Re:Victory for Individual rights: NOT (Score 1)

Regulation of natural monopolies is in the public interest. Harmless monopolies, such as your local WalMart, should be left alone. If your local WalMart were to drop prices every time a competitor appeared, and raise them again after driving the competitor out of business, it would have become an abusive monopoly subject to prosecution.

Local loop services were until 1996 government-protected monopolies with government-guaranteed profit margins. No matter what they did, shareholders were guaranteed a 15% (or whatever) return on their capital. This is why our small local telco has a dual OC-48 ring ... in order to make money the owner has to find new and increasingly wasteful ways to spend it.

In order to guarantee 15% return, the taxpayers and ratepayers have been subsidising local service. The extent of the subsidy can be imagined by asking how much an insurance company would charge to guarantee all telcos 15% profit. You'd have to get someone with a lot more time than I have to run the figures throough Black-Scholes but I'd estimate that the ratepayers have invested far more in the local loops than have the nominal owners.

Until the advent of Michael Powell's "Piss On Them" Economics, this situation was acceptable because the ratepayers who had compulsorily invested all this money into their local loops were supposedly protected by PUC's. Now, using the same corrupt strategies that raped taxpayers for S&L and PG&E, the utilities want their cronies to rewrite the stated-mandated contract between the ratepayers and shareholders, such that the ratepayers lose their entire investment and lose service choice and pay higher prices ... and gain nothing in return.

Such would be a victory for corruption over property rights.

Clearly the shareholders' compulsory profits were not all that great for ratepayers either, although not as bad as being cleaned out by Powell. That was one of many good reasons for the 1996 Telco Deregulation Act. Telcos which permitted competition on the local loops would be permitted to diversify into newer and more profitable segments.

It is no surprise that the Telcos would want to both keep their monopolies and abuse them. Sadly, it is also no surprise that our extremely corrupt government officials could be induced to legalise such a travesty.