[governance] Hmmmm... Google: "Internet Freedom!"... (from taxes?

[Milton L Mueller]

Riaz, on economics: I am not a neoclassicist but an institutionalist. But of course you don't know the difference, do you?

Let's not have an ideological debate. It is uninteresting to me. Let's have a relevant, factual one. Take a look at the facts about telephone penetration in any society that had a state-owned monopoly before and after competition was introduced in the 1990s or before. If there is some specific point you want to make about market failures and how specific policies helped to overcome them, make it.


On 12/04/2012 02:38 AM, Riaz K Tayob wrote:
It is one thing to claim this in fact and then generalise the principle that markets "do best". The same cannot be said for eg on the railroad revolution in the US - which enjoyed massive subsidies. In many developing countries, regulation that fixed the number of operators ensured a mix of competition and oligopoly to fund the high infrastructure entry costs by limiting the number of entrants. In other areas, other publicly established infrastructure was utilised as well (in some countries to improve coverage, UCTAD recommends intervention - sharing of infrastructure costs like cell masts).

In the US railroad revolution the sharing of these fixed infrastructure costs (from taxes) in this way improved American economic performance. If one used neoclassical economics to judge the impact of the transformational railroad, the result is that it "only" improved US economic performance by 3 to 4%. This was such a major change in the US economy (it integrated the US as a single market - a huge increase in scale).  Contrary to the ahistorical writing of history by neoclassicals , the American economic system in its formative years was radically different from neoclassicals- rather following Alex Hamilton, Richard Ely, Daniel Raymond, Frederich List... Then, the understanding was that low cost infrastructure enhanced economic performance/production. Nowadays, the neoclassicals believe that "free" infrastructure is bad, and to improve competitiveness things must be privatised or private - the tollbooth economy.

Arguments against regulation, as the neoclassicals do, actually reduce democractic choices about how markets can be shaped and structured - and how plastic they are - which is no wonder that oligopolists/monopolists love the arguments on "free markets" because what while what may be "true" in theory is very beneficial to them in fact. In some of these markets the market is too violent and perhaps the possibility of looking at the functioning of the extant reality - oligopolistic market structures: which are not going to disappear with neoclassical utopia of perfect competition just around the corner if we only would liberalise and deregulate more and faster.

While perhaps not directed at Mueller per se, but it would take much more to deal credibly with an economic theory (or its prescriptions - neoclassical) after a financial crisis which for it is a theoretical impossibility: i.e. it cannot happen. But it did.

So the neoclassical jingle of leaving it to markets is controversial. Markets do work, and when they do they should be left well alone. But do markets always work? Well that simply depends...

On 2012/12/03 08:29 PM, Milton L Mueller wrote:
Just so you know: competition and liberalization have done more to extend telecom infrastructure to the largest number of people than any social equity program. Taxes and subsidies (at best) pick up the margins/ high cost areas, the really poor, but the real work is always done by the market. At worst, taxes and subsidies keep monopoly incumbents in place, prevent new technologies from emerging, and raise costs.


From: michael gurstein [mailto:gurstein at gmail.com]


I would be the first one to argue for a transparent, net neutral, open access, free speech Internet but I'm also for an inclusive Internet in a decent socially equitable environment with proper schools, and healthcare, and an adequate physical and social infrastructure for all, not just for the rich (or those in rich countries) and that means that companies, like everyone else has to pay their fair share.

Greed is greed and the best way to keep from paying taxes as you have pointed out, is to make sure that there are no laws/regulations in place to require you to pay taxes.

M

From: governance-request at lists.igcaucus.org<mailto:governance-request at lists.igcaucus.org> [mailto:governance-request at lists.igcaucus.org] On Behalf Of Milton L Mueller
Sent: Monday, December 03, 2012 6:36 AM
To: governance at lists.igcaucus.org<mailto:governance at lists.igcaucus.org>; 'Dominique Lacroix'
Subject: RE: [governance] Hmmmm... Google: "Internet Freedom!"... (from taxes?

Suresh, I think the debates are related. Now it is not just ETNO and the old telecom incumbents who want to grab a share of the new wealth being generated by over the top internet services, it's national governments as well.  So what is new here? Governments want to tax whatever they can for their own (political) self-interest, while businesses (and most citizens) want to reduce their taxes as much as possible.

What's interesting is  how un-selfconsciously the Dominiques and Gursteins of the world assume that more taxation = always better for society. Not a shred of critical perspective on the governments' demands for more revenue. And as usual, Gurstein approaches the debate by attaching labels ("Reaganomics") rather than mounting a serious argument.

Do governments have some kind of right to these revenues? If so, what is the basis? If so, what is a reasonable rate of taxation? How are these revenues used? How do they benefit the internet users who generated them? Might be good for you all to contemplate the answers to some of those questions. The implication of your statement is that more taxation is always better. You don’t have to be a supply-side economist to understand that taxation can reach a point of diminishing returns and that it can destroy economic activity as well as help sustain social services. Please, a more intelligent perspective on this…


Some Internet companies can escape taxes because their activities aren't linked to territories. Others are linked to countries and pay full taxes.


-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.igcaucus.org/pipermail/governance/attachments/20121205/5d98a37c/attachment.htm>
-------------- next part --------------
____________________________________________________________
You received this message as a subscriber on the list:
     governance at lists.igcaucus.org
To be removed from the list, visit:
     http://www.igcaucus.org/unsubscribing

For all other list information and functions, see:
     http://lists.igcaucus.org/info/governance
To edit your profile and to find the IGC's charter, see:
     http://www.igcaucus.org/

Translate this email: http://translate.google.com/translate_t