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FCC Commissioner Carr Gets It Wrong in Treasury Rule Comments
With all due respect to Federal Communications Commissioner Brendan Carr, his reaction to the Rescue Plan Act's State & Local Fiscal Recovery Fund (SLFRF) spending rules is way off base. As I wrote last week, the rules for broadband infrastructure spending are a good model for pushing down decision-making to the local level where people actually have the information to make informed decisions. (Doug Dawson recently also responded to Commissioner Carr’s statement, offering a response with some overlap of the points below.)
The Final Rule from the Treasury Department gives broad discretion to local and state governments that choose to spend some of the SLFRF (SLurF-uRF) funds on broadband infrastructure. The earlier draft of rules made it more complicated for networks built to address urban affordability challenges.
However, in coming out against the rules, FCC Commissioner Carr is giving voice to the anger of the big cable and telephone monopolies that cities can, after collecting evidence of need, make broadband investments even in areas where those companies may be selling services already. Commissioner Carr may also be frustrated that he has been reduced to chirping from the sidelines on this issue because the previous FCC, under his party’s leadership, so badly bungled broadband subsidies in the Rural Digital Opportunity Fund (RDOF) that Congress decide NTIA should administer these funds and have the state distribute them.
Nonetheless, the issues that Commissioner Carr raised are common talking points inside the Beltway and we feel that they need to be addressed.
The failure of the FCC to assemble an accurate data collection is many years in the making. No single presidential administration can take the full blame for it, but each of them could have corrected it.
President Biden’s FCC is not yet fully assembled because of delays in appointment and in Senate confirmation, but it would not be reasonable to lay blame on the current FCC for the failures discussed below. That said, it is not clear that we are on a course for having better maps and data that will resolve these problems anytime soon.
Commissioner Carr’s Criticism
Transcript: Community Broadband Bits Episode 270
This is the transcript for episode 270 of the Community Broadband Bits podcast. Professor Barbara Cherry goes into detail on the history of common carriage and telecommunications law. Listen to this episode here.
Barbara Cherry: It's been a mess. And part of the problem is restoring a more accurate understanding of our history.
Lisa Gonzalez: This is Episode 270 of the Community Broadband Bits podcast from the Institute for Local Self-Reliance. I'm Lisa Gonzalez this week Christopher talks with attorney and legal scholar Barb Cherry about common carriage. We often talk about common carriage as it relates to telecommunications. And this week Christopher and Barb get into the policy. But most of us aren't aware of the legal history behind common carriage. Barb describes how its origins relate to the way it's applied today and how we need to consider the past as we move toward the future. Now here's Christopher and Barb Cherry.
Christopher Mitchell: Welcome to another edition of the Community Broadband Bits podcast. I'm Chris Mitchell from the Institute for Local Self-Reliance up in Minneapolis. Today I'm speaking with Barb Cherry a lawyer and a Ph.D. in communications who worked for the FCC for five years has 15 years in industry but is now a professor at the media school at Indiana University. Welcome to the show.
Barbara Cherry: Thank you, Chris.
Christopher Mitchell: Barb, one of the things I've warned you about. I'll tell the audience that you have an incredible amount of knowledge and you're very passionate. And so if this seems like it's getting a little bit too you know, friendly I might poke you a little bit to get some of that passion up on the surface.
Barbara Cherry: No problem.
Christopher Mitchell: Let's talk about common carriage which is something that I've never heard anyone explain as well as you have and and maybe you can just start with giving us a sense of the historical origins of common carriage in general.
Uncommon Knowledge of Common Carriage - Community Broadband Bits Podcast 270
The modern fight over network neutrality isn't a few years old. It is well over 1,000 years old across a variety of infrastructures and is totally wrapped up in a legal concept known as common carriage that has governed many kinds of "carriers" over the years. Few, if any, are as conversant in this subject as Barbara Cherry - a lawyer and PH.D in communications. She has worked in industry for 15 years, at the Federal Communications Commission (FCC) for five years, and is currently a professor in the Media School at Indiana University.
One of the key points of our conversation is regarding the problems with media shortening the Network Neutrality policy fights as turning the Internet into a "public utility." Barbara helps us to understand how common carriage is distinct from public utility regulation and why common carriage regulation is necessary even in markets that may have adequate competition and choices.
We also talk about the history of common carriage and the importance of what might seem like outdated law from the days of the telegraph.
This show is 30 minutes long and can be played on this page or via Apple Podcasts or the tool of your choice using this feed.
We want your feedback and suggestions for the show-please e-mail us or leave a comment below.
Listen to other episodes here or view all episodes in our index. See other podcasts from the Institute for Local Self-Reliance here.
Thanks to Arne Huseby for the music. The song is Warm Duck Shuffle and is licensed under a Creative Commons Attribution (3.0) license.
DC Revolving Door, Comcast, and Campaign Finance Reform
Another Example of Regulatory Capture
As you observe (or hopefully, participate in), the debates around network neutrality or universal service fund reform, remember that many of the loudest voices in support of industry positions are likely to be astroturf front groups. Between extremely well-financed astroturf organizations and industry-captured regulatory agencies, creating good policy that benefits the public is hard work. It helps to study how industry has gamed the FCC in the past -- as documented by David Rosen and Bruce Kushnick in a recent Alternet article.
At the risk of being sarcastic, we can thank the FCC for working with the industry to make our phone bills to easy to read - an example is available here.
Background From Reedsburg, Wisconsin: Community Fiber Pioneer
RUC first entered the telecommunications business in 1998, when it constructed a ring to tie its wells, its five electrical substations together and to provide Internet access for its high school, middle school and its school administration building. In planning the ring, the city asked Verizon and Charter if they would build it, but they were not responsive. RUS built a partly aerial, partly buried 7-mile ring of 96-strand fiber at a cost of about $850,000. Internet access was provided by Genuine Telephone, a tiny subsidiary of LaValle Telephone Cooperative which ran a fiber from LaValle, about 8 miles NW of Reedsburg.As they were building the ring, local businesses asked to be connected as well. Reedsburg took the path that so many communities have followed, start by building for yourself and expand opportunistically. Of course, this requires that you originally engineer the network so it can be later expanded, which is good practice regardless of your future plans. Reedsburg used bond anticipation notes, a financial mechanism that few others have used in building similar networks.
A local bank loaned the initial $5 million in bond anticipation notes for planning and construction.
Wanna Be a Wonk? Understanding Regulatory Capture
But the most common form of capture is honest and may be characterised as intellectual capture. Every regulatory agency is dependent for information on the businesses it regulates. Many of the people who run regulated companies are agreeable, committed individuals who are properly affronted by any suggestion that their activities do not serve the public good.