FCC Tunes Out Consumers
[August 12, 2002]
By S. M. Oliva
Last Friday, the Federal Communications Commission
issued a final order to carry out its 1997 congressional mandate to "phase
in" High Definition Television (HDTV) over the next five years. The order
says that in 2007, all television signals must be digitally transmitted,
and, not coincidentally, all television sets sold must be manufactured to
receive these signals. The traditional antenna-based analog signals will
no longer be allowed after 2007.
At present, about 20% of Americans do not possess
televisions capable of receiving digital signals. These sets will either
have to be scrapped or their owners will have to subscribe to cable. After
2005, all televisions sold will be digital-equipped, at a cost of about
$100 extra to the consumer.
In some corners, we'd call a government mandate that
forces consumers to pay more for something a tax. We know it sounds
old-fashioned, but it seems to me that there is nothing in the
Constitution which grants Congress the power to tell Americans what
television sets they may or may not use. Supposedly, a marketplace exists
to decide those questions.
Now the reply to this argument is, "it's the commerce
clause, stupid." Since Congress can regulate interstate commerce, they can
mandate television set standards. It's an interesting theory, and one that
is applied to just about every facet of the U.S. economy these days, but
it's wrong. The constitutional grant of "interstate commerce" power to
Congress was intended so that federal government would protect the
process of commerce. It was not a license to dictate the outcomes
of commerce, as is the case here.
What makes the FCC's actions here all the more appalling
is the not-so-secret motivation. Broadcasters are required under the law
to exchange their analog signals for digital ones by the 2007 deadline.
Once the analog frequencies are returned, the FCC will then auction them
off again to cell phone broadcasters, making a handsome profit for the
government while sticking consumers with the burden of buying costlier
At no point did anyone—not Congress, not the FCC, not
even the businesses affected—ever suggest that we try capitalism. In other
words, nobody stood up and said the broadcast frequencies are not public
property (as they have been since the New Deal), but are just another form
of private property that the government should not interfere with the use
of. I know, that's a radical idea. Companies would profit instead of
If anything, however, this is a good case study of how
fraudulent the claim is that the government acts to "protect consumer
rights," a phrase you often hear in antitrust proceedings and product
regulation. If consumer rights really was a government interest, then why
did it not apply here?
I don't know the answer to that, but it's certainly not
a question I'll be asking the FCC anytime soon.
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