Economists Urge Telecom Deregulation; Move Would Spur Investment, Stimulate Recovery

In a letter delivered today to the White House, the Department of Treasury and the Department of Commerce, eight leading free market economists outlined ways in which the Bush Administration could reinvigorate the economy by encouraging investment in the IT sector, which has been responsible for as much as 25 percent of recent GDP growth. “Upgrades to the telecommunications infrastructure are important because they will allow the IT sector to create and market ‘next generation’ products and services that can only be made available over broadband connections,” the economists said, citing statistics on the importance of the IT sector to the economy.

“Excessive and unwise telecommunications regulation is playing a significant role in the IT sector’s decline,” and the Administration should “do everything possible to accelerate the process of deregulating the telecommunications business,” the letter said.

Signatories on the letter included some of the leading free market economists in the nation, including Robert Crandall, Senior Fellow, The Brookings Institution, George Gilder, Senior Fellow, the Discovery Institute, Thomas W. Hazlett, Senior Fellow, the Manhattan Institute, Lawrence Kudlow, Chairman, Kudlow & Company, James C. Miller III, Counselor, Citizens for a Sound Economy, William Niskanen, Chairman, The Cato Institute and Alan Reynolds, Senior Fellow, The Cato Institute.

“We are really making two points,” said PFF President Jeff Eisenach, who is also among the letter’s signatories. “First, it’s important for the economy as a whole to speed up broadband deployment by having a pro-market telecom policy, and, second, a pro-market telecom policy is about deregulation, not protecting competitors.”

The letter concludes by calling on the Bush Administration to “end its silence on telecom deregulation and take a stance squarely in favor of eliminating disincentives to investment in broadband infrastructure.”

The Progress & Freedom Foundation studies the impact of the digital revolution and its implications for public policy. The foundation is a 501(c)

(3) nonprofit organization. The full text of the letter is available on the Foundation’s web page, http://www.pff.org .

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SOURCE The Progress & Freedom Foundation

CONTACT: Francis Rose of The Progress & Freedom Foundation +1-202-289-8928