FCC Decision: Another Government Power Grab

Most Americans likely stifled a yawn when they heard the news that the Federal Communications Commission (FCC) laid down new rules regarding the Internet. Consumers won't notice any immediate changes in the way they use the web, so the ruling will be quickly forgotten.

However, people need to pay more attention because this is just another attempt by the federal government to extend its tentacles into private enterprise. Whenever the government decides to place the heavy hand of regulation on an industry, the consequences usually end up harming consumers and adding to the price of services.

In its ruling, the FCC approved new guidelines for something called "net neutrality." The rules place additional burdens on telecommunications and cable companies for broadband, while offering little in the way of consumer protection.

Of course, President Obama supported the decision. No surprise there. He campaigned on a pledge to "preserve the freedom and openness" that have allowed the Internet to flourish. It didn't hurt that one of his campaign's biggest contributors, the evil empire known as Google, championed FCC intervention on "net neutrality."

Let's set aside the arcane technical aspects of the ruling for this article. No matter your position on the issue of "net neutrality," the FCC's foray into regulation of the Internet signals the commission's intent to expand its ever increasing role into every nook of communications.

Even those like Google, who are applauding the decision today, will come to rue the day the FCC ventured into Internet regulation. Once the President leaves office and a new FCC is installed, the Evil Empire will get a taste of what its like to be on the receiving end of bureaucratic meddling. Google will be the first to scream foul.

It defies logic that the FCC would tamper with arguably one of the greatest American business success stories. Left unfettered, the Internet has grown from a tiny industry into a behemoth that circles the globe, connecting people and businesses in ways once thought unimaginable. Innovation and massive investments by private companies have been responsible for the growth.

Why then does the Internet market need government regulation? What failures exist that can only be solved by Washington bureaucrats? Unless someone can show irreparable harm, then the rationale for regulation is non existent. Furthermore, the federal courts have already determined that the FCC has no jurisdiction over the Internet.

The FCC's eleventh hour decision at the end of a lame duck Congress is simply a pay-off to Google. There is no other way to view the action. With Democrats about to lose their grip on Congress, this was one last desperate grab for power that also allowed the President to placate his supporters in the Evil Empire.

It is easy to predict what will happen as a result of the FCC's action. The decision will make cable and telecommunications firms more reluctant to invest billions in broadband until all the rules are promulgated to implement the decision. With billions in dollars already sitting on the sidelines, this is just another example of the anti-business attitude in Washington that is clouding investment.

This decision will also add another industry to the growing list of businesses controlled by the federal government (automobiles, banks, investment firms, housing, student loans, etc.) As the government extends its regulatory footprint, the costs to taxpayers keeps mounting.

For instance, the FCC has already requested a $19.4 million increase in funding for 2011. In its proposal, the commission said it wanted to increase its payroll by 75 people. In 2009, the FCC's budget was $466 million. The commission had 1,899 full time employees.

To be fair, the FCC gets 90 percent of its budget funded by fees charged those its regulates. Still, those fees are simply passed on to consumers through higher prices for services. In the end, consumers always pay for the excesses of regulation, which goes unreported in the media.

The incoming Congress should haul the FCC commissioner into a hearing room and demand justification for his decision on regulating the Internet. After politely listening to his drivel, the Congress needs to defund the FCC, an agency established by the Federal Communications Act of 1934.

It is just one of many federal agencies that have outlived their usefulness. With budget axes looking for targets in 2011, we suggest the FCC should be the first bureaucracy to fall.