Now that the Senate has confirmed Ajit Pai to another term,
he again can devote his undivided attention, as the agency’s Chairman, to
leading the Commission. There is still much to do to reform communications
policy and the institution itself.
It is an unfortunate indication of the temper of the times
that someone as well-qualified as Mr. Pai was subject to an effort by
pro-regulatory interests to defeat his confirmation simply because of differences
in policy perspective that, in the past, would not have led to such opposition.
In the face of this campaign – and some overheated rhetoric – I urged here
that Mr. Pai be promptly confirmed. There is no need now to rehearse all of
what I said there. Suffice it to say the blog’s last sentence captured my view:
“Mr. Pai surely is the right person to lead the FCC at this time.”
So now there is an opportunity to keep moving
forward. But, first, a “correction.” Right up there in my first sentence, I see
that, in a slip of the keys, I said Chairman Pai “again” can turn his undivided
attention to his job. That might imply – wrongly! – that Mr. Pai has spent time
thumb-twiddling while awaiting his confirmation. Not so.
Since becoming Chairman last January, Mr. Pai
(almost always with the support of his Commission colleague, Michael O’Rielly) already
has accomplished much that is notable. For example, regarding procedure and
institutional reform, Chairman Pai began – and has now made permanent – the
practice of releasing to the public draft proposals and orders three weeks in
advance of agency open meetings. This gives the public an opportunity to see
the draft of the proposed Commission item on which the commissioners will be
voting so that interested persons have the opportunity to provide reactions to
the draft before the Commission vote. So far, this move to increase the
transparency appears to be working well.
Also notable from an institutional procedural
perspective is Chairman Pai’s commitment to ensuring that the commissioners
vote on important matters that should not be delegated to the staff for
handling. A good example is the restoral to the commissioners of the authority
– and the responsibility – to vote on the various congressionally-mandated
competition reports, such as the recently adopted Wireless Competition Report.
With regard to matters of substantive policy, the
accomplishments thus far likewise have been noteworthy. For instance, early on
in his tenure, Chairman Pai terminated the Commission’s innovation-stifling
investigations into various popular free data wireless plans that had been
initiated by the Wheeler Commission. With Commissioner O’Rielly, he stayed parts
of the Wheeler Commission’s overreaching privacy order from taking effect.
And, of course, most consequentially, again with
the support of Commissioner O’Rielly, Chairman Pai initiated the Restoring Internet Freedom proceeding
to consider reversing all or parts of the public utility-like regulatory regime
imposed on Internet service providers by the Wheeler Commission’s 2015 Title II
order. The Commission’s Notice of Proposed Rulemaking (NPRM) seeks comment on
important questions relating to whether the agency possesses the legal
authority to adopt the 2015 regulations and, even assuming such authority
exists, whether, as a matter of policy, it is reasonable for the Commission to
do so. [For the views of Free State Foundation scholars on the issues raised in
NPRM, see our initial comments
and reply
comments.]
Going forward, acting in the Restoring Internet Freedom proceeding is the single most consequential
item on the Commission’s agenda. For the reasons discussed in the Free State
Foundation’s filed comments and reply comments, it is important for the
Commission to eliminate, or at least curtail to a substantial extent, the
regulations currently applicable to Internet service providers.
But consistent with, and in furtherance of, the
commendable efforts already begun by Chairman Pai to rollback unnecessary and
costly regulations that don’t make sense in today’s competitive communications
landscape, there is more that should be done. In remarks
at the Free State Foundation’s Tenth Anniversary Gala Luncheon on December 7,
2016, then-Commissioner Pai pointed out that the “regulatory underbrush at the
FCC is thick” and declared: “We need to fire up the weed whacker and remove
these rules that are holding back investment, innovation, and job creation.”
To that end, I want to urge, once again, that
Chairman Pai and his fellow commissioners, consider a series of reform
proposals I published earlier this year, all but one of which were co-authored
by my Free State Foundation colleague, Seth Cooper. [Links to each of these
proposals may be found below at the end of this piece.]
I want to call special attention to the FSF proposals
for improving the Commission’s periodic regulatory reviews and forbearance
reviews mandated by Sections 10 and 11 of the Communications Act and the
proposal for improving the Commission’s periodic review of regulations that
have a significant economic impact on small businesses. In each instance, in
recognition of the evidence that the communications marketplace is largely
effectively competitive, the Commission should establish deregulatory
rebuttable evidentiary presumptions. As explained in detail in each of the
pertinent proposals, these evidentiary presumptions would not alter the substantive
standards or findings required by the regulatory review, forbearance, or small
business statutory provisions. Rather, adoption of an evidentiary presumption consistent
with the deregulatory congressional intent of these provisions would facilitate
eliminating regulations that are no longer necessary due to changed competitive
circumstances.
To the extent that there was ever any doubt
concerning the Commission’s authority to adopt rebuttable presumptions such as
those that I have recommended, such doubt should have been expelled by the D.C.
Circuit’s July 2017 decision in National
Association of Telecommunications Officers and Advisors v. FCC. There, in a
unanimous decision, the court affirmed the Commission’s adoption of a
rebuttable evidentiary presumption to the effect that if a cable franchise area
is served by at least two competing providers, each of which offers services to
at least 50% of the franchise area’s households, and the number of households
subscribing to the services of providers other than the largest exceeds 15% of
the households, then the FCC presumes the franchise area is effectively
competitive. In adopting this deregulatory presumption, which reversed a
presumption running in the other direction, the Commission cited the changed
competitive landscape. To his credit, then-Chairman Wheeler joined with
Commissioners Pai and O’Rielly to forge the Commission majority in favor of this
sensible deregulatory action.
In affirming the Commission’s decision, the D.C.
Circuit observed in NATOA that “the
Commission has grounded its presumption in strong evidence of market conditions
and facilitated rebuttal where the facts may warrant it.” Furthermore, the
court declared that merely because a statute requires the Commission to make
“findings,” this does not indicate that the use of presumptions is precluded,
especially where, as the court put it, “Congress has not spoken directly to the
question whether the Commission may use a rebuttable presumption in lieu of
case-by-case findings of fact….”
Now that Chairman Pai has been confirmed to
another full term, and as he prepares to lead the Commission in a direction
that removes unnecessary rules that, as he has said, are “holding back
investment, innovation, and job creation,” he and his fellow commissioners should
consider employing deregulatory rebuttable presumptions as a means of minimizing
regulatory roadblocks.
I’m confident that this course will enhance
overall consumer welfare, while spurring the nation’s economy.
SOME FREE STATE FOUNDATION PROPOSALS FOR REGULATORY
REFORM
Randolph J. May and Seth L.
Cooper, “A Proposal for Improving the FCC's
Regulatory Reviews,” Perspectives from FSF Scholars, Vol. 12, No. 1 (January 3, 2017).
Randolph J. May, “A Proposal for Trialing FCC
Process Reforms,” FSF Blog, January 9, 2017.
Randolph J. May and Seth L.
Cooper, “A Proposal for Improving the FCC's Forbearance Process,” Perspectives from FSF Scholars, Vol. 12, No.4 (January 17, 2017).
Randolph J. May and Seth L.
Cooper, “A Proposal for Improving the FCC's Video Competition
Policy,” Perspectives from FSF Scholars, Vol. 12, No. 5 (February 8, 2017).
Randolph J. May and Seth L.
Cooper, “A
Proposal for Improving the FCC’s Regulations Impacting Small Businesses”, Perspectives from FSF Scholars, Vol. 12, No. 6 (February 13, 2017).
Randolph J. May, “A
Proposal for Spurring New Technologies and Communications Services,” Perspectives from FSF Scholars, Vol. 12, No. 7 (February
21, 2017).