It is a well known rule of economics that the most innovative and cutting edge industries are those that have the most government intervention.
Biggest economic lie #5: “Markets” exist without government. Truth: Government organizes, defines, and enforces the market.
— Robert Reich (@RBReich) February 16, 2013
The extreme (and perfect) example of this is the efficient mail delivery juggernaut: The United States Postal Service.You can’t stay in business for over 230 years without being an innovative entity. The USPS even has an innovative web portal for submitting innovations from outside the USPS! How innovative!
The USPS is so beloved by every citizen that it is illegal for private competitors such as the unreliable UPS and Fed-Ex to deliver mail to official USPS mailboxes. That’s right, UPS and Fed-Ex are so hated that the government had to make laws to maintain the USPS monopoly on delivery of unwanted catalogs and credit card solicitations.
Now, contrast USPS with the backwards cellular phone industry. The government absence in the cell phone manufacturing business (not cellular carriers, just the phones) is noticeable and the resulting lack of innovation and growth is predictable.
Once an industry becomes important enough, it is inevitable that the government won’t be able to stop itself from swooping in to help. The latest example of this is the aforementioned cellular phone industry.
Private entities simply cannot be relied upon to decide what they want, how they want it and then create private contracts to satisfy those desires. To remedy this problem, The Digital Millenium Copyright Act by the Library of Congress back in October 2012 outlawed unlocking of phones, which remedied the problem carriers had with cellular phones.
Now our Dear Leader Obama has stepped in to remedy that remedy by decreeing that his administration supports consumers’ ability to unlock phones.
So who is right? The DMCA or Obama?
Both! But really, who cares?
The point is not “who is right”. The point is that the government is meddling and making rules and pronouncements that contradict and confuse producers and consumers. This will inevitably help the cellular industry to finally begin to grow.
When the government meddles, the winner is…YOU.