Telecom: Federal Policies Helped to Elevate, then Pop IT
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The Federal Government Hit US Again ...
Current
Situation

 

The Telecom Act of 1996 unleashed an avalanche of innovation and investment that created a stock market bonanza up until the dot-com burst of year 2000.  While an abundance of bad business plans and questionable accounting practices were clearly a factor in the bursting of the bubble, the erratic behavior of government exacerbated the situation, and led to an escalation of the incident.

Many of those bad business plans were based on the expectation that the old Baby Bell companies should have their property, wiring to residences, taken for the common good of society.  Our government acted under the Marxist philosophy "from those who can give, to those who need".  

This confiscation of the Baby Bell's property was the basis of "Competitive Local Exchange Carriers" business plans that depended upon continued theft of this infrastructure.  Once the theft was initiated, hundreds of billions of dollars of investor's money was invested in the creation of CLEC  infrastructure.  Alas, the party was short.  When the Bush Administration  assumed power, the Baby Bell companies realized justice was near, and hardened their stance against permitting the CLEC companies access to their networks.  The already shaky business plans blew up, and botch government regulation thereby deepened the destruction in America's telecom industry.  The reality is that government intervention worsened the stock market crash of 2000-2002.

From day #1, it was never necessary for the Telecom Act of 1996 to have stolen property from the Baby Bell monopolies in order to foster competition.  Instead, after lifting of regulatory prohibitions, alternatives such as cable & wireless would have sufficed to bring fair competition into the telecommunications market place.
Proposed
Changes 		Remove most regulatory barriers to competition, and don't attempt to steal infrastructure from monopolies by forcing them to share their infrastructure with their competition.
Expected
Benefits		 Free and fair competition, driven by technological innovation, will allow consumers to have good telecommunication services at affordable prices.