Pai: FCC Should Defer to Congress on Net Neutrality

Tells C-SPAN that FCC Should Pause, Let Legislative Effort Play Out

FCC Commissioner Ajit Pai told C-SPAN this week that the network neutrality debate has turned into a political football and says the FCC should pass that ball to Congress.

Pai was being interviewed for C-SPAN's Communicators series.

The commissioner, the senior Republican on the panel, has historically called for Congress to step in and clarify the FCC's authority and Republican leaders in the House and Senate have just done so, circulating a draft bill late last week and holding hearings on it this week.

So far, there are no Democrats on the draft, but Republicans have signaled their willingness to work on the many problems those Dems raised in net neutrality Hill hearings this week.

Pai praised that effort, and said the FCC should "take a pause" from the planned Feb. 26 vote on the chairman's proposed new Open Internet order and "let the legislative process play out." Pai would not comment on whether there would be a pause, but he said he had seen no signals and an FCC source said Thursday that that a Feb. 26 vote was still on.

The commissioner was in a pausing mood, also saying the FCC might want to pause its broadcast incentive auction timetable to give the wireless companies who have just bid over $4 billion for spectrum in the AWS-3 auction some breathing room to raise capital. At the moment, the incentive auction is targeted for early 2016, only a year away. He also said a pause would help the FCC improve the auction framework.

Pai said the FCC "stands poised" to consider Title II regulation, which he says would be a "tremendous mistake." He agrees with ISPs that Title II would discourage investment and innovation.

Pai was not ready to say Title II was a done deal, pointing to the devil in the details. But he said it was clear that the President's announcement that he thought the FCC should go the Title II route "dramatically changed the political landscape." Pai said he believed, perhaps foolishly that the agency was not "a rubber stamp for the Administration." He said the law and facts are still in flux.

Pai suggested that the FCC's independence depends in part on public perception that the agency is making independent judgments. He said that is jeopardized to the extent that an elected official--in this case the President--"not just suggesting a policy course for the agency but prescribing a specific legal rationale." He said to the degree the FCC simply rubber stamps that, it will be perceived as just another political agency, like a cabinet department.

FCC Chairman Tom Wheeler has argued that there was never that much distance between his and the President's positions, certainly in the goal of preventing blocking and discrimination and anticompetitive paid prioritization.

Pai said the President's push for Title II is, as far as he can tell, an White House involvement in an issue before the FCC.

While Feb. 26 is being viewed by some as a deadline for new net neutrality rules, Pai said the forbearance issues associated with Title II will likely take a year to resolve at least, and suggested the issue, propelled by legal challenges, could stretch beyond the Obama administration, which would mean into 2017.

The commissioner said he had serious concerns about the FCC's ability to preempt state laws on municipal broadband. The FCC majority is expected to vote--also in February--to preempt such state regs in Chattanooga and Wilson, N.C. Pai said he thought that if a municipal broadband project runs out of funds, as some of them have, the state could be on the hook for building out the project, so if voters want to pass a law restricting that, it is their prerogative.

FCC Chairman Tom Wheeler, who has signaled the FCC should step in, has characterized those laws as anti-competitive efforts ramrodded through by incumbent ISPs. The President echoed that sentiment last week in calling for the FCC to step in to help cities in 19 states that have such municipal broadband-limiting laws.

Pai says the President's announcement "doesn't change what the law is." As Pai sees it, a 2004 Supreme Court decision makes it clear that the FCC has to identify where Congress gave it preemption powers, and he simply does not see it. He said it was another case of the President prescribing what the FCC should do.