Accelerating Tea Party Express Seeks Telecom Deregulation

A majority of the Tea Party candidates running for the Senate are likely to win in the November elections, said Larry Sabato, director of the University of Virginia’s Center for Politics. That’s because they represent heavily Republican territory, including Utah, Alaska and Kentucky, he said. “However, a few will crash and burn, led by Christine O'Donnell in Delaware,” he predicted. What happens in the House is less clear, he said.

The Tea Party movement will have an impact on all policy matters before Congress next year, regardless of which party has control of Congress,” said Paul Raak, vice president of the Independent Telephone & Telecommunications Alliance. On telecom, “the net neutrality debate resonates the most with anti-regulation/Tea Party-minded individuals who see the Internet as a successful example on how an industry can prosper absent government regulation.” Keeping net neutrality rules at bay is thus likely to be the top telecom priority for the group, he said.

"It would be very anti-Tea Party sentiment” to implement net neutrality through reclassification of broadband under Title II of the Communications Act, said Seton Motley, president of Tea Party activist group Less Government and editor-in-chief of StopNetRegulation.org. “The Tea Party movement wants less government,” but net neutrality and especially reclassification would mean a “huge increase” in the government’s size, he said. However, Tea Party groups may support narrow legislation allowing the FCC to enforce open Internet rules, such as the one that flopped last week in the House, Motley said. “If tailored properly, the bill should be fine.” An anticipated “seismic demographic shift” in favor of Tea Party beliefs this November “bodes well” for Congress crafting such narrow legislation, he said.

Tea Party candidates in the election haven’t been vocal on net neutrality, so it’s unclear which ones would be active on the issue once elected, Motley said. But it’s difficult to imagine any Tea Party candidate voting for net neutrality “as defined by Free Press and company,” he said. “It’s not going to take a six-hour seminar … to reach that ‘no’ vote."

While the Tea Party is somewhat “amorphous,” there appears to be consensus among supporters that the FCC shouldn’t be given new power to regulate net neutrality, agreed FreedomWorks’ Brough. “That notion of regulating the Internet is something that sounds off some alarm bells.” At a recent event, the issue came up “unprompted,” he said. “That crowd was definitely opposed to expanding the FCC’s authority” by reclassifying broadband, he said. The party members believe the FCC can address net neutrality concerns with existing authority, he said. Waxman’s recent proposal advocating a case-by-case approach is probably “more in line” with the kind of net neutrality legislation that the tea party would support, he said.

The Tea Party believes phone and cable no longer require regulation, according to The Patriot’s Toolbox, a Heartland Institute guide for Tea Party activists published Oct. 1. “Continued utility regulation -- except as may be necessary for ensuring interconnectivity and number portability -- is unnecessary and distorts competition in ways that harm consumers,” said authors Hance Haney and George Gilder of the Discovery Institute. States that have taken a deregulatory approach to telecom have seen the most new broadband investment, they said.

Net neutrality rules should be rejected, Haney and Gilder wrote. The existing four Internet principles “may be sound” but “giving the FCC authority to turn them into a regulatory code and then to enforce it risks a repeat of the disaster that was caused by the Telecom Act of 1996, when thousands of pages of new regulations and years of litigation slowed innovation to a crawl and helped cause the telecom crash of 2000-2003,” they said.

To promote broadband investment, elected officials should “repeal discriminatory taxes and fees on telecom services,” Haney and Gilder said. “Direct government subsidies or investment in broadband is unnecessary.” And regulators should end or revamp carrier-of-last resort and buildout obligations, they said. Policymakers should revamp intercarrier compensation to make call termination rates technologically neutral, and implicit intrastate access charges should be replaced with explicit high-cost funding, they said. Also, incumbent telcos shouldn’t have to file tariff notices telling their competition about plans to alter rates, terms and conditions, Haney and Gilder said. Competition, not regulation, should dictate prices, they said. The Toolbox authors also urged local governments to reduce cable franchise fees, and said states should lower communications taxes and preempt local franchise laws that impose large fees or restrict new entrants.

CompTel believes it’s “premature to consider further deregulation in the telecommunications marketplace,” James said. “The type of robust competition that is required to support a deregulated environment does not currently exist in the wholesale market which is essential to the existence of retail competition. Therefore government oversight continues to be necessary to ensure that large incumbent companies do not abuse their market power and adversely impact innovation, job creation and availability of choice for U.S consumers and businesses alike.” It’s surprising that the Tea Party would support deregulation, considering they also claim to be on the side of small businesses, added a competitive industry official.