Pai Proposal on Economics Office Could Face Objections by FCC Democrats
FCC Chairman Ajit Pai’s proposal for an Office of Economics and Analytics is expected to be OK'ed at the Jan. 30 commissioners’ meeting largely as proposed, given the minority members' concerns may not be addressed. The item could face opposition from the two Democratic commissioners, Mignon Clyburn and Jessica Rosenworcel, industry and agency officials said. Clyburn in particular may make clear her concerns during next week’s meeting, the officials said. Republican Commissioner Mike O’Rielly told reporters Monday he's studying the proposal (see 1801220040).
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Critics of the December net neutrality order slammed the economic analysis behind it, but there has been little public opposition to the new office expressed. The agency created a docket, 18-3, on the new office Jan. 9, but no filings have been submitted. With the meeting next week, Tuesday was the final day for opponents or proponents to the proposal, and the no-lobbying period has begun. The initial reaction to the office was mostly positive (see 1801120006). The FCC declined comment. Cass Sunstein, administrator of the White House Office of Information and Regulatory Affairs in the Obama administration, and others have praised the move.
Public interest groups don’t have enough resources to raise questions about all the things they don’t like that the current administration is doing, so that may be why there has been little reaction, said Gigi Sohn, aide to former Chairman Tom Wheeler. Putting economic analysis “front and center” in FCC policymaking “is contrary to the public interest standard” of the Communications Act, Sohn told us. Creation of the office could mean a team of right-leaning “Chicago School types” who “will look at nothing but economic analysis, cost-benefit analysis,” she said. Sohn questioned the logic of creating a new office with four divisions, as proposed by Pai. “It’s not exactly ramping down on bureaucracy,” she said. For a chairman “hell-bent” on reducing bureaucracy “this comes as a surprise to me,” she said. “What’s wrong with the hardworking economists already in the agency?” she said.
“Democrats may have legitimate concerns that Pai intends to use the new office to dress up anti-consumer and anti-competitive policies with economic technobabble,” said Public Knowledge Senior Vice President Harold Feld. “We won't oppose the creation of such an office, but we have to laugh at Pai's fraudulent economic claims in places like the net neutrality order, as well as his ridiculous claims that the FCC doesn't already conduct rigorous economic analysis,” said Matt Wood, Free Press policy director.
Lawrence Spiwak, president of the Phoenix Center, said there are legitimate questions about consolidating FCC economists. “There’s a lot of arcane stuff” that economists work on, he said. “It’s like being a lawyer,” Spiwak said. “I’m a mass media lawyer. I may know nothing about common carriage law or cable law.” Spiwak also said creation of the office sends a clear message that the FCC expects better economic analysis in arguments made there by industry. “The real question to me is … is the industry going to step up its game and do some serious work or not,” he said. “The commission is sending a message and the chairman is sending a message -- I want better quality work,” he said. “Are people going to do it?” he asked. “I’m not sure I’ve seen it yet.”
Free State Foundation President Randolph May said creating the office should help the FCC attract more “top-notch” economists. “It’s hard to argue with the notion that FCC decision-making benefits from having available the best economic analysis possible,” May said. “This doesn’t mean that the economic analysis of the new office, or of any economist, always dictates the outcome because other factors rightly may come into play. I also think the new office makes sense so that the agency’s economic analysis can be strengthened and be more cross-cutting and less parochial.”