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Washington, D.C., September 30, 2002—The future of the U.S. telecommunications industry could be hurt if the federal government persists in its policy on telecom and international trade. In comments  filed this week with the Office of the U.S. Trade Representative, Competitive Enterprise Institute senior policy analyst Solveig Singleton explains the problems with the telecom regulations the U.S. has urged on our trading partners.
“It’s no secret that the telecom sector is in a financial crisis, and the federal government’s regulatory framework deserves its share of the blame,” said Singleton. “For years U.S. regulatory policy encouraged broad, unsustainable investment in telecommunications companies that added no real economic value to the networks. The policies that created this crisis are now the same guidelines that the U.S. trade representative is asking our trading partners to follow.”
Despite a growing awareness among government officials with the Federal Communications Commission that U.S. telecom regulations need to be revisited and revised, drafts of the nation’s trade agreements with Chile and Singapore and past negotiations with Japan threaten to freeze the current flawed American system in place. U.S. trade officials should avoid this in their current negotiations with Latin America (Free Trade Area of the Americas) and in future negotiations with the entire world (World Trade Organization). “U. S. trade representatives should steer clear of any tendency to micromanage other countries’ telecom regulatory regimes—even if they have asked us for advice,” continued Singleton. “For years, the United States has been a world leader in telecommunications deregulation. But since the 1996 Telecom Act was passed, U.S. regulators have added rather than reduced regulation. We have made some grave mistakes. And conditions in other countries are very different, especially for wireless technology.”
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