The Power to Tax is a Duty to Defend

A friend asks a good question:

What I’m trying to understand is the immense effort that is going into trying to maintain the fictional telecom industry and so little effort to enable a real marketplace.

The answer is very simple.

 

Power.

 

Political power, government power, economic power,  yes.

 

But also taxing power.

 

Because these old networks are heavily taxed, in many different ways, government and the political classes have become co-dependent on the telecom and copyright industries.

Conservatives love to quote John Marshall's aphorism that the power to tax is the power to destroy. But the power to tax also brings with it a duty to defend. Those in the Internet industry first saw this in the Third World 10 years ago, and we laughed at it.

Laugh no more.

 

I think it's vital that we understand how united the telecom and copyright industries are here, and why it is natural that the government would ally with them, even against the very idea of progress.

 

By defining content as a service, there are working business and taxation buckets for old copyright material.

 

When we define networks as mere connectivity, then copyright becomes water flowing through your hands.

 

All these industries see is the necessity to them of all water flowing into buckets. But when it flows through hands, it may become part of a stream, a lake, an ocean, an ecology everyone can drink from. The oceans of the streams of story, as Rushdie called it.

 

And that's the problem. Connectivity, as a principle, seems a direct threat to the property paradigm for both these industries, and the government.

 

But it's not, of course. As we've seen with open source software, sharing is a rising tide that lifts all boats. New business models emerge, and progress is faster than with the old proprietary model.

 

So the question becomes, how do we get government to see that the economy will be bigger, even more taxable, by switching to this open source economic model? Or must we wait for those who  do embrace it to pass us by?