Monday, February 21, 2005

Standing Up!—"Government must compete at times with private sector"

The Advertiser editorializes in favor of government competeing with private enterprise when private companies will not provide needesd services and (this is implicit rather than directly held) when such companies prove to be actively hostile to the community's interests in the pursuit of their own. It is a tight well-written essay; here are three of the most relevant 'graphs:
Under most circumstances, we support the argument that government should not compete for business with private companies. There have always been exceptions, however. There is nothing new or sinister about government competing in the private sector when it fills a public need that private companies are unwilling or unable to address. The Lafayette Utilities System came into existence because private companies were not interested in serving what was then a small, rural community.

Instead of reaching out to the community, they reached for their big guns - heavy political influence and deep pockets - and launched a battle to scuttle the LUS proposal.

Because our city officials are willing and able to think outside the box, we have an opportunity to build an infrastructure that will move Lafayette far ahead of other cities. We can become a leader in this, the Information Age. Cox and BellSouth are not only unwilling to help, but are determined to block our progress. Should government enter into competition with these private-sector companies? There is no other choice.
Strong stuff. I would add only this: The Advertiser's editorial is based on the understanding that the central purpose of government is to promote and protect the well-being of its citizens. But they choose to apply this principle only in the negative—they focus on the fact that BellSouth and Cox do not intend to provide needed infrastructure and that this fact alone provides the needed excuse for the city-parish to enter the field. It is good reasoning; based on sound principles and the facts on the ground. They need go no further.

But there is a stronger, more positive, line of reasoning available: Government has the right and even the obligation to step in to protect its citizens when, in fact, there is no "free enterprise" to respect and no prospect of such emerging. That is the case here. We have the spectacle of two wireline monopolies that have no effective competition for their basic services because of their exclusive ownership of the only network over which those services may be offered. The economic framework for understanding for the situation is that they are natural monopolies. —Natural monopolies because no one can afford to build a network which will compete with their already largerly paid-for systems. The evils of monopolies are well know. Monopolies inevitably exploit their advantage by overcharging, providing poor service, and resisiting innovation. (Innovations like fiber optics, for instance.) The Federal Communications Commission made herculean efforts to encourage "overbuilding" of new networks which ignored the basic economic principles of natural monopolies and failed miserably. Our opportunity comes because a new wireline technology, fiber optics, is now available which can more efficiently deliver the services formerly offered by the monopolies and many, many more. By seizing the day the city-parish effectively breaks the grip of the monopolies and turns this potential new natural monopoly network into a utility owned the people it serves. This is exactly the same situation as any the earlier decisions to make water, roads, and electricity city utilities. The people have unquestionably benefited and providing that benefit and preserving its citizens freedom from economic tyranny is a perfectly reasonable way for a vigorous, in-touch government to behave.

5 comments:

Neal Breakfield said...

It's a little scary... thinking of government getting into an entrepreneurial role is something that we were all kind of taught in civics that government doesn't do. Government doesn't compete with the private sector.

- Joey Durel, Campaign 2003

John said...

Folks, this is typical of Neal and, I have to say, the folks at Fiber411. If you'll look at adjacent posts you'll see that Neal, instead of actually responding to any of the articles or commentary just repeats himself 18 times. There’s no communication attempted. It's a tantrum; the (im)moral equivalent of pissing on a neighbor's wall because he said something you didn't like.

It would be easier to develop some respect for these guys if they'd show some for themselves.

Likely what is frustrating Neal is the growing wave of formerly silent support made visible in response to Joey Durel's call to action. And likely LPF is a target because he doesn't like what I say about the boys in response to yesterday's tirade posted to our site. (See http://lafayetteprofiber.com/Blog/2005/02/standing-up-advertiser-endorses-fiber.html)

He can't answer real questions. He just continues to parrot whatever the last angry thing he or some handler feeds him.

I'll repeat what is obviously a futile plea: Start answering real questions. Quit mouthing nonsense.

I'm out of patience with these guys.

Neal Breakfield said...

People who can beat the message don't waste time trying to beat up the messenger.

WE have thick skin. You have no message.

The community's RIGHT to vote on this is not a luxury, it is a necessity. It is the law.

You want to break the law to ensure that you get your way.

You are entitled to your opinion, but if you try to break the law to infringe on OUR rights, WE can and will do something about it.

And no amount of insults will dissuade US from it.

Neal Breakfield said...

John:

You are absolutely right about one thing: I was rude and I apologize. No excuses. I apologize to you and all the other users for spamming your site.

It will not happen again... with one exception: I will post this where I spammed in hopes that it will clear the air.

I want what I think most of us want: a meaningful, informative and civil discussion where all sides can be heard.

John said...

Neal,

Thanks, that's a gracious and straightforward apology.

Accepted.

We all get wound a mite tighter than is good for us at times. Myself included.