"The FCC did not have the statutory authority to do what it did" On Net Neutrality, Says Departing FCC Commissioner


Photo credit: jdlasica / Foter.com / CC BY-NC

The biggest failure of the Federal Communications Commission (FCC) under President Obama, says departing FCC Commissioner Robert McDowell, was the long push to regulate Internet traffic management via net neutrality rules. The net neutrality push, which consumed the agency during 2009 and 2010, was a major initiative under Chairman Julius Genachowski, a campaign fundraiser and law-school classmate picked by the president to be the nation's top tech regulator. 

Both Genachowski and McDowell announced last week that they would be leaving their commission posts.

In an exit interview with Ars Technica, McDowell, a Republican appointee who became a commissioner under President Bush, reiterated his case against the Internet traffic rules:

"First of all, I've been a strong advocate for a free and open Internet. What I opposed really focused on, first of all, there is no market failure that needed to be addressed. Second, the FCC did not have the statutory authority to do what it did. Third, if there had been a problem there were laws already on the books that would have addressed the problem. There wasn't a problem before the rules and there's not a problem with any danger of a closed Internet in this country after the rules. For those who think the rules have preserved an open Internet, that's sort of like a rooster taking credit for the sunrise."

These are the important points about net neutrality: It's not necessary, and it's probably not legal. 
The policy's backers could never point to more than a tiny handful of concrete examples of violations they wanted to prevent — the FCC named just four in its order, one of which was dismissed by a court and another of which did not ever result in a formal complaint. It was a solution in search of a problem.

And it was a solution that the FCC did not have explicit authority to pass. As a D.C. circuit judge pointed out when the agency attempted to justify its original net neutrality guidelines — which were held merely as policy principles rather than actual rules — the FCC's lawyers could not point to any statute explicitly giving them the power to regulate Internet traffic. The court eventually ruled against the FCC on the grounds that it was trying to enforce non-binding policy principles rather than actual regulations. The court's ruling left open the possibility that explicit rules might be legal, however, so the agency went ahead and passed explicit rules (McDowell voted against the rules). But those rules still lack statutory backing, which is why they are now being challenged again in court. 

I chronicled the story of the push to pass net neutrality rules in Reason's March 2011 issue