Cable’s big day

They held a birthday party Monday for the Telecommunications Act of 1996, age 3. The U.S. Department of Commerce’s present to the cable television industry was an announcement that it will not stop next month’s scheduled elimination of price controls on rates.

It was one heck of a fete, and everybody who’s anybody joined in: President Clinton, who signed the law on Feb. 8, 1996, with a gusher of futurist hyperbole; Congress, which fundamentally restructured the nation’s communications system without bothering to read the fine print; the Federal Communications Commission, which promised unfettered competition in cable television and telephone would bring unimaginable benefits to the consumer. The guest of honor, the cable industry, appreciated the government’s thoughtful gift, which goes so nicely with the 21-percent rate increases it already enjoys.

The public was not invited. It will, however, pick up the tab.

The Telcom Act freed cable, local and long-distance telephone companies to get into each others businesses, the rationale for the loosening and eventual elimination of federal control was that competition would restrain prices. The coming sunset of FCC price regulations on all but the lowest, “antenna-level” cable rates was written into the 1996 law, as Congress figured that three years would be enough time for free enterprise to develop.

It hasn’t. That’s why cable rates have risen at four times inflation and why in community after community across the country (Bangor and Princeton being two local examples) the public has complained bitterly about rising prices and declining service, especially in the lower channel tiers. It’s why virtually every consumer group going urged Commerce to block the sunset provision until Congress could revisit a law that isn’t doing what it was supposed to. Now it’s up to Congress, which so far has shown no interest in admitting that creating unregulated monopolies was a mistake.

There is a lighter side. In announcing his decision to permit the sunset, Commerce Secretary William Daley said the government will keep an eye on cable rates after price controls are lifted: “We will watch it. We will not let anyone take advantage and gouge customers.” It’s not a real birthday party without a clown.