The FCC Is Burning the Turkey | Citizens Against Government Waste

The FCC Is Burning the Turkey

The WasteWatcher

The Thanksgiving holiday is an opportunity to celebrate with family and friends and be grateful for not only what everyone has now, but also what happened in the past.  While most of these memories are personal, some are professional, like the November 2011 blog post that cited the Federal Communications Commission (FCC) for delivering “a Turkey for Thanksgiving” by finalizing its Preserving the Open Internet Order of 2010, which was subsequently struck down in courts in 2012.  Those of us at Citizens Against Government Waste who have been in the trenches, along with consumers and taxpayers, have been hoping the issue would be resolved so this Thanksgiving could be spent being thankful rather than thinking about the adverse consequences of net neutrality, government control of the internet, digital discrimination, and other policies being promulgated by various federal agencies that are making it harder and more costly to connect every household and business that wants access to broadband.

On November 11, 2014, President Barack Obama delivered another Thanksgiving turkey by instructingChairman Tom Wheeler to adopt strong net neutrality rules and impose Title II common carrier rules on the internet.  The FCC complied by issuing the Open Internet Order of 2015, which reclassified the internet as a “common carrier” under Title II of the Communications Act of 1934.  This order was overturned in December 2017 through the adoption of the Restoring Internet Freedom Order, which was subsequently upheld by the U.S. Supreme Court in October 2019.

As lines are being drawn again on how the internet and broadband services should be regulated, the FCC is taking a two-pronged approach to imposing onerous rules and regulations over internet service providers.  The FCC is both overturning the RIFO and imposing new regulations that might be even worse than the restoration of net neutrality.  On October 19, 2023, the notice of proposed rulemaking (NPRM) for Safeguarding and Securing the Open Internet was adopted on a 3-2 party-line vote.  It restores the rules promulgated in the Open Internet Order of 2015 along with new restrictions. 

CAGW’s response to the NPRM called it “a wasteful, fruitless, and likely unconstitutional effort to re-establish and expand government control over a vibrant sector of the economy. … Rather than calling it the Open Internet Protection order, it should be called the Close the Internet Order.  It would be even worse than the OIO, because it would impose rate regulation, despite promises by various administration officials that they have no intent to do so.  The NPRM is not only a waste of time and money but also jeopardizes America’s leading position in global telecommunications.”  The statement also noted that, “At a time when states are finalizing their Broadband Equity Adoption and Deployment (BEAD) funding applications with the National Telecommunications and Information Administration to help provision broadband in their unserved communities, this proceeding will create uncertainty and disincentives for providers to participate in the program.”  An October 17, 2023, letter to the FCC from members of the House Energy and Commerce Committee pointed out that, “We know from experience that broadband investment decreases when regulations increase, as we saw when the FCC last reclassified broadband in 2015.  That network investment increased under the current regime undermines your argument that reclassification will ‘better support the deployment of wireline and wireless infrastructure.”

While restoring net neutrality is problematic, the FCC has now agreed to act in a manner that is likely to be even more damaging to broadband deployment.  On November 15, 2023, the FCC issued a rule and order, Preventing Digital Discrimination in Broadband Internet Access, on a party-line vote.  The agency was required by Section 60506 of the Infrastructure Investment and Jobs Act (IIJA) to “take steps to ensure that all people of the United States benefit from equal access to broadband internet access service.”  The rules, where technically and economically feasible, were intended to prevent “digital discrimination of access based on income level, race, ethnicity, color, religion, or national origin;” and identify “necessary steps for the Commissions to take to eliminate discrimination described.” 

While the intent of Congress seemed simple, the FCC decided to go far beyond the statutory requirements by imposing significant burdens on not only broadband service providers by regulating every aspect of their business operations, including “network infrastructure deployment, network reliability, network upgrades, network maintenance, customer-premises equipment, and installation.”  The order also imposes fines and fees for arbitrary speed, capacities, latency, data caps and more, mimicking the Safeguarding and Securing an Open Internet proposed rules. 

FCC Commissioner Nathan Simington noted that the order, “will have the Commission run a permanent inquisition against the broadband industry, creating a climate of fear and uncertainty when we should instead be encouraging greater investment and innovation.  Under the digital equity rules we are adopting today, every business practice or decision, by any company remotely connected to the provision of broadband, is prohibited unless any disparate impact is unavoidable due to ‘technical or economic infeasibility.’  This is an impossible standard to meet and the only way for a company to even attempt to comply is to practice racial, ethnic, and religious discrimination in every business decision.”

Businesses that would fall under the jurisdiction of the FCC under these new rules are not limited to broadband service providers.  FCC Commissioner Brendan Carr’s remarks on the order noted, “Landlords are now covered, construction crews are now covered, unions are now covered, marketing agencies are now covered, banks are now covered, the government itself is now covered – all newly subject to these FCC rules and liable under them for both acts and omissions.” 

The excessive scope of the rule was excoriated by 28 Republican members of the Senate Commerce, Science, and Transportation Committee, led by Sen. Ted Cruz (R-Texas).  Their November 10, 2023, letter to FCC Chairwoman Jessica Rosenworcel insisted that she “adhere to the will of Congress and conform to the plain meaning of section 60506 to avoid causing serious damage to the competitive and innovative U.S. broadband industry.”

The senators are referring in part to the expenditure of more than $65 billion from the IIJA’s establishment of the Broadband Equity Access and Deployment (BEAD) program, $42.5 billion of which is being provided as grants to every state and territory, as well as Native American tribes.  The states are filing applications for funding and creating application guidelines within their broadband offices for service providers and local governments to build new broadband networks in local communities, and CAGW is keeping track of how those decisions are being made. 

Commissioner Carr noted on page 7 of his dissent that, the “Order now exempts the Biden Administration’s signature ‘Internet for all’ initiative (BEAD) and the FCC’s own Universal Service Fund programs from these rules,” which means that administration believes the digital discrimination decision is so burdensome, it should not apply to those two programs.  But there are tens of billions of dollars available elsewhere for broadband deployment from the federal government, and the private sector spent a record $102.4 billion in 2022 on broadband.  The rulemaking will damage that effort by making it nearly impossible for any provider, regardless of size, to comply with all these new, vague, and arbitrary obligations.

It is time for Congress to force the FCC to take the turkey out of the oven, strip away the damage that has been done, and see if any of this mess can be salvaged.  Like most burned Thanksgiving turkeys, it will probably need to be trashed and a new meal prepared.  That means that Congress is going to have to step up to the plate, write legislation with explicit and enforceable requirements on, and hammer down on federal agencies, like the FCC, that have gone rogue and are randomly issuing rules for which no one should be thankful.