The FCC and the Jobs Report

On Wednesday the FCC announced that it was going to put off tightening regulations on broadband providers.  Today, the  Bureau of Labor Statistics announced that private payrolls rose by 67K  in August, a gain mostly due to an increase of 45K in healthcare and education, two sectors that are heavily government supported.

Indeed, over the past year, the rest of the private sector, outside of healthcare and education, has lost jobs.

However, there are pockets of strength. One such pocket is in the communications sector,  where employment wireless communications, Internet companies  (think  Google), and custom computer programming services (think apps developers)  are up over the past year. This is a sign that this sector may be one of the leaders in the recovery.

From that perspective, the FCC made exactly the right decision when it postponed imposing new regulations on communications.  At a time when there are so few economic bright spots,  it would be a serious mistake to take a regulatory hammer to a growing sector.

There’s a sign that the FCC is recognizing these imperatives. In the statement released on Sept. 1, the FCC said:

in light of rapid technological and market change, enforcing high-level rules of the road through case-by-case adjudication, informed by engineering expertise, is a better policy approach than promulgating detailed, prescriptive rules that may have consequences that are difficult to foresee

But there’s a broader principle here. As I have suggested, the Obama Administration needs to think in terms of countercyclical regulatory policy. Regulations are essential for making the market economy work, but timing is essential–not just in communications, but in biosciences, environment, education, and a whole host of different areas. Overly enthusiastic regulation in a deep downturn is not the way for fast and healthy growth.


  1. How does letting broadband monopolies/oligopolies do as they please promote growth?

  2. For once, cm and I are in complete agreement. 🙂 If the FCC had any brains or balls, they’d force telephone and cable companies to provide open access like this state fiber network has. I don’t care who paid for the infrastructure as all the telcos have received hundreds of billions of dollars in subsidies already (I’d remove the dumb universal service restrictions too, there’s no way the rest of us should be paying for rural access). As for those who claim the telco act of 1996 already tried this, I suggest they talk to DSL providers like Earthlink and find out how much access they were actually given to the local loop: it was a sham. Also, if there were actual competition, “network neutrality” wouldn’t even need to be talked about. However, none of this will happen because the FCC is perfectly happy to be bought off by the incumbent telcos to maintain their monopoly, just like all govt agencies. It will only change once investors realize the great gains that could be had from open access fiber networks and put the current telcos out of business with that superior model.

  3. Investment in national savings schemes saw a big jump during January thanks to increase in interest rates on different products effected by the government in December.

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