Week of Hill FCC Oversight Seen Widening Partisan Rifts on Net Neutrality

FCC Chairman Tom Wheeler testified before the House Oversight Committee (see 1503170057), Senate Commerce Committee (see 1503180055) and the House Communications Subcommittee (see 1503190048) over the course of three days last week, accompanied by his four fellow commissioners at the final two hearings. Wheeler and GOP Commissioner Ajit Pai will testify before a House Appropriations subcommittee Tuesday and the House Judiciary Committee Wednesday. Senate Commerce Committee Chairman John Thune, R-S.D., and House Communications Subcommittee Chairman Greg Walden, R-Ore., trumpeted draft legislation they circulated in January that would codify net neutrality protections while limiting FCC authority on Communications Act Title II and Telecom Act Section 706. House Commerce Committee Chairman Fred Upton, R-Mich., also backs that effort. Other Republicans prefer stronger measures attacking the FCC’s order, such as Rep. Doug Collins, R-Ga., who is preparing a Congressional Review Act resolution of disapproval (see 1503170059).

“By focusing so much on White House attacks, the hearings probably helped unify the Democrats,” said New America Foundation Open Technology Institute Policy Counsel Josh Stager. “That will make it more difficult for Thune or Upton to find a Democrat who's willing to join legislation. Many Democrats made clear in the hearings that they won't support a Trojan horse bill that purports to protect net neutrality but really just guts the FCC.”

These “hearings indicate to me that the prospects for legislation along the lines of the Thune-Walden draft are not good because the Democrats just don't want to restrict the FCC's authority in any way,” said Free State Foundation President Randolph May. “And, to my mind, legislation that does not restrict the FCC's authority at least to the extent that the Thune-Walden draft does is not worth pursuing. Even as it is, I think the absolute ban on paid prioritization, without any requirement for a market power or consumer harm showing, is quite problematical."

Senior Democrats who have said they're open to net neutrality legislation -- Senate Commerce Committee ranking member Bill Nelson, D-Fla.; Senate Communications Subcommittee ranking member Brian Schatz, D-Hawaii; and House Commerce Committee ranking member Frank Pallone, D-N.J. -- all repeated last week that they're still open but doubtful about prospects due to the partisan divide on display.

“They’re trying to create the best deal for themselves” and are “creating political cover for themselves to actually negotiate,” argued TechFreedom President Berin Szoka, an advocate for the GOP net neutrality draft bill. “Most of that is theatrics.” He identified the most important part of the hearing as the Democrats remaining receptive to legislation -- and they should act soon, Szoka insisted. They “can’t allow it to get rolled into” the overhaul of the Communications Act that GOP leaders are pursuing and shouldn't wait for a court to impose a possible stay on the FCC net neutrality order, he believes. Even June would be “too late” to advance such stand-alone legislation, he said, warning of the frenzy that will take over once GOP presidential primary campaigning begin.

Industry lobbyists and Hill staffers caution that congressional productivity may drop around the fall once the focus on 2016 rises.

“We’re still very early in the year,” said Rick Boucher, a former Democratic House lawmaker who’s now honorary chairman of the Internet Innovation Alliance. “There’s ample opportunity for legislation to be considered.” As the 2016 election focus rises, “most of the reckoning that takes place is more politically driven,” he remarked. “To resolve” net neutrality through legislation “really does clear the deck” for a Communications Act overhaul later on, he said.

The chance of "passing a major bill isn't looking great at the moment,” said Guggenheim Partners analyst Paul Gallant. “To their credit, the key players are thinking big. But the current environment isn't helping. Net neutrality feels like a gating factor, and the pre-presidential window is fairly limited.”

Walden and House Oversight Committee Chairman Jason Chaffetz, R-Utah, are prioritizing transparency legislation, they said. They slammed the FCC for not releasing order texts before votes. Gallant sees transparency legislation as “the easy lift” compared with the “harder” bipartisan net neutrality effort despite “forward progress that the two top Democrats sounded legitimately open” to the notion. “There was a lot of drama, and it’s fair to say both sides landed some blows,” Gallant said. “Substantively, there was broad consensus for more FCC transparency.”

“When it comes to transparency, sure -- let's have smart reforms of the FCC process,” said Free Press Policy Director Matt Wood. “It's not a perfect one, but it is a public one, and the FCC responded correctly to the record public input it received in this proceeding calling for strong rules. Yet we can't have Congress changing the rules at the end of that process just to undermine the FCC's tremendous decision to reclassify and adopt strong rules.” Wood had “to laugh a lot to get through this week,” singling out a moment from Thursday’s House hearing: “When Chairman Walden yesterday defended the timing of his last-minute FCC reauthorization bill, he said something like well, we followed the rules. But what he and others keep ignoring is that the FCC followed its rules too.”

Wood said Wheeler “was great” and “on solid ground” due to the net neutrality order's foundation of Title II. Net neutrality opponents “keep grasping at straws on the substance,” Wood said. “But Americans can't be fooled by a few press releases and hearings into giving up their hard-won legal rights to open Internet access, and to communications channels free from unreasonable discrimination by cable and telecom companies.”

Wheeler “has been doing his best on defense,” said Information Technology & Innovation Foundation telecom policy analyst Doug Brake. “While there hasn’t been a smoking gun of improper influence, it is increasingly clear that this order was purely results-driven, with the decision to reclassify made first, and the factual finding to support it tacked on.”

“Tom Wheeler does not know how to deal with Congress,” said Szoka, fearing his style was “a sign of things to come” in additional congressional hearings. He saw the No. 1 “gotcha” moment as GOP lawmakers getting commissioners to concede that the FCC has legal authority under Title II to regulate rates, despite Wheeler’s repeated insistence that the FCC intends to forbear from that: “His game is to hide the ball.” Wheeler’s stance was to “interrupt and argue” with lawmakers, “combative to the point of being obnoxious,” Szoka said.