LTE direct allows peer to peer routing of traffic over high capacity, licensed spectrum. In rural areas where a device has shoddy coverage, you could conceivably route traffic from devices with poor coverage to devices with strong coverage and then out to the Internet.

You wouldn't want to do this for streaming traffic, as it could negatively impact the experience of the device with the strongest coverage. But you could do this for traffic that has lower performance requirements.

Paid prioritization has existed over the course of the entire Internet. I happens every day- and it is known as peering agreements. Would you characterize the history of the Internet so far as "stifled growth"?

The thing is, "net neutrality" arguments are not really about peering agreements. They are a consequence of a deeper, unfortunate reality: anyone who uses a packet-switched network to emulate a circuit-switched one is in a state of sin. Streaming applications like to pretend that they have a dedicated circuit connection to their peer, whether that peer is a centralized service like Netflix (or their CDN provider), or another end user's cable box or handset. That's not the case, but we have to maintain the fiction that it is, and treat packets that are part of a Netflix stream just the same as transient ones to or from Twitter.

Just how to preserve this unnatural state of affairs is what is being debated. If we don't understand this fact -- if we create laws or technical standards that favor one type of packet over another -- we risk foreclosing all sorts of interesting and valuable applications in the future that no one has even imagined yet.

So no, I don't think it's a good idea to promulgate standards that work well with transient messages and datagrams but not streams. If that's true of LTE Direct (and I'm not familiar with the spec, so I don't know if it is), then that's a problem. We've already baked that behavior into the architecture of the Internet itself, and it's only going to become a bigger issue as time goes on.

I conceptually agree with the problems you're describing.

I have absolutely no faith that the government is capable of responsibly managing this ecosystem.

Let the nerds work. Do not bring regulators in whenever architectural decisions need to be made.

Amen. Isn't Google Fiber an attempt of the market responding to a lack of competition? It's probably more likely for a company to go out of business / lose market share than for a government agency to give up power.