Wireless competition is good for consumers -- even if it costs taxpayers extra

[Commentary] The Federal Communications Commission, under the leadership of freshly-confirmed chairman Tom Wheeler, is hard at work on rules that will govern an upcoming spectrum auction. AT&T and Verizon, the nation's largest wireless carriers, want the FCC to hold an unrestricted auction that could allow them to maintain or even widen their lead in premium low-frequency spectrum. Their smaller competitors, especially T-Mobile, are urging the FCC to adopt rules to guarantee that the largest carriers do not wind up with a disproportionate share of that spectrum.

It stands to reason that restricting participation in the auction would lead to lower revenues. But that doesn't necessarily mean the restrictions are a bad idea. To the contrary, the benefits to consumers from a more competitive wireless market may dwarf the lost auction revenue. Selling monopolies has always been one way for governments to raise money. But it's almost never a good one.