Genachowski Likely to Face Tough Questions from Republican House

Commerce Committee Ranking Member Joe Barton, R-Texas, said fighting the FCC on possible Title II reclassification of broadband transport will be a top priority for the committee if he gets a waiver from GOP leadership and becomes chairman. “One of my first actions” will be to require the agency “to explain why it thinks the Internet needs federal government regulation for the first time,” he said.

Communications Subcommittee Ranking Member Cliff Stearns, R-Fla., will “absolutely” make oversight of the FCC a priority next year, he said in an interview. The regulator should not reclassify broadband under Title II of the Communications Act, he said. If there’s to be any compromise, “I'd want it to come through the subcommittee, not through the FCC, so that Congress still retains jurisdiction over that aspect,” Stearns said.

"It means more oversight by Congress,” said an FCC official. “It means commissioners should expect to testify before Congress more frequently.” The level of investigations by the Commerce Committee and whether it will be similar to what Martin faced depends on the “personalities” of those who step up to lead the committee, the official said: “Oversight doesn’t have to be negative."

Hundt agreed that the biggest question facing the FCC is which Republican takes over the House Communications Subcommittee. Immediately after that person is chosen, Genachowski ought to sit down with him and his Senate counterparts and say, “What do you need me to do,” Hundt said. The focus of the FCC must be, “Jobs, jobs, jobs,” he told us.

It'll be difficult work with Congress divided and the public clearly angry, Hundt said. “The Democratic Senate and the Republican House, both animated by a vivid awareness of the frustration, worry and fear of the voters, are going to have to find a way to produce jobs in the communications sectors,” he said. “That’s just not something we've seen before in our lifetime.” President Barack Obama’s best bet is to divide the country into regions and to appoint deputies who'll be charged with spurring job creation in those regions, Hundt said.

"It’s clear the FCC itself will be operating in a much different oversight environment and can expect much more vigorous oversight from the Republicans, particularly to try to draw distinctions on policy issues from where the Genachowski administration may be headed,” said a former FCC official. Asked if the change means the agency will be less aggressive on net neutrality, the person said only Genachowski can answer that question. It’s unclear whether the chairman will face the “turn over every rock” kind of investigation Democrats directed against Martin, the official said.

"Genachowski will face a more skeptical House, but I suspect the pushback will be more at the policy level than in terms of formal investigations,” said Paul Gallant, analyst at MF Global. “The Republican House certainly adds a new layer of resistance on net neutrality. It doesn’t preclude reclassification or aggressive net neutrality rules, but it makes them more difficult."

The GOP gains will make the FCC more cautious about moving forward on broadband reclassification, predicted multiple telecom association executives. The election results will “slow down the effort to reclassify,” predicted Telecommunications Industry Association President Grant Seiffert. Then again, while there could be ramifications later on, the FCC is an independent agency that doesn’t need approval from Congress to proceed, said National Telecommunications Cooperative Association Vice President Tom Wacker.

"The FCC is in a tough place” on net neutrality, said CEA President Gary Shapiro. “You can’t please Congress, because their whims change.” Republican legislators would want to see evidence of actual harm, such as blocking of websites, before taking action, he said.

"The landscape has changed here a lot” on net neutrality and that will “certainly increase the pressure at the FCC,” said President Matt Polka of the American Cable Association, which opposes broadband reclassification. Having a Republican “majority House that would be opposed to such action and I am sure holding Genachowski accountable in oversight hearings, etc.” will factor into his decision making, Polka added. “I think he’s going to get pretty comfortable spending some time up on the Hill."

"I think you'll see some very adversarial oversight,” said Managing Director Gregg Rothschild of the Glover Park Group. If Genachowski overhauls the Universal Service Fund as the broadband plan seeks, “then I think you'd have a Congress that doesn’t split over partisan lines,” said Rothschild, who was chief counsel on the House Commerce Committee when it was chaired by Rep. John Dingell, D-Mich. The Hill would be “very interested in working with the FCC” on USF, he added.

Attention from Congress will sap the time of senior commission staffers, said communications lawyer Andrew Lipman of Bingham McCutchen. “A lot of scrutiny is actually labor intensive in terms of preparing for hearings,” Lipman said. Oversight will come not only from the Commerce committees but from the House Oversight Committee, he predicted. “That can really soak up a substantial amount of high-level time and activity."

"Genachowski should learn from Reed Hundt and Kevin Martin, both of whom faced similar transitions,” said Public Knowledge Legal Director Harold Feld. “At the end of the day, there is not much Congress can really do to you, although they can make your life unpleasant. If Genachowski has something he really wants to accomplish, he can make it happen. Hundt was able to defend regulating children’s television and promoting wireless competition against opposition from Congressional Republicans.”

In particular, Genachowski is likely to find success with consumer protection initiatives such as wireless bill shock or limiting early termination fees charged by carriers, and on bipartisan issues like getting more spectrum into play, Feld said. On net neutrality and reclassification, “there is very little a hostile House can actually do if Genachowski goes ahead,” he added. “Even if the House passed something to reverse the FCC, it would not clear the Senate. So other than hold hearings and shout at him, there is not much the Republicans can do to show displeasure."

"I would expect that Julius Genachowski will definitely face a more hostile House” next year, which is why “forth with action would be the wise strategy,” said Sascha Meinrath, director of the New America Foundation’s Open Technology Initiative. “I would expect that Genachowski would face an increasingly hostile House irregardless -- from Democrats for moving too slowly and from Republicans for moving too quickly."

Genachowski should expect to be called “on a regular basis” to testify before many committees in the House should the FCC move forward on net neutrality, said Robert Hahn, senior fellow at the Georgetown Center for Business and Public Policy. “I think the new House will more closely scrutinize the actions of the FCC and the chairman on a number of issues,” he said. “With the Republicans in charge of the House, I think it is more likely that we will see telecom policies that are actually pro-consumer and pro-business at the same time. That means highly interventionist forms of net neutrality will likely go nowhere in this Congress.”

"It would be a big mistake for Genachowski not to take the cue from the election results and drop his proposals for net neutrality regulation,” said Randolph May, president of the Free State Foundation, which opposes such rules. “Continued pursuit of net neutrality regulation by Genachowski would be a fool’s errand, which likely would be stopped by Congress.” It would also be foolish for Republicans to start a series of investigations “where there are no indications of inappropriate or improper conduct,” he said.

"You can expect aggressive oversight -- the administration will have its hands full placating a Republican Congress that, without the gavel, has been unable to conduct substantive oversight of the Obama administration,” said Raymond Shepherd, former staff director of the Senate Permanent Subcommittee on Investigations, now at Venable. “Republicans have learned from past mistakes and will not be handing out subpoenas like candy on Halloween. Instead, look for Congress to conduct intensive, fact-based oversight investigations designed to highlight policy differences with the Obama administration."