Some clarity on what net neutrality is

The Twitter-verse is going bonkers over today’s report that the Federal Communications Commission is considering getting rid of net neutrality.  That view is erroneous. The concept or principle of net neutrality is not being abandoned. What Chairman Pai is proposing is that the FCC stop applying the telecommunications rules found in Title II of the Communications Act to enforce net neutrality.

In the late 1980s and early 1990s, internet protocol was being introduced into phone networks. Also, new local phone entrants such as cable companies and local network bypass companies were bringing new services into local markets. The issue was, how do we bill for the exchange of traffic ie data and voice traffic in such a way as to encourage competition. Regulators decided to lightly regulate the agreements that these companies entered into to exchange traffic. Some companies decided to exercise what was once called “bill and keep.” In other words, they wouldn’t bill each other for the exchange of traffic.

Over past 25 years, this traffic has increased. Phone networks needed the additional revenue to invest in networks that could keep up with traffic as well as compete with bypass providers like cable companies. Also, content providers and search engines were developing and spawning more traffic. Net neutrality grew out of this. In short, it has never been about democracy for the consumer. That’s a bullshit argument that a strategic communications expert made up in order to generate support from regulators to keep the exchange of traffic between the Googles and the Verizons low to non-existent.

The consumer is being used if you will as an excuse. Rates are going to stay where they are. The real issue is, smaller content providers who can’t pay broadband companies or content delivery companies the fees to move their traffic will fall to the wayside.

Consumers are being duped by Facebook and Google into supporting their argument for net neutrality. It is ironic that those companies use the “open internet” concept to design apps that spy on you….

Charlie Rose and the politics of pussy grabbing

I have been hearing the theme song from “Charlie Rose” playing around in my head since yesterday’s announcement that Mr Rose had been accused of sexually harassing women, some of whom actually worked for Mr Rose’s production company. The announcement caught many off guard given the genteel persona that Mr Rose exhibits during his show where he interviews high-profile figures including heads of state, writers, actors, and the occasional activist.

I was one of those that grimaced upon hearing the news. “Really? No way, man.” But pushing back a minute I had to say to myself, “Well. Why not him?” Mr Rose, given his decades as a journalist, is a powerful figure. A man whose brand is distributed by Bloomberg, PBS, and CBS has garnered considerable leverage over the years. One bad world from him could end a career before it even started.  He made a number of his employees feel apprehensive, trapped, and violated. His actions paint a textbook case for on the job harassment.

What is being downplayed is the increase in women coming forward with claims of sexual harassment by men. I saw a comment on Facebook posing the question, “Why now and why so many?” I believe there is a political motive behind what appears to be a recent rise in allegations, an emerging wave that started back on 8 November 2016. I believe what we are seeing here is a messaging campaign from the left that is now back firing.

Donald Trump’s crass attitude about women was put on display during the last election cycle when he was seen and heard on a video describing his “Grab ’em by the pussy” approach to women. This and other displays of perceived insensitivity to race and gender makes Mr Trump public enemy number one to progressives who have been calling for his impeachment before he even took the oath of office.

How then to get rid of him? In politics, the number one weapon is persuasion and I believe that the messaging machine is using sexual harassment as both fuel and output to paint a picture that America’s unsafe environment for women is the result of the man the Electoral College put in office in December 2016.

The messaging started with the protest marches in major cities with women’s issues including gender bias and harassment at the core. They then elevated to women coming forward and calling out powerful men for their low-brow deeds.

Unfortunately for the progressives, their messaging is causing collateral damage. They did not expect Hollywood to take a hit, the very same Hollywood that has been at the forefront criticizing the President for insensitive policies towards women, immigrants, blacks, and gays. They did not expect that the cancer of harassment was lurking behind their very walls where studio owners and producers would be called on the red carpet for their inappropriate sexual behavior.

Mr Rose’s behavior was no secret based on the accounts in The Washington Post, whose account of Mr Rose’s misgivings is very detailed and well investigated. Definitely not a hit piece written overnight which should be expected since The Post ended up exposing one of their own.

I think there will be more collateral damage. The accusations will not stop. The ultimate collateral damage will be incurred by progressives who thought that only old, fat white men who vote Republican would take the heat.

Atlanta the city-state … and alkaline water

Atlanta is growing, expecting to sit at the core of a metropolitan statistical areas boasting a population of 9.0 million residents over the next twenty years. I saw something at the Whole Foods in Midtown during Hurricane Irma that made me question the resilience of the city. While customers raided the shelves for bottled water, they left a lot of alkaline water on the shelves. These are the very customers that swear by the health benefits of alkaline water, but in this instance they were foregoing health for the cheaper water. Shouldn’t health be a consistent part of life?

It just seemed a little hypocritical to me that residents of a city sitting over a thousand feet above sea level and relatively inland would go forego their values regarding health because of a storm that was not expected to bring any where near the damage expected by our neighbors to the south. But there the shelves were; not one bottle of water with the exception of $3.99 bottles of alkaline water.

The 21st century Atlantan is interesting to observe. No, more like slightly amusing. The body language of the people in the core city reflects not a care in the world. I often wonder if these people have jobs much less a care in the world. They look more like displaced mid-westerners trying to make Atlanta proper look and feel like Manhattan.  I guess this is the type of swag you should expect from citizens that occupy an alpha-city.

But it looks more to me like a city that has no character. Yes, the jobs are coming here. Almost 80,000 were created in Atlanta in 2016, but I see a blandness. The city is so transient that the people with some skin in the cultural game, mainly those that were born here, appear to be outnumbered by those of us who were not. This is nothing new. I heard this complaint back in the mid 1980s when I first lived here. The resentment of people who were born here that believed they were being foreclosed from opportunities because out of town people moving to the Peach City were blessed and highly favored by employers.

They are probably right. I know very few people who were born here. Mary Norwood, a candidate for Atlanta mayor wasn’t born here. Cleta Winslow, a member of the Atlanta city council representing my district, wasn’t born here. I have high school and law school classmates that live in the area, none of whom are from here.

Southern charm is being pushed out by Northern and Midwestern blandness.

Voluntary market agreements not FCC should create incubators.

The Federal Communications Commission today issued a notice of proposed rulemaking as a first step toward creating an incubator program for disadvantaged groups that want to enter the television and radio broadcast industries. According to the Commission, “Such a program would seek to encourage new and diverse broadcast station owners by drawing on the technical expertise and/or financial assistance of existing broadcasters.”

The NPRM also seeks comment from the public on how best to structure and implement the program.

The State via the Commission has a monopoly on access to spectrum. It has the force of law behind this monopoly. It should, for the sake of bond holders, pursue policies that help increase returns on the spectrum that it licenses to private companies. The better broadcast companies perform i.e. attract listeners and views and sell advertisement, the more taxable income for the State and continued flow of income to bond holders.

I don’t see this incubator program doing that. It is a pure political move. It is designed to keep the barbarians aka social justice warriors from knocking down the gate. The Commission has been holding the warriors off since the Clinton Administration by not following through on recommendations to institute such programs. It appears now, with this NPRM, that they are trying to give the impression of progress on the issue of diversity.

They should save their strength.

Any incubation for future broadcast station owners can be done in the private sector. Potential and existing broadcast station owners can enter into voluntary agreements to exchange expertise and financial assistance in exchange for a piece of a minority owner’s action. It should be up to a potential minority owner to explain the economic and financial value that an existing broadcast station owner can glean from an investment in a minority-owned station or outright sale of an existing station to a minority-owned firm.

Think of the decision rule the British Empire imposed on itself when it decided to decolonize. The second world war drained the Empire of resources. Holding on to territories in Africa and the Caribbean was expensive, so they cut a deal with these protectorates. We’ll prepare you for independence and you’ll give us a piece of the economic action.

This is the model that existing broadcast station owners and potential minority-owned firms should enter. Where the existing owner wants to off-load a station and a minority firm shows it can bring value, then they can enter an exchange. The State via the Commission need not involve itself by establishing incubator programs.

My instincts tell me the feds won’t go after Bitcoin … for now

The financial press has been focusing on Bitcoin’s rapid appreciation in value of late. The value of a single Bitcoin eclipsed the $7,000 mark a couple weeks ago. At the time of this writing, Bitcoin.com reported the cryptocurrency is selling for around $7,171 while its “fork”, Bitcoin Cash, is selling at $1,181.

Supply and demand primarily drive the price the currency. I guess it also helps that over 100,000 merchants accept the coin. A payment system driven by blockchain provides Bitcoin owners additional certainty about who actually owns a generated coin at a particular time. Also the near instantaneous payment is an attractive feature.

In my business, I focus on political threats and I see the Federal Reserve taking a parallel approach to Bitcoin as a payment system. One possible route is issuing its own digital currency supported by an enhanced payment system. A report filed last September by CNBC described a recommendation by the Bank of International Settlements that central banks consider issuing their own digital currencies.

Also, the Federal Reserve is in the process of revamping the payments process system. Bitcoin competes with at least two prongs of the Federal Reserve’s payments system: clearinghouse services and coin distribution services. Federal Reserve governor and Fed chair nominee, Jerome Powell, currently serves as co-chair of the Federal Reserve’s payments improvement oversight committee. I expect given Bitcoin’s growing popularity, the appeal of blockchain, and the concerns about using cryptocurrency for fraudulent purposes that should Mr Powell become Fed chair, improving the payments system and increasing the Fed’s ability to compete with innovative payment systems will remain a priority.

 

Net neutrality’s transparency rules do nothing for Bitcoin

As transparent as Bitcoin’s underlying block chain process is for Bitcoin users, there is still a need for protecting the privacy of the user when moving Bitcoin from seller to purchaser. Current net neutrality rules on transparency may negatively impact the need for privacy.

Experts at Bitcoin.org warn the crypto-currency’s use to protect the IP addresses used during Bitcoin transactions. Including an IP address on a website or social network site may not be a good idea if maintaining anonymity is crucial. Once a Bitcoin address is used to receive a payment, the address becomes traceable along with all other transactions associated with the address.

Further, according to Bitcoin.org, since the currency’s users usually reveal their identity’s in order to receive goods or services (like a Klingon or Romulan starship decloaks before firing), Bitcoin addresses won’t remain fully anonymous.

Question is, as investment in Bitcoin and transactions using Bitcoin increase, why would the Federal Communications Commission pursue a net neutrality regime that includes an intrusive transparency requirement?

Current net neutrality rules require that broadband providers disclose certain details about network management including disclosures about congestion management practices and the types of traffic subject to those practices. Proponents of the transparency component of net neutrality rules argue that these rules protect consumers against misinformation about prices, services offered, and data speeds.

What isn’t discussed by net neutrality advocates is the slippery slope that transparency embarks on when it comes to Bitcoin. For example, as more consumers use broadband, and in particular mobile broadband to conduct Bitcoin transactions, should we put their anonymity at risk by requiring broadband provides disclose information about the data Bitcoin users send?

Bitcoin could become mainstream over the next ten years especially given its use of the blockchain. Should intrusive transparency rules be allowed to slow down this train?

The new cyber society will see the poor pay more for government

I sense a major “cost shift” for tax payers over the next twenty to fifty years as the more affluent of United States citizens move more of their survivability activities into cyber society versus current brick and mortar society.

I believe one key will be the use of cyber currency by an increasing number of service providers and producers. Less dependence on fiat money and more reliance on a block chain that cuts out the middleman providing for faster payment systems. In addition, the affluent are re-imagining the use of public infrastructure by using it less frequently or more efficiently. Think drones, driver-less & fuel efficient vehicles, or the delivery of groceries via Instacart.

The affluent will also find more innovative ways to provide security, from improved security technology to private police forces. In short, as the affluent pursue an increasingly self-sovereign approach to life, they will make the case for dishing the traditional services of the State while arguing that their tax burdens should be less. Why support police and road services that hey hardly need. If anything, they will argue, let us reduce our tax bills by the amount that we spend on providing these services for ourselves.

For low income individuals and a large proportion of communities of color, they will experience the burden of the “cost shift” as tax jurisdictions pass on the costs of providing traditional State services to these communities. These communities will not be able to bear the burden given their low incomes. Services will be reduced as traditional government finds itself facing competition from non-State actors financed by the more affluent.

The State will react violently at first. It will create laws designed to slow down the affluent’s abandonment of the traditional State system. It may, ironically, use net neutrality laws to slow down deployment of the advanced networks necessary for delivering services to taxpayers leaving the system. It will further reduce renewable energy subsidies to residents that generate electricity at their residences.

I don’t expect the State’s attempts at holding sovereign individuals hostage will be successful. The attempts will invalidate the State’s arguments that it represents democracy when the actions to squelch freedom are the furthest from the truth.