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Bernie Sanders Thinks Your Cable Bill Is Too High

By Daniel B. Kline - Jul 12, 2015 at 11:43AM

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The Vermont Senator and three colleagues want the FCC to investigate.

Democratic presidential candidate Bernie Sanders thinks cable companies charge too much.

The senator from Vermont, who trails Hillary Clinton in the race for the 2016 Democratic party nomination, joined three other senators in asking the Federal Communications Commission to investigate the "ridiculous prices" pay-television and broadband services charge, International Business Times reported.

Sanders, along with along with Democratic Sens. Al Franken of Minnesota and Elizabeth Warren and Ed Markey of Massachusetts, wrote a letter to FCC Chairman Tom Wheeler in which the group cited the lack of competition and the companies' mini-monopolies. Sanders said the current situation allows providers to charge high prices, which makes consumers the losers.

Sanders and his colleagues also called on the FCC to examine the prices rural customers pay versus those who live in urban areas.

What is Sanders asking for?
While calling for lower cable prices in the middle of a presidential race seems a bit like pandering, it's not out of character for Sanders. The Vermont senator has always been a bit of a populist who sides with individuals.

Bernie Sanders. Source: BernieSanders.com.

In this case, while the timing is perhaps fortuitous for him, it's hard to argue with his point.

"We need healthy competition to foster innovation and ensure fair prices for consumers," the letter states. "At the very least, Americans should be able to understand the price of the product they are buying and what their neighbors are paying for the same service."

Sanders and his Senate colleagues who issued the letter also pointed out that consumers deserve transparency.

"In addition to steeply rising prices, consumers are often unaware of the various fees that are tacked onto their monthly bills because of the lack of transparency in pricing," the letter states. "To cite just one example, Time Warner Cable began charging a cable modem rental fee in 2012 of $3.95 a month. TWC then raised the price to $5.99 a month in 2013. Today it charges $8 a month, a 203% increase in three years' time."

It's probably also worth noting (though Sanders doesn't point it out) that TWC does nothing to let customers know they can buy a modem for around $100 and not pay the rental fee at all.

Is it just politics?
Sanders has made some gains in his race against Clinton and by being out front on cable prices, Sanders clearly establishes himself as the candidate for the middle class and the working man.

Clinton hasn't publicly taken a stand on cable prices. While she probably agrees with Sanders, her efforts to court left-leaning Republicans in the general election may keep her from taking an openly anti-business stand. That leaves an issue that resonates with a portion of the public to her opponent. Cable companies are among the least popular businesses in the country, and in some cases disliking them probably even crosses party lines.

Sanders could shape the debate. The idea that cable prices are too high has been a rising tide since the FCC blocked TWC's merger with Comcast. It's something the FCC should examine, and with pressure from the Senate, it very well may.

This is not a crackpot candidate screaming that "the rent is too damn high." This is a political maverick asking the FCC to do what government is supposed to do -- protect the people.

Daniel Kline has no position in any stocks mentioned. He pays too much for cable. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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