Regulation isn’t way to reform

Third in a three-part series.

Unless it is knocked off the agenda by the Haiti misadventure, Congress may try to pass a massive telecommunications “reform” package before the 103rd Congress adjourns this autumn. Passage of the “reform” bill could have massive unintended effects. Examples: It would actually delay construction of the information superhighway, especially to people in hard-to-reach rural areas, and it would also slow down the development and use of new applications in education, health care, transportation and other areas.

In fact, the so-called reform bill should be called a “regulation substitution and enhancement bill.” Reasons: It creates whole new layers of federal regulation (including “buy American” and other protectionist manufacturing requirements); it deepens the involvement of the federal government in planning and regulating America’s high technology telecomputing industries (including a huge expansion of the lawyers and other staff of the Federal Communications Commission); and it increases government spending on these matters by $154 million over the next five years.

The “reform” legislation is also opposed by many state utility regulatory commissions as usurpation of 10th Amendment rights — that powers not expressly given to the federal government are reserved to the states. In fact, the “reform” legislation pre-empts important state regulatory functions. Or, in the words of Joe Miller, chairman of the Committee on Communications of the National Association of Regulatory Utility Commissioners, it is a “nationalized program” that attempts to “conscript the states as agents in a federal regulatory scheme.”

At the same time that government is trying to impose top-down industrial policies to “guide” new developments in the rapidly changing telecommunications industries, the industries themselves are forging ahead with new applications that will give Americans new choices, more convenience and greater control over the way they live, work and play.

Example: Today, in Washington, D.C., a consortium of leading universities and telecomputing companies, called NIIT (for National Information Infrastructure Testbed) is unveiling before members of Congress and the Clinton administration a first-of-its-kind nationwide application of telemedicine. This demonstration combines innovative networks, computers, software and communications to show how health care access, quality and efficiency can be greatly improved by using high-speed information technologies.

The result: By working together, U.S. industry, academia and the national laboratories are demonstrating how to: 1) extend specialized care to rural areas; 2) reduce costs related to redundant staffing, testing and surgical procedures; 3) enhance the performance of physicians through on-line collaboration and digitized X-rays and other medical images; and 4) improve access to medical records electronically.

Rather than increasing the heavy hand of regulation and control over the nation’s telecomputing industries, Congress should go back to square one and write a genuine reform bill that favors more choices for consumers, not specific industries, dominant firms or specific technologies. The government should be neutral on what technologies or applications are “best.” Congress, in other words, should take a walk this year and come back in 1995 with true reform.