Obama. Most conservatives agree with Trump. Judge Gorsuch, of course, is a conservative nominee appointed by an anti-net neutrality president. So the going assumption is that Gorsuch will hurt the cause of net neutrality if confirmed to the Supreme Court. That he will not protect the open internet.

This is a mistake.

“Net neutrality,” for those of you who have never read my gigantic posts about it, is the principle that internet service providers (such as Comcast) have to allow their users equal access to the entire Internet. Under net neutrality, Comcast can have its own video service that competes with YouTube, but it cannot block YouTube from its network to force you (the Comcast subscriber) to use the Comcast video service. Nor can it treat its videos differently from YouTube videos as they travel down the wire to your computer: you get both videos as fast as possible, based on whatever data rate you are paying for. Nor can Comcast force YouTube to pay extra to connect with its network. And so forth.

This is a fundamental architectural principle of the Internet. It was the law of the land for the Internet’s early, formative years, and I explain why it is still necessary today at absurd length in my two previous articles on the subject: “A Sorta-Technical Overview” and “Why Free Marketeers Want to Regulate the Internet.” Vint Cerf called the second one a “must read,” and I can die happy knowing that. I’m not going to explain it further here.* It’s time to talk about Gorsuch.

No, wait, it’s time to talk about the Brand X.

On the Internet, there are two kinds of provider. There are content providers like Google and Netflix and… well, this blog. We create stuff that people want to see and we put it on the wires. Then there are Internet Service Providers (ISP), like Comcast and CenturyLink, which actually own the wires.

When the Internet was first created, the ISPs were regulated as “common carriers,” like phones and airlines. Phones and airlines have to sell bandwidth (or seats) to any customer who has the money to pay, without discrimination, just as a net-neutral ISP has to carry content for any customer with money to pay, without discrimination. If you think that sounds a lot like net neutrality, you’re right.** For early ISPs working under this regulatory regime, net neutrality was “baked in” by pre-existing laws originally written for phone companies.

In 1996, Newt Gingrich’s Congress passed a law (which President Clinton signed) reforming telecommunications regulation for the Internet Age. Although Republicans love deregulating things, their reforms left the common-carriage requirements on ISPs untouched. The Republicans opened up a lot of space for content providers, and they tried to create competition in the ISP market, but they retained the essential protections of the original Telecommunications Act. ISPs would continue to operate as common carriers for many years to come, through the entire ’90s tech boom and well into the post-bust recovery.

Then, in 2002, George W. Bush’s did something very strange. All of a sudden, they radically re-interpreted the Telecommunications Act. Their new opinion, they announced, was that ISPs actually were not a telecommunications service after all. This meant the FCC could no longer regulate ISPs as common carriers. Since ISPs were no longer common carriers, net neutrality was no longer the law of the land. It became a mere option… one which the ISPs were quick to abandon and abuse.

Worse: this wasn’t some well-meaning attempt to correct the improper enforcement of the law. To put it charitably, the FCC’s legal reasoning for this conclusion was garbage. It was, in fact, a bald-faced attempt by the Bush White House to deregulate ISPs without going through Congress–and everyone admitted this, including the FCC.

There was, of course, a lawsuit. A small ISP called Brand X Internet, which needed common carrier treatment to move its traffic through other (larger) networks, was going to be wiped out by (now legal) monopolistic practices of other, larger ISPs. Brand X sued the FCC, among others, for violating the Telecommunications Act of 1996, which, as previously stated, required ISPs to be treated as common carriers.

The case was called National Cable & Telecommunications v. Brand X, and it went all the way to the Supreme Court in 2005. It ended up hinging on a strange legal doctrine called Chevron Deference.

Named for a regulatory case from the 1980s, Chevron v. Natural Resources Defense Council, the principle of Chevron deference says that the courts should not rely on their own interpretation of the law when the executive branch is involved. Instead, courts should defer, whenever possible, to the legal interpretations put forth by executive agencies like the EPA or the FCC.

When an executive agency comes up with a novel interpretation of a law, which happens a lot these days, courts ask two Chevron questions to decide whether to accept that interpretation. First, the court asks whether Congress has unambiguously addressed the issue in question (whatever it is). If there is no ambiguity, then the law of Congress must stand. However, if there is ambiguity–even a little– then the court decides whether the agency’s official interpretation is “permissible.” Not natural, not reasonable, not obvious… “permissible,” within the bounds of the English language. No matter how tortured the logic or the language, if the agency interpretation is “permissible,” then, Chevron says, the court must accept it.

In other words, if an executive agency can find even a small silver of ambiguity in a law passed by Congress, the agency can take that ambiguity, wedge a new ruling into it, and twist the language as much as they need to to achieve whatever policy goal they want, and to heck with Congress. Even if the agency’s interpretation runs pretty much contrary to every reasonable reading of the law, as long as it is technically permissible, the court has to accept it. That’s Chevron deference. (And, yes, there are theoretically limits on this agency power, but, in practice, it has given the executive branch vast power to do nearly anything it wants, regardless of what the law says.)

Okay, back to 2005 and Brand X.

The FCC ruling deregulating ISPs was a doozy. Everyone on the Supreme Court agreed that the ruling was not the most natural reading of the Telecommunications Act. In fact, the judicial branch had already previously ruled in other cases that another reading of the Telecommunications Act should be followed… one that preserved the common-carrier rules for ISPs.

However, the Supreme Court concluded, by a 6-3 majority, that the Telecommunications Act was just ambiguous enough to allow alternative interpretations, and the FCC’s ruling was just reasonable enough to qualify as a “permissible” construction in the English language. Therefore, under Chevron deference, the Court decided it had no choice but to accept the FCC ruling, even overturning the judicial system’s own prior rulings to support the FCC. Brand X lost, and the FCC’s deregulation went ahead. That was the beginning of the net neutrality battle.

Justice Scalia wrote a scathing dissent in Brand X. Justice Scalia was a conservative,  so he liked deregulating things as much as the next Republican, and he even agreed with Chevron deference in principle. But, Scalia insisted, the FCC ruling failed the Chevron test. The Telecommunications Act was unambiguous about regulating ISPs as common carriers, and, even if the Act were ambiguous, the FCC’s ruling was an absurd and totally impermissible re-interpretation of the law. Scalia may have liked the outcome (he didn’t say), but he argued–correctly–that the FCC had exceeded the authority granted to it by Congress… even under Chevron deference.

But Scalia was in the minority. Brand X lost. In the dozen years since, the FCC has dithered over ISP regulation, unable to make any ruling that sticks for more than a couple years at a time. Net neutrality has been eroding apace. Although it is not yet to the point where consumers are taking regular notice, it is already driving up consumer prices, as ISPs use network leverage to force services like Netflix to pay ransom money or lose access to its paying customers. All because of Chevron deference.

Now here comes Gorsuch. Here’s something Judge Gorsuch wrote last year, in a concurring opinion on a case (this one about immigration law) that also happened to hinge on Chevron deference:

There’s an elephant in the room with us today. We have studiously attempted to work our way around it and even left it unremarked. But the fact is Chevron and Brand X permit executive bureaucracies to swallow huge amounts of core judicial and legislative power and concentrate federal power in a way that seems more than a little difficult to square with the Constitution of the framers’ design. Maybe the time has come to face the behemoth…

[W]hat would happen in a world without Chevron? If this goliath of modern administrative law were to fall? Surely Congress could and would continue to pass statutes for executive agencies to enforce. And just as surely agencies could and would continue to offer guidance on how they intend to enforce those statutes. The only difference would be that courts would then fulfill their duty to exercise their independent judgment about what the law is. Of course, courts could and would consult agency views and apply the agency’s interpretation when it accords with the best reading of a statute. But de novo judicial review of the law’s meaning would limit the ability of an agency to alter and amend existing law. It would avoid the due process and equal protection problems of the kind documented in our decisions. It would promote reliance interests by allowing citizens to organize their affairs with some assurance that the rug will not be pulled from under them tomorrow, the next day, or after the next election. And an agency’s recourse for a judicial declaration of the law’s meaning that it dislikes would be precisely the recourse the Constitution prescribes — an appeal to higher judicial authority or a new law enacted consistent with bicameralism and presentment. We managed to live with the administrative state before Chevron. We could do it again. Put simply, it seems to me that in a world without Chevron very little would change — except perhaps the most important things.

These are the first and last paragraphs, respectively, of a carefully written, very polite, 23-page concurrence in which Gorsuch attacks Chevron deference at every level. In the end, Judge Gorsuch calls on the Supreme Court to reconsider and overturn Chevron entirely. This is noted by many people as a huge difference between Gorsuch and Scalia; Scalia was a staunch defender of Chevron, while Gorsuch is its most prominent opponent.

This has many implications, touching all sorts of issues, and it has lots of people on all sides talking–some hopefully, some fearfully. I won’t go into all that.

But what does it mean for net neutrality?

If Justice Gorsuch reaches the Supreme Court, he could lead a judicial movement to overturn or limit Chevron. Given his record on Chevron, this is widely expected, and Gorsuch will have a considerable amount of time to do it, since it’s a lifetime appointment.

Brand X is known for being such an extreme application of Chevron that practically any limitation of Chevron will lead to Brand X being overruled or drastically narrowed (although not necessarily immediately; the law moves slow). Gorsuch needs only be slightly successful in limiting Chevron to put Brand X at risk.

If Brand X were overturned, it would be very good news for net neutrality activists. The Telecommunications Act of 1996 is still on the books. It still, pretty unambiguously, demands that ISPs be regulated as common carriers. The FCC got around that with a bunch of legal argle-bargle that was confirmed valid by Brand X… but, if Brand X falls, so does the FCC’s justification for not regulating ISPs correctly.

In short, overturn Brand X and you bring back ’90s-era net neutrality. President Trump couldn’t stop it. The FCC couldn’t stop it. Al Gore couldn’t stop it. The only thing that could stop net neutrality at that point is Congress, and Congress has too many net neutrality advocates for a change in law to happen.

I haven’t the faintest idea what Judge Gorsuch thinks about the policy of network neutrality. He’s a conservative, so he may well oppose it (though I’d love to persuade him otherwise). But if there’s one common theme in Gorsuch’s work, it’s that he doesn’t rule for his favored policies; he rules for the law, whatever it may be.

This is very good news for net neutrality advocates, because, despite the last decade of silly legal acrobatics, the law is on our side. It always has been. That makes soon-to-be Justice Gorsuch a powerful ally.

Let’s hope his colleagues on the court are as open-minded to reconsidering bad precedents as he.

NOTES

*I still owe this guy a real reply, though, so rest assured I still have more to say about NN.

**This is not an exact analogy, but the alternative is that I spent six pages explaining how Title II of the Telecommunications Act works, and none of us wants that. Tim Wu more carefully defines net neutrality and their relationship with common carriage rules in his seminal paper on the subject.

This post was updated on 9 October 2016. Updates are at the bottom.

Since winning the nomination, Donald J. Trump has done all of the following: insulted the family of a man who died in service of his country; kicked a baby out of a rally; failed to rebut evidence that he was a draft dodger; embraced the opponent of the sitting Republican Speaker of the House while refusing to endorse the 2008 GOP nominee for president; attacked fire marshals at his rallies as “political” for enforcing occupancy limits; driven his staff and the RNC to despair; and denied the (very real) Russian conquest of Crimea.

I’m sorry, did I say, “since winning the nomination”?  Actually, that was just the past 36 hours (as of this writing). By the time you read this, no doubt Trump will have disqualified himself from the nuclear suitcase many more times – and it’s not like Trump was an angel before August, either.  Trump should not be the Republican nominee for president.  He should not even be the Republican nominee for Secretary of Transportation – 13^th in the line of succession is far too close for a man of his low character.

Fortunately, he doesn’t need to be.

The More You Tighten Your Grip…

Just a few weeks ago, at the Republican National Convention, the Trump campaign and the Republican National Committee crushed an attempt to stop Trump and reform the rules of the RNC.  As a result, the RNC was able to pass a renewal of Rule 12, the infamous power-grab that seized control of the party from the grassroots.

Historically, the Republican Party was governed by the delegates to the national convention, who would debate and pass rules for the party organization. The RNC existed and operated at the pleasure of the delegates. Rule 12 turned that on its head: yes, the convention still meets every four years, but Rule 12 allows the RNC to amend the rules of the Republican Party between conventions without input from the delegates.  As was pointed out at the time, this permits the RNC to completely disregard the results of national conventions: if the convention passes a measure the RNC doesn’t like, the RNC can simply pass a new rule at the next meeting to undo the convention’s decisions.

There was hope this year that Rule 12 would be removed as part of a conservative reform package spearheaded by Morton Blackwell and Sen. Mike Lee.  However, the Trump campaign closely coordinated with the RNC to destroy that package, bragging about their victory afterward on Twitter.

It would be poetic justice if the Trump campaign were hoisted on its own petard.

…The More Star Systems Will Slip Through Your Fingers.

No presidential nominee has ever died on the campaign trail before, but it could happen.  William Henry Harrison could have caught pnuemonia in October.  In 1912, the Republican vice-presidential candidate, James Sherman, actually did die less than a week before the election.  Both major parties have rules governing what to do if that happens.  The Republican version is called “Rule 9: Filling Vacancies in Nominations”.  It has not changed during the 2016 cycle.  This is what it says:

(a) The Republican National Committee is hereby authorized and empowered to fill any and all vacancies which may occur by reason of death, declination, or otherwise of the Republican candidate for President of the United States or the Republican candidate for Vice President of the United States, as nominated by the national convention, or the Republican National Committee may reconvene the national convention for the purpose of filling any such vacancies.

(b) In voting under this rule, the Republican National Committee members representing any state shall be entitled to cast the same number of votes as said state was entitled to cast at the national convention.

(c) In the event that the members of the Republican National Committee from any state shall not be in agreement in the casting of votes hereunder, the votes of such state shall be divided equally, including fractional votes, among the members of the Republican National Committee present or voting by proxy.

(d) No candidate shall be chosen to fill any such vacancy except upon receiving a majority of the votes entitled to be cast in the election.

Many commentators are hoping that Mr. Trump will drop out of the race, creating a vacancy for the RNC to fill.

Some rather more daring commentators believe that the RNC is already empowered, by simple majority vote, to declare Donald Trump’s candidacy vacated by “death, declination, or otherwise” (strong emphasis on the “otherwise”) thanks to his shameful misbehavior on the campaign trail. Personally, I don’t believe that a unilateral declaration of vacancy by the Republican National Committee qualifies as a “vacancy” within the ordinary English meaning of the word.  Of course, the RNC and the Trump campaign have never allowed the actual text of the rules to stop them from doing whatever they want, rules of order be damned, so maybe the RNC will do it anyway.  However, I don’t believe that Donald Trump should be stripped of the nomination by cheating. That would be unfair to Mr. Trump and his many enthusiastic supporters.

Instead, Trump should be stripped of the nomination fair and square, by a clear action under Rule 12 – the very same Rule 12 Mr. Trump himself has so fiercely defended.  Rule 12 provides:

The Republican National Committee may, by three-fourths (3/4) vote of its entire membership, amend Rule Nos. 1-11 and 13-25. Any such amendment shall be considered by the Republican National Committee only if it was passed by a majority vote of the Standing Committee on Rules after having been submitted in writing at least ten (10) days in advance of its consideration by the Republican National Committee and shall take effect thirty (30) days after adoption. No such amendment shall be adopted after September 30, 2018.

This sets out a clear, incontrovertibly legal mechanism for stripping Trump of the nomination:

1. Any member may propose an amendment to Rule 9 and submit it in writing to the Standing Committee on Rules. It would contain a simple morals clause, like that contained in many employee contracts. It could read something like this:

Rule 9 is amended by the addition of a section (e), which reads as follows:

(e) If the Republican nominee for President or Vice-President commits an act of moral turpitude which is shocking to the nation’s sense of decency, the full Republican National Committee may, by three-fourths (3/4) vote of its entire membership, vacate that nomination.

2. After waiting ten days, the Standing Committee on Rules must vote to approve the amendment by a majority vote.

3. The Republican National Committee may then immediately vote to approve the amendment by a three-fourths supermajority.

4. Thirty days later, the new clause goes into effect. The Republican National Committee may meet at that time. and, by a three-fourths supermajority, terminate the misbegotten candidacy of Donald J. Trump for his many acts of moral turpitude – his fight with the Khan family being only the most prominent.

5. The RNC would then be free to immediately select a new candidate under the terms of Rule 9.

6. The new Republican nominee, whoever it is, would easily defeat Hillary Clinton, the least popular nominee in history (except for Donald Trump). That’s not wishful thinking: almost any Republican, from John Kasich to Marco Rubio to Ted Cruz — or even David French! — could beat Mrs. Clinton. This is the most winnable election in history, and Trump is doing the impossible by losing it.

Just Crazy Enough to Work

By the time the new nominee is selected, forty days after the initial submission of the amendment, many states will have locked in their ballots for the November election.  Trump’s name will still appear on those ballots.  However, this is hardly the first time in American history such a thing has happened. In Minnesota’s 2002 Senate race, Sen. Paul Wellstone died in a plane accident less than two weeks before the election. He was replaced by Walter Mondale, and, although the ballots all said “Wellstone,” Mondale would have gone to Washington had he won.  More notoriously, in 2000, Sen. John Ashcroft actually lost an election to his deceased opponent, Mel Carnahan. (Carnahan’s widow, Jean, served in his place.)

Trump, for his part, will be unable to mount an independent “spoiler” campaign, precisely because those ballot deadlines would have passed him by. Though he could mount a court challenge or write-in campaign, he would have little time and no help from the RNC apparatus that he depends on for his ground game. Meanwhile, the Republican electorate has already demonstrated that it will unify behind literally anyone in order to stop Hillary – after all, Republican voters were willing to unify behind Trump.  The Republican nominee would thus enjoy a clear path to a November 8^th victory.

Presidents, of course, are actually elected by the members of the electoral college.  The members of the electoral college are selected by the winning political party in each state. Generally speaking, they are both pledged by their party and bound by state law to cast their electoral vote for the candidate of the party that appointed them – regardless of which candidate technically appeared on the ballot.  (A few states appear to legally bind them to the candidate on the ballot, but all such laws are likely unconstitutional.)  Since electors are well-vetted partisan loyalists anyway, they can generally be counted on to support the party’s nominee, regardless of pledge or legal constraint.  Certainly no Republican elector would ever vote for Hillary Clinton, and many of them already disdain Mr. Trump.  Therefore, we could reasonably expect all Republican electors to vote for the party’s new nominee, whomever that may be.

Even if some faithless electors still cast their votes for Trump, this would not change the final outcome of the election: even if there were enough faithless electors to deny the new nominee a majority in the electoral college, all this would do is throw the election to the House of Representatives, where the entrenched GOP majority would easily put the new nominee into the Oval Office.

Indeed, thanks to the electoral college, it would seem that the Republicans do not even need to complete the entire re-nomination process by Election Day.  As long as the Republican nominee has been formally changed by the time the electoral college meets (December 19, 2016), Republican electors can be relied upon to vote for the new Republican nominee.  That means the deadline for starting this process is technically November 9th… although, if Trump is still the nominee on election day, it is highly probable that Hillary Clinton will be elected and this will all be moot.  The sooner we start the process of vacating the nomination, the better.

In short: despite some minor complications, if we replace Trump, our new nominee will be the next President of the United States.

The Fallout

This is hardly the ideal mechanism for defeating Hillary Clinton. It would have been much better to nominate a good candidate back at the convention. A last-minute switch like this would make the primaries a farce (though they already are), shatter the Republican Party (though this has already happened), and create a major political hubbub.  These are very bad things.

But the election of Hillary Clinton would, without serious question, destroy the American experiment forever with a single appointment to the Supreme Court. The election of Donald Trump, the misogynist draft-dodging anti-veteran Russian pawn, would not be much better for America – and is appearing less and less likely anyway, as Americans wake up to Trump’s moral turpitude.

The Republican National Committee, then, has the power to stop Trump. They now face a simple choice: save their party, or save their country.

Guess which one they’re going to pick.

UPDATE 9 October 2016:

The idea of vacating the Republican nomination has suddenly picked up steam in the wake of Trump’s favorable comments about sexual assault, and that has led to some extra traffic to this blog.  I want to add three thoughts to what I said above back in August:

1. If only we’d done this ten days ago…

The process I sketched out above takes forty days to complete. November 8th — the day when voters in each state cast ballots to elect a partisan slate of electors to the electoral college — is only thirty days away.  This means that, even if the appropriate motion were filed with the Rules Committee right this moment, it would still take until ten days after Election Day for Donald Trump to be formally stripped of the nomination.  It would have been much, much easier to vacate the nomination if Pussygate had happened on, say, September 26th.

This doesn’t mean the process to vacate the nomination is impossible. Heck, given Trump’s free-fall in the polls since the first debate (he is on track for a landslide defeat), forcibly replacing him is still probably the RNC’s last, best hope for winning this election. But the late timing does make the process a lot trickier: you would, first and foremost, have to convince voters to cast ballots for Trump with nothing but a promise that Trump will soon stop being the nominee.

This may be a bridge too far.  Voters have a hard time remembering who the vice-presidential nominee is, still less how their vote connects to the electoral college. It is for this reason that, when I spoke to Gwynn Guilford for her article this morning, I was fairly pessimistic. I still think this is a possible path to a Republican in the White House, not just a symbolic repudiation, but, as I told her, it is… tricky.

2. Can we speed this up by suspending the rules?

Late in the day, Politico reported that the RNC is actively looking into this option. Well, guys, welcome aboard.  Better late than never, right?

Politico’s piece also contained this juicy tidbit, which caused my jaw to drop:

One option might be invoking Rule 12 — which gives the party the authority to amend its own rules — but that would also be problematic because it requires at least 40 days to take effect. However, the committee — which operates under Roberts Rules of Order — also appears to have the authority to suspend those restrictions with a two-thirds vote.

Well, heavens to Betsy, I think they might just be onto something!

Let’s go back to our trusty copy of the Republican Party Rules.  Rule 7(a) provides:

(a) The current authorized edition of Robert’s Rules of Order: Newly Revised (“Robert’s Rules of Order”) shall govern in all meetings of the Republican National Committee and its committees insofar as they are applicable and not inconsistent with these rules.

I’m a little surprised I never thought of this myself! Robert’s Rules of Order allows a body, such as the RNC, to “suspend the rules” by a supermajority vote.  Suspending the rules allows the RNC to clear procedural obstacles that are getting in the way of doing business.  If you’ve ever been at a political convention at any level, you have almost certainly participated in a parliamentary action to suspend the rules. You can’t use rules suspension to grant yourself additional powers or violate your organizational constitution and by-laws, so the RNC couldn’t just vote to suspend the rules and declare that Mike Pence is the new GOP nominee.

However, you can use rules suspension to clear procedural roadblocks.  And what’s the biggest obstacle to replacing Trump right now?  That darned thirty-day waiting period mandated by Rule 12 before any rules changes passed by the RNC can take effect.

It may be possible, under Robert’s Rules, for the RNC to suspend that waiting period.  As I read Robert’s, it would require a two-thirds majority vote — which is actually easier than changing the rules in the first place (which requires a three-quarters majority).

If this is correct, then the RNC could meet as soon as October 19th, vote to amend Rule 12 as I described in my original post, and then attempt to proceed immediately to a vote on vacating the nomination. This would be ruled out-of-order, thanks to the 30-day waiting period. Any RNC member could then put forward a motion to suspend the rules and proceed directly to the vote on vacating the nomination. With two-thirds support, the motion would carry, the vote to vacate would be held… and Donald Trump would cease to be the Republican nominee for President of the United States by the morning of October 20th.

However, it might not be correct.  I am not up-to-speed on the vagaries of rules-suspension motions, and am seeking the advice of an experienced parliamentarian as to whether the waiting period is considered a parliamentary rule suspendable under Robert’s Rules.  (It could be seen as a by-law, thus not suspendable.)  I will keep you readers posted.

3. Trust nothing you hear.

Jim Bopp, a noted RNC lawyer, is running around telling everyone who will listen that this whole thing is impossible.  Jim Bopp is a warrior for life and free speech, whose credentials, experience, and genuinely wonderful accomplishments eclipse my own.

He is also completely out to lunch.  Cozy with Trump since Day One, Bopp is editing his own reality to only see the parts that support Trump.

Does that sound familiar?  It should: Jim Bopp was the star of my 2010 blog series, Why Personhood is Right for Wisconsin, and, as I showed at great length there, Bopp twists and sometimes outright lies about the law in order to bolster his own sheerly political conclusions. He didn’t think Personhood was an electoral winner, so he invented a reality in which Personhood endangered other pro-life achievements in Wisconsin, regardless of the actual law of Wisconsin.  He thinks Trump is an electoral winner, so he’s inventing a reality in which Trump is the only possible GOP nominee, regardless of the Rules of the Republican Party he himself helped craft.

EDITOR’S NOTE: If you want to see this happen, you should share this article on social media.  I love each and every one of you, my readers, but none of you are voting members of the Republican National Committee.  Nobody who has the power to vacate the nomination will consider it unless they see it, through social sharing.  And they probably won’t anyway.  But we should still try.

Our legal system, like every legal system, struggles with the problem of proving non-consent in rape cases.  A rapist will often admit that sexual activity occurred, but will insist that it was consensual.  The burden of proof falls on the victim.  That is as it must be, since the defendant is innocent until proven guilty, but, under current law, it is very, very difficult to obtain that level of proof.  If it turns into a case of “he-said/she-said”, the rapist gets away with it.  Few rape cases that lead to an arrest end in conviction and prison time.  Partly because of how difficult they are to prosecute, few rape reports lead to an arrest in the first place.  And, given the high costs and low chance of success offered by the justice system, relatively few rapes are reported at all.  RAINN estimates that only 3% of bona fide rapists are sent to prison for their crime.  This is a tragic injustice.

At the same time, I was thinking about premarital and non-marital sex, which are bigger social problems than most people realize.  While fornication used to against the law in all 50 states, those laws are now considered unconstitutional (because — one of this blog’s main themes — Anthony Kennedy is both a moron and a tyrant), and fornication has become socially acceptable:

The results have been predictable: premarital sex is more prevalent than it has been in millennia — perhaps in all history — while solitary motherhood has become both the curse of the poor and the luxury of the very rich.  41% of American children are born out of wedlock, and the number rises to an astounding 73% for black American children.  Social pathology follows, as night follows day.  I will not bother enumerating the harms inflicted on children by mass unmarried parenthood, because I no longer believe this is novel or controversial information, but here are a couple links to recent op-eds and research discussing the threat non-marital parenting poses to the next generation, from larger disciplinary issues to less successful careers.  As it stands, there’s not much we can do about this.  Even if there isn’t a constitutional right to sleep around, do we really have the desire or police resources to do anything about it?

At the time, I failed to note that fornication is also a key driver of the abortion rate (more than half of American reproductive-aged women are married, yet 85% of abortions are performed on the unmarried).  I really want to discourage fornication.

One day, while making dinner and thinking alternately about these things, it occurred to me that rising rape rates are in many ways related to rising fornication rates, because the lack of a wedding vow prior to sexual intercourse makes consent much cloudier, and, in a culture where non-marital sex is widely embraced and even supported, it become much easier for a rape case to degenerate into “he said/she said” reasonable doubt.  So I started to consider them together, and, within a few minutes, I had come up with an amazing idea which (I was pretty sure) nobody had ever heard before:

I have an idea that could make it easier to apprehend rapists without short-circuiting their due process rights, while simultaneously forcing people to think more carefully about fornication, reducing the number of abortions and increasing the rate of births that take place in wedlock — or at least within a truly committed relationship.

I propose that we add the following language to all sexual assault statutes:

“There shall be a rebuttable presumption that sexual contact between the actor and the complainant was non-consensual, if the actor is not married to the complainant.”

Here is what this says, in plain language: if you report to the police that you were raped, and the person you accused says, in defense, that you did have sex, but it was consensual, then it is no longer your responsibility to prove that you were violated against your will.  It is the other person’s responsibility to prove that you did agree to have sex.  The court would not presume that you gave consent, as it does today.  Instead, it would presume that you are telling the truth — that you were raped.  The only cases where the law would continue to presume that the sex was consensual are cases where the accused and the accuser are married to one another.  There is a very good reason to make that exception: a married couple has publicly given sexual consent to one another, and has specifically requested that their sexual relationship be formally recognized under the law.  Although marital rape can and does occur, it is right for a court to give the benefit of the doubt to the marriage.

Much of the rest of my post was dedicated to explaining what a rebuttable presumption was, and defending the fact that rebuttable presumptions (in a sense) invert the “innocent until proven guilty” standard of Anglo-American justice.  (They do this for good reason, and they’re really quite common: example 1, example 2.)

My ultimate vision was that young people, in order to protect themselves from rape allegations under the new law, would start using what I called a “consent contract” before fornicating with anyone.  This would establish consent and be sufficient to rebut the presumption of non-consent.  (A contract would not be the only way to establish consent; they could also film themselves on their phones just before sex, verbally agreeing to it for the record.)

My first hope was that this new law would make it much easier to convict rapists.  Rapists would not have signed a consent contract with their victims, and any cell phone footage would clearly establish rape, so they would have no way of rebutting the presumption of non-consent.  Rape conviction rates would skyrocket — an obvious blow for justice

My second hope was that this new culture would turn fornication into such a social and legal minefield that it would effectively deter it in many cases.  It is not easy to interrupt sex to sign a quick contract, and — don’t forget — you would have to sign one of these every single time you hooked up, even if it was with your steady girlfriend or live-in partner of five years.  And you’d have to keep the records — written contracts and cell phone videos documenting every single sexual act you perform with any other person — for approximately ten years (the statute of limitations on rape in Minnesota is nine years).  Until you married, sex would never be presumptively consensual.  Those who refused to get and keep documentation would find themselves vulnerable to a rape allegation if their relationship ever went south.  If some fornicators ended up unjustly convicted of rape, I wasn’t too concerned about it, since I already wanted them prosecuted and convicted under the old fornication laws.  Affirmative consent would have effectively brought fornication laws back through the back door.  Bwahahahaha!  My evil plan to ruin and criminalize the campus hook-up scene would finally be complete!  No doubt my shadowy overlords at the National Organization for Marriage would reward me richly for my guile!

I had two major problems with my proposal, though, and it languished in drafts and re-drafts for years and years as I tried to fix them.

The first big problem was selling it.  Fornication, as we’ve established, is super-popular, and the Left — which simultaneously opposes marriage and supports people of any sort having sex at any time for any reason with no possible consequences — seemed particularly unlikely to support a proposal whose second prong would turn the hook-up paradise they’ve established on college campuses into a wasteland.  The anti-rape provisions were nice, but would they be enough to make an ally of the cartoonishly villainous Erin Gloria Ryan?  But this is just politics, and, deep down, I think most people know that fornication is bad, so I was confident that, in the long run, this proposal could make it over the finish line if packaged well.

The second big problem was far more fundamental.  In the end, it was fatal.  This legal standard makes it so that the best defense to a rape accusation is not “it was consensual”.  It makes it so the best defense to a rape accusation is a counter-accusation: “I didn’t rape her; she raped me.”  Assuming there’s no documentation — which there wouldn’t be, because it was a rape! — the situation would still be a he-said/she-said, much like it is today… with the important difference that the loser of the he-said/she-said would end up in prison for 25 to life.  Think of how hard it is to come forward with a rape allegation today, and then imagine how hard it would be if you knew that coming forward carried a real risk that you’d be the one sent to prison instead of your rapist!

I tried to pooh-pooh this to myself, but, the more I thought about it, the worse it seemed.  Serial rapists, knowing that creating simple doubt is no longer be enough to get them off the hook, would start trying to frame their victims for rape, Gone Girl-style.  In order to get the drop, rapists could even start accusing their victims first, reaping the benefits of making the first accusation.

And the new affirmative consent regime would incentivize all this.

It seemed to me that the new rape regime would become, if anything, even worse than it is today, both for victims and for the falsely accused.  The only people who wouldn’t be negatively impacted by the new rape laws would be the rapists.  My proposal would still have the desired effect of completely ruining (and partially criminalizing) the consensual non-marital sex scene, which was great, but, if it meant worse outcomes for rape victims — who have a hard enough row to hoe as it is — I didn’t think it was worth it, so I put the whole thing on the shelf.  I intermittently pulled it off the shelf and played with ways to fix it, but the only idea I ever had was, “Believe the woman is telling the truth and the man is lying.”  Unfortunately, aside from being an obviously sexist and unjust rule of construction, it is simply a fact that men can be both raped and falsely accused, and both happen at low but non-trivial rates, so it wouldn’t be remotely effective.  The proposal remained on the shelf.  My post, quoted above, was never published.

This was 2012.  Fast-forward to today.

As it turns out, I was not the first person to think of this.  Tiny Antioch College tried something similar (only without the marital exceptions) in 1991.  Everyone made fun of it, but, twenty-odd years later, about two years after I started working on this idea, California suddenly came out of nowhere and passed an affirmative consent law that applies to all college codes of conduct.  California.  Home of the Left.  And the Left… cheered?  Seriously, that link is Ezra Klein celebrating the fact that “men [will] feel a cold spike of fear when they begin a sexual encounter.”  I’m happy about ruining fornication for everyone, but why are you?   This link is Erin Gloria Ryan, whom I expected to be the foremost opponent of these laws, angrily denouncing the law’s detractors in her trademark, savagely ad hominem, style.

Libertarians freaked out, correctly pointing out that this law would not help stop rapes, but would only hurt casual fornicators.  Conor Friedersdorf, a proud Leftie who nevertheless frequently engages in thinking, mentioned the counter-accusation problem I had foreseen.  The mainstream Right noted the same things, but spent most of its energy mocking the law.  (However, Heather MacDonald had a must-read piece dissecting the “neo-Victorianism” that this law represents, to which David Brooks had a must-read response.)  The Right also continued arguing (correctly) that campus rape tribunals are kangaroo courts, farces of justice injuring both accusers and accused more or less at random (though they are increasingly stacked against the accused).  These tribunals — mandatory under Title IX and dramatically expanded by the Obama Administration — have no business existing in the first place, because the proper venue to try a rape charge is in court, and affirmative consent policies only empower them to ever greater injustices.

(On that note, I thought it instructive that California applied the “affirmative consent” standard only to college codes of conduct, not to the California criminal code.  Perhaps they recognize what a catastrophe it would be for all concerned if the affirmative consent standard weren’t just a tool to help college administrators persecute accused rapists, and were applied in a system that actually has due process of law.)

This all happened last year, and I figured the affirmative consent was doomed, so I made no comment.  California passes all sorts of weird bills, and presumably the Left — given a little time — would realize that “affirmative consent” standards hurt rape victims and (worse!) undermine the Left’s pièce de résistance, the Sexual Revolution, leading them to withdraw support for the idea.  I mean, once Jonathan Chait gives up on your feminist crusade, it’s all over.  (I’m pretty sure that’s a Rule of Acquisition.)

But I was wrong.  This has not happened.  Affirmative consent has only grown more prevalent, although, even now, nobody has legislated it into criminal law.  This week, I learned that my own local state university, the University of Minnesota, is on the verge of imposing an affirmative consent policy of its own.

What actually prompted me to finally post about this, though, after so many years thinking about it, was a tidbit I picked up on social media today: a group styling itself the “affirmative consent project” has started actually circulating a sexual consent contract.  I laughed very hard.  All my predictions are coming true!  They are actually going to make kids sign a contract before they have sex, and save it for years!  Every time they do it! My only mistake was in thinking that the Left would need some prompting from the Right to so radically violate their “stay out of other people’s bedrooms” principle they’ve spent so many years pretending to care about.

This is certainly amusing, and, in some ways, the first wave of affirmative consent is useful.  But my next round of predictions suggests that increasingly savvy rapists will (easily) exploit the new rules, leading to an unraveling of justice for both rape victims and falsely accused rape perpetrators.  I don’t want that.  Even the destruction of the college hook-up scene isn’t worth causing more harm to rape survivors… and the lack of a marital exception to these policies means the damage could eventually extend far beyond fornication, harming all sexual relationships of any kind.   We should repeal these policies before we get anywhere close to that.

I recognized these problems after only a couple hours thinking about the idea, and my concerns led me to shelve the idea for more than two years.  But the State of California, and now the U of M board of regents, have now gone ahead and passed actual laws, affecting millions of people, apparently without bothering to think about it as much as I did for a blog post.  Once these policies are repealed, everyone in California and on the U of M board of regents needs to sit down for a very long think about passing real, very powerful laws without bothering to consider their unintended consequences.

Thanks everyone for coming.  I am James Heaney, and my talk is on network neutrality.  I can’t claim any particular credentials on this topic, the way our past speakers have been able to.  I did write a blog post about the economics of net neutrality that got picked up by TechDirt and retweeted by Vint Cerf, which was maybe the coolest thing that ever happened to me, but my interest in it is amateur: net neutrality sits at the crossroads between technology, economics, law, and public policy, which rings pretty much all my chimes.  My presentation will start with tech, where you’ll probably know most of what I’m talking about, and move toward policy, which hopefully is a little more educational. Net neutrality a hugely complicated issue, and – while I do have an opinion – I think this is one of the few policy issues where this is no single right answer.

That said, let’s see how the room shakes out.  Based on whatever it is you know – no matter how vague –  do you think the FCC’s proposed regulations on network neutrality go too far, don’t go far enough, or are just right?  And, yes, you have to decide, no matter how irresponsible your opinion.  Don’t worry: I won’t tell the FCC.

Cool.  And, just out of curiosity, do you think your opinion is fairly well-informed, or not?

So, let’s start with the basics.  Net neutrality is about how data traffic is handled on the internet. What’s the internet?

(TED STEVENS IMPRESSION) “It’s… it’s… it’s a series of tubes!”

Heh heh.  I love that one.

But, seriously, Senator Ted Stevens was basically right.  The Internet is a bunch of computers stuck together with tubes.  All of them want to send data over the tubes to everybody else.

When a home user connects to the Internet, he typically connects to an Internet Service Provider, or ISP.  This ISP – let’s say Comcast – owns what is called a Tier-2 network.  You give them money, they let you connect to every other computer in their network.  Right now, Comcast will sell you “unlimited” access, which is actually 250 gigabytes per month, with 20 megabit-per-second-service, for around $80.

But Comcast isn’t connected to everyone on the Internet.  In fact, it’s not really connected to very many people at all besides other Comcast customers, which is just a subset of other people in the United States.  And they call it the Internet, not ComcastAmericaNet, so they must be doing something to get their users connected to the rest of the world.

Some of what they do is called peering.  In a peering arrangement, Comcast calls up another network – say, Vodafone – and asks to send traffic to their network.  In exchange, Comcast will let Vodafone send traffic back to Comcast. Once they’ve agreed, at a convenient location, they build a physical connection between their two networks, large enough to handle the agreed-upon data loads. Typically, peers don’t charge each other, because the arrangement is mutually beneficial: it widens both networks, improves performance on both networks, and increases the prestige of both networks.  But, sometimes, especially when the data loads are unequal, one of the peering partners charges the other partner money for the privilege of peering.  There are also public peering locations (Internet Exchange Points) where dozens or hundreds of different networks build access points and are allowed to peer with each other… normally for a fee, paid to the administrator of the IXP.

Now say Comcast wants to get access to British Telecom’s network.  BT is willing, Comcast is willing, the prices are fair, just one problem: BT is in Britain.  Peering requires a physical connection, and there’s no way for Comcast to build a connection to BT’s network without building a cable across the ocean.  Comcast may be richer than Creseus, but even it can’t afford its very own transatlantic fiber line.  So Comcast calls up somebody who has one – Level 3 Communications – and asks to pay them for what’s called “transit.”

In an Internet transit agreement, a Tier-2 network reaches another network by paying a third network – a middleman – for the privilege of using their tubes.  So if Comcast pays Level 3 enough, Level 3 becomes the connection between Comcast and British Telecom, and now they can access each other’s networks.

One way or another, Comcast has to be able to connect to all the other networks on the Internet; otherwise they’re not really connecting to the Internet, but just a subset of it.  This means setting up interconnection agreements (transit and peering) with everyone.  This is very complicated, and involves a tremendous amount of private negotiation and difficult contracts.  That it works at all is a testament to the miracle of free and relatively unregulated markets.

Oh, and I mentioned tier-2 networks a few times there, so you may be wondering what a tier-1 network is.  Tier-1 networks are just like Tier-2 networks, except they are so big that they can connect to every other network without ever purchasing transit from a third party.  Tier-1 networks do peer with other Tier-1 networks, and they are usually the ones selling transit to smaller outfits, but they do not themselves ever purchase transit in order to reach another network.  There are currently seven tier-1 networks in the world – Level 3 Communications is an example of a tier-1 network.

Content can live in any of these zones: it can live on home computers and small-business servers that connect the rest of the internet through an ISP.  More general content providers often connect directly to tier-1 networks.  For example, my website, starshipexcelsior.com, lives on a Hostmonster server, which connects directly to the Cogent Communications network, a tier-1 network.  This makes sense; it ensures that the average distance between my content and any computer connected to the internet is relatively short.

And providers with a particular need for high performance or high data loads (or both) often use a content distribution network.  In a CDN, content is distributed from a central server to various endpoints around the world – points of presence (POPs) that are close to end users.  This ensures that content reaches end users swiftly, and it often reduces the total cost of data transmission for the content provider, since not every piece of data has to come from central every time, but can be cached and reused at the points of presence.

So, yes, the Internet is just a series of tubes.  But it’s a series of tubes governed by thousands of different companies, individuals, and governments, each with their own turf, each with their own carefully negotiated deals with dozens of other companies, each with carefully maintained interconnection points in thousands of locations around the world.  That a fully interconnected “network of networks” could exist at all is humbling, when you consider its scope; that all these fiercely competitive networks can, under contract, cooperate so reliably that we often don’t even think of them as separate networks is perhaps, without exaggeration, free enterprise’s crowning achievement.

So why on Earth would anyone want to the United States government to step in and regulate it?

Let’s talk economics now.

The Internet works because it is, at every level, a free and competitive market, where all network managers are ultimately accountable to their customers.  If a content owner doesn’t like the price that AT&T is charging for first-mile network access, she can easily call Cogent instead.  If Comcast doesn’t like what Level 3 is charging for IP transit over the Atlantic so Comcast can reach British Telecom, Comcast can easily take its business to TaTa Communications instead.  And if an end user thinks that TimeWarner Cable’s service is crappy or slow or expensive, he can switch to a different ISP.

This means that everyone is always competing for each other’s business, and that means that every company involved is always trying to deliver the most service to everyone else at the lowest total price.  In a market where everyone has a strong incentive to be efficient and make their customers happy, the heavy hand of government regulation, no matter how well-intentioned, can only get in the way.  Adam Smith’s invisible hand is already doing everything possible to maximize customer happiness, plus it turns a healthy profit for providers, keeping them interested in doing business.

At least, that’s how the economics of Internet connectivity work in theory.  In practice, the Internet access market looks less like Adam Smith’s ideal free market every day.  In one sense, it never resembled a competitive market in the first place.

Back in the late 19^th and early 20^th century, the United States noticed something odd about railroads: while there were several railroad companies, over time they competed less and less with each other. Instead they settled down to form a few regional monopolies.  Within those regions, they acted like all economic monopolists do: they stopped responding to the needs of customers.  Instead, the railroads set about extracting as much money from consumers as they could.  Wealthier towns saw higher rail fares, for absolutely no reason except that the railroads thought they could get away with it.  Service and safety became badly degraded, because why would a monopolist do more than the bare minimum to keep their trains running?  What were the consumers going to do, not use trains?  (Some people did stop riding trains; given the price, some had no choice.  But not enough quit to make “good service and fair prices” worth it to the railroads’ bottom lines.)

Normally, the free-market response to terrible service and high prices is simple: start your own company and beat the tar out of the incumbents, taking away their market share fair and square.  If there’s only one Chinese restaurant in town, and it’s terrible, you start another Chinese restaurant across the street, and may the best man win.  But, in the railroad market, every startup failed, despite the fact that consumers wanted them to succeed.  The free market simply broke down, the invisible hand stopped pushing prices down or lifting up consumers, and everyone ended up under the tyranny of the monopolies.

When consumers have no power in a market, and no firms can break in to make the market competitive, there’s only one entity that can break up the logjam: the government.  In the 1880s and 1890s, Congress passed a series of bills that broke up some of the biggest monopolies, and which tightly regulated the railroad industry for over a century.

Later on, our grandparents saw the exact same thing happen in other industries, like electricity and phones.  Slowly, in the aftermath of the Marginal Revolution, economists figured out why competition just didn’t work in some markets, and they coined a term for it: natural monopoly.

In most businesses – generally speaking – the more you sell, the more it costs you. If you run a hot dog stand, and you want to sell ten hot dogs in an hour, you have to buy enough meat, bread, and condiments for ten hot dogs.  But if you want to sell a million hot dogs in an hour, then you have to buy a hundred thousand times as much meat, bread, and condiments, not to mention all the other costs of scaling up, from human resources to fuel for your grills to inventory tracking.  The more you sell, the more it costs.  This is almost always true – so much so that the standard supply and demand graph simply assumes it.

However, there are some markets where it is not true.  Consider a power company at the dawn of the Electric Age.  They build a power plant and power lines to carry electricity throughout town to their wealthy customers.  One day, Bob the Barrister decides he wants electricity, too, so he calls the power company, which drives out, connects Bob’s house to the grid, and begins charging Bob for the electricity.  Here’s the magic: by selling more product, the power company’s costs actually go down.  See, it was already producing the electricity that Bob just purchased, because that’s mostly how generators work – they produce a certain amount of electricity, whether it gets used or not.  It’s just that, until Bob signed up, that electricity was going to waste.  Now Bob is paying for it.  The power company also already had most of the infrastructure to move Bob’s electricity the five miles from the power plant to Bob’s house.  Now Bob is helping pay for that infrastructure, too.  The only added cost from Bob signing up with the power company was a single short cable and an hour or so of labor – which, from the company’s perspective, is a very low cost indeed, and is more than offset by the savings Bob’s membership brings.  In fact, the more product the power company sells, the lower their average cost goes.  In theory, they’d be able to return those savings to the consumer, lowering the price of electricity for all their customers every time they add one.

That makes it almost impossible – indeed, economically inefficient – for competition to survive in a market like this.  All companies in the market fight bitterly to get the most customers (this is good).  But, as soon as one company gets a small lead over the others, that company is able to cut prices, leading more customers to sign up, allowing the company to cut prices more, leading more customers to sign up… while the other companies are losing customers and are forced to raise prices, causing them to losemore customers, until they eventually go out of business.  It’s a domino effect, where the invisible hand herds consumers into signing up with the same company faster and faster until it’s the only company left standing.  Potential new competitors face daunting startup costs and the impossibility of beating the market leader on price.  As a result, the single company that survives the initial round of combat becomes a permanent monopoly… and, as soon as its last competitor is dead, it begins raising prices to take advantage of monopoly profits.  Because market forces alone forced this to happen, it’s called a natural monopoly.

As it turns out, most utilties work this way.  Electric power is a classic example, water another.  The government deals with these problematic markets in various ways.  U.S. water systems are regulated very simply: they are owned and operated directly by the government, with no private competition allowed (not that it would be feasible anyway).  The government then aims to deliver clean water to customers at the lowest possible price (with varying success).  The electric system is little different: while people buy their electricity from a company rather than the government, that company is, in most states, regulated closely by the government, which sets a legally mandated price that all electric companies must use.

There is a great deal of suspicion of regulation, which is not without cause.  Government-run or government-regulated monopolies don’t rely on the market to set prices; they rely on the best guesses of well-intentioned bureaucrats.  They are complacent and often fail to innovate, because they have little or no incentive to do so.  Their service is usually not as good as you’d expect for the price you’re paying, although you retain some leverage simply because you can vote out city officials who don’t do their jobs.  For that reason, many states do as much as possible to deregulate their utility markets.

However, even those programs can only go so far.  For example, in Texas, where deregulation was embraced more fiercely than perhaps anywhere else, power generation has been completely deregulated.  But the delivery network, the grid, remains under the control of the incumbent natural monopolies, and Texas is forced to regulate them very tightly in order to prevent them from abusing their market power.  This is because even Texas free-marketeer Republicans broadly agree that an unregulated natural monopoly is far worse than even a government takeover.  Rather than relying on well-intentioned bureaucrats to set a fair price, the monopolist sets prices as high as possible – far higher than a free market would allow.  Monopolists, too, are complacent, and don’t just fail to innovate, but often fight innovations, because innovation could disrupt their control.  Their service is abysmal, because they have absolutely no reason to care about you.  After all, what are you going to do?  Disconnect from the electric grid?  Move to another state?  In economic terms, your personal demand curve is inelastic.  In practical terms, they don’t care whether you’re satisfied with their service, and they don’t care whether they provide you with fair service at a fair price.  You needtheir service and will pay nearly any price, tolerate nearly any indignity, to get it.  While much of the monopolist’s effort remains focused on adding customers early on, that gradually peters out as they approach saturation, and instead they begin to work on ways to gouge more money out of existing customers.

If your customer experience with Comcast has been anything like mine, you’re beginning to see where this is going.

But first, a short aside: the “utility model” of natural monopolies is the main thing we’re concerned with today, but it’s not the only way a monopoly can arise naturally.  There’s a closely related but distinct phenomenon called the “network effect,” where adding a new customer doesn’t lower corporate costs, but does increase the value of the service for everyone else using it.  Social networks are a wonderful example of this kind of natural monopoly: within each region of the world, a single service has taken absolute control of the market for social profiles.  In most of the world, it’s Facebook.  In China, it’s Qzone. In Russia, everyone has a V Kontakte (KOHN-tact) profile.  Many of us Americans are unhappy with Facebook, and would leave for a viable competitor if we felt we could – but the network effect has made it impossible for any competitor just starting out to give us the same value Facebook does, because Facebook alread y has everyone we want to connect with.  So, for most of us, our practical options are to have a Facebook or to have no online social profile.  This isn’t exactly the same way a railroad monopoly works, but it’s close, and I think we’re all probably more familiar with Facebook’s triumph over Google Plus than we are with Great Northern Rail’s defeat of the CB&Q railroad in 1901.  Keep Facebook in mind as we start talking about the ISP monopolies.

By this point, even if you didn’t know a word about net neutrality or the Internet coming into this, it won’t surprise you to hear me refer to the ISP market as a natural monopoly situation.  Their business model is identical to that of the power companies: they build huge networks of cables and, when you pay them, they connect the cables to your house.  The only difference between an electric grid and a tier-2 network is what the cables are carrying.  Likewise, natural monopolies gradually took over the telephone market eight decades ago… and, for just that reason, Bell Telephone and the Baby Bells have been tightly regulated by the Federal Communications Commission since the New Deal era.

Twenty years ago, it was hard to imagine the ISP landscape we have today.  Back then, when the world wide web was a newborn, ISPs were a free-for-all, with thousands of competitive options in every region of the country.  My family was a Sprynet house.  That’s just what we expect to see in a young market, even one that naturally tends toward monopoly, because no single firm has had time to become dominant yet.

But, sure enough, starting around 1998, the market entered a long consolidation.  Most of the early ISPs either failed, were bought up, or faded so that, today, they serve only some particularly arcane submarket, and not the average consumer.  Today, the average consumer has very few choices.  Speaking personally, there are only two serious competitors for my broadband internet coverage: CenturyLink and Comcast.  That’s actually up from the past several years, during which CenturyLink told me it couldn’t reach my home with anything faster than dial-up.  According to the FCC’s December 2013 report on broadband penetration, I’m one of the lucky ones: one out of every three Americans has access to just one broadband provider (where broadband is defined as at least 6 mbps downstream).  These Americans have zero choices: it’s their ISP or the highway.  Another one in three Americans are in my boat, with two options – although, if the FCC redefines broadband to 10 mbps downstream, as it is expected to do next year, I and many others will be back down to one option.  [EDITOR’S NOTE: not only did this happen shortly after I gave the talk, but the FCC went much further than expected and defined broadband as 25 mbps downstream.]  5% of Americans have no broadband access at all, and the remaining quarter have three or more choices.  No matter how you slice it, this is a far cry from the heyday when any hacker could run a commercially viable ISP out of his bedroom, and every consumer had his pick of the litter.

And they’re not done consolidating yet!  When the Comcast-Time Warner merger is complete, bringing two of the biggest players together under one roof, the monopoly effects will be even stronger.  We would expect prices to rise and service to degrade accordingly.  According to the American Customer Satisfaction Index, ISPs are already the least popular industry in America – less popular than life insurance salesmen and the cigarette industry. Given how terrible they are already, it wouldn’t surprise anyone to see them get even worse.

One of the easiest ways the ISPs could make things worse is by attacking the principle of net neutrality.  And that brings us to our point.

Net neutrality is a relatively simple principle.  Indeed, it never needs to be defined, much less legislated, in a competitive free market, because customer demand virtually guarantees that every successful company will provide net neutrality.  Only in a collapsed or collapsing market, where a few regional duopolies or monopolies control a sufficiently large slice of the global pie, can net neutrality start to break down.  That’s when people start paying attention to it, and trying to pin down precisely what it means.  (The internet has been net neutral since USENET days, but the phrase wasn’t coined until 2003, when Professor Tim Wu first suggested that it might be in trouble.)

According to Wu’s original paper, a network is neutral if it “does not favor one application… over another.”  There are other, similar definitions.  Sir Tim Berners-Lee, the Web’s inventor, gave this definition: “If I pay to connect to the Net with a certain quality of service, and you pay to connect with that or greater quality of service, then we can communicate at that level.”  I’m personally fond of Wikipedia’s formula: a neutral network does not “discrimin[ate] or charg[e] differentially by user, content, site, platform, application, type of attached equipment, or mode of communication.”

But let’s stick with Wu’s.  It’s short, it’s original, and it’s narrow, and if you start using the broader definitions, it gets even messier than it already is.  Net neutrality works like this:

If Comcast is net neutral, and if I’m paying the monthly fee for 250 gigabytes of data at a 20 megabit-per-second download rate, then they’ll give me that level of performance, or the closest approximation they can manage under network congestion, regardless of the data I’m trying to access.  If I want to spend my entire 250 GB allotment on ASCII art of the Sacred Heart of Jesus, I’ll get it, and I’ll get it at 20 megabits per second.  If I want to spend all my data downloading and seeding a (legal) torrent of Weird Al Yankovich’s hit song “Don’t Download This Song”, I won’t be discriminated against based purely on the fact that the content is on the BitTorrent protocol, nor based on the fact that it’s a Weird Al song.

Likewise, when networks interconnect, if they are neutral networks, they will allow any compatible data, and won’t prioritize one kind of data over another kind of data.  They will charge you for how much data you want to move and how fast you want to move it – but nothing else.

The incentive for network neutrality is consumer demand.  When monopolies take over, this incentive breaks down, and neutrality crumbles.

Returning to an earlier example: let’s say CatsWearingTopHats.com (not a real website – yet) hosts its content on British servers (because of course it would), which are connected to the internet through British Telecom.  The CWTH.com admins want to send cat pictures to a Comcast subscriber named John, who is trying to access their site.  Since BT and Comcast don’t directly peer, BT buys transit on Level 3’s network to reach Comcast, which passes the cat pix on to John.

Now, suppose, one day, one of the three networks in that chain decides it doesn’t like cat pictures, or that people who download pictures of classy cats probably have extra money laying around and can afford to pay a little more.  So this network informs the other participants that, henceforth, they will have to pay a substantial toll if they want to get any more pictures from CatsWearingTopHats.com over to John in the United States.

In a free and competitive market, the answer is easy: change networks.  If the discriminator is BT, the CatsWearingTopHats.com changes to a different first-mile network.  If the discriminator is Comcast, John cancels with Comcast and is connected to a different last-mile network, at the same price, ten minutes later.  If the discriminator is Level 3, it’s a little more complicated – John and CatsWithTopHats have to tell BT and Comcast to raise the issue with Level 3.  BT and Comcast can renegotiate, or they change to a different Tier-1 network for transit, or they can tell John and Cats to take their business elsewhere – which they promptly will.  Bottom line, discrimination is harshly and immediately punished by competition.

But what if Level 3 owned the only transatlantic fiber cable in the world?  Then there would be nothing anyone could do if Level 3 chose to discriminate.  Either CatsWithTopHats and BT and Comcast would have to pay the arbitrary classy-cat toll (with John footing the bill in the end, in the form of higher subscription costs), or CatsWithTopHats would have to simply stop sending John any cat pictures, effectively cutting itself off from John’s network – no longer the World Wide Web, but some subgraph thereof.

Unfortunately, this is what we’re starting to see in some corners of the Internet, mainly among last-mile service providers, where competition is – as we’ve discussed – an endangered species.  A few years ago, AT&T blocked Apple’s video chat app (FaceTime) for customers who weren’t also paying AT&T for unlimited voice and text messages… even though FaceTime used only data, not voice and text, and even if the customer was already paying for unlimited data.  AT&T simply refused to allow competition to exist on their network.  An FCC investigation under now-defunct net neutrality rules persuaded AT&T to back down.

In 2007, Comcast throttled all traffic using the BitTorrent protocol, slowing it to a dead crawl.  Comcast’s justification was that some BitTorrent users are heavy network users, which was causing network congestion.  BitTorrent users responded by pointing out that their connections were advertised as having “unlimited” bandwidth, and, besides, you can’t attack an entire protocol for the activity of a few bad apples.  Comcast replied that it could do as it damn well pleased, and its customers could go elsewhere if they were upset – knowing full well that many of their customers had no other broadband options.  An FCC investigation under now-defunct net neutrality rules persuaded Comcast to back down.

Most recently – certainly more importantly than other past suspensions of net neutrality – last-mile ISPs have started raising access costs for major content providers.  The main target and major headline grabber so far has been Netflix, which hosts its content (mostly) through Level 3 Communications (a tier-1 network).  In one example, Verizon, throughout the first half of 2014, publicly demanded that Netflix stop using Level 3 to get to Verizon’s customers. Instead, Verizon demanded that Netflix pay Verizon to host the content on Verizon’s servers, as part of a content delivery network.  In the meantime, wherever Level 3’s network interconnected with Verizon’s, Verizon refused to upgrade their routers to absorb the large amount of traffic coming from Netflix… even after Level 3 offered to pay for the (inexpensive) upgrades themselves.  As a result, Netflix traffic – plus anything else being transmitted by Level 3 – became very slow on Verizon’s networks, and actually became unusable for some home users, despite the fact that said home users were paying for unlimited data at 75 megabits per second.  Verizon’s customers didn’t have a lot of alternative choices in the decreasingly-free ISP market,  though and, in the end, it turned out that Netflix needed access to Verizon’s customers more than Verizon needed Netflix on its network.  Netflix gave in and started paying Verizon for a CDN.  Within a few months, every other major ISP did the same thing to Netflix.

For advocates, this was a fairly clear-cut case of discrimination against a single application.  While Verizon insisted that this was a simple case of Netflix trying to take a free ride on Verizon’s network using the net neutrality buzzword for political cover, this interpretation is difficult to sustain, given Level 3’s public offer to pay for Verizon’s network upgrades themselves.

So what do we do?

Option one is we leave things as they are, unregulated.  We’ll let the market take us wherever it wants to go – even if that takes us right into the arms of a natural monopoly.  This would avoid the many costs inherent in regulation.  But it could also impose a natural monopoly regime on us.  Perhaps that wouldn’t be a bad thing.  A couple weeks ago, when my blog post on net neutrality got picked up, a conservative think-tanker tweeted me a 1968 article by the University of Chicago’s Harold Demsetz, entitled “Why Regulate Utilities?” which argued that doctrines about the danger of natural monopoly, though widely agreed-upon by economists, are wrong, and that there is no need to regulate. The libertarians at the Mises Institute agree, though their arguments are as much moral as economic.  I confess I haven’t been able to finish the Demsetz article yet – largely because I was writing this talk!

Option two is to do what we did with Microsoft in the ‘90s: just threaten ISPs with regulation and sanctions, so that eventually they either back down or market forces take over before anyone manages to exercise monopoly powers.  Unfortunately, that ship has sailed, and is no longer in the policy toolbox.  In the mid-2000s, the FCC issued regulations that mostly enshrined net neutrality, but the regulations were on legally very shaky ground.  They worked as long as the ISPs didn’t fight back.  In 2007, that’s exactly what Comcast did.  In 2014, Verizon won a final court case, and the FCC’s net neutrality regulations were thrown out.

That being said, although most of its regulatory power over broadband was gutted by the courts, the FCC is still trying to impose a very limited form of net neutrality with the authority it has left.  This proposal would prevent networks from arbitrarily blocking traffic, but would still allow them to charge content-based tolls on (or accelerate) the data that traverses its network, rather than charging each bit the same price for the same quality of service.  We might call the FCC’s halfway-neutral proposal “option two point five.”  [EDITOR’S NOTE: Since I gave this presentation, the FCC has abandoned this approach.]

Option three is to ask Congress to do… something or other.  There is, of course, the problem of figuring out what to ask them for in the first place.  But, beyond that, the current Congress, for reasons well beyond the scope of this talk, is incapable of doing much of anything, particularly when lobbyists oppose taking action. That is especially true in the tech sector, where most Congressfolk are out of their depth – as we’ve seen from Congress’s continuing failure to do anything about software patent trolls, despite the flagrant abuse and obvious damage current patent law is doing to the economy.  Moreover, after Barack Obama endorsed net neutrality legislation on the campaign trail in 2008, the issue became polarized along party lines.  With divided control of government guaranteed through 2017, Congress is an option that isn’t really an option.

Option four: we could use government, especially municipal governments, to create more competition in the market.  Of course, this would only be pseudo-competition: a private monopoly versus an unaccountable public bureaucracy bailed out by taxpayers is not exactly the free market we envisioned when we started out.  However, it’s a moot point: thanks to brazen rent-seeking by major ISPs, in nearly half the states, local governments are barred by law from providing municipal internet as a public utility.

Option five: some people suggest breaking up any ISP that gets too big, like Reagan broke up Ma Bell in the ‘80s, restoring competition by taking an axe to the monopolies and near-monopolies.  However, there is no obvious legal way to do that. The Bell breakup resulted from a lot of special circumstances, some plain-as-day antitrust violations, and an 8-year court battle.  Moreover, breakup would probably not solve the problem: the “wee ISPs” would still have local monopolies in many areas, and economics 101 would force them to immediately begin reconsolidating into new national monopolies (as the Baby Bells are doing today).  And even the Baby Bells remain tightly regulated post-breakup.  In the long run, the consolidation and price gouging of natural monopolies are probably inevitable.

This brings us to option six: the Federal Communications Commission.  I’ll dwell on this option at length, not because it is necessarily the right option, but simply the main option people are talking about today. (Neither net neutrality advocates nor anti-regulation telecoms are happy with the FCC’s proposed regulations under “option two point five.”) As I mentioned earlier, the FCC was created in the 1930s to regulate the natural monopolies in the telephone market.  The technical term-of-art used here is “common carrier:” any company that sells bandwidth (such as a 12-baud connection to the phone network, or a cubic foot of space on a freight train) to the public at large counts as a common carrier, and most are susceptible to natural monopoly.  Because of their unique, key position in the national transportation infrastructure, they are also required to actually serve the public at large.  If you have the money to pay for a ticket on an American Airlines flight, there’s a seat available, and there’s no other justification for denying you a ticket, then American Airlines must sell you that ticket.  Everyone must be given equal access to the nation’s transportation networks – as long as they can pay the price.  Under Title II of the Federal Communications Act of 1934, the “common carrier” appellation applies whether a service carries physical goods and persons (transmitted by rail and sea) or data (transmitted by phone and telegraph).  The FCC’s mandate was to prevent the common carriers of data from arbitrarily denying service to lawful users, or from freezing into a monopoly or cartel.  It could even require phone companies to make interconnections between different phone networks, in order to ensure that everyone with a phone could reach everyone else with a phone – if the Level 3/Netflix/Verizon fight we talked about earlier had taken place over phone lines instead of cable, the FCC would have been squarely in the middle of the dispute.

Early ISPs were classified as common carriers under U.S. law.  Of course they were.  ISPs literally sold bandwidth to the public, and, according to World Wide Web’s designer, Sir Tim Berners-Lee, the World Wide Web depended on the public being given equal access as long as they were willing to pay. Naturally, the FCC would regulate ISPs the same way it had regulated the phone companies for 60 years.  And, throughout the dial-up era, it did.  In 1996, Congress passed the Telecommunications Act, which updated the FCC for the Internet Age.  The “Republican Revolution” Congress under Speaker Gingrich made sure that the updated framework did as much as possible to promote competition in the market – without allowing monopolies to overtake that competition.  A few years later, DSL came out.  The FCC examined DSL and ruled that it fell under the common carrier provisions. It obviously met the definition, so how could it not?

A little after that, cable broadband internet began rolling out to consumers.  The FCC examined it… and a remarkable thing happened.  In 2002, the FCC ruled that cable broadband was neither a “telecommunications service” nor a “cable service” subject to common carrier regulation.  Instead, cable broadband was solely an “information service,” with no telecommunications or cable element included. Since information services can not be regulated as common carriers under Title II, this freed cable broadband providers from all those regulations.

Of course, this was a ludicrous ruling.  The Telecommunications Act of 1996 leaves no wiggle room for cable modem operators: they are clearly telecommunications services.  The “information service” classification, by the FCC’s own precedents, was for services like Google, or your library catalog system, or dialing 411, not an ISP; indeed, information services were unregulated precisely because they involved little to no infrastructure and few, if any, barriers to entry.  So, you know, the exact opposite of ISPs.

The FCC spent thirty pages producing a – if I may, rather convoluted – rationale for this ruling.  Their basic argument was that broadband internet was a telecommunications service which also carried information services on it.  They went on to say that the broadband “information service” is not distinguishable from the underlying telecommunications service – they are one and the same, so to speak – and, since the information service is mainly what the consumer sees and understands himself to be paying for, the telecommunications service side of cable broadband fades out of regulatory view. In paragraphs 38 through 40, the FCC argues that, because data travels over the ISP pipes, the pipes themselves are legally the same thing as data.  I am trying to be fair here, but there’s not much to work with.  I don’t know of anyone who takes this ruling seriously on its own merits.

The FCC’s press release focused on something quite different from the merits, and created the narrative that has, for both sides, defined the ruling ever since: the FCC claimed it was trying an experiment in telecom deregulation, hoping that, by deregulating further, competition (which had not materialized in the wake of the Telecommunication Act) would finally emerge in the ISP market and stop the slide toward monopoly.  It had worked reasonably well in the 1980s deregulation of the airline industry, so maybe it would work in telecom, too.  To accomplish this, the FCC didn’t technically need to follow their precedents or the Telecom Act; they just needed to find a justification that could survive bare minimum judicial scrutiny – which is not a high bar to clear, because the courts must give overwhelming deference to the FCC and other regulatory agencies.   Sure enough, the FCC’s strange ruling survived review in a 6-3 Supreme Court ruling (Justice Scalia’s blistering dissent, where he slams the FCC for unilaterally deregulating the ISP market, is a fun read, as always).  A few years later, the FCC extended the same deregulation offer to DSL and phone services.  They eagerly took it, escaping the Title II regulation regime.  Suddenly, ISPs in America were no longer considered “common carriers” under law (even though they obviously were common carriers in actual fact).  Internet regulation, which had been part of the Web’s DNA since its invention, was gone.

In short, the only reason the Internet isn’t protected from monopolies today is because, in 2002, the FCC decided to experiment with not regulating the Internet.  Shortly thereafter, the earliest warnings about net neutrality started to show up in the academic literature, and those warnings have only built in the years since, as ISPs have busted apart any regulation trying to keep them on a net neutral regime.  The Wall Street Journal regularly argues that the Internet has thrived because ISPs have never been regulated like phone companies.  This is false, and the Journal should know better.  Indeed, the years of the Web’s most explosive growth and development happened under the auspices of strict common carrier regulation, identical to those of phone companies.  (Heck, even today, limited portions of Verizon’s high-speed fiber network, FiOS, fall under Title II – at Verizon’s request!)

If the FCC decided to fully regulate net neutrality, the fix would be very easy.  Indeed, several courts have pointed to it over the past several years: simply revisit the strange ruling of 2002.  Overturn it, and (correctly) decide this time that Internet Service Providers are “telecommunications services”.  Instantly, every ISP in America would go back to common carrier status, and net neutrality regulation wouldn’t just become easy; in many ways, neutrality is baked into Title II.

[EDITOR’S NOTE: A few hours before I posted this, the FCC came out in favor of Title II.]

One issue I should mention that opponents sometimes bring up is “forbearance.”  The long and short is, Title II comes with an enormous number of tools and obligations.  It would become a factor in all interconnection agreements, it would impose price controls, and it would have veto power over all sorts of network management.  Even many net neutrality advocates don’t want to impose all that.  They argue that the FCC can simply “forbear” from imposing any parts of Title II it doesn’t want to apply to network access providers.  Opponents argue that forbearance only works in limited cases where good reasons exist, and that the ISPs don’t meet forbearance standards.  This is a complicated in-the-weeds legal argument which I can’t summarize here, but, for my two cents’ worth, I tend to think that the opponents are right: imposing Title II would impose most or all of Title II – not just the parts that protect net neutrality.

The U.S. Council of Catholic Bishops has repeatedly asked the FCC to do something to protect net neutrality.  Being a council of bishops, not a room full of nerds, they have not gone into technical detail, but their call to action is clear. Their most recent piece, this one by Bishop John Wester, chair of the USCCB Committee on Communications (and bishop of Salt Lake City), appeared on September 16^th.  “Instead of adopting rules that permit the wealthiest companies to purchase the best service,” wrote the bishop, “the FCC should insist on fair treatment for everyone no matter our income. Community-serving organizations – such as the church – should not be treated as secondary “customers” in this digital environment. The content and connections we provide to people are more important than entertainment content — such as movies and television shows — even though we don’t have the resources to compete with entertainment companies to pay more to the Internet providers… Allowing some Internet content to be favored because of its greater ability to pay could result in an even greater divide between the powerful and the rest of a community. Under that scenario, decisions regarding access to public information… would be determined based only on the bottom line of corporations, not to promote the common good.”

The USCCB’s position hardly ends the discussion – I’m sure we can all name at least one policy where we disagree with a USCCB opinion – but it introduces a moral dimension to what has otherwise been a very horizontal issue of economics, law, and technology.

Here is where my blog post roared into a blazing conclusion, making a ringing endorsement of one particular option and scorning all others.  But we’re here for a discussion, and so I’ve tried to give this talk at least the sheen of objectivity.

So, instead of ending with a rhetorical flourish, I’d like to end with a few of the questions I hope we’ll examine when we come back from break:

How is our day-to-day work, as computer people, impacted by net neutrality, and how would it be changed if neutrality changed?

What Catholic principles of social justice help guide our action in the realm of net neutrality?

And finally, the big one: what should be done about net neutrality, if anything, and who should do it?

But those are big discussion questions.  Right now, in the remaining fifteen minutes or whatever, I’d like to take your questions about the meat of the presentation you just heard.  Was I clear?  Should I expand on anything?  Did I get anything completely wrong?

Thanks for your close attention to that rarest of 21^st-century unicorns: an hour-long presentation without an accompanying PowerPoint.

EDITOR’S NOTE: The author didn’t want to come out and say it in this talk, but he supports Title II reclassification, and is very excited by today’s announcement.

CORRECTION 6 Feb 2015: The original article, in one paragraph, conflated two court cases, Comcast v. FCC (2010) and Verizon v. FCC (2014).  I regret the error, now corrected.

CORRECTION 1 Jun 2016: Some readers thought that Justice Scalia’s “blistering dissent” in NCTA v. Brand X was in favor of deregulation, apparently because deregulation is generally seen as a right-wing idea and Justice Scalia is generally seen as a right-wing judge. But Scalia was actually arguing against deregulation in his dissent, arguing that, whatever the merits of deregulation, the FCC had no authority to deregulate ISPs without Congress’s express approval. This has since been clarified in the text.

[NOTE: If you are more technical-minded, you may prefer my recent presentation to a group of local I.T. professionals, Net Neutrality: A Sorta-Technical Overview.]

[UPDATE: In 2021, this post drew the attention of Republican FCC Commissioner Nathan Simington, and we had a lovely chat about it.]

Like most Americans, conservatives do not know very much about Net Neutrality.

What they do know about it makes it sound like a terrible idea: a bunch of Silicon Valley elites, backed by the Google panopticon and the Mozilla jerks who publicly executed Brendan Eich over his quiet support for traditional marriage, are demanding that the FCC impose sweeping regulations on the companies who bring the Internet to your door.  With help from their close ally President Obama, these shysters have made tremendous forward progress against the so-called “evil” corporations who (in reality) own, develop, and generally manage the series of tubes that make up the Internet – corporations who have, in short, ushered in the entire Internet Age and all the good it entails.  The only people in this drama who are holding off the regulators are the valiant heroes at the Wall Street Journal and the National Review, who are not afraid to stand athwart the regulatory agenda yelling “stop!,” demanding free markets and free peoples and not an iota less.

Given that narrative, it seems odd for a conservative – whether an old-guard big-business Bush-era conservative or a new-guard Paulite libertarian conservative – to support Net Neutrality.

Except I do Internet for a living, and I am one of the lucky ones who actually knows what Net Neutrality means and what it’s responding to.  And, folks, I’m afraid that, while L. Gordon Crovitz and Rich Lowry are great pundits with a clear understanding of how Washington and the economy work, they don’t seem to understand how the Internet works, which has led them to some wrong conclusions.

A Functioning Free Market

Let’s start at the very beginning: how does a free market work?  Presumably, as a respectable conservative, you’re familiar with the bare-bones basics, but I’ll still run through them quickly here.  (If you have seven minutes to spare, this entertaining video does a nice job explaining competitive markets in greater detail.)  Here’s a standard supply-demand graph:

In a free and competitive market, consumers want a product.  Let’s say our consumers are tourists in Chicago, and the product they want is a Chicago dog from an outdoor hot dog cart.

Now, if a hot dog cart man is selling a Chicago dog for $1000 apiece, not very many tourists are going to want to buy a hot dog; they’ll go to another cart.  If every cart is selling Chicago dogs for $1000 apiece, most consumers will just go to Gene & Jude’s for an indoor dog, or skip lunch entirely.  There will be a surplus of outdoor hot dogs.  That’s what happens on the right side of the graph: the high price makes the market very attractive to suppliers, but very few consumers remain in the market to pay that price.  Everybody loses: the vast majority of consumers don’t get the hot dogs they want, and the vast majority of cart owners don’t sell any hot dogs.  There’s a huge gap between supply and demand.

On the other hand, if one hot dog cart is selling dogs for a penny each ($0.01), he’s going to find that lots and lots and lots of consumers want to buy his hot dogs.  But he’s going to find it very difficult to stay in business with hot dogs at such a low price.  If consumers get it in their heads that nobody should pay more than a penny for a genuine street-cart Chicago dog, nearly all hot dog cart owners are going to leave the business – they simply can’t make a living without selling hundreds of times as many hot dogs every day, and they can’t afford to invest in the infrastructure (extra grills, bigger carts, hired help) that they would need in order to run an operation of that scale… especially not at that price!  In the end, everybody still loses: consumers end up mobbing the handful of sellers who stay in business, and those few sellers can’t possibly make enough hot dogs in a day to satisfy all those hungry tourists.  When the price falls too low, consumers get hurt because supply shrinks, causing a hot dog shortage.  That’s what happens on the far left side of the graph: the low price makes demand very high, but leads suppliers to produce and sell very few Chicago dogs.  There’s a huge gap between supply and demand.

The beauty of the free market is that competition self-corrects these gaps between supply and demand when they arise, guiding them toward equilibrium, which is the point at which everybody wins – consumers get the most hot dogs, and vendors get the most business.  Let’s say the going price for streetcart Chicago dogs (the current market equilibrium) is about three-fifty ($3.50).  One vendor decides one day that he doesn’t make enough money, so he’s going to sell his dogs for $7.50 instead.  Easy market response: everyone stops buying from him, and he goes out of business.  Equilibrium is restored.  No one supplier can arbitrarily shift the market against consumers.

However, the contrary could happen.  Suppose a vendor realizes that, using a new fuel-efficient grill, he can make Chicago dogs at a lower cost than everybody else.  So he buys a grill and cuts his prices, selling the same quality hot dogs for $2.50 while keeping the same profit per hot dog.  Consumers flock to this vendor, driving up his profits while dramatically driving down demand for more expensive hot dogs.  So his competitors – who want to stay in business – buy the same fuel-efficient grills… and, if they don’t, entrepreneurs will realize there’s money to be made supplying the demand for $2.50 hot dogs, and open up their own hot dog stands with their own fuel-efficient grills.  Either way, when the dust settles, the new “going price” for streetcart Chicago dogs ends up at $2.50.

In other words, the entire supply curve has “shifted” to the right, driving down the equilibrium price for the entire market, all because one man came up with a single innovation.  Meanwhile, that one man, because he discovered this efficiency, sells lots and lots of hot dogs to eager consumers while the market adapts to his innovation, and is fairly rewarded with a ton of money.  This beautiful mechanism, called the “invisible hand,” drives the entire American economy: individual entrepreneurs and big corporations all want to make innovations and drive down prices, so that they can make a ton of money while the market adjusts. Consumers win as prices are eternally driven down toward the minimum possible cost (with the minimum sustainable profit).*

Unfortunately, one regulation can crush the entire market.  In our example, we have a thriving competitive hot dog market.  In reality, however, the tightly-regulated City of Chicago has made it illegal for street vendors to sell any hot dogs.  It doesn’t matter how much consumer demand there is, and it doesn’t matter how many people want to go into business to fulfill that demand: nobody gets any outdoor hot dogs (unless they’re willing and able to successfully break the law, as a few do, at high cost), so we end up with an extreme hot dog market shortage, imposed by the government. In the end, everybody loses – except the bureaucrats.

Government is doing this, to greater or lesser extent, all the darn time.  Every time the government imposes a sales tax, or a licensing fee, or a reporting requirement, or virtually any regulation at all, it means that there are additional costs built into the supply curve that aren’t naturally there.  This shifts the curve to the left, raising prices for the entire market, and putting products out of reach for some consumers (especially the poorest: all free-market regulations are, in effect, regressive taxes).  In some cases, the government may even impose price controls, which sets market price at something other than equilibrium, directly and deliberately creating a surplus or shortage that creates losers among both consumers and producers… with no winners (besides the bureaucrats).

As a result, conservatives are highly skeptical of regulations of all kinds and want to demolish much of the Washington bureaucracy.  We may agree that some regulations are necessary – most of us are willing to accept the added costs that come because the FDA checks that drugs sold to Americans are safe, and most of us agree that someone (the SEC) needs to be able to prevent dishonest behavior on the stock market – but we recognize that those choices do carry big costs, and we are deeply troubled by the size and scope of the modern regulatory state (including the FDA and SEC).  The invisible hand is a hundred times better at promoting the general welfare than crony capitalists and liberal special interest groups.

However, as conservatives have recognized for over a century, there are situations where the market simply breaks down. The invisble hand stops moving, and the only thing that can save the freedom and competition of the market is government intervention.  We don’t like it, and, thanks to modern laws, it happens pretty rarely, but, when it arises, the dedicated free-marketeer grimaces, pulls out the sword of bureaucracy, and attacks without hesitation.  The very worst-case scenario is called “monopoly.”

Monopoly: When The Music Stops

I couldn’t find a video for this that explained quite what I wanted to explain, so here’s a song instead.  (This video is also pretty good, but contains spoilers for the rest of this article.)  Happily, it’s not very hard to explain what a monopoly is and how it attacks freedom in the market.

Monopoly is when a single seller controls the market.  There is no competition.  Indeed, because the monopolist is able to set prices wherever he wants, a monopoly is able to destroy any competitors who attempt to enter the market (by undercutting their prices, even at a loss, until the competitors die).  There is also little innovation, because there is little incentive for it, and, when innovations are developed, the savings are pocketed by the monopolist, not the consumer.  Finally – worst of all – the monopolist is able to set prices, not at the optimal equilibrium point where a free market would put it, but at a different point – which turns out to be a point off to the left of equilibrium, where price is higher and quantities are lower than consumer demand in a free market would sustain.  Consumers are trapped.  Competitors are destroyed.  The invisible hand stops.  The free market becomes a tyranny, where the only freedom that counts is the monopolist’s.

To illustrate, let’s return to our Chicago dog streetcart market, where the equilibrium price has settled at $2.50.  Now suppose George Soros rolls into town one day and decides he wants a piece of the action.  So he buys every single hot dog streetcart in the city.  Now that George controls the market, he has no competition.  Remember earlier when we saw a single streetcart vendor raise his price to $7.50, because he wanted to bring home more money?  He was driven out of business, because consumers had no reason to put up with that and went to his competitors.  But George has no competitors.  If he raises his prices to $7.50, there’s not a thing consumers can do about it.  They have to buy from him, or go without hot dogs.  Of course, “go without” is exactly what many of them will do.  But some will still be willing to pay that price, even though the price is way outside what a free market would tolerate.  George may also decide that he doesn’t need a cart on every street corner anymore, so he closes three-quarters of the stands, creating artificial scarcity.  The invisible hand is no longer forcing him to serve the consumer in order to serve himself; a disconnect has opened up.  Ultimately, the price and quantity he sets will be determined by marginal cost/revenue curves, the details of which go beyond the scope of this post, but which will both be quite different from the market equilibrium – and detrimental to everyone else in the market.  Soros will gouge customers every way he possibly can, to the very limits of their tolerance and willingness to get hot dogs.  Welcome to a new world of ketchup fees and lower-quality meats being sold at the same price.  Some consumers will still get their hot dogs, but at a much higher cost with far fewer options and much lower quality.

And say one of George’s hot dog stand operators discovers an even more fuel-efficient way to grill hot dogs, so the equilibrium price of hot dogs falls even further, to $2.12.  You think the Soros Chicago Dog Empire is going to cut prices accordingly?  No: it will implement the grills, if it saves them money, but those savings are going straight into George’s money bin, not getting passed on to the consumer.**

But what if an angry citizen decides to open his own hot dog stand to resist the Soros monopoly, selling dogs once again at the market-clearing price of $2.50?  Easy: Soros has big reserves of stockpiled money from his monopoly profits.  He cuts the prices at his stands to $1.50 and sells hot dogs at a loss for a few weeks until – inevitably – the competition fails and closes.  (He may also use his monopoly power in other nefarious ways.  For example, he might buy some city councilmen to pass a law requiring all streetcart vendors to purchase a $1 million license, or he might just hit them with frivilous lawsuits until they die.)  Once the competitor is gone, George raises prices again to $7.50.

It is worth noting that most of the above holds true even if there is a single competitor in the market (called a “duopoly”), and quite a bit still holds true when there are just a handful of competitors (“oligopoly”).  It is simply too easy for a small number of sellers to tacitly avoid price competition or innovation in order to maximize individual profits, becoming a functional monopoly that prevents the free-market outcome.  In order to have true competition and a vigorous free market, many sellers must be in competition with each other – so many that it becomes impossible to formally or informally fix prices or form cartels.  But the worst and clearest case of this market distortion is certainly the classic single-seller monopoly.

The tyranny of a monopoly market is why conservatives have always opposed monopolies.  It’s also why we (unlike liberals) oppose government monopolies.  Want a great example of how monopoly drives down supply, eliminates consumer choice, and hinders innovation?  Look no further than single-payer health care, with its long waiting lines, denial of expensive treatments to patients, and general stagnation.

Unfortunately, when a monopoly arises in the private sector (which is very rare today) (UPDATE: not actually that rare), the only entity that can fix the market is the government.  Sometimes, the government can limit itself to a stern warning: “If we see you backing off on innovation or raising prices above equilibrium or cheating to crush competitors, we will break up your company!”  (That’s more or less what happened to Microsoft, in the end – the government’s threats kept Microsoft in line and market forces functioning until their monopoly, which was always a very weak one, was naturally eroded by said market forces.)  Sometimes, the government has to go in and simply break up the company into many smaller companies, as President Reagan did to Ma Bell in 1984.  But, whatever the particular tool employed, every true believer in the free market system knows that one of the few things government is good for is protecting free markets them from the tyranny of monopoly.

What’s this have to do with the Internet?

Natural Monopolies: Everything Is Upside Down

In a normal market, the more product you sell, the more it costs.  If you want to sell ten hot dogs in an hour, you have to buy enough meat, bread, and condiments to make just ten hot dogs.  If you want to sell a million hot dogs in an hour, then you have to buy a lot more meat, bread, and condiments… and you have to hire people to help prepare the dogs, you need inventory tracking, you may find that you’re driving up the price of hot dog meat in the area just because you are demanding so much.  The more you sell, the more it costs.  This is almost always true, so much so that the supply-demand graph simply assumes it.

However, there are some markets where it is not true.  Consider a power company at the dawn of the Electric Age.  They build a power plant and power lines to carry electricity throughout town to their wealthy customers.  One day, Bob the Barrister decides he wants electricity, too, so he calls the power company, which drives out, connects Bob’s house to the grid, and begins charging Bob for the electricity.  Here’s the magic: by selling more product, the power company’s costs actually go down.  See, it was already producing the electricity that Bob just purchased, because that’s mostly how generators work – they produce a certain amount of electricity, whether it gets used or not.  It’s just that, until Bob signed up, that electricity was going to waste.  Now Bob is paying for it.  The power company also already had most of the infrastructure to move Bob’s electricity the five miles from the power plant to Bob’s house.  Now Bob is helping pay for that infrastructure, too.  The only added cost from Bob signing up with the power company was a single short cable and an hour or so of labor – which, from the company’s perspective, is a very low cost indeed, and is more than offset by the savings Bob’s membership brings.  In fact, the more product the power company sells, the lower their average cost goes.  In theory, they’d be able to return those savings to the consumer, lowering the price of electricity for all their customers.

This makes it almost impossible – indeed, economically inefficient – for competition to survive in a market like this.  All companies in the market fight bitterly to get the most customers (this is good).  But, as soon as one company gets a small lead over the others, that company is able to cut prices, leading more customers to sign up, allowing the company to cut prices more, leading more customers to sign up… while the other companies are losing customers and are forced to raise prices, causing them to lose more customers, until they eventually go out of business.  It’s a domino effect, where the invisible hand herds consumers into signing up with the same company faster and faster until it’s the only company left standing.  Potential new competitors face daunting startup costs and the impossibility of beating the market leader on price.  As a result, the single company that survived becomes a monopoly… and, as soon as its last competitor is dead, it begins raising prices to take advantage of monopoly profits.  Because market forces alone forced this to happen, it’s called a natural monopoly.

Many utility markets are natural monopolies in one way or another.  Electric power is a classic example, water another.  Governments regulate these markets in various ways.  Most U.S. water systems are regulated very simply: they are owned and operated directly by the government, with no private competition allowed (not that it would be feasible anyway).  The government then aims to deliver clean water to customers at the lowest possible price (with varying success).  Most people buy their electricity from a company, but, in most states, that company is regulated closely by the government, which sets a legally mandated price that all electric companies must use; this prevents local electric monopolies from abusing their monopoly position as described in the previous section.  In some states (like Texas), electric companies are allowed to set their own prices, and this is called “deregulation”… but it’s not really deregulation, because of one critical factor: every electric company is given free access to the power lines of incumbent monopolies by law, and those incumbent monopolies remain regulated and protected in various ways.  Generation is deregulated, but the delivery network remains under government’s tight control.

None of this is ideal.  Government-run or government-regulated monopolies don’t rely on the market to set prices; they rely on the best guesses of well-intentioned but dim-witted bureaucrats.  They are complacent and often fail to innovate, because they have little or no incentive to do so.  Their service is usually not as good as you’d expect for the price you’re paying, although you retain some leverage simply because you can vote out city officials who don’t do their jobs.  Republicans and other free-marketeers generally work to deregulate as much as possible in these situations (see their handiwork in Texas) trying to get some invisible hand action back into the market… without allowing unregulated natural monopolies to take over the whole thing.

Because – as Republican free marketeers know – an unregulated natural monopoly is far worse than even a government takeover.  Rather than relying on well-intentioned bureaucrats to set a fair price, the monopolist sets prices as high as possible – far higher than a free market would allow.  Monopolists, too, are complacent, and don’t just fail to innovate, but often fight innovations, because innovation could disrupt their control.  Their service is abysmal, because they have absolutely no reason to care about you or your money.  After all, what are you going to do?  Disconnect from the electric grid?  Move to another state?  In economic terms, your personal demand curve is inelastic.  In practical terms, they don’t care whether you’re satisfied with their service, and they don’t care whether they provide you with fair service at a fair price.  You need their service and will pay nearly any price, tolerate nearly any indignity, to get it.  While much of the monopolist’s effort remains focused on adding customers early on, that gradually peters out as they approach saturation, and instead they begin to work on ways to gouge more money out of existing customers.

Perhaps you begin to see the connection to Internet Service Providers.

How the ISPs became Natural Monopolies

When my household first logged on to the Internet in 1996 (mwong-NWANG-mwong DING DING), we were subscribed to a small ISP named SpryNet – a company so unimportant it doesn’t have a Wikipedia article, one of more than 1,400 options available to the just 20 million people who were online at the time.  But, in 1998, a new trend began: SpryNet was bought out by MindSpring, a bigger ISP.  In 2000, MindSpring got bought out by EarthLink.  A couple years later, EarthLink’s high-speed internet service in our area (the Twin Cities) was taken over by Comcast (they kept the EarthLink branding for a while, but eventually we became Comcast customers).  And that was the end of that.  The huge range of ISP options we had in the early days of the Internet had shrunk to just two: Qwest (now CenturyLink) and Comcast.  And if you happened to want high-speed Internet that’s sufficient for HD video streaming or gaming, you actually have just one choice: Comcast.

The Twin Cities ISPs have consolidated.  And we’re actually one of the lucky cities: we technically have two ISP options, which puts us in the same boat as 37% of Americans.  28% of Americans have only one option for broadband internet.  (2%, mostly in rural areas, have zero options.)  That means, for all the freedom and competition happening on the internet, fully two-thirds of Americans live in areas where access to the internet is determined by either a near-monopoly or a literal monopoly (see figure 5(a) here; for counter-point, see figure 5(b)).  Once Comcast and Time Warner Cable complete their merger, that number will skyrocket – and, what’s worse, economics tells us that, unlike most markets, ISPs will naturally continue to consolidate until every consumer has one (and only one) broadband internet option.

That’s because – guess what! – internet service is a market where natural monopolies prevail.  Just like with the electric company, most of the cables and most of the network are already purchased and deployed.  Adding a new customer often means literally just flipping a switch at HQ, or – at most – laying a few yards of cable to an existing network.  In the end, the more the company sells, the less it costs them.  Over time, the big companies beat the small ones on cost, gobble them up… then lobby the government to freeze out potential competitors, while jacking up costs and slashing service quality,.

If you have ever interacted with Comcast in any way, you already know about their “service” “quality” – the infinite wait times, the incompetent “help,” the constant upselling, the blatant lies (usually about credits they promise), the desperate measures.  Since they are our local monopoly, I don’t hear too much about the other monopolists out there, but I understand Time-Warner isn’t any better.  It is a fact that customers despise their ISPs on average:

What you may not realize is that they are overcharging you, too, like textbook monopolists.

For one, their prices are way higher than they would be in a competitive free market.  They just are.  It does not cost $90/month to provide 250GB of 20 mbps service to a residential consumer in a dense metropolitan area.  It doesn’t cost anywhere close to that.

But the really worrisome thing is that they’ve now started shaking down other companies.  Verizon is deliberately slowing down Netflix traffic until and unless Netflix agrees to pay Verizon protection money.  (Verizon brands this as paying for the use of Verizon’s network… but Verizon’s customers who access Netflix are already paying for every bit and megabyte Netflix sends over Verizon’s network.  Downstream network access is what we’re charged for every month.)  Several other ISPs (including Comcast) have already gone through similar bouts with emerging internet titans like Netflix – and won their share of money.  Guess who’s paying for that?  You are, my friend, only now it’s through your Netflix (or Hulu or Amazon Prime) bill instead of your ISP bill.  Clever, right?  The ISP manages to raise the price of your internet use, but hides it from you by shoving it onto a third party.

This practice is not only new; until this year, it was also considered illegal.  One of the basic design principles of the World Wide Web (according to its inventor, Sir Tim Berners-Lee) is the idea that network owners may charge individuals to access their networks, and may charge them for data use, but, once individuals are on the network, the network must treat all data equally.  Comcast cannot decide to delay your download of a YouTube video in order to make more room on the network for your neighbor to download the same video from Comcast.com; you both paid equally for network access for the same amount of data, so the network must treat your data equally.  Without this principle, much of the internet breaks down.  It stops being an open network facilitated by service providers – who merely connect you to whatever data you want, anywhere on the network – but becomes a closed network shaped and ultimately controlled by service providers – who drive you toward a limited number of ISP-owned services and content streams that wouldn’t surive in the online free market free-for-all we have today.  That principle – a core design at the very heart of the World Wide Web and all the brilliant competition and innovation that has come from it – is called Network Neutrality.

And the ISPs want it dead, because, if they kill it, they can rake in monopoly profits without consumers realizing what’s happened.

A couple years ago, AT&T blocked Apple’s video chat app (FaceTime) for all customers who weren’t paying for unlimited voice and text messages – even if they were already paying for unlimited data (FaceTime used data, but not voice or text).  AT&T simply straight-up refused to allow a competitor to beat them on price.

In 2007, Comcast “throttled” (blocked) BitTorrent files that were moving over its network.  Although many people use BitTorrent files for illegal activity (like everything else on the Internet), a great many small tech-savvy distributors rely on BitTorrent to transfer their hosting and bandwidth costs to consumers – which Comcast didn’t like one bit, since it meant consumers actually ended up using the data capacity they were paying for.

We could go on, through data caps and artificial shortages, but I think you get the idea.  The ISPs have become, or on the threshold of becoming, natural monopolists, and they are beginning to flex their muscles.  There’s only one entity that can protect consumers and the market, imperfect though it is: the government.

Ma Bell or Microsoft? Government Responses to ISP Monopoly

Conservatives (rightly) want to keep markets as free of government influence as possible.  When the government must intervene, conservatives (rightly) give the government only as much power as it absolutely needs in order to protect the health of the free market.  So what’s the minimal possible response to the ISP problem?

Ideally, we’d pull what we pulled on Microsoft: threaten them a whole lot, force them to back down repeatedly, and just wait them out until something unimaginable comes along and disrupts the whole market, ending the threat of monopoly.  This strategy is messy and prolonged, but it preserves the market without the government ever actually doing anything.  I have supported this tactic since 2006, when Net Neutrality first became an issue.  Liberals, of course, wanted to regulate everything immediately, the moment they even thought of the possibility of an ISP abusing its power someday.  But that was stupid, I thought.  The FCC had rules protecting Net Neutrality.  They were a little amorphous, a little legally grey, but they helped the FCC stop abuses (like the FaceTime and BitTorrent incidents mentioned above), and ISPs (in 2006) were willing to abide by them.  Their willingness was all we needed to forestall the most serious, immediate threat from the encroaching monopolies – the threat to net neutrality.  We held off on tighter regulation and waited to see what would happen.

What happened, unfortunately, is one of the ISPs – Comcast, in this case – decided to stop abiding by the FCC’s  (legally questionable) net neutrality rules.  Comcast sued the FCC.  In 2010, Comcast won, forcing the FCC to draft new (and equally questionable) rules to protect net neutrality.  This time, Verizon sued… and, early 2014, they won.  The FCC’s rules on net neutrality were utterly vacated, and the courts concluded that the FCC had no power to impose any effective net neutrality rules without invoking Title II of the Communications Act (we’ll come back to that).

So now the delay-and-harass strategy has failed.  The monopolists have a blank check from the law, and they are exploiting it with tremendous rapacity (as we’ve seen in the series of Netflix stickups, which picked up the moment net neutrality collapsed).  Perhaps the next most attractive option is to pull a Reagan and just break up the major ISPs into smaller companies.  Unfortunately, there is no obvious legal way to do that. The Bell breakup resulted from a lot of special circumstances, some plain-as-day antitrust violations, and an 8-year court battle.  Moreover, breakup would probably not solve the problem: the wee ISPs would still have local monopolies in many areas, and economics 101 would force them to immediately begin reconsolidating into new national monopolies (as the Baby Bells are doing today).  In the long run, the consolidation and price gouging of natural monopolies are probably inevitable.  It’s a cold, heartless law of economics: the same laws that allow the government to increase revenues by cutting taxes will eventually compel certain telecom markets to become monopolies, no matter how many times we break them up.

Another option would be to promote or require more competition, subsidized or operated by the government if necessary.  This strategy is repugnant to conservatives, and for good reason: a private monopoly versus an unaccountable public bureaucracy bailed out by taxpayers is not exactly the “functioning free market” we envisioned 16 pages ago.  (Yes, you’re 18 pages into this post.)  However, it’s a moot point: thanks to brazen rent-seeking by major ISPs, local governments are barred by law from providing municipal internet as a public utility in nearly half the states.  The FCC can’t touch that, and – for better or for worse – Congress won’t.

So this leaves only one apparent option to hold the monopolists in check: Title II regulation under the Communications Act of 1934.  You’ve probably never heard of it.  In fact, your eyes probably glazed over as soon as you saw the words “Title II,” because that sounds super-legal and super-boring.  It is both those things.  I’ll spare you the full 102-page law and give you the highlights.

Way way back in the 1930s, Congress noticed that phone companies were becoming natural monopolies, and created the FCC to deal with them.  Congress gave the FCC broad authority to regulate phone companies the same as other “common carriers.”

Common carriers are companies that sell bandwidth (such as a passenger seat on an airplane, or a cubic foot of space on a freight train) to the public at large.  Because of their unique, key position in the national transportation infrastructure, they are also required to actually serve the public at large.  If you have the money to pay for a ticket on an American Airlines flight, there’s a seat available, and there’s no other justification for denying you a ticket, then American Airlines must sell you that ticket.  Everyone must be given equal access to the nation’s transportation networks – as long as they can pay the price. When Congress extended the “common carrier” concept to include not just physical goods and persons (transmitted by rail and sea), but also data (transmitted by phone and telegraph), it entrusted the FCC with licensing and regulating this new class of common carriers.  The FCC’s mandate was to prevent the common carriers of data from arbitrarily denying service to lawful users, or from freezing into a monopoly or cartel.  It could even require phone companies to make interconnections between different phone networks, in order to ensure that everyone with a phone could reach everyone else with a phone.

In 1989, Al Gore invented the Internet (working under the name Tim Berners-Lee), and, immediately, Internet Service Providers became common carriers under the law.  Of course they did.  ISPs literally sold bandwidth to the public, and the new World Wide Web depended on the public being given equal access as long as they were willing to pay.  Naturally, the FCC would regulate ISPs the same way it had regulated the phone companies for 60 years.  And, throughout the dial-up era, it did.  In 1996, Congress passed the Telecommunications Act of 1996, which updated the FCC for the Internet Age.  The “Republican Revolution” Congress under Speaker Gingrich made sure that the updated framework did as much as possible to promote competition in the market – without allowing monopolies to overtake that competition.  A few years later, DSL came out (for you youngsters: DSL was an early form of broadband internet).  The FCC examined DSL and ruled that it fell under the common carrier provisions. It obviously met the definition, so how could it not?

A little after that, cable broadband internet began rolling out to consumers.  The FCC examined it… and a remarkable thing happened.  In 2002, the FCC ruled that cable broadband was neither a “telecommunications service” nor a “cable service” subject to common carrier regulation.  Instead, cable broadband was solely an “information service,” with no telecommunications or cable element included. Since information services can not be regulated as common carriers under Title II, this freed cable broadband providers from all those regulations.  Of course, this was a ludicrous ruling.  The Telecommunications Act of 1996 leaves no wiggle room for cable modem operators: they are clearly telecommunications services.  The “information service” classification, by the FCC’s own precedents, was for services like Google, or your library catalog system, not an ISP; indeed, information services were unregulated precisely because they involved little to no infrastructure and few, if any, barriers to entry.  So, you know, the exact opposite of ISPs.

The FCC spent thirty pages producing a convoluted rationale, often mistaken in technical details, for this absurd ruling, but admitted in the press release what everyone else already knew: the FCC was trying an experiment in total telecom deregulation, hoping that, by continuing the process of deregulation, competition (which had not materialized in the wake of the 1996 Act) would finally emerge in the ISP market and stop the slide toward monopoly.  They didn’t really care much about the legal details; they just needed to find a justification that could survive judicial scrutiny – which is not a high bar to clear, given the immense deference courts must give to the FCC and other regulatory agencies.  The FCC’s goal was deregulation by any means necessary.***  Sure enough, it survived review under Chevron deference in a 6-3 Supreme Court ruling (Justice Scalia’s blistering dissent is, as always, a fun read).  A few years later, the FCC extended the same deregulation offer to DSL and phone services.  They eagerly took it.  Suddenly, ISPs in America were no longer considered “common carriers” under law (even though they obviously were common carriers in actual fact).  Regulation got out of the way… which let the natural monopolists go to work destroying what free market there was.

We Must Destroy the Market To Save It: Towards Title II

To sum up, the only reason the Internet isn’t protected from monopolies today is because, in 2002, the FCC decided to experiment with not regulating the Internet.  Almost immediately thereafter, the telecoms began fighting the core Internet principle of network neutrality, aiming to take control of the Internet for themselves and impose monopoly prices on consumers.  All attempts to restrain them outside of Title II have failed.  The Wall Street Journal regularly argues that the Internet has thrived because ISPs have never been regulated like phone companies.  This is false, and the Journal should know better.  Indeed, the years of the Web’s most explosive growth and development happened under the auspices of strict common carrier regulation, identical to those of phone companies.  (Heck, even today, limited portions of Verizon’s high-speed fiber network, FiOS, fall under Title II!)

The fix to the growing monopoly problem is very, very easy, and several courts have pointed to it over the past several years: simply revisit the obviously nonsensical ruling of 2002.  Overturn it, and (correctly) decide this time that Internet Service Providers are “telecommunications providers”.  Instantly, every ISP in America would go back to common carrier status, and net neutrality regulation wouldn’t just become easy; in many ways, neutrality is baked into Title II.  The FCC would gain many tools to reduce the risk of natural monopoly where it doesn’t exist, or its effects where it does. The market would be saved, the consumer freed from the tyranny of monopoly.

This isn’t an “everybody wins” situation, of course.  As conservatives, we know that regulation is always evil, even in the rare cases (like this one) where it’s a necessary evil.  The regulatory regime raises the costs of doing business, encourages corporate rent-seeking and bureaucratic co-opting, empowers yet another Washington agency, and makes it more difficult for genuine innovations to get into the market.  Market distortions based on political considerations are possible, even likely (see here).  Heavy regulation forestalls new entrants in a market (not that this seems to be a problem in the ISP market, where natural monopoly prevents new companies from joining anyway).  Reclassification will (probably) have unanticipated consequences, which, by definition, I can’t describe or evaluate here.  The unexpected consequences worry me more than anything else.  I wonder whether I will look back ten years after reclassification and realize that reclassification really just helped Google, Amazon, and other major internet players become monopolists themselves.  I don’t think Title II will do that – you might say they’re doing a pretty good job crushing competitors on their own – but you never quite know, especially when you issue broad regulations of the sort Title II requires.

Nevertheless, the alternative to Title II “Common Carrier” reclassification appears to be the destruction of the free market, the tyranny of monopoly pricing, Dantean customer service, and the gradual erosion of the World Wide Web as it comes fully under the control of the handful of corporations who have absolute power, under current regulations, to manipulate and suppress competition in more and more lucrative online marketplaces.  Given the dynamic role the Web has to play in the commerce and discourse of the 21^st century, this outcome is simply unacceptable, despite the inevitable costs of regulation.   For these reasons, I support regulation of the Internet.  If you’re a conservative defender of free markets and free peoples, then you should, too.

*Yes, this is a really simplified model, which ignores plenty of other kinds of supply and demand shocks.  But I’m not trying to get you a passing grade on the AP Microeconomics test; I’m trying to show you something about monopolies.

**Unless the marginal cost curve dictates otherwise, which it could.  But there’s a 0% chance that the consumer is going to see the full price cut that he would in a functioning competitive free market.

*** Full Disclosure: At the time, I thought this was a good idea.  In fact, I still do.  It had been 70 years since telecoms had shown a tendency toward natural monopoly, and deregulation had worked very well in other common carrier industries, like air travel.  It was worth trying deregulation in telecommunications as well.

UPDATE: In response to a few other blogs which linked to this piece, I wrote a small follow-up a few days later.

UPDATE II: A couple of readers have asked why the usual Disqus comment thread isn’t showing up below this post.  After spending fifteen minutes looking through the Disqus control panel, I have an answer: I have absolutely no idea.  Readers have spontaneously started leaving comments on this post over here; I invite you to join them.

UPDATE III – 5 Feb 2014: A friendly reader pointed out that, in the original version of this post, I conflated two lawsuits against Net Neutrality — Comcast v. FCC (2010) and Verizon v. FCC (2014) — into one (which I called Comcast v. FCC (2014)).  I have corrected the error, which was in the paragraph that starts, “What happened, unfortunately…”  Thanks, Conan!

*****

Resolved,

That we, the members of the Republican party of the United States, in discharge of the duty we owe to our country, unite in the following declarations:

1. That the history of the nation, during the last one hundred fifty-seven years, has fully established the propriety and necessity of the organization and perpetuation of the Republican party, and that the causes which called it into existence are permanent in their nature, and now, more than ever before, demand its peaceful and constitutional triumph.

2. That the maintenance of the principles promulgated in the Declaration of Independence and embodied in the Federal Constitution, “That all men are created equal; that they are endowed by their Creator with certain inalienable rights; that among these are life, liberty, and the pursuit of happiness; that to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed,” is essential to the preservation of our Republican institutions; and that the Federal Constitution, the Rights of the States, and the Union of the States, must and shall be preserved.

3. That to the rule of written Law, over the transitory whims of Monarchs, this nation owes its unprecedented increase in population, its surprising development of material resources, its rapid augmentation of wealth, its happiness at home and its honor abroad; and we hold in abhorrence all schemes for suspension of the laws, be they temporary or permanent, come from whatever source they may. And we congratulate the country that no Republican member of Congress has countenanced the current Administration’s loathsome refusal to enforce those valid laws which it has, on its sole and dictatorial authority, deemed inexpedient, without rebuke and with applause from their political associates; and we denounce those acts, lawlessly undertaken despite popular rebuke of their ascendency, as denying the vital principles of a free government, and as an avowal of contemplated treason, which it is the imperative duty of an indignant people sternly to reprimand and forever silence.

4. That the maintenance inviolate of the rights of the states, and especially the right of each state to order and control its own domestic institutions according to its own judgment exclusively, is essential to that balance of powers on which the perfection and endurance of our political fabric depends; and we denounce the lawless invasion by armed force of the soil of any state or territory, no matter under what pretext, as among the gravest of crimes.

5. That the present Democratic Administration has far exceeded our worst apprehensions, in its measureless subserviency to the exactions of an ideological interest, as especially evinced in its desperate exertions to force the infamous Health Care Act upon the protesting people of twenty-six states; in construing the relations between executive and legislative to involve an unqualified power to wage war and to appoint federal Officers without the advice and consent of Congress; in its attempted enforcement everywhere, on land and sea, through the intervention of Congress and of the Federal Courts, of the extreme pretensions of the military-surveillance complex; and in its general and unvarying abuse of the power intrusted to it by a confiding people.

6. That the people justly view with alarm the reckless extravagance which pervades every department of the Federal Government; that a return to rigid economy and accountability is indispensable to arrest the systematic plunder of the public treasury by favored partisans, while the recent startling developments of frauds and corruptions at the Federal metropolis, show that an entire change of administration is imperatively demanded.

7. That the new dogma, that the Constitution, of its own force, carries Abortion into any or all of the Territories of the United States, is a dangerous political heresy, at variance with the explicit provisions of that instrument itself, with contemporaneous exposition, and with legislative and judicial precedent; is revolutionary in its tendency, and subversive of the peace and harmony of the country and all her inhabitants

8. That the normal condition of all the territory of the United States is that of freedom; That, as our Republican fathers ordained that “no person should be deprived of life, liberty, or property, without due process of law,” it becomes our duty, by legislation, whenever such legislation is necessary, to maintain this provision of the Constitution against all attempts to violate it; and we deny the authority of Congress, of a legislature, or of any individuals, to give legal existence to Abortion in any territory of the United States.

9. That, while providing revenue for the support of the general government by taxation upon income, sound policy requires such an adjustment of this taxation as to encourage the development of the industrial interests of the whole country; and we commend that policy of reducing burdensome and arbitrary regulations, thereby securing to the workingmen liberal wages, to agriculture remunerative prices, to mechanics and manufacturers an adequate reward for their skill, labor, and enterprise, and to the nation commercial prosperity and independence.

10. Finally, having thus set forth our distinctive principles and views, we invite the co-operation of all citizens, however differing on other questions, who substantially agree with us in their affirmance and support.

****

As it turns out, I was mostly just taking big blocks of the GOP Platform of 1860 and changing a few words to reflect modern times.  It is surprising how little needed to be changed for it to fit the Obama presidency instead of the Buchanan presidency.

The original 1860 platform was 17 points long; this one is only 10.  That’s mainly because several of the provisions of 1860 were about very specific issues that have no modern analogue (support for the Transcontinental Railroad, for example, or the admission of Kansas into the Union), but it’s also partly because I simply never finished this document, and did not have time to do so today.

Still kinda fun.  If you think this simple, passionate statement of principle is the sort of platform that you’d like to see the Republican party adopt (in lieu of the zillion-page, special-interest-owned monstrosity that the modern party actually writes every four years), then why not share this post on The Facebook or The Twitters?  There’s some handy sharing buttons right below this sentence.