Category: Uncategorized

Holding out hope on Iran

Posted on by The Progressive Policy Institute

Not much has gone right in the Middle East during President Obama’s second term. The White House has been hoping that a nuclear deal with Iran would yield the foreign policy success Washington badly needs after a string of reverses across the region.

But after a weekend of last-ditch diplomacy in Vienna, the deadline for striking such a deal expired yesterday. The anticlimactic result was an agreement to keep talking.

Even that is too much for hardline skeptics, here and abroad, who believe Iran is stringing the world along and has no intention of giving up its nuclear program. In their view, extending the talks another seven months grants Tehran unearned relief from economic sanctions as well as immunity from military strikes to destroy its nuclear facilities.

Continue reading at the Hill.

The Hill: Title II is wrong way to keep an open Internet

Posted on by The Progressive Policy Institute

The Progressive Policy Institute was cited in an article in The Hill advising against President Obama’s recent endorsement of Title II reclassification in the net neutrality debate.

According to the Progressive Policy Institute, broadband providers spent “roughly $46 billion in broadband investment in 2013.” To continue promoting this type of private sector investment we must not over-regulate innovative broadband providers using antiquated policies that may end up being litigated for years and diminish the certainty of being able to bring high-speed, advanced broadband networks to all Americans.

Read the full piece at the Hill.

Huffington Post: Entrepeneurs: Engines of our Economic Growth

Posted on by The Progressive Policy Institute

In a piece penned for the Huffington Post by U.S. Representatives Scott Peters (D-Calif. 52), Ron Kind (D-Wis. 3), and Patrick E. Murphy (D-Fla. 18) on the importance of encouraging entrepreneurship, a study by the Progressive Policy Institute was cited as evidence of current regulatory obstructions.

The Federal Code of Regulations numbers nearly 170,000 pages, and more pages are added to the code almost every single day. An analysis by the Progressive Policy Institute shows that the number of pages in the code more than doubled since 1975. We have a choice: We can either grow the mounds of paper that our entrepreneurs have to sift through to launch new ventures, or we can make the code simpler and easier to navigate, allowing our economy to grow and create new jobs.

Read the entire piece at Huffingtonpost.com.

Outdated cable box rule harms the data-driven economy

Posted on by The Progressive Policy Institute

Innovating in the digital age requires flexible rules that keep pace with the latest technology. This is especially true in the video services market, where change has been fast and furious. That’s why Congress should act to repeal an expensive and innovation-restricting requirement on the design of set-top cable boxes — without limiting the choice of retail devices that consumers enjoy today.

Currently, the Federal Communications Commission (FCC) mandates that each cable box — the electronic device in your home that links your TV with your cable provider — use a particular type of technology known as a “CableCARD.” This is a credit card-sized security device that enables the box to access the channels and other services to which you subscribe. The FCC’s rule, formally known as the “integration ban,” requires that these security functions cannot be hard-wired or otherwise integrated within boxes leased to consumers by their cable company.

The CableCARD requirement is a good example of how not to regulate in the dynamic data-driven economy, a topic on which the Progressive Policy Institute (PPI) has written extensively. In this case, the intention behind requiring CableCARDs was to foster a retail marketplace for set-top boxes, similar to telephones. Customers who decided to buy cable boxes instead of leasing them could use the box across different cable providers by obtaining a CableCARD from their provider to access its services. To ensure that cable operators would support CableCARDs, the FCC also required operators to include the cards in their leased set-top boxes.

Continue reading at The Hill.

The Washington Post: Obama’s plan to regulate the Internet would do more harm than good

Posted on by The Progressive Policy Institute

President Obama’s call this week to regulate the Internet as a public utility is like pushing to replace the engine of a car that runs perfectly well. The U.S. data sector — including wired and wireless broadband — is the envy of the world, administering a powerful boost to consumer welfare, generating high-paying jobs and encouraging tens of billions of dollars in corporate investment. Indeed, the prices of data-related goods and services have dropped by almost 20 percent since 2007.

Putting the Federal Communications Commission in charge of regulating broadband rates and micromanaging Web services, as the president proposes, would slow innovation and raise costs. It would be bad news for the economy. It would also be a serious misstep for the Democratic Party, marking a retreat from market-based, pro-competition policies pioneered by President Bill Clinton in the 1990s.

The issue here is how best to ensure an open Internet, in which big and small companies alike have unfettered access to customers. After the courts threw out the old open Internet rules in January, virtually all concerned parties agreed the United States needed strong regulations to prevent blocking or discrimination online, to require real transparency for network-management policies by Internet service providers and to ban paid prioritization that could divide the Internet into fast-lane “haves” and slow-lane “have-nots.”

Continue reading at the Washington Post.

The Rise of the Data-driven Consumer

Posted on by The Progressive Policy Institute

PPI is strongly committed to the success of the data-driven economy.  The beneficiaries of the data-driven economy includes Americans as consumers, workers and citizens. Participants in the data-driven economy includes edge providers,  internet service providers,  and in the future, entities such  as healthcare networks and internet-enabled state and local governments.  We acknowledge that strong differences of opinion exist about the right way to achieve the success of the data-driven economy—notably the debate over Title II regulation of broadband. However, we believe that we all share a vision of how the data-driven economy can benefit Americans.

In that spirit, we share here some of the results from our soon-to-be released paper on data and consumer welfare gains since the recession, by Michael Mandel and Diana Carew.  We analyzed how Americans are consuming data-related goods and services, including everything from cable, wireless, and internet service to computers, software and content.

Here are the main results of our analysis:

  •  The prices of data-related goods and services have dropped by almost 20 percent since 2007.
  •  Real consumption of data-related goods and services per person has risen by 48 percent since 2007.
  • Real consumption per person of all other goods and services—from healthcare to housing to autos to food—is only up 0.9 percent since 2007.
  • As a result, the data sector has been the main force driving average gains in consumer welfare since 2007.  By our estimate, data-related goods and services account for roughly 70 percent of the gain in average consumer welfare over that stretch. *
  • Stunningly, real personal consumption per capita of all goods and services outside of data, healthcare, and housing actually fell by 3.0 percent since 2007. Real consumption per capita has fallen for motor vehicles and parts; furniture; food; jewelry; and even financial services.
  • From this perspective, the recent election was a referendum on what many Americans already know – in the non-data sector, stagnant real wages have failed to keep up with inflation.

Our results show we are truly in a “data-driven economy” – data-related goods and services  are driving post-recession gains in consumer welfare. Outside of health and housing, non-data-related goods and services are simply not part of the story.

Without the success of the data sector, American consumers would be far worse off than they are today.  Whatever we do about regulating the Internet must take into account that it’s the most vibrant sector of the economy.

*In the forthcoming paper, we define average consumer welfare as real personal consumption expenditures per capita. By this measure, average consumer welfare has  risen by 3.1% since the third quarter of 2007.  Of that gain, 0.9%, or roughly 30%,  comes from non-data-related goods and services.  The rest, or 70%,  comes from data-related goods and services.

 

 

NYT: Net Neutrality Debate: Internet Access and Costs Are Top Issues

Posted on by The Progressive Policy Institute

A policy report by PPI Senior Fellow Hal Singer and Brookings Non-resident Fellow Bob Litan was cited in a New York Times article suggesting that the regulation of broadband Internet with restraint can be achieved through lighter means that does not put at risk other crucial objectives — like broadening access to the Internet and tackling the nation’s very real digital divide.

A report published this year by Robert Litan of the Brookings Institution and Hal Singer of the Progressive Policy Institute recommends “pick the policy that maximizes total investment across the entire Internet ecosystem.”

Read the entire article at The New York Times.

AP: Obama Steps Into Divisive Debate on Net Neutrality

Posted on by The Progressive Policy Institute

The Associated Press cited a policy report authored by PPI Chief Economic Strategist Michael Mandel and PPI Economist Diana Carew, “U.S. Investment Heroes of 2014: Investing at Home in a Connected World” as part of an article arguing against regulating Internet Service Providers (ISPs) as utilities.

Last year, AT&T, Verizon, Comcast and Time Warner Cable invested a combined $46 billion in the U.S. on plants, property and equipment, according to estimates complied in an analysis by the Progressive Policy Institute, a think tank.

Read the entire article at ABC News.

NYT: Obama’s Call for Net Neutrality Sets Up Fight Over Rules

Posted on by The Progressive Policy Institute

PPI Chief Economic Strategist was interviewed by the New York Times in a story detailing President Obama’s recent endorsement of Title II regulation of broadband Internet and the implications of that endorsement.

But critics of the proposal say regulating Internet service like a utility, without subjecting it to the same aggressive oversight of industries like electricity or water, will be a tough balancing act for the commission.

“Forbearance is a fig leaf here, especially when it comes to big issues like rate regulation,” said Michael Mandel, chief economic strategist at the Progressive Policy Institute, which dislikes the prospect of treating broadband like a utility. “The F.C.C. can forbear easily from day-to-day rate decisions. But I don’t see how they can stay out of that when there are big innovative leaps.”

Mr. Mandel pointed to the introduction of the iPhone as an example. When that device was released, AT&T needed to develop a new type of data service package to charge consumers who wanted to use the iPhone’s ability to connect to the Internet.

Read the entire article at The New York Times.

Regulating the Open Internet: A Letter to Pro-growth Progressives

Posted on by The Progressive Policy Institute

To Whom It May Concern:

As Democrats who care about the dual priorities of protecting broadband consumers and stimulating broadband investment, we are gravely concerned about President Obama’s endorsement today of monopoly-era, common carrier regulations (called “Title II”) for broadband providers. The president’s proposal does not balance these goals, nor move us towards compromise on other, arguably more critical, communications issues.

First, Title II is not necessary to protect consumers from the hypothetical threat of discrimination by broadband providers against edge providers. In Verizon v. FCC, the D.C. Circuit made clear that the Federal Communications Commission (FCC) could regulate pay-for-priority deals—and even reverse them after the fact—under Section 706 of the 1996 Act.

Second, Title II itself isn’t guaranteed to stop pay-for-priority by broadband service providers. Title II would merely require that the terms of any pay-for-priority deal be extended to all comers. The monopoly-era cases of generations ago in which the FCC used Title II to proscribe “inherently unjust” conduct have nothing to do with a competitive broadband provider offering paid priority. Thus, the prospect that Title II could be used to bar pay-for-priority deals is very small.

Third, the more likely rationale for imposing Title II is to pursue an aggressive regulatory agenda unrelated to net neutrality, in particular, “unbundling,” the policy that requires companies that make investments in broadband infrastructure to share them with competitors at government-set prices. But when this policy was ended in the decade following the bi-partisan 1996 Act, an explosion of investment by telcos and cable companies in broadband infrastructure resulted, which allowed the U.S. to catch up to the rest of the world. Both the Clinton and Bush Administrations supported this consensus. Moving backwards to a forced-sharing regime would likely chill broadband investment, along with its job-creation and impact on growth, and preserve the “digital divide.”

Fourth, the net neutrality saga has diverted the FCC’s resources for nearly a decade. By eschewing real compromise made possible by the D.C. Circuit Court, and instead pursuing a radical prescription of Title II, the FCC guarantees itself a drawn-out litigation battle with broadband providers. Other, more critical policies, such as broadband deployment in underserved areas and freeing up spectrum for wireless, will sit on the back burner.

Broadband providers have made clear they would not challenge net neutrality rules based on the FCC’s Section 706 authority, so long as the rules made some effort to accommodate arrangements with edge providers that led to new and improved services. That compromise would be consistent with the desire expressed by the American electorate to find the middle ground and reject extreme intervention in the U.S. economy.

Sincerely,

Ev Ehrlich, PPI Senior Fellow

Michael Mandel, PPI Chief Economic Strategist

Hal Singer, PPI Senior Fellow

A Better Path Forward on Open Internet

Posted on by The Progressive Policy Institute

This morning, President Obama spoke out urging the Federal Communication Commission (FCC) to regulate broadband Internet as as a utility.

In a September policy brief, The Best Path Forward on Net Neutrality, PPI Senior Fellow Hal Singer and Brookings Non-Resident Senior Fellow Robert Litan explained how Title II enforcement in the late 1990s chilled cable/telcom investment. They argue that by relying on its Section 706 authority the FCC can promote greater investment across both edge and content providers compared to Title II. It will also allow the FCC to avoid any unintended consequences, such as creeping regulation, that encompasses content providers or other ISP services.

Download “2014.09-Litan-Singer_The-Best-Path-Forward-on-Net-Neutrality“

PPI Statement on President Obama’s Endorsement of Title II Regulation

Posted on by The Progressive Policy Institute

PPI President Will Marshall released the following statement today after President Obama’s announcement urging the Federal Communication Commission (FCC) to regulate broadband Internet as a public utility under its Title II authority:

“’I hear you,’ President Obama assured voters in his post-midterm press conference last week. But his endorsement today of subjecting the Internet to heavy-handed regulation suggests otherwise.

“In fact, the president’s statement is exactly the wrong reaction to the election. It endorses a backward-looking policy that would apply the brakes to the most dynamic sector of America’s economy.

“The shellacking the president and his party suffered last week was largely about the economy. In exit polls, 70 percent of voters said they were mostly concerned about the economy, and an overwhelming majority of them described economic conditions as ‘not so good’ or poor.

“If the election yields any lesson, it is that Democrats need to offer the public a more convincing plan for accelerating economic growth and restoring shared prosperity. Such a plan should begin by building on America’s comparative advantages in digital innovation and entrepreneurship.

“Imposing public utility-style regulation on the Internet points in the opposite direction. It would very likely reduce private investment in broadband, which as PPI has documented in a series of policy reports, is a prime catalyst for job and business creation in the United States.

“It is also inconsistent with the Democratic Party’s legacy. After all, the Internet took off in the 1990s, thanks in significant degree to the ‘light touch’ approach to regulation adopted by the Clinton-Gore Administration.

“We hope President Obama will reflect on that legacy of pro-growth progressivism and reconsider his endorsement of Title II regulation of the Internet.”

How Democrats Can Recover

Posted on by The Progressive Policy Institute

Electoral defeats are painful, but clarifying. As Democrats survey the damage left by a larger-than-expected Republican wave, it’s possible to discern four signposts on the road to a progressive recovery.

First, the party needs to start working on a post-Obama agenda.

Anti-Obama sentiment engulfed Democratic candidates everywhere, dragging red-state senators underwater and nearly drowning seemingly safe incumbents in purple or blue states, like Sens. Mark Warner of Virginia and Jeanne Shaheen of New Hampshire. The main “issue” in all these campaigns was the Democratic candidates’ supposed fidelity to Barack Obama. Only in this sense did Republicans succeed in nationalizing the midterm, but it was enough.

In his press conference Wednesday, a rather clueless President Obama took no responsibility for the wipeout and conveyed no urgency about making course corrections. This suggests that while Obama will be the main bulwark against GOP hubris and extremism over the next two years, Democrats will have to look elsewhere for the new ideas and arguments they need to regain the political initiative and rebuild support for progressive goals.

Second, those ideas won’t come from the party’s current congressional leadership, either.

Speaker Nancy Pelosi and Majority Leader Harry Reid are able legislative tacticians, tough partisan warriors, and world-class fundraisers. The charge now being leveled against them by some on the left—that they haven’t been aggressive enough in confronting Republicans—is ludicrous.

But agile tactics and fighting spirit aren’t enough, especially if voters think they are mainly in the service of expanding benefits for favored party constituencies. What Democrats need is a larger vision for restoring shared prosperity that can unite the interests of core partisans with those of moderate and independent voters. The current leadership has discouraged creative thinking by party pragmatists about ways to speed up economic growth, improve the regulatory environment for innovation, or make government work better. Instead, they’ve enforced conformity to focus-grouped “messages” tailored narrowly to different slices of the electorate.

Yes, I know that raising the minimum wage is popular. But it didn’t lift Democrats last Tuesday, and neither did alarmist rhetoric about a “war on women.” Next time around, Democrats will need to offer voters something more inspiring than a tired pastiche of messages aimed at bribing or scaring voters. It’s time to replace the current team with a younger crop of rising leaders open to bigger, bolder ideas for tackling America’s big problems.

Continue reading at The Daily Beast.

 

 

Wall Street Journal: Sullen Voters Set to Deliver Another Demand for Change

Posted on by The Progressive Policy Institute

PPI President Will Marshall was quoted in a Wall Street Journal article on public dissatisfaction facing both parties, examining how the trend of “change elections” reflects growing discontent among American voters.

Will Marshall, president of the Progressive Policy Institute, a centrist Democratic research group, predicts that public frustration with politics will only intensify after the midterms, and will be a central issue for both parties in 2016.

“There will be tremendous pressure on the presidential candidates,” said Mr. Marshall, “to say how they are going to get out of this impasse and break the stalemate.”

Read the rest of the article at Wall Street Journal.