Yet, I hate the proposed FTC rules even more than I detest masked bloggers. (We will debate this FTC fiasco today on Power Lunch on CNBC; you can follow my running comments at twitter.com/denniskneale).
My biggest fear is what this arbitrary and abrupt intrusion by the FTC, without congressional authorization or exhortation, says about three broader issues:
First: That the federal government could end two decades of hands-off regard for the Internet and regulate it too much, constraining growth.
Second: That the feds now view consumers as hapless and helpless and unable to fend for themselves, instead of realizing that consumers are the ultimate free-market regulators—screw ’em over and you lose ’em.
And third: That an Imperial Bureaucracy is rising up in Washington, pre-emptively imposing rules where harm hasn’t yet been done and moving by fiat where Congress otherwise is divided.
All three disturbing trends threaten business, but the FTC foray into the blogosphere is especially onerous and reprehensible. It would force “all” bloggers who review any product or service to disclose any ties they have to the companies behind those goods. Failure to do so would result in an $11,000 fine for each infraction.
Revealing any swag is a good, ethical practice that the best blogs should follow anyway—and those that do ultimately will prevail in the market, without the FTC having to act as overlord for the entire blogosphere.
But once a government agency, unelected and unaccountable to anyone but the executive branch, makes this a legal requirement, the ridiculousness starts.
First and foremost: Have these officious FTC-crats heard of the First Amendment? The blogosphere is the ultimate 21st century mass medium, a hot bed of all forms of free speech.
Can you imagine if the FTC were to force The Wall Street Journal’s god of gadget reviews, Walt Mossberg, to reveal in every column that the product he’s praising arrived free of charge for a tryout? Or legally require, under threat of fine, the travel writers for The New York Times to disclose a junket?
Yes, the Journal and Times should ensure any such conflicts are disclosed or avoided—but they should do it to protect their brands and their business, not because some appointed government brass hat has decreed that they must.
Moreover, this FTC crackdown is absolutely unenforceable given the millions upon millions of blogs out there and the start-up of hundreds of thousands more every day.
So, instead, the FTC rules will become a cudgel used only when the FTC deems it advantageous—say, for blogs that bash Obama, or ones that cotton up to the feds’ chosen enemies. Or ones that tick off a friend of an FTC staff member.
And if the FTC is going to wade in here, how ’bout forcing Barnes & Noble to reveal how much Random House paid for the front-window display for its next best-seller? Why don’t we legally mandate that Pathmark must reveal that the end-aisle shelves are crammed with Twinkies because the Interstate Bakeries paid extra slotting fees?
This ain’t so far-fetched guys. Here’s a silly—and chilling—quote from an FTC official in today’s story in The Wall Street Journal: “We look at it from the perspective of the consumer and the principle being that a consumer has the right to know when they’re being pitched a product. It doesn’t matter whether it’s an email or Twitter or someone standing on a street corner.”