The FCC Could Have a Dark Future | Citizens Against Government Waste

The FCC Could Have a Dark Future

The WasteWatcher

As the Senate considers the nominations of current Federal Communications Commission Acting Chair Jessica Rosenworcel to be the next Chair of the FCC, and Gigi Sohn as the fifth commissioner, they should keep at the front of their minds a paraphrase of the Hippocratic Oath:  First, do no harm to the internet.  Or, they can adhere to what former President Bill Clinton said in July 1997, that the internet “should be a place where government makes every effort . . . not to stand in the way, to do no harm.”

The last time the FCC had a Democratic-confirmed majority of commissioners, the agency adopted the Open Internet Order (OIO), among many other overreaching and burdensome rules and regulations that strayed from President Clinton’s standard, and deeply involved the government in the internet.  Fortunately, the OIO was short-lived and overturned through the adoption of the Restoring Internet Freedom Order (RIFO), making the OIO and other concomitant rules adopted by the FCC an exception to the light touch regulatory regime that had been the key to the incredible innovation and growth of the internet ecosystem.  But like everything else that the Biden administration is doing to expand the size, scope, power, and intrusiveness of the federal government, the FCC appears likely to be headed back into the Dark Ages of overregulation.

Senators and nominees must remind themselves that the FCC was created by Congress as an independent agency, which means it is still subject to oversight by Congress, but it is supposed to be removed from partisanship and pressure from the White House.  Unfortunately, the agency’s history has proven that even an independent agency can easily become prone to partisan politics, like when former President Obama demanded in November 2014 that the FCC adopt stricter rules over the internet, by which he meant net neutrality.  Three months later, the OIO was adopted.  Although the agency had been working on the proposed order for several months and then-FCC Chairman Tom Wheeler had not decided how far the agency would go, President Obama’s letter was specific in calling for the strongest possible regulations with “four ‘bright-line rules,’ including ISPs not being allowed to block websites, ISPs being forbidden from throttling content (something the FTC recently filed a lawsuit against AT&T for doing), making full use of transparency and no paid prioritization.”

Commissioner Rosenworcel joined the FCC in May 2012, and Gigi Sohn was Counselor to Chairman Wheeler from 2013-2016, so they were both involved in adopting the OIO.

It now appears that the FCC will once again be dragged into the net neutrality abyss.  The rulemaking process was incredibly divisive, and there is ample evidence that the OIO harmed the nation and broadband investments. 

And just like his former boss, President Biden stepped on the toes of the FCC in his July 9, 2021, Executive Order on “competition” by encouraging the FCC to “Restore Net Neutrality rules undone by the prior administration.”  In response, Citizens Against Government Waste published a July 14, 2021 blog post, “A Blast from the Past,” which noted that the EOs “technology and telecommunications proposals would increase government control over companies that have invested trillions of private sector dollars to create the technology necessary to build the world’s most resilient network by restoring stringent, heavy-handed regulations on internet service providers (ISPs), along with the potential for rate regulation.”

Among other evidence of the positive impact of the RIFO, CAGW noted:

“According to US Telecom’s 2021 Broadband Pricing Index Report, the ‘most popular tier of broadband service costs 7.5 percent less in 2021 when compared to 2020; continuing downward pricing trend that began in 2015.’  This decrease in comparative pricing occurred at the same time demand skyrocketed during the pandemic, and there has been the largest increase in inflation and costs for consumer goods in decades. 

“The re-imposition of Title II, or net neutrality, would revive the substantial negative impact it had on investment, a result from the past that no one should want.  According to a November 1, 2018, Phoenix Center report, Title II caused a loss of between $24-30 billion in investment between 2015-2017.”

So-called net neutrality does not create a level playing field for internet access.  Instead, it creates an opportunity for the agency to conduct rate-setting, heavy-handed government regulations, and the imposition of common carrier restrictions on the most vibrant sector of the U.S. economy.  Reversing course again on internet freedom will create even more uncertainty for internet providers, reduce investment, and harm innovation.  As the blog post concluded, “It is time the new administration moved forward and paid attention to the world it is now inhabiting instead of continuing to live in a bunker from the past.”

Another area that should be discussed during the confirmation hearings is how the FCC provides funding to local and state governments that intend to build municipal or government-owned broadband networks (GONs) in areas of the country that are neither underserved nor unserved.  Instead, the FCC should continue working toward improving broadband networks maps, using the funds already appropriated by Congress to ensure federal funds are deployed where they are most needed, and not used to overbuild existing networks.  There should also not be “alternative” maps used from other federal agencies like the National Telecommunications and Information Administration.

A third area that the FCC must avoid is developing consumer privacy regulations.  In 2016, the FCC tried to implement online privacy regulations based on authority the agency believed it had created under the Open Internet Order, but it only created confusion over how consumer privacy should be regulated.  Privacy laws must remain the purview of Congress, which badly needs to pass a national data privacy framework that will enable innovation to continue without companies having to comply with a patchwork of laws for each state. 

The COVID-19 pandemic has added new urgency for Congress to act on protecting consumer privacy.  The increased online activity stemming from working from home has created new concerns about consumer data privacy, mobile device surveillance, and location information stored within the apps on our mobile devices.  Because this is a national issue, Congress must take the lead on developing a national framework to protect this data, and the Federal Trade Commission, not the FCC, should be the primary agency for consumer welfare protections, although with the recent politicization of that agency even those protections are at risk. 

The FCC must continue its successful spectrum allocations and auctions; rural broadband deployment in unserved areas of the country; and, modernizing the Universal Service Fund to reduce the financial impact of the rising contribution factor on consumers.  Since the first of 97 spectrum auctions was conducted in July 1994, the FCC has brought in more than $242 billion in proceeds (including in the recently completed 3.7 GHz spectrum auction which brought in over $81 billion alone) and the FCC is currently conducting another auction of the 3.5 GHz spectrum band, which as of October 8, 2021, had brought in more than $1.5 billion.  The spectrum licensed through these auctions has enabled fast deployment of next generation 5G mobile services that will be critical to the nation’s communications infrastructure.  These areas of traditional and appropriate FCC jurisdiction have generally been bipartisan.

Moving hand-in-hand with spectrum deployment is provisioning rural broadband in unserved communities.  Leveraging the Rural Digital Opportunities Fund (RDOF) auctions, winning bidders can use this funding to build new networks in unserved communities across the country.  On October 20, 2021, the FCC announced another $553 million for broadband to be deployed in 19 states through the RDOF program:  Alabama, Arkansas, Georgia, Illinois, Indiana, Iowa, Kentucky, Maine, Michigan, Minnesota, Mississippi, Missouri, Nebraska, North Carolina, New Mexico, Ohio, South Carolina, Texas and Wisconsin.  At the same time, the FCC is working to ensure these funds are not wasted in areas where there is evidence of existing service.

Finally, the FCC must continue to combat the massive number of robocalls consumers receive daily and ensure the cybersecurity and integrity of our nation’s networks by closely monitoring and updating the FCC’s covered entities list and keep foreign actors from intruding on the communications infrastructure.

Maintaining the United States’ global lead in technology and telecommunications requires that the internet be regulated with a light touch.  But the heavy-handed regulations and mandates emanating from the White House, to which the majority in Congress is not objecting, does not bode well for the future growth and innovation of these vital sectors of the economy.  The case needs to made during confirmation hearings that partisanship has no place at the FCC. 


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