Senate Hearing Should Consider Replacing the Public Interest Standard

By Randolph May

On December 17, the Senate Commerce, Science, and Transportation Committee is holding an FCC oversight hearing. Conducted properly, oversight hearings can be valuable tools in assisting legislators, and the public too, in understanding an agency's work – what an agency is doing, and why. And, sometimes, an oversight hearing can lead to the subsequent introduction of legislation to reform the agency's enabling statute.

That should be the case regarding the Communications Act – specifically legislation replacing the public interest standard.

But it's a good bet that some Democrats on the committee, perhaps all of them, will use most of their allotted time to lambaste FCC Chairman Brendan Carr, especially regarding his remarks in "l'affaire Jimmy Kimmel." Without rehearsing all the details here, you'll recall that Chairman Carr issued what was reasonably taken to be a threat that, unless Kimmel's show was taken off the air, the broadcast station owners airing it would suffer adverse consequences. After all, by virtue of the licenses the FCC issues requiring that broadcasters operate consistent with the "public interest," the agency exercises substantial power over their operations. And if broadcasters wish to transfer or assign their licenses to another entity, the FCC first must find the transaction is in the "public interest."

At the time of Chairman Carr's remarks regarding Jimmy Kimmel, I said that, regardless of whether they rose to an actual violation of the First Amendment, and despite what I considered to be Kimmel's factually inaccurate and insensitive monologue regarding Charlie Kirk's assassination, I didn't like what appeared to be Carr's threats directed at the broadcasters. I stand by that.

But when the Democrats and those on the Left get in high dudgeon railing at Carr at the hearing or otherwise, the theatre is a bit too contrived. For over the long history of the FCC, it's been Democrats in Congress, and those sitting on the FCC, who have been most persistent and insistent in wielding the FCC's public interest authority to dictate or influence broadcast content. I recited some of the historical evidence here. And, significantly, it was a Democrat-controlled FCC that employed the "Fairness Doctrine," with its requirement that broadcasters present balanced coverage of issues of public importance, as a content regulation sword. Most notably, the Fairness Doctrine was invoked, successfully, to silence conservative broadcasters. See Red Lion Broadcasting v. FCC – which now is ripe for history's constitutional dustbin.

 

Moreover, with the current focus on the FCC's "news distortion" rule – a prohibition grounded in the FCC's public interest authority – it's worth recalling the April 2018 letter to then-FCC Chairman Ajit Pai signed by twelve Senate Democrats. That letter urged the FCC to consider sanctioning Sinclair Broadcasting Group, including revoking its broadcast licenses and preventing it from acquiring others, allegedly on the basis that Sinclair stations engaged in "news distortion" inconsistent with its public interest obligations. (Some of the twelve Senators who signed that April 2018 letter likely will participate in the December 17 oversight hearing.)

Nevertheless, my purpose today is not to tote up a scorecard demonstrating that one side of the aisle or the other, either political or philosophical, has abused the public interest standard more than the other side. That's backward-looking and likely counterproductive. Rather, consistent with the legislative purpose of an oversight hearing, I want to suggest – as I have many times previously –a more productive way forward.

The Commerce Committee Senators, led by their able, reformist-minded Chairman Ted Cruz, should use the oversight hearing, at least in part, to begin a serious discussion about replacing the FCC's public interest standard, upon which the agency's program content regulation, including its news distortion rule, is grounded. It should be replaced with some form of consumer welfare standard more attuned to the current competitive environment and technological dynamism of the marketplace. To the extent there are special considerations, such as maintaining the availability of communications relating to public health and public safety, or universal service, they can be delineated and dealt with discretely.

As I recounted recently in this recent FSF Perspectives, The Public Interest Standard: The Historical Legislative Context, "for almost two decades now, Free State Foundation scholars have been advocating that any meaningful updating of the Communications Act must include replacement of the public interest standard with one oriented towards a proper assessment of consumer welfare and marketplace competition." You can find links to that advocacy in that paper. And throughout the FCC's website you can find numerous papers each year documenting the dramatic changes, driven by relentless technological innovation, that have occurred in the media and telecommunications marketplace in the last several decades.

The long and short of it is that these conspicuous marketplace changes have rendered obsolete the original anti-monopoly and "scarcity" rationale that was the principal impetus for inclusion of the public standard in the Communications Act of 1934, which itself merely incorporated the standard from even earlier legislation.

The public interest standard, malleable and ambiguous as it is, has been a ready means for expanding the FCC's authority in the hands of those commissioners who wish to use it for that purpose. And, more particularly, for those who wish to use it in this way, it has been the means by which the agency has restricted speech, or preferred some speech over other speech, by regulating program content or threatening to do so. All under the claim of furthering the "public interest."

As far back as 2001, I argued in a law review article that the public interest standard is so indeterminate that it constitutes an unconstitutionally unintelligible delegation of legislative authority. The Supreme Court has yet to agree, but I suspect that Chairman Cruz might be sympathetic to the argument. Justice Felix Frankfurter, a New Deal acolyte, proved my point over six decades earlier in the landmark FCC v. Pottsville Broadcasting Co. (1940) case when he declared that the public interest standard "is as concrete as the complicated factors for judgment in such a field of delegated authority permit."

Read Justice Frankfurter's elucidation again. I challenge you to tell me what it means.

In other words, the public interest standard is standardless. And this means it is inconsistent with the rule of law and invites abuse. The Senate Commerce Committee should begin to consider replacing it with some form of consumer welfare standard fit for the Digital Age.

FSF Announces the Appointment of Joseph V. Kennedy as Director of Policy Studies and Senior Fellow

Free State Foundation President Randolph May announced on December 4, 2025, that Joseph V. Kennedy, an accomplished economist and lawyer with deep public policy expertise and experience, is joining FSF on a full-time basis as Director of Policy Studies and Senior Fellow, effective January 1. 

Previously, Mr. Kennedy served as Senior Principal Economist at the MITRE Corporation. Prior to that, he served as a Senior Fellow at the Information Technology and Innovation Foundation. Mr. Kennedy’s former positions include serving as a Senior Officer at The Pew Charitable Trusts; Chief Economist for the U.S. Department of Commerce; Senior Economist for the U.S. Congress Joint Economic Committee; and General Counsel for the U.S. Senate Permanent Subcommittee on Investigations. He is also an Adjunct Professor at Georgetown University.
 
Dr. Kennedy received his Ph.D. in Economics from George Washington University, his M.S. in Agricultural and Applied Economics from the University of Minnesota, and his J.D. from the University of Minnesota. He received his B.S. in Foreign Service from Georgetown University. Mr. Kennedy has written two books and more than 70 articles. He has provided legal and economic advice to members of Congress, Cabinet secretaries, and top business executives. Much of this advice has been directed at public policies involving technology, competitiveness, and the social contract.
 
In announcing Dr. Kennedy’s appointment, Mr. May stated: “I am very excited that Joe Kennedy is joining the Free State Foundation as Director of Policy Studies and Senior Fellow. With his outstanding academic background in both economics and law, and his real-world professional experience in both disciplines, Joe will play a major role in leading FSF’s law and policy work in the communications, Internet, intellectual property, and other related fields. FSF already is widely acknowledged for its thought leadership in these areas, and in his senior position, Joe will further enhance our leadership position.”
 
Upon accepting FSF’s offer, Mr. Kennedy stated: “I am thrilled to be joining an institution that is so highly regarded for the quality and impact of its free market-oriented work. My goal is to use my decades of expertise and experience in law and economics to help make FSF even stronger and even more respected than it already is and to help expand its work into related fields. I look forward to the challenge ahead.”

Traveling Backwards in Time: The Public Knowledge Petition to Deny the Charter – Cox Transaction

 by Randolph May

As predictable as the sun rising tomorrow morning, Public Knowledge and like-minded organizations have filed a petition to deny the proposed acquisition of Cox Communications by Charter Communications. The pro-regulatory groups contend that, if approved, the combination "would reshape the American broadband landscape" and "would create unchecked gatekeeper power over Internet distribution."

Unchecked gatekeeper power? Reshape the American broadband landscape? 

Public Knowledge and the co-signers must have pushed the wrong button in a time-travel machine, for they are surely looking backwards regarding the current state of the communications and media environment. In the process, they may have set a new low bar for extreme hyperbole.

We'll have more to say about the Public Knowledge petition and the FCC's consideration of the Charter – Cox transaction going forward. For the moment, I refer you to the comments submitted by the Free State Foundation and this Free State Foundation Perspectives authored by Daniel Lyons, a member of FSF's Board of Academic Advisors. They completely refute any notion that a combined Charter – Cox would possess any "gatekeeping" power over Internet distribution. And they demonstrate how dramatically the communications and media landscape already has been "reshaped" by vigorous competition among cable, fiber, satellite, fixed wireless, wireless, and hybrid facilities-based platforms – and continues to be reshaped, even as I write.

 

If approved by the Commission, the combination of Charter and Cox, "each now struggling with the challenge of competing in multiple maturing markets," as Daniel Lyons put it, will have an opportunity to survive and provide further competition in an already competitive intermodal marketplace.

Oh, while in the time-travel machine looking backwards, please recall the notorious AOL – Time Warner merger. Some of the very same signers of the petition to deny Charter – Cox petitioned to deny the AOL – Time Warner combination. The rhetoric – extreme hyperbole, you could say – regarding the supposed harms to consumers were that merger to be approved by the FCC was over-the-top.

The petition to deny the AOL – Time Warner merger described the "dangerous new dimension" being added to "the emerging structure of the cable TV/broadband Internet industry…." Among the "findings" cited in their petition: "The merger would allow two enormous firms to dominate the markets for broadband and narrowband Internet services, cable television, and other entertainment services, which could leave consumers with higher prices, fewer choices, and the stifling of free expression on the Internet." The petition claimed that the new "media giant" would "be able to quickly capture the new product market for interactive TV."

Well, the FCC approved the AOL – Time Warner merger…and you know how that combination worked out. We've seen this movie – I mean petition to deny! – before. Talk of "gatekeeper power" may have been slightly relevant in the early 2000s. Now it's downright frivolous.

It's time for Public Knowledge and the other like-minded groups to stop looking backwards through the looking glass and acknowledge the current marketplace reality.

A Toast to the Constitution

We are now well into the observance of America's 250^th birthday celebration marked by the signing of the Declaration of Independence on July 4, 1776. Though our Constitution was not signed by the framers in Philadelphia until September 17, 1787, and ratified by the required nine states until May 1790, it, rightfully, is central to our birthday commemoration.

 

Here, between Veterans Day and Thanksgiving, and in the spirit of our nation's year-long celebration, I want to offer a toast to the Constitution. While there's not a time when toasting the Constitution would not be in order, it seems especially fitting to do so between those two special national holidays.

 

This toast is not my own, but a truly noteworthy and memorable one offered by my good friend Leonard Leo, the Co-Chairman of the Federalist Society, at the Society's recent 2025 National Lawyers Convention.

 

But first a bit of historical backdrop.

 

During Lafayette's 1824 farewell tour of America, he visited both Monticello and Montpelier, the homes of Thomas Jefferson and James Madison. During one notable celebration commemorating his return to America, Lafayette, Jefferson, and Madison were all present for an elegant dinner held at the nearby Orange Court House. At the dinner, Madison praised Lafayette, and thirteen ceremonial toasts were made, including one honoring Madison himself, already known as the "Father of the Constitution."

 

Madison’s toast praised Lafayette’s devotion to the principles of the American Revolution, and he also offered his own "toast to the Constitution."

 

Now, here is Leonard Leo's "Toast to the Constitution" delivered at the Federalist Society's Antonin Scalia Memorial Dinner on November 6, 2025.

 

"May it endure as a source of awe and joy, reminding us of how fortunate we are to live in this great country.

 

May it endure as a source of wisdom and understanding, instructing us about the relationship between the dignity and worth of a person and the limits on government power.

 

May it endure as a source of self-restraint and prudence, admonishing both our leaders to respect the limits of authority and the voters to demand that respect.

 

May it endure as an example of what can be achieved when leaders unite the virtues of wisdom, justice, courage, and temperance.

 

And may it endure as a charter of self-government that binds the American people together in the mutual pursuit of that which is good and just."

 

Leonard Leo's toast is surely worthy of committing to memory as we celebrate America's 250 Birthday!

CTIA Joins Growing Chorus Opposing Military Spectrum Veto

In a November 13 letter to congressional leadership, CTIA President & CEO Ajit Pai warned that Section 1564 of the version of the 2026 National Defense Authorization Act (NDAA) that passed the Senate imposes an "unnecessary" restriction on NTIA's ability to migrate existing military spectrum users into the 3.1-3.45 GHz and 7-8 GHz bands – and thereby free up spectrum in other bands to be auctioned by the FCC for commercial use.

The "One Big Beautiful Bill Act," which called for the auction of 800 MHz of spectrum (and reinstated the FCC's spectrum auction authority through the end of September 2034), explicitly prohibits the auction of spectrum in the aforementioned bands.

Section 1564, which was added to the NDAA by Senator Deb Fischer (R-NE), a senior member of the Senate Armed Services Committee and chair of the Strategic Forces Subcommittee, would go a step further and "[p]rohibit[] any modifications to DoD systems in key spectrum bands without joint certification from the Secretary of Defense and Chairman of the Joint Chiefs of Staff" (emphasis added).

Mr. Pai is not the first to object to the inclusion of Section 1564 in the NDAA.

In a September 10 post to the FSF Blog, Free State Foundation President Randolph May (1) pointed out that the White House in a Statement of Administration Policy objected to Section 1564 because it "would hinder the President's executive authority," (2) agreed that "Congress cannot properly restrict a president's executive authority by handing over final decision-making authority to his subordinates," and (3) urged Senator Fischer to withdraw the provision.

Some additional examples:

• On October 16, Citizens Against Government Waste's Deborah Collier wrote that, should the Senate version prevail, "the Pentagon will be given the absolute authority to veto the sale or shared use of DOD-controlled spectrum, jeopardizing the ability of the U.S. to remain the global leader in telecommunications and stymie the FCC's ability to auction more spectrum for wireless communications."

• At a Punchbowl News event on October 9, House Commerce Committee Chairman Richard Hudson (R-NC) expressed similar reservations, stating that "I don't think we need to give any kind of veto authority to the Pentagon. I think that could be counterproductive."

• At NTIA's 2025 Spectrum Policy Symposium in September, Senator Ted Cruz (R-TX), Chairman of the Senate Commerce Committee, reportedly cautioned that "[p]ractically speaking, this means NTIA would not even be able to move other federal operators to these bands – which it will have to do to clear the spectrum pipeline – unless first receiving approval from the sovereigns at the Joint Chiefs."

Draft Bill Would Reclaim BEAD Program Nondeployment Funds

Senator Joni Ernst (R-IA) reportedly has drafted legislation that would direct the states to return funds from the $42.45 billion Broadband Equity, Access, and Deployment (BEAD) Program not specifically used for broadband deployment – a savings estimated to be as high as $20 billion.

The "Recovering Excess Communications Appropriations while Protecting Telecommunications Upgrades, Reinvestment, and Expansion Act" (the RECAPTURE Act), which as of this writing has not yet been introduced, would amend the statute that created the BEAD Program – the Infrastructure Investment and Jobs Act (IIJA) – to clarify that each state shall "deposit in the general fund of the Treasury, for the sole purpose of deficit reduction," funds beyond those "designated for a specific purpose in the final proposal" approved by NTIA – that is to say, in the wake of the "Benefit of the Bargain" revisions, nondeployment funds.

In "How to 'Spend' Unused BEAD Funding," an October Perspectives from FSF Scholars, former FCC Commissioner and current Free State Foundation Adjunct Senior Fellow Michael O'Rielly – while acknowledging that some state use of BEAD Program funds for non-deployment purposes is "contemplated in the infrastructure law" – recommended two alternative approaches:

• One, given that the national debt is massive and growing rapidly, nondeployment funds should be returned to the U.S. Treasury: "[w]ith the nation facing such widely acknowledged financial difficulties, the thinking by many experts is that this money needs to be reclaimed."

• Two, in light of past grant-recipient performance, at least some of that money should be set aside "to account for the simple fact that not all broadband builds will happen as planned…. [E]xperience suggests that a reserve funding stream could be useful to handle this inevitability."

It is worth noting that others, including Senator Roger Wicker (R-MS), have argued that the IIJA allows states to retain any such remaining money. As Senator Wicker wrote in September:

[T]he Trump administration has changed the way these broadband funds will be spent. Because of this, many states' proposals will come in under budget. These states could actually end up with leftover funds from the 2021 broadband legislation. In that law, Congress was clear: States can use this remaining grant money. That policy rewards those who wisely stewarded their deployment funds.

Senator Ernst's draft legislation, should it ultimately become law, would provide a definitive response to this potentially open question.

Relatedly, Senator Ernst announced on November 7 that she is introducing the "Returning Unspent COVID Funds Act," a bill that would "claw back more than $65 billion in unspent COVID funds and return the money to taxpayers." That legislation would target subsidy programs created by the American Rescue Plan Act of 2021, among others.

NTIA's Roth Targets Net Neutrality, Duplicate Funding

In remarks delivered at the Hudson Institute on October 28, NTIA Administrator Arielle Roth announced implementation changes to the $42.45 billion Broadband Equity, Access, and Deployment (BEAD) Program regarding two topics of substantial concern for Free State Foundation scholars: (1) the imposition of so-called "net neutrality" obligations, and (2) the possibility of overlapping federal subsidies.

With respect to the former, Roth clarified that state-level net neutrality statutes represent a form of rate regulation inconsistent with statutory language found in the Infrastructure Investment and Jobs Act – "[n]othing in this title may be construed to authorize the Assistant Secretary or the National Telecommunications and Information Administration to regulate the rates charged for broadband service" – and therefore may not be applied to BEAD Program subgrantees, not just in subsidized areas, but statewide:

State-level net neutrality rules—itself a form of rate regulation—create a patchwork of conflicting regulations that raise compliance costs and deter investment…. To protect the BEAD investment, we are clarifying that BEAD providers must be protected throughout their service area in a state, while the provider is still within its BEAD period of performance. Specifically, any state receiving BEAD funds must exempt BEAD providers throughout their state footprint, from broadband-specific economic regulations, such as price regulation and net neutrality.

Regarding the latter, Roth announced a straightforward solution to the duplicate-funding risk I have highlighted on many occasions, most recently in "The Failure's in the Footnote: Agencies Must Improve Broadband Expenditure Coordination Efforts," a January 2025 Perspectives from FSF Scholars:

NTIA will require states to have providers certify in writing that they will not require or take additional federal subsidies—including operational subsidies—to complete or operate their BEAD projects…. BEAD was designed to close broadband gaps once and for all, not create another cycle of dependency. Congress envisioned "future-proof" networks that would stand on their own, not require permanent federal subsidies or future bailouts.

These changes are of a piece with other action Roth has taken to realign the BEAD Program with congressional intent, as well as ongoing efforts to prevent waste, fraud, and abuse.

Video of Roth's remarks can be found here.