Washington Times-EDITORIAL • May 2, 2000
Break up the regulators
Government regulators are out to do private enterprise a big
favor. On Friday they proposed to break up Microsoft in an effort
to restore competition to the software industry. Under the
proposal, said Department of Justice official Joel Klein,
"neither ongoing government regulation nor the self-interest of
an entrenched monopolist will decide what is best for consumers."
Rather, he said, "the market" will decide.
This is the modern-day equivalent of destroying the village
to save it. Mr. Klein proposes to destroy a key competitor in
order to save competition, to replace Adam Smith's "invisible
hand" with the federal government's clenched fist. If he thinks
the public distrusts the government's ability to regulate
software giant Microsoft, why does he think the public trusts the
feds to break it up? The department's case against Microsoft is
filled with unanswerables like this one, but the truth is Mr.
Klein and other agency officials want both to break up the
company and to continue to regulate it.
According to the plan proposed to U.S. District Judge Thomas
Penfield Jackson last week, the feds would split Microsoft into
separate firms. One would control the famous Windows operating
system, from which consumers launch applications like word
processing and money management. The second would hold the
applications themselves. The idea is for the first firm to get
applications to compete against the second, and for the second to
provide applications to operating systems competing against
Windows. Presto, competition.
If Judge Jackson agrees to the plan, perhaps later this
summer, it would be one of the biggest breakups in U.S. history,
although it would have to survive the appeals process to do so.
Of course, the feds' experiment may not work the way it hopes,
which is one reason people get nervous when regulators try to
rearrange business flow charts more to their liking. By adding to
its operating system software that allowed consumers to "browse"
the Web, Microsoft forced competitors like Netscape to drop the
charge for its own browser, made it easier for less high
tech-savvy users to get to the Web and increased public access to
it. There's no guarantee that breaking up the team would mean
similar innovation and service.
The department's proposal doesn't end there, however. The
feds want to impose what Wired magazine calls "extraordinarily
strict government regulations" on Microsoft that would last three
years after a breakup. Among the rules: No sale prices on Windows
to computer makers. No sale prices to software and hardware
developers in exchange for promoting Microsoft products. The
government would have access to e-mail from all Microsoft
officers, directors and managers for up to four years. The
company — with the feds looking over its shoulder — would have to
track all changes it makes to Windows that might — or might not —
slow down the performance of third-party applications. Regulators
could go onto company property to "inspect and copy" any
document, e-mail and more.
If Mr. Klein and company don't like what Microsoft proposes
to do, the company could find itself back in court to ask
permission to innovate and improve its products. That sounds like
a formula for progress on the order of the U.S. Postal Service, a
monopoly that the Justice Department has somehow managed to
overlook. One can only hope that Congress or some future
administration can break up the regulators before they break up
Microsoft.
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Kadosh, Kadosh, Kadosh, YHVH, TZEVAOT
FROM THE DESK OF: <[EMAIL PROTECTED]>
*Mike Spitzer* <[EMAIL PROTECTED]>
~~~~~~~~ <[EMAIL PROTECTED]>
The Best Way To Destroy Enemies Is To Change Them To Friends
Shalom, A Salaam Aleikum, and to all, A Good Day.
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