Academic journal article Harvard Journal of Law & Public Policy

Advice to the New President on the FCC and Communications Policy

Academic journal article Harvard Journal of Law & Public Policy

Advice to the New President on the FCC and Communications Policy

Article excerpt


The Telecommunications Act of 1996 ("1996 Act")(1) promised the first major revision of communications policy since the passage of the Communications Act of 1934 ("Communications Act").(2) In passing the 1996 Act, Congress intended to "promote competition and reduce regulation."(3) Congress believed that the 1996 Act would "secure lower prices and higher quality services for American telecommunications consumers and encourage the rapid deployment of new telecommunications technologies."(4) President Clinton characterized the 1996 Act as "revolutionary legislation" aimed at bringing the future to the doorsteps of the American people.(5) Vice President Al Gore claimed to be championing the Clinton Administration's efforts to promote the goals of private investment, competition, and flexible regulation.(6)

One year after the passage of the 1996 Act, former Federal Communications Commission ("FCC" or "Commission") Chairman Reed Hundt asked, "Is it working?"(7) The answer was clearly no. Unfortunately, and largely due to actions of the Clinton FCC, the regulatory framework created by the 1996 Act has failed to produce many of the benefits promised by its supporters.(8) The Act has instead provided an excuse for the FCC to expand its already swollen bureaucracy.(9) Although some in Washington "paradoxically and mischievously" refer to the current state of affairs as "deregulation," the FCC continues to regulate emerging communications technologies and to re-regulate previously deregulated communications industries.(10)

The 1996 Act was supposed to end "outdated, invasive regulation," which should, according to elementary common sense principles, require a smaller budget.(11) Nonetheless, on the third anniversary of the 1996 Act, President Clinton submitted a budget to Congress asking for a 20% hike in the FCC's budget for fiscal year 2000.(12) For fiscal year 2001, the FCC requested and received an additional 11.5% increase, bringing the agency's current allocation to a staggering $237,188,000.(13) All the while, the FCC has kept on its books hundreds of regulations which have long outlived their usefulness and has refused to heed the command of Congress to deregulate American communications markets.(14)

Given the rapid pace of change in the telecommunications industry, the new Administration should work with Congress and the FCC to make the Commission do less, faster. Only then will the American public obtain the benefits of the competitive, innovative telecommunications industry that the 1996 Act envisioned. To accomplish these goals, the new President should take the following "top ten" steps. He should ensure that:

1. the FCC stops using its merger reviews to extract conditions it could not otherwise impose;

2. the FCC exercises its statutory power to forbear from regulation more often;

3. the FCC adopts a customer service mentality;

4. the growth of the FCC as an administrative agency is halted;

5. the FCC ends its regulation of mass media content;

6. the FCC modifies its ownership restrictions;

7. the FCC keeps it hands off the Internet;

8. the FCC eliminates access charges and reforms its regulatory fee structure;

9. the FCC reforms its spectrum allocation policies to increase the use of auctions and allow for spectrum flexibility; and

10. the FCC gives more respect to states' rights.


A. Limit FCC Merger Review and Attendant Conditions

Since the passage of the 1996 Act, the FCC has become far more heavy-handed in its review of mergers between telecommunications companies.(15) Given the FCC's increased focus on communications mergers, many will be surprised to learn that the 1996 Act did not increase the FCC's merger review authority. Indeed, no provision of the Communications Act expressly authorizes most of the Commission's current merger review activities. …

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