Let's say you own a nice, well-kept, little Internet store.
Because you have worked hard and played by the rules to build up your shop over the years, you enjoy a steady stream of traffic and have managed to accumulate a small but growing number of happy, regular customers. You employ a nice, young man named Vito to update inventory, and business is generally good.
Then one day, a big, burly man in a white suit and fedora strolls confidently into your store. He walks up to the counter and introduces himself.
"My name is Don Telco. How's business?"
"Ok I guess, " you shrug.
"You know this is my neighborhood," the Don declares. "You should show me some respect. You should let me wet my beak a little."
"What do you want?" you ask warily.
"Give me $200 a month for your own protection," the Don replies, "and I'll forget the insult."
"But I don't need your protection," you counter, "this is a nice neighborhood".
Don Telco chuckles. "You will paisan. You will."
The next day, a busy Saturday, a menacing looking man dressed in black and named Bruno shows up outside your shop. Like a bouncer at an exclusive night club, he delays your customers before letting them through the door. When your store becomes half-full, Bruno completely stops anyone else from entering.
A line of disgruntled customers forms outside, and they wait with increasing impatience while the man in black decides to pick and choose who will next enter. A couple of well-heeled regulars pay the bouncer a few bucks to jump the queue and get inside, but most simply leave in disgust to try their luck at one of the other stores down the block.
By the end of the day, your profits for the day have dwindled to less than half of what they usually would be.
The next day, Sunday, Don Telco shows up again.
"Too bad about about yesterday," he sneers. "Bruno tells me your shop was only half full. And didn't I see some of your customers over at that big, mega-portal across the street? Such a shame you still don't want my protection."
"But this is extortion!" you cry. "I am gonna call the cops."
Don Telco laughs long and loud.
"Cops? Cops! Why you silly twerp, I AM the cops. See, a Federal law was just passed which says that unless you pay me, I can delay anyone who wants to come inside your door for as long as I want. The law also lets me charge your customers if they want to get in quicker. And because this is a FEDERAL law, no local or state yahoos can keep me from doing it. It's in the Constitution. Look it up - something about 'Preemption' and the 'Commerce Clause'. Ah America. What a beautiful country!"
You look over at Vito, the boy who stocks for you. Paying Don Telco means you'll have to let Vito go. But if you don't pay you won't be in business much longer anyway. You have no choice, and you reluctantly decide to give in.
"Ok, Don Telco, you win. I'll pay your fee."
"Good!" he crows. "Punks like you have to learn to respect a man like me! Oh, just one more thing. The neighborhood's getting sloppy. People don't pay on time, don't pay the full amount. I've been too nice to everyone. Now I get double from everybody."
"Fine," you mumble.
Don Telco leaves, and that night you fire Vito. As he walks out, you offer the boy a bag of groceries, but he refuses.
Last you heard, Vito is making his living by stealing rugs.
End of Part I
Read Part II
(originally posted at: Hoot at the Dark