The Spanish-American War may have ended over a century ago, but anyone in the U.S. with a telephone line is paying a 3 percent luxury tax created to fund the conflict in 1898 -- That's a situation that a number of Republican senators would like to change. This week, they introduced a bill to repeal the Spanish-American War levy. "Common sense dictates that repeal of the telephone excise tax is long overdue," said Sen. Rick Santorum, R-Pa. "Communication is not a luxury. It has become part of the basic fabric of our social and economic life." Other sponsors of the Senate legislation include Republicans Mike Crapo of Idaho and Gordon Smith of Oregon. A related bill is pending in the House of Representatives. The obscure telecommunications tax took center stage in January when a congressional committee suggested the tax could be extended to include "all data communications services" including broadband, dial-up, fiber, cable modems, cellular and DSL (digital subscriber line) links. In addition, the Internal Revenue Service and the Treasury Department have said they are considering whether the tax should apply to Internet phone calls.
Try to imagine this scenario, that General Motors and Ford were given exclusive franchises to build America's interstate highway system, and also all the highways that connect local communities. Now imagine that, based upon a financial crisis, these troubled companies decided to convert all "their" local arteries into toll-roads -- they then use incremental toll fees to severely limit all travel to and from small businesses. Why? This handicapping process reduced the need to invest in building better new roads, or repairing the dilapidated ones. But, wouldn't that short-sighted decision have a detrimental impact on the overall national economy? It's a moot point -- pure fantasy -- you say. The U.S. political leadership would never knowingly risk the nation's social and economic future on the financial viability of a restrictive duopoly. Or, would they? The 21st century Global Networked Economy travels across essential broadband infrastructure. The forced intro...