I’ve been following Tim Lee’s thoughts on the AT&T/T-Mobile merger with great interest. In two recent posts, he’s been elaborating on the theoretical underpinnings of his concerns about the merger. Last week, he described the moral intuition behind the “Lockean Proviso”:

The legitimacy of a property rights system depends on it being open to everyone. True, we’ll never have a society in which everyone is a landholder. But our system of land ownership gives everyone the opportunity to purchase land at market rates. And the diversity of land titles means that those who don’t own themselves have many landlords from which to choose.
And this is an important safeguard for liberty. In a society with highly concentrated land ownership, people with unusual or unpopular housing needs—interracial couples in the 1950s, gay couples in the 1980s, people who want to throw loud parties or own unusual pets—might have trouble finding housing that allowed them to live in the way they chose. But in a world with thousands of landlords, almost everyone can find somebody willing to rent to them, no matter how unusual their demands might be. The diversity of landholdings doesn’t just hold rents down, it has direct implications for individual liberty.
Land ownership has been so decentralized for so long that we aren’t in the habit of thinking of it as an issue of liberty. But it is. A real estate market in which three landlords owned all the land would be less free than a real estate market with 3000 landlords. And the same is true of most other natural resources. The liquidity of commodity markets protect our rights to do as we please with oil, gold, copper, and other natural resources we purchase. My gas station doesn’t try to dictate what brand of car I drive because it knows there are lots of other places I can buy gasoline.
Spectrum is different. If I want to use the electromagnetic spectrum in a novel way, at power levels above those allowed by the unlicensed bands, I need to buy (or more likely rent) spectrum from someone. And in the contemporary American market, there are only a handful of firms to choose from. These firms are vertically integrated and place tight restrictions on what kinds of signals can be transmitted.
In other words, there is not “enough, and as good” spectrum “left in common for others” to use for their own purposes. A handful of parties have claimed for themselves all the available spectrum and tightly constrain how it’s used.

As Tim goes on to argue, the remedy for this condition isn’t obvious. Yet he sees efforts to prevent further concentration of the industry as one way the federal government can keep matters from getting worse. In a more recent post, Tim makes a thought-provoking point on monopolies:

We don’t live in an ideal free market, and monopolies clearly do happen in the actual economy we’ve got. Maybe libertarians are right and they’re the product of government interference in the free market. Maybe we’re wrong and some monopolies would occur even in a perfect free market. But I don’t think this matters if the question is what to do when a market becomes highly concentrated.
Like most libertarians, I suspect that a more liberal spectrum regime would produce more competition in the wireless industry rendering spectrum caps irrelevant. But if anything, this seems to me like an argument for, not against, blocking mergers that would take us farther from the outcome a true free market would produce. The federal government has a responsibility to clean up its own messes, as it did with the Ma Bell breakup in 1984, and it will hopefully do by blocking the AT&T/T-Mobile merger.

Like Tim, I favor taking immediate steps to liberalize the spectrum regime. I also favor allowing the AT&T/T-Mobile merger. Yet if you were to tell me that the federal government will never allow a more liberal spectrum regime, I might think differently about the issue.