Some assume policymaking follows a rational, linear process in which policymakers observe a problem, weigh the critical variables, review possible solutions (and their costs and benefits), and then apply the appropriate action (or inaction, no harm is shown).
Some even think that regulators, in an effort to make good policy, engage a policy research process in which they evaluate the merits of their past to decisions. The reality however is more like what Giandomenico Majone describes in “Evidence, Argument and Persuasion in the Policy Process”: policymakers use theory selectively after the fact to justify their pre-ordained and favored policies.
The Federal Communications Commission claims that it conducts rulemakings at the behest of Congress, writing rules “each time Congress enacts a law affecting telecommunications,” but the major rulemaking that the FCC has enacted during FCC Chairman Tom Wheeler’s tenure have focused on laws made years ago. It appears that the FCC sees rulemaking a “policy innovation” opportunity, to re-interpret statutes regardless of whether Congress decides it is necessary to update a law.
While the premise of FCC rulemaking is that there will be a meaningful exchange between relevant parties and subsequent optimization of rules, the reality is that by the time a rulemaking is issued, it’s too late to change them. The policy endgame is already decided whenever a new chairman is appointed; there is no research process to find the good and right policy.
Chairman Wheeler’s three years at the FCC have broken records in partisanship, with more votes along party lines for rulemaking than previous commissions combined. Consider the recent online privacy rulemaking, which came about only because the FCC’s Open Internet rules reclassified Internet broadband under Title II, giving FCC new authority to regulate Internet privacy. Simply stated, the FCC rulemaking was not born out of any concluded necessity.
Absent are findings that the Federal Trade Commission wasn’t doing its job; the FCC has no complaints about online privacy violations; and no investigations were conducted to determine whether broadband providers had violated consumers’ privacy. All the same, the FCC pressed forward with 147 pages of misinformed, unjustified rules. Given that these rules deter market entry of broadband providers into the heavily oligopolistic online advertising market, a legal challenge is not unexpected.
Both Republican commissioners dissented to the rules, calling them unjustified and likely illegal. Nevertheless, they made attempts at bipartisanship with the hope that they could craft a set of rules that commissioners on both parties could support. As Commissioner Michael O’Reilly noted in his remarks at the meeting, Democrats did not even respond to the request by Republican commissioners for a conversation, much less a compromise.
To avoid consumer confusion on having the same services regulated differently along with other problems of regulatory asymmetry, Commissioner Ajit Pai suggested that the rules be harmonized with the FTC framework. Many experts agreed, including the Democratic and Republican commissioners of the FTC itself.
Unfortunately, since the FCC wasn’t willing to harmonize with the FTC, the last shot at achieving privacy regulation uniformity (without congressional action) is for the FTC to now abandon its years of experience and lessons-learned in consumer privacy protection and mirror the FCC approach. Commissioner Pai declared that the FCC has adopted rules that ultimately install an environment of “Corporate Favoritism,” restricting the broadband providers so that established online advertising platforms need not face competition.
The moral of the story is that in policymaking, it’s not the facts that matter but the politics.
