I just wrote about the disturbing trend of Internet censorship in democracies around the world, and this story is a case in point. A bill supported by President Sarkozy that would have cut off Internet access to people was defeated, but may be resurrected next month. What crime must you commit to lose your Internet connection?

The measure would have created a government agency to track and punish those who pirate music and film on the Internet. Analysts said the law would have helped boost ever-shrinking profits in the entertainment industry, which has struggled with the advent of online file-sharing that lets people swap music files without paying.

So a department of Internet monitoring and censorship, empowered to cut of your Internet connectivity with the full force of the French government, would be established to help boost a flagging industry. How long before the censorship agency would be used for other sorts of control over Internet freedom?

Legislators and activists who opposed the legislation said it would represent a Big Brother intrusion on civil liberties -- they called it "liberticide" -- while the European Parliament last month adopted a nonbinding resolution that defines Internet access as an untouchable "fundamental freedom."

I am very sensitive to the rights of copyright holders, but let's remember that it is not a natural right, such as freedom of expression or even physical property rights. It is a man made right -- an artificial monopoly created by government fiat to provide a limited economic incentive for creators to produce.

In the US, you don't find copyright in the listed in the Declaration of Independence as an "unalienable right," such as "life, liberty, and the pursuit of happiness," but rather its justification is found in Article 1 of the US Constitution that "The Congress shall have Power To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries."

Your copyright comes at a cost of my freedom, and so it is a right that should only be very carefully applied when there is a compelling societal interest, and in a limited fashion. I'm not against punishing lawbreakers, but this bill is beyond the pail.


UPDATE: NYT covers this story.

From Foreign Policy, a disturbing piece on how Internet censorship is not just on the rise in places like China and Iran, but also in democracies including Australia, France, India, Argentina, and India. An international declaration of Internet rights is in order.

This is good news:

"As the president stated during the campaign, he does not believe the Fairness Doctrine should be reinstated," White House spokesman Ben LaBolt told FOXNews.com.

Interesting, though brief, overview of classical liberalism in this review of Richard Epstein and his new book, "Skepticism and Freedom: A Modern Case for Classical Liberalism." Excerpt:

This hard-nosed political philosophy—first formulated by John Locke in response to Thomas Hobbes, and later Adam Smith; used by Jefferson and Madison to inform the U.S. Constitution; and embracing aspects of libertarian theory and laissez faire economics—continues to offer “the best guide to human behavior” and social organization, said Epstein. “Classical liberalism requires us to maintain the distinction between liberty and coercion: to advance the former while constraining the latter,” he said.

“If we start with a clear vision of human motivation and cognitive limitations,” Epstein said, “we shall gravitate in all matters great and small to a classical liberal position that protects autonomy, property, and exchange of labor and possessions within the framework of limited government. A government,” he emphasized, “that directs its power against coercion and monopoly and calls it a day.”

But what I found equally interesting was the fact that "Epstein describes his personal evolution over 25 years 'from a staunch libertarian who distrusted consequentialist explanations to a classical liberal who embraces these explanations.'" I too feel like I have moved in this direction.

Some more examples of hostility to business among many in California, provided by Thomas Sowell in Criminalizing business: Part II. Excerpts:

A recent column in the San Francisco Chronicle vividly illustrates the anti-business mindset of many Californians. It dealt with the fact that Wal-Mart lost a referendum to allow the retailer to put a store in Inglewood, Calif.

According to the Chronicle columnist, Wal-Mart was "trying to bully its way into another targeted community." Putting an issue to a vote is called "bullying" when business does it, and the community where it wants to locate is a "target."

Among the other rhetorical flourishes of this indictment is that Wal-Mart tries to "crush the competition." What does such purple prose amount to? That some people prefer shopping at Wal-Mart rather than in competing stores, so some of the latter may end up going out of business as a result.

In all this venting of spleen against Wal-Mart in the Chronicle column, there is no mention of the cynical role of activists in depriving a low-income community of jobs and taxes. By flexing their muscle against Wal-Mart, Jesse Jackson et al. have shown those who want to locate businesses in minority communities must get their OK — and that does not come cheap. ...

Yet another example of the anti-business climate in California is a class action lawsuit against the Bank of America and Wells Fargo for charging people for cashing paychecks when those people do not have accounts at these banks.

California law makes that illegal. But federal law says otherwise, and this will all have to be sorted out in appellate courts, at the taxpayers' expense.

Why such a law in the first place? Are there no costs to cashing checks? Do the people who do this work not get paid?

Great to see the Institute for Justice get some well deserved press:

...the Ohio businessman who wants that land for a $125 million development, and for the city of Norwood, which wants that developer for the new tax dollars it hopes he'll bring in.

There's just one hitch: A handful of small businesses and homeowners don't want to sell. Earlier this week, with the help of the Washington, D.C.-based Institute for Justice, they took their case to state court, arguing that the designation of their neighborhood under the city's blight ordinance was a sham. ...

Alas, this abuse of eminent domain is part of a larger pattern across America. We've written about some of these cases before, most recently the effort by a California city (rightly thwarted by a federal judge) to condemn land purchased by a church so it could be sold to Costco. Last month in Connecticut, the state's high court narrowly upheld the city of New London's right to transfer its powers of eminent domain to a private corporation for economic development. In New Jersey, owners of oceanfront property in the shore town of Long Branch are fighting city efforts to take their homes and replace them with condos and townhouses.

And yesterday Michigan's Supreme Court reconsidered a controversial 1981 decision -- a landmark case in eminent domain law -- that saw the blue-collar neighborhood of Poletown condemned and delivered on a platter to General Motors. Notwithstanding the millions in taxpayer subsidies GM received, and the razing of 1,200 homes, the plant ended up delivering only about half the number of jobs promised.

Notice anything similar about all these cases? Whereas years ago the "public use" provision of the Fifth Amendment meant invoking eminent domain for, say, a highway or school, expansive court rulings now allow local politicians to seize private property from Citizen A and hand it over to a Citizen B they believe will prove a better class of taxpayer.

The slippery slope here is obvious. Because businesses will always pay governments more than homeowners (and large businesses will yield more than small), it's no coincidence that governments tend to invoke eminent domain powers on behalf of the rich and politically well-connected at the expense of the mom-and-pop shop or the family that simply wants to keep the home it's lived in for generations.

The studies that showed that legal action by Big Music were dampening file swapping appear to have been flawed. See: Perhaps the industry would be better served hiring engineers rather than lawyers and increase their pace of innovation. Excerpt:

What's clear, though, is that until the music industry gets fully behind online music sales, file-swappers will flock to next-generation sites like eDonkey -- which has seen 150% growth in the past year, according to independent tallies by both BayTSP and BigChampagne.

"This stuff is not going to go away," Gartner's McGuire says. "The industry needs to provide a compelling legal alternative." Until that happens, pirates will continue to rule the online music seas.

Essential reading for anyone interested in technology and public policy from Bill Gurley's "Above the Crowd" newsletter. Excerpt:

On October 6, 2003, the Ninth Circuit Court of Appeals issued an opinion in the case of Brand X Internet vs. FCC that has the potential to delay the progress of the Internet in the United States by certainly years and potentially decades. Through its actions, the Ninth Court has "invited" the fifty independent and natural bureaucratic state-based public utility commissions directly into the fold of the Internet. ...

Some will argue, as does Judge Sidney Thomas of the Ninth Circuit, that opening the cable networks to competitive carriers will directly benefit consumers. The enormous problem with this argument is the prima facie evidence suggesting the opposite. Clearly stated in the Ninth Circuit opinion, 70% of all broadband users use cable modem services as compared with 30% for DSL. Cable companies, free to compete without the shackles of regulation, represent over two-thirds of all broadband users in the U.S. DSL, supposedly advantaged by its open connectivity and therefore supposed increased competitiveness, represents less than one-third. If regulated open-access is such a great thing, why are cable modems such a compelling value proposition for consumers? And why were the RBOCs slow to roll out DSL?

The bottom line is that we tried an experiment in DSL and it failed. Attempting to increase competition by mandating that a company invest in infrastructure and then share that infrastructure with competitors is simply not a market-based solution. Companies, naturally motivated to take market share, not give it away, are simply not effective at appropriately enabling competition. If you want to increase competition, add holistic competitors, not partial ones. This type of solution had a huge positive impact when PCS licenses created a third cellular alternative in most U.S. cities. Solutions such as cable overbuilding can accomplish this as well. Notably, a WISP in Cerritos, California recently announced an eight square mile 802.11 coverage zone based on Cellular-WiFi equipment from Tropos Networks*. This solution will offer ubiquitous broadband of greater than 1MB throughout the entire city. These solutions are the ones that will successfully advantage the customer while avoiding the overt dangers of increased regulation.

We should all know by now that rather than increasing competition, regulation typically reinforces monopolies and oligopolies. Startups will not and cannot prevail in heavily regulated industries. They lack the required resources and capital to manage fifty different utility commissions on a hundred different regulatory issues. For this same reason, you will never see a startup deliver an automobile in the U.S. as the regulatory red tape swamps all efforts. Increased regulation will do nothing more than ensure that new competitors and innovative solutions are permanently locked out of the market.

Also from The Volokh Conspiracy, David Bernstein writes:

Unlike fellow guest blogger Daniel Drezner, I am not appalled that Howard Dean believes that labor unions were the saviors of American workers, because I remember learning this in fifth grade social studies class. I suppose that means that the unions as saviors myth is conventional wisdom, and I don't generally expect politicians to depart from conventional wisdom. But I agree with Daniel that neither economic history nor economic logic support this conventional wisdom. Increases in wage rates follow increases in productivity, and have historically been independent of the concentration of union membership or influence. ... Economists have found that to the extent that unions raise the wages of their members, the long-term gains come largely, perhaps solely, at the expense of other workers. ... And labor unions often serve as a barrier to entry to excluded minorities (this was historically true in the U.S., but nowadays blacks are overrepresented in unions) and to unskilled workers.