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May 25, 2010
Free Press: Holier than thou

National Journal notes ($) that while Free Press frequently taps the media to slam its opponents as fronts for special interests who won't reveal their funding, much of Free Press's own funding is concealed.

Free Press staff members "want to call everyone else a front group ... [but] they don't subject themselves to the same scrutiny," [Phil] Kerpen [of Americans for Prosperity] contended. The charges of Astroturfing that Free Press aims at other groups, [Mike] McCurry [a former White House spokesman, who now runs Public Strategies Washington, a government-relations firm whose Arts+Labs coalition supports the telecoms in the net-neutrality debate] said, carry "a little whiff of hypocrisy."
Always better to debate the arguments, isn't it? Shooting the messenger is usually an act of desperation that tends to reveal the weaknesses in one's case. As this revelation shows, it can also make one look foolish.

The article points out that Free Press -- which is urging Democratic policy makers to regulate the Internet and enact subsidies for media professionals -- is "firmly allied with media professionals who provide content to niche markets." It's former press chief, Jen Howard, is now the press secretary for FCC Chairman Julius Genachowski, and its talking points and arguments match the statements of administration officials.

According to McCurry, the group and its allies "hate everything about capitalism, corporations and profit-making."

December 10, 2009
Comcast + NBC = Blackmail

A Sunday editorial in the New York Times expressed concerns about Comcast's proposed acquisition of NBC, but explicitly stopped short of calling for rejection of the deal.

According to the Times, this combination could be just awful

Comcast could bar rival cable and satellite TV companies from access to desirable NBC shows, or it could offer them only at a high price, bundled with less attractive content .... Comcast could now be tempted to limit access to NBC content on rival Internet services, or charge them high fees. And Comcast could take its bundling business model to the Internet by forcing customers to buy cable packages in order to see content from NBC's network online.
After citing these horrific possibilities, the Times then says,
These concerns might not justify blocking a merger. But they do justify a careful review .... What regulators must not do is let this deal pass unchallenged.
What? If it's so bad, shouldn't we call 911?

Well, if the deal is rejected or withdrawn, various special interests get nothing.

Continue reading "Comcast + NBC = Blackmail" »

September 4, 2009
Making waves

From pollster Charlie Cook:

With 14 months to go before the 2010 midterm election, something could happen to improve the outlook for Democrats. However, wave elections, more often than not, start just like this: The president's ratings plummet; his party loses its advantage on the generic congressional ballot test; the intensity of opposition-party voters skyrockets; his own party's voters become complacent or even depressed; and independent voters move lopsidedly away. These were the early-warning signs of past wave elections. Seeing them now should terrify Democrats.
If there is any possibility of a wave, a good bet would be that nothing of significance will happen in the Senate during those 14 months.

February 6, 2009
Which Republican for the FCC?

Over at TVNewsday, Harry A. Jessell writes

I don't like the way the new FCC is shaping up. There's something missing.

My concern has nothing to do with Julius Genachowski, whom the president has reportedly tapped for chairman....

What I'm having trouble with are the names popping up for the Republican seat....

All [the rumored candidates] work or used to work on Capitol Hill. They are basically experts on policymaking, crafting legislation and Washington politics, but not much else.

The seat is turning into a reward for loyalty and a test of whose boss has the most clout.

Bad idea.

As the professed champion of business, the Republicans should award the seat to a businessman or a businesswoman.

I'm talking about somebody who has actually done some hiring and firing, made a payroll in tough times, sweated a big sale, produced goods or services, acquired another company, got a loan to expand operations or survive a downturn and struggled to untangle and comply with federal regulations.

There's a double standard here.

Ajit Pai, for example, who is one of the Republican candidates, is Deputy General Counsel of the FCC. He served as Chief Counsel of the U.S. Senate Judiciary Committee's Subcommittee on the Constitution, Senior Counsel at the Office of Legal Policy at the U.S. Department of Justice, Deputy Chief Counsel of the U.S. Senate Judiciary Committee's Subcommittee on Administrative Oversight and the Courts, an Honors Program trial attorney in the Telecommunications Task Force at the U.S. Department of Justice's Antitrust Division and a law clerk to Judge Martin L.C. Feldman of the U.S. District Court for the Eastern District of Louisiana. He graduated with honors from Harvard College and from the University of Chicago Law School, where he was an editor of the University of Chicago Law Review.

Sounds an awful lot like the background of Julius Genachowski or, for that matter, President Obama.

Aside from Pai, each and every one of the Republican candidates is highly accomplished and is easily as qualified as any other recent FCC nominee.

As the title of his column, "Wanted: A Broadcaster for the FCC," suggests, Jessell wants a special interest advocate to fill the vacant seat.

Who might that be? Jessell doesn't say.

The FCC is supposed to regulate and deregulate in the public interest, not in the interest of established commercial entities just because they have to hire and fire, make a payroll in tough times, sweat a big sale, produce goods or services, acquire another company, get a loan to expand operations or survive a downturn and struggle to untangle and comply with federal regulations.

In short, the purpose of the FCC is not to ensure the profitability of the entities it regulates, but to ensure that innovation can flourish. Innovation leads to more competitors, new or better services and ultimately lower prices. Sometimes established firms must be allowed to fail.

The problem with the FCC is that it has become a special interest playground. It ought to be eliminated, of course. But since that isn't possible at the moment, we ought to insist on having commissioners who are experienced in communications policy, and, yes, who understand policymaking, crafting legislation and Washington politics. They should be principled and diplomatic. They should have the temperament to be able to compromise or to respectfully dissent, depending on the circumstances. They should grasp, but not feel beholden to special interests.

If anything, Senate staffers are more likely to have acquired these skills, not less.

So I say, yes, perhaps we need a Senate staffer who has been schooled in the public interest, not an executive who is beholden to a special interest.

February 3, 2009
Republican nominees for FCC

Senate Republican Leader Mitch McConnell and Senate Commerce Ranking Member Kay Bailey Hutchison, I hear, have received approximately one dozen recommendations for filling the vacant seat on the FCC which, by law, must be filled by a Republican. Although the president will make the appointment, the views of the Senate Republican Leader, in particular, are usually accorded significant weight.

The most prominent candidates include Lee Carosi Dunn (Senator McCain's assistant for communications policy), Brian Hendricks (Hutchison's assistant for communications policy), Ajit Pai (Senator Brownback's assistant for judiciary matters) and two officials from the Bush administration (David Gross, ambassador for international communications and information policy; and Meredith Baker, former acting assistant secretary of commerce for telecommunications and information policy). All sound like good choices. The Senate staffers have the inside track.

Aside from the current vacant seat, it's also possible one of the candidates could replace current FCC Commissioner Robert M. McDowell, whose term expires in June. By law his seat would also have to be filled by a Republican.

January 13, 2009
Genachowski for the FCC

President-elect Obama intends to appoint Julius Genachowski, a protege of former FCC chairman Reed Hundt, as the commission's next chairman.


Having been at the FCC with Hundt, Genachowski should have seen industries largely ignored by the commission -- cable and wireless -- thrive as a result of deregulation while the telephone industry it attempted to reinvent soon crashed.

As George Gilder and I noted in a paper this past summer, when the 1996 law passed, there were several cable operators who planned to offer competitive phone services in a venture that included Sprint Corp. These plans were shelved, according to Sprint CEO William T. Esrey, due the FCC's "pro-competition" policies: "If we provided telephony service over cable, we recognized that they would have to make it available to competitors." Thus, the local competition rules which were intended to speed effective competition actually delayed it. Cable voice services did not gain significant momentum until 2004, when the FCC scaled back its pro-competition rules. Those changes prompted phone companies to enter the video market dominated by cable operators, who in turn accelerated their entry into the voice market dominated by incumbent phone companies.

Genachowski should know that in its pure form net neutrality regulation would encumber broadband networks with the same open access regulation which failed when applied to local telephone networks.

December 9, 2008
Report hits Martin's leadership

A report prepared by the staff of the House Energy & Commerce Committee is critical of FCC Chairman Kevin Martin's leadership. Among the findings: "There are instances in which the Chairman manipulated, withheld, or suppressed data, reports, and information ... in an apparent attempt to enable the Commission to regulate cable television companies."

The report mentions that Martin's actions "have certainly undermined the integrity of the staff. Moreover, it was done with the purpose affecting Congressional decision-making..."


Oh, and the report notes that there is some friction between Martin and some or all of his four fellow commissioners. The report concludes that Martin's management style is "heavy-handed, opaque, and non-collegial," and that his leadership has led to "distrust, suspicion, and turmoil among the five current Commissioners."

Martin said in a statement he has merely sought to "enhance choice and competition in the market for video services."

I completely disagree with Martin's policy agenda when it comes to the cable industry.

And I would certainly like to see integrity and collegiality at the FCC.

But my first glance at the report reminded me of a former FCC chairman during the Clinton administration who had the audacity to try to enhance choice and competition in the market for telephone services. His name was Reed E. Hundt. And his telephone policy agenda was as bad as Martin's cable policy agenda.

Like Martin, Hundt had his enemies.

In his memoirs, Hundt recounts

the other commissioners told anyone who would listen that I was arrogant, imperious, stubborn, self-righteous, deceitful. They tried numerous forms of embarrassment, ranging from leaking confidential documents to (my favorite) drawing a caricature of me on the wall.
Hundt also has this to say about his own efforts to reach out to his colleagues:
Despite the contentiousness on the eighth floor, I occasionally made an effort to be a clubbable chairman. To this end, one day that fall, I visited Jim Quello's office. As usual, he was friendly enough; at least he was willing to have me sit down. Of the other two in the Gang of Three, one would rarely meet and the other would never meet with me alone.
The purpose of this report is to ensure that the FCC is fair, open and transparent, the implication being that it hasn't been so under Martin.

But, again to be fair, Hundt also tried to ram things through:

Almost everyone at the agency thought it was unbearable that Congress had commanded the FCC to conduct specific rulemaking in statutorily set time periods ... The impossible deadlines, in fact, were a stroke of luck. They permitted my team to rush the items past the other commissioners to votes, insisting on our interpretation of law, and brooking no delays ....

To put even more pressure on the other commissioners, I announced that I expected to obtain a unanimous vote on all items. If the Gang of Three could not agree with my team's recommendations, I hoped to invoke memories of the Republican shutdown of government. I wanted the Gang of Three to fear that the public would blame them, as it had the Congress, for failure to produce results.

I am not defending everything Martin did as FCC chairman; only pointing out that no one up on the Hill conducted an investigation of Hundt's management style. And there is always a danger these investigations can mask a hidden agenda to personalize policy differences.

Both Hundt and Martin had ambitious agendas which they were or are determined to move. But the FCC is a place where things languish for eternity or are compromised to the point of meaninglessness. If we want to be rid of authoritarian chairmen, we will have to look more deeply into process reforms.

Dotted Divider Line

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