The Net Neutrality Accountability Gauntlet

The House's rejection of the FCC's December Open Internet order 240-179 is just the latest in an ongoing high-profile accountability gauntlet for the FCC's unauthorized, unwarranted and unjustified net neutrality rules.

• While the wheels of democracy, public accountability, and the rule of law can turn slowly, they do turn steadily.
• And from what we have seen so far, the FCC's out-of-the-mainstream, over-reach effort to regulate the Internet for the first time, has been pummeled in our Government's accountability process gauntlet to date, and it can be expected to continue to be pummeled going forward.

The Net Neutrality Accountability Gauntlet:

First, the President's January Executive Order, "Improving Regulation and Regulatory Review" to seek the "least burdensome" regulations, was a big post-mid-term election political pivot by the Administration to be more sensitive to business, economic growth and job creation concerns.

• Through the new lens of the President's Executive Order, the FCC's pre-mid-term-election-mindset net neutrality rule making has been viewed as badly out-of-focus with the renewed bipartisan interest in economic growth and job creation.

Second, February and March had House hearings, Subcommittee/Committee votes, and Committee analysis on the legitimacy of the FCC's order.

• The Energy and Commerce Committee's Report has an excellent and devastating analysis (see pages 2-13) of why the House disapproved the FCC's Open Internet order.

Third, April resulted in the House officially rejecting the FCC rules 240-179 for the public record.

• While opponents claimed there should be no vote, because the House could not realistically overturn a likely Presidential veto, the real accountability was the process of creating an official recorded vote for the next election, and informing the public of this serious overreach of regulating the Internet for the first time.
  • Interestingly, the White House, in signaling its opposition to the House's rejection of the FCC's order, did not use the strongest language available to it, that the President would veto the House's  action, but only that "the President's advisors would recommend a veto."
  • This appears to signal that the White House does not relish the prospect of vetoing this Resolution of Disapproval.

Fourth, comes net neutrality accountability in the Senate.

• Under the arcane rules of the Resolution of Disapproval process, the House vote will go to the Senate Commerce Committee, where the Chairman can decide whether or not to hold any hearings.
• When the FCC finally publishes its December Order in the Federal Register, (probably in the summer) it then triggers an unusual special process in the Senate, where if thirty Senators sign a discharge petition, there must be a majority vote on the Senate floor in twenty days, without amendments, and no filibusters allowed.
• While many have reiterated the conventional wisdom that the FCC Resolution of Disapproval will not pass the Senate, the political reality may not be as clear cut.
  • If all 47 republicans voted against the FCC order, only 4 Senate Democrats would be needed to disapprove the FCC Order.
  • Given that six House Democrats voted to disapprove, and so many Democratic Senators appear to face very tough reelection races in 2012, the accountability process in the Senate will be high as well.
  • The accountability process here is that some  Senate Democrats in tough 2012 races may not choose to defend regulating the Internet for the first time based on the FCC's speculative harms.
  • The other key aspect of this accountability process is that the White House will be pushing Democratic Senators in very tough races to go on the record with a vote that may be against their individual political interests, so that the President does not have to go on the record with a veto defending the FCC's regulation of the Internet in the 2012 Presidential race.
  • The point here, is that there could be much more to this Senate accountability gauntlet than first meets the eye.

Fifth, the Court process will add the ultimate in net neutrality accountability.

• The jockeying for where appeals of the FCC order will be heard will create yet another accountability process point before the FCC order is even judged on its merits.
• Defenders of the FCC order can be expected to perform filing gymnastics to try and increase the chances in a potential lottery that Appeals Circuit Courts known to give regulators more deference ultimately hear this case.
  • The takeaway from this jockeying likely will be that the FCC decision was more political than justified on the law or merits.
• Once the Appeals Circuit Court is determined, another accountability process will play out as the trade press and analysts handicap the likely outcome (the conventional wisdom is the FCC will lose in court.)
  • The accountability story here will be about whether the FCC or Congress has the authority to set new U.S. Internet policy.
• Once this accountability decision comes down, likely in 2012, the case could then be appealed to the Supreme Court for decision in 2013, and the earlier process would be played out on an ever bigger and more public accountability scale.

In sum, the FCC is just in the beginning of a rigorous 3-4 year accountability process for their preemptive economic regulation of an industry for a problem the FCC has yet to clearly define. Many important conclusions are likely to emerge from this net neutrality accountability gauntlet.

• It will be clear that the FCC's Open Internet order is the first major change in U.S. Internet policy in 15 years that:
  • Abandoned longstanding bi-partisan Internet policy consensus;
  • Abandoned longstanding competition policy and law; and
  • Attempted to supplant Congress' Constitutional authority to legislate and set national Internet policy.

The net neutrality accountability gauntlet has not been kind to the FCC so far, and the next stages look to spotlight further the core flaws of the FCC order, i.e. that it is:

• Unwarranted and unjustified on the facts;
• Is the most controversial and divisive FCC rule making in the Internet era; and
• Is an illegal usurpation of Congress' Constitutional authority.