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February 1999, Week 4

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From:
Wirt Atmar <[log in to unmask]>
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Date:
Sat, 27 Feb 1999 12:54:38 EST
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Tom Madigan asks:

> OK ... what's the "straight skinny" on this?  Last time I heard, the US of
>  A government wasn't going to do anything about Internet taxation until
>  2002.  Should this be added to the growing list of urban legends?
>
>  If Slick Willy and his partners in crime *do* decide to tax the Internet
>  (as if everything else ain't already taxed to death!!), it's going to put a
>  serious crimp in my lifestyle and, I imagine, those of a lot of other
folks.
>
>  I'd like to get the truth, the whole truth, and nothing but the truth!!

The staight skinny is that the United States government appears committed to
keeping the internet toll-free (or at least to the point where you contribute
your share only through flat-rate monthly connect charges). For all practical
purposes, the internet are the roads of the next century -- and road-building
has always been a central purpose of government as a mechanism to increase
commerce and the wealth of a nation. Indeed, the founding fathers of the
American nation, being so distrustful of a strong central government and the
tryanny that it might become, gave the Federal government only three powers:
to provide for the common defense, to build roads and to create a post office.
Everything else, by default, in the Jefferson-Franklin interpretation of the
Constitution, fell to state government.

As an aside, Jefferson's strong advocacy of this interpretation left him in an
extraordinary quandry when he became president and was offered the opportunity
to purchase Lousiana and its territories from France. There was absolutely no
provision in any part of the powers explicitly granted the Federal government
to conduct such a transaction, and Jefferson was loathe to assume powers he
did not already possess. Nonetheless, the deal was obviously too good to pass
up -- and the very thing that Jefferson wanted to avoid, a central government
that slowly grew in ever increasing power, he helped set in motion.

If Jefferson and Franklin were alive today, they would be wildly excited about
the internet -- and they would deeply understand the importance that the
internet represents to the economic security of not only the United States,
but of the world at large. [As an aside, Jefferson and Franklin were both
scientists of the first rank; Jefferson is widely regarded as the father of
American paleontology (an underreported aspect of the Lewis & Clark expedition
that Jefferson commissioned was Jefferson's hope that many of the extinct
"dinosaurs" that were being found in Europe would still be alive in the
American west); Franklin was a physicist of extraordinary genius.]

The internet is rapidly becoming the Golden Goose of the American economy. No
government, now or in the foreseeable future, is going to willingly endanger
that goose. The reason that the American Federal government was originally
granted the power to build roads was precisely to head off the construction of
private toll roads in the American states. They were choke points to the
evolution of the nation.

In that vein, and of more immediate importance, two days ago the FCC ruled
that telephone connections to your local ISP are NOT local phone calls, but
are interstate. That ruling was widely interpreted in most of the national
news media to mean that per-minute charges could be begun to be levied on all
internet connections. The FCC released several notices yesterday to say that
interpretation is not true. Actually, quite the reverse is true. I've included
one here:

=======================================

FCC Ruling Will Not Lead to Internet Access Rate Increase

WASHINGTON, Feb. 26 /PRNewswire/ -- The Federal Communications Commission
confirmed Thursday that a telephone connection to the Internet is interstate,
not local.  The FCC, however, made it clear that this decision would not
result in the imposition of per minute usage charges for dial-up Internet
access.  Such access remains subject to the FCC's long-standing FCC access
charge exemption.  The following response can be attributed to Ed Wynn,
Ameritech vice president, regulatory policy.

"Suggestions that the FCC's decision opens the door to usage charges for
Internet connections are completely unfounded.  The opposite is true because
the effect of the FCC ruling is that reciprocal compensation is not required
on Internet calls.  The FCC's decision eliminated pressure many local carriers
were facing to raise Internet access rates in an attempt to recoup the massive
reciprocal compensation payments for Internet traffic that could not recovered
from existing Internet connection user rates.  Thus, the FCC's decision helps
to ensure that consumers will continue to pay the same low rates for Internet
access that they currently enjoy."

========================================

The bottom line is this: there are plenty of Franklins and Jeffersons still
alive today in the government who understand the fundamental importance of the
internet and will diligently work to insure its future security and easy
common access.

Wirt Atmar

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