The Digital Transition and Public Safety Act of 2005 is a sham.

Here at The Cosby Sweater, I like to take bad ideas (and good ideas) seriously enough to destroy them with one or two sentences.  And that’s what I’ll do with this Digital Transition. 

What is the Digital Transition? – you might ask if you haven’t been watching network TV for the last half-year.  It’s been hard to swallow all these advertisements about this impending rape of the free market, but, on to my description:  the Digital Transition is the government’s benevolent attempt to help out us dim TV watchers while freeing up air waves to add frequencies to the emergency services we use auction off for a profit on the backs of networks.  The act is found on page 18 of this PDF behemoth.  (This is a budget add-on from 2005.)  Among the text is this little ditty: “This title may be cited as the ‘Digital Television Transition and Public Safety Act of 2005.’”  Okay, package anything with “Public Safety Act” that prime facie does not have anything whatsoever to do with public safety, and I’m looking for my next blog post.  But this is just too much.  The Act:

1. Requires the networks to broadcast via a digital signal instead of an analog signal,
2. Grants $3 Billion to help families upgrade to digital through Converter Box coupons,
3. Uses the newly abandoned analog signal to establish a better emergency communication system,
4. Auctions off the unused portion of the spectrum (presumably to the wireless communications industry),
5. And increases the licensing fees to the (private sector) networks for their trouble.

Here’s the kicker: they aren’t even sure about getting their funding back for this project!  Hooray for uncertainty.

Estimates of spectrum values are very uncertain, largely because they depend on market
factors that differ among firms, technologies, and regions, all of which can vary over time.
CBO’s estimates of the potential proceeds from such auctions are based on a variety of
methods and considerations, including assessments of potential cash flows for various
applications, historical trends in auction bids, and information provided by numerous
industry experts.  (source here)

Market factors?  Whoa, chalk one up for that Nostradamus-like wizardry there.  Well, anyone convinced of the brilliance of our guys on the hill yet?

But my problems with the fundamentals within this brainstorming session are not going to be the focus of this next portion.  Let us assume that this was reasonable and beneficial (to most even, if not everyone).  Cross apply any of this to our newly-found love of throwing money to people and organizations who have a track record of not spending money well.  Bailout dollars can go to the banks and lenders and auto makers and the beggars who cannot manage, but when the government takes over the territory (albeit wavelength territory) that the networks make their livelihood on, they get a bump in their licensing costs. 

And make no mistake, my wise, above-and-beyond readers who went to the above links to investigate, when the Congressional Budget Office gives that line in the report about saving money via electricity costs, there are several factors not accounted for by these unelected gurus. (For reference, the line is: “Most publicly owned television stations have already made the transition to digital television and would realize savings of up to $100,000 per station in electricity costs when they turn off their analog signals” (5-6). 

First, the most of these costs come from running both analog and digital at the same time, a problem that wasn’t a damn mandated problem until this legislation.  If a station wanted to broadcast in two different signals in the free market, it would take the burden of the additional costs (electricity, equipment, or whatever) as their risk for having a better, broader service base.  It is their choice about whether to incur the costs, when we are talking about a free market system – free from dumb government policy. 

Second, there is no cost reported for the electricity for the digital service, leaving us wondering which costs more, or what the savings would be to these same networks that didn’t have to carry both services immediately before the transition.  The word “savings” is a misnomer here – they mean to say, after the transition, networks will get to stop paying the electricity on the analog service they chose to carry when the government takes away their ability to carry it.  I would call that a deduction in my service base, not a savings on electricity.  Sneaky devils tried to make us forget they were confiscating the airwaves. 

And while we are discussing how bad this Act of Congress is, let us consider the idea of eminent domain.  I am aware that ever since the 2005 Supreme Court case Kelo v. City of New London, the idea of eminent domain has taken a backseat to the idea of “benefit to the general welfare.”  However, as far as I am aware, no opposition has been taken to “without just compensation” clause found in the judicial system (unless we’re talking about drug laws, which is a different post).  Now, follow me here.  The mere act of re-applying for a license for the stations’ airwave rights assumes the “right” to rent or lease the airwaves.  A professor of mine once told me that every government policy breaks promises and increases coercion.  This policy is no exception.  The government changed the deal here, and I firmly contest their solution to just compensation by increasing the licensing fees.  Ha, even if we assumed the “good deal” stations were getting with electricity, the government is taking that and more under this new policy. 

I am past the point of trying to understand why I cannot find more opposition to this.  I will note to you readers, in conclusion to this piece, that one Republican of noteworthy status voted “no” to this.  Find the votes here.

Not ambitious enough to go check out who voted no?  Go see what he has to say about Eminent Domain in the Kelo case here.

Oh, before I forget, the two sentences for why this is bad legislation:

1. The Digital Transition and Public Safety Act of 2005 disrespects the distinction between the categories of policy and business.  (And thus reaffirms the bad notion that the government should function under the latter category.)
2. The Digital Transition and Public Safety Act of 2005 is another attempt to place the yoke upon successful industries to support those not as successful (or completely unsuccessful).
   See, unlike some members of Congress, I keep my promises.