By Jim Thompson
HCP columnist
If you are in your mid-50s or younger, you likely have no idea about these stories I am about to tell you, for these events took place in the 1970s or earlier, when you were a youngster or not born yet.
Starting in 1974, the U.S. Department of Justice initiated a suit which, by 1982 had broken the Bell System, the major telephone system in the United States into a bunch of pieces, known as the Baby Bells.
Prior to that time, local telephone service had been provided by the Bell System (big player) and General Telephone (small player). Most of the equipment had been made by Western Electric, a Bell subsidiary, and most innovation had come from Bell Labs.
For nearly 100 years, common knowledge was that it was good to have one major telephone company tightly regulated by the government.
This century old protocol had left the telephony industry in the slow lane, as compared to where it seemed computers and computer networking (barely in existence) were headed. Home phone service was about $133 per month (2024 $) and consisted of one line, no voice mail and no other services.
Of course, there were loud voices on both sides of the argument. On one side, there were those who said heavy government regulation was needed, that the poor especially would be harmed by the Bell breakup. The other side was in favor of loosening the shackles of government control.
Well, we know how this turned out. Nearly everyone, including the poor, but excepting Rory Ryan, is carrying a phone around on their person. For all intents and purposes, phones with a gazillion features are nearly free to own and operate. When was the last time you heard of long-distance charges? Do you even know what this means?
Letting competition work has saved all of us tremendously.
As recently as 1988, when I lived in Finland, it cost $7 per minute to call the U.S. There is a British series I have watched on YouTube called “War Factories.” The premise of this series is that modern wars are not won in the field, but in the factory where war materiéls are manufactured (they don’t mean disrespect to soldiers; their point is if you do not have the guns, ammunition and so forth, you cannot win a war with soldiers alone).
In their programs on World War II, they often compare and contrast what we did here in America with what they did in Germany. Here in America, we awarded lucrative contracts, specifying only the result, not how it was made, and turned our manufacturing geniuses loose. In Germany, war production was tightly regulated, and it was often dictated to the manufactures what to do and how to do it.
Our productivity was far beyond what even we thought we could do. We turned out ships and planes at levels of production unimaginable before the war started. (One vestige of our efforts that remain to this day is Kaiser Permanente, which Henry Kaiser created for his shipyard employees.)
Today, it is fashionable to think we need central or government planning on nearly every enterprise in our country. The next time you get into a conversation like this, I hope you will remember the two examples I have given you here.
Jim Thompson, formerly of Marshall, is a graduate of Hillsboro High School and the University of Cincinnati. He resides in Duluth, Ga. and is a columnist for The Highland County Press. He may be reached at jthompson@taii.com.
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