Your Final Exam

Imminent Pricing of the Net Predicted!!!

Yes, well, and... there's really not much we can do to stop this. Whenever demand exceeds supply, there are only three options:
  1. Reduce demand. For the net, just try it!
  2. Increase supply. Unfortunately, demand grows exponentially, as the software genii think of new ways to shove bits over the wires, and as more people get on the net, the more useful it is for others to get on it, too. The Rev. Mr. Malthus would understand.
  3. Restrict access.
There are lots of refinements, but in essence there are only 4 ways of restricting access:

Rationing.

Alas, you need a rationing apparatus. Even-shares rationing leads to inefficiency (some people have too much = more than they use, others not enough), and a more flexible rationing system demands a larger and more powerful apparatus. If the net ever becomes really important, I don't think I'd like to have the federal Bureau of Information Technology issuing diktat on my ability to communicate --- imagine what that would do to Chomsky, or would have done to Tom Paine. (This comes close to a ``when modems are outlawed, only outlaws will have modems'' argument, but there're big difference between this and the gun-control debate. While I agree that, in principle, a well-armed citizenry does make tyranny harder, given the strength of the US Army, we could give every citizen a few good rifles, teach them how to use them, and it still wouldn't stop a determined coup d'etat; and the cost of arming a populace as ignorant, careless and trigger-happy as this one currently is is just too high.) Also, both the net and the apparatus must be paid for; presumably this would come out of taxes.

The current radio & TV broadcast set-up is a rationing system. Taxes pay for the apparatus, advertising (and the prices we pay for advertised products) for the media proper.

Privilege

This is really a variation on rationing, but an important one: only certain people can use the Net, but their use is unlimited. This is essentially the way things are now, only, since we are, after all, egalitarians, we're busy extending the privileges to everyone; and not surprisingly, it won't work.

Discussion question (20 pts.) Compare the spread of the net with the efforts to institute universal education and popular literacy in the 19th century. For extra credit, discuss the way normal schools and teachers' colleges were turned into universities in mid-20th century America. To suck up to the grader, quote Voltaire. Which do the B1FF-nodes resemble more: the ``University of Wisconsin --- Eau Claire'', ``Oral Roberts University,'' The Bridges of Madison County or a Harlequin romance novel?

Markets

Yes, they've got a bad rep (among us leftists --- there's a joke that circulates among economists that goes as follows: ``How many University of Chicago economists does it take to change a light-bulb?'' ``If it needed fixing, the market would take care of it.'') But --- when suitably regulated to screen out frauds and junk products, the informational equivalents of putting whole rats in sausage --- Internet access seems to be the kind of service markets are good at providing. Efficient markets need lots of buyers and sellers with roughly equal bargaining power, and those in the market need to be able to compare offers reliably. Since there are few barriers to entry --- there are thousands of technogeeks, the cost is low, the tech is getting simpler all the time --- and no real economies of scale, there's no reason why there shouldn't be lots of sellers of Internet access, and ex hypothesi there are lots of buyers. Comparing the services offered, again, should not be much of a problem. The net really doesn't care whether the bits it's moving are ftp'd gnu software, pornographic .gifs, love letters or audio instructions for blowing up New York. Your provider need only quote you price lists for bits, and tell you about the hardware/software it offers. (This is a good reason why network software should be public, and hardware not made by service providers.) You pay your provider for the bits you send out, and that amount hopefully covers what it's charged by its network connections --- sort of like retail merchandising, only bits move in the opposite direction from things. (``I can get it for you wholesale!'' he cried, before plunging into the details of connecting directly to your midlevel network.)

Essay question: Access for Poor People (80 pts.) Discuss, critically and in detail, the following models for providing access for poor people:

  1. Public libraries. Could and should libraries actually provide free access, and not just be the models for the sort of service provided? Consider the issues of government control mentioned above, especially in light of the continuing history of attempts to censor libraries and use them for indoctrination. Why or why not will these be more or less of a problem with public net access? (Bonus pts: Discuss the evolution of libraries in the Western world, from the fee-charging lending libraries of the late 1700s and early 1800s fee-charging lending libraries of the late 1700s and early 1800s to the public libraries of the early 20th century. Could, e.g., Bill Gates act as the Andrew Carnegie of the fin de millenne?)
  2. Scholarships. Consider the history of need vs. merit based scholarships. Under current scholarship rules, families are expected to put themselves in debt to school their children --- should something like this apply to the net? Should Internet scholarships be set aside for specific groups?
  3. Subsidies. Should they be in cash, or vouchers that access providers are forced to honor? If vouchers, should they be fore specified units of service, or for a monetary amount of service? Should subsidies be transferable?
  4. Price control. Cite at least two empirical studies on the effects of price control on markets. Is net access similar enough to these markets that something similar should be expected? Would putting price limits on net access be more like rent control or a cap on oil prices? How and by whom would price controls be set? How likely is it that they would be set fairly? What are fair prices for Internet access?
General points.
Should access be free, or just at very low cost? Should it be available to all citizens, or just to poor ones? Should it be available to resident aliens? To illegal aliens? As always, justify your answers.
Remark.
None of these schemes is the fairest in the world, since none of them will let poor people have as much access as richer people could. But we can't afford to give everything to everyone, and the amount of unfairness involved can be held to tolerable limits. If you have to use the public library, you can't take the books home with you forever, or cut articles out of the New York Times, which you could do if you were buying them --- mais tant pis.
In short: markets aren't pretty, but they can work, and the net is a case where they probably would, without too much injustice.

Auctions

Auctions are the final canonical way of restricting access --- selling privilege, in essence --- and while there are lots of refinements to the basic idea of auctions, I see no way whatsoever of making it work with the net: to begin with, no one owns enough of it to sell it off, unlike, say, mineral rights.

Oral

100 points

Formulate a plan for regulating access to the Internet. Consider issues of technical and political feasability, civil liberties and human rights, economic and bureaucratic efficency, the international nature of the net, educational, intellectual and more broadly cultural standards, corruption, commercial pressures, the fact that both technologies and institutions, even states, become obsolete and vanish, and not least, the ease of implementing your plan. The plan should be clear, concise, specific, flexible, empirically grounded, logically coherent and rhetorically effective.

Then defend it in open debate with the following panel:

  1. the last Marxist who is not a child of the white middle class *,
  2. the late Mr. John Stuart Mill, as channeled by the late Mr. D. D. Homes, as channeled by Dr. Sonya Friedman,
  3. a Singaporean technocrat,
  4. an anarcho-capitalist (``why settle for the lesser of two evils?'')
  5. Prof. John Kenneth Galbraith,
  6. Prof. Avram Noam Chomsky,
  7. a randomly selected inhabitant of Sarajevo,
  8. Mr. Serdar Argic,
  9. Prof. Kenneth Arrow,
  10. a software-writer from Bangalore,
  11. an unemployed Pennsylvania steelworker and
  12. a Granola Crunchette from alt.save.the.earth and rec.pet.cats.
To avoid having thirteen at the table, discussion will be moderated, and wine served, by Mr. Sokrates Sophoronsou of Athens. Points will be awarded for rationally changing your mind.

Good luck,

illegible scrawl

*: If he is unavailble at the time of the exam, he will be represented by Mr. Larry Canter, Attorney-at-Law. GO BACK