The WasteWatcher: The Staff Blog of Citizens Against Government Waste

Give the FCC an Inch, and It Will Take a Mile

The WasteWatcher is the staff blog of Citizens Against Government Waste (CAGW) and the Council for Citizens Against Government Waste (CCAGW). For questions, contact blog@cagw.org.


On June 14, 2016, the U.S. Court of Appeals for the District of Columbia Circuit (DC Circuit Court) rejected by a 2-1 decision the petition of US Telecom in its case against the Federal Communications Commission’s (FCC) Open Internet Order (OIO).  The net neutrality debate has been through legal gyrations at the FCC and the courts for seven years, and this case is still not the end of the long and winding road.

The OIO regulations became effective on June 12, 2015.  While consumers may not have noticed any immediate change in how the internet operates, future technological advances will begin to suffer as internet service providers (ISPs) become increasingly burdened with the new regulatory scheme.  The OIO subjects ISPs to mandates covered under Title II of the 1934 Communications Act, a law that was intended to cover old-fashioned telephone services.  This section of law enables the FCC to impose the heavy hand of government on a previously innovative and energetic market that includes both connected and wireless internet services. 

Previous efforts by the FCC to take control of the internet included an attempt in 2010 to sanction Comcast for its internet traffic management process, and its first foray in 2011 to impose regulations similar to the OIO on the internet.  Both of these efforts were overturned by the D.C. Circuit Court, which ruled in the Comcast case that the FCC had no authority to require broadband providers to give equal treatment to all internet content flowing through their networks.  On January 14, 2014, the DC Circuit Court ruled that, while the FCC has some authority to regulate broadband services under Section 706 of the Communications Act, the FCC had overstepped its bounds when it subjected internet providers to treatment as Title II common carriers through its anti-discrimination and anti-blocking rules. 

The US Telecom majority opinion, written by Circuit Judges David Tatel and Sri Srinivasan, noted that this is the third time in seven years that the court has reviewed an effort by the FCC to compel net neutrality on ISPs.  The opinion relied heavily on the Supreme Court’s Chevron case, which gives deference to agency rulemaking.  The reliance on Chevron enabled the court to defer to the FCC’s interpretation of its own statutory authority when the law is unclear and the agency’s rulemaking has been called into question.      

However, Senior Circuit Judge Stephen Williams noted in his dissenting opinion that the OIO should be vacated because the FCC’s reclassification of the internet was justified by “the switch on the basis of new policy perceptions;” limits on Section 706 render the OIO inadequate to justify the ban on paid prioritization; and, the FCC’s decision to forbear from enforcing many of Title II’s provisions is inconsistent with its reclassification of broadband.

While the case will be appealed, Congress is also to blame for this ongoing saga due to its failure to update the Telecommunications Act of 1996 and the Communications Act of 1934 to meet the communications needs of the nation today and into the future.  Until this statutory void is filled, the FCC will continue down its heavy-handed regulatory path.

In 2014, the House Energy and Commerce Committee began reviewing the two communications acts, seeking a path forward to update the laws.  The committee issued a series of white papers designed to help define the new parameters of communications law taking into consideration ongoing technology innovations.  Citizens Against Government Waste was among many of the respondents to the call for outside input and comment. 

Unfortunately, the committee’s effort became stagnant after the final white paper deadline of January 23, 2015.  The FCC took control of communications policy, legislating through regulation.  Beyond the OIO, the FCC has issued a privacy notice of proposed rulemaking, expanded the Lifeline program, and initiated a set-top box proposed rulemaking.

The DC Circuit Court decision not only has made the FCC’s regulatory overreach the law of the land, it has provided encouragement to the political activists at the FCC to impose additional onerous regulations over the communications industry.  Barring action by Congress or the Supreme Court to reign in the FCC, the agency will gladly travel many extra miles down the regulatory road without worrying about the ultimate consequences to consumers or taxpayers.

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