Rep. Lamar Smith Gets Big Bucks To Handcuff FCC

October 24, 2011 3:31 pm ET — Brian Powell

Rep. Lamar Smith

House Judiciary Committee Chairman Lamar Smith (R-TX) has scheduled a hearing for Tuesday on H.R. 3010, the "Regulatory Accountability Act of 2011." Smith calls it a "bipartisan, bicameral bill" that would "[restore] accountability by requiring openness and transparency in the regulatory process." In reality, H.R. 3010 is a radical piece of legislation that particularly benefits a specific set of political donors from whom Smith has received more than $100,000 this year alone.

The bill's summary is short, stating that its purpose is "to reform the process by which Federal agencies analyze and formulate new regulations and guidance documents." But watchdogs say the effect of the 32-page bill would be enormous. From The Huffington Post:

[A]nother proposed measure that would have all-encompassing reach is the Regulatory Accountability Act, which would make cost the top consideration for all federal regulations.

"It single-handedly amends probably more laws of the United States than any law ever introduced in Congress," said John Walke, a lawyer with the Natural Resources Defense Council.

Taken together, the measures would so hamstring regulators that they would effectively return the nation to the 1880s era of the nation's first modern-style regulator, the Interstate Commerce Commission, advocates say.

While the Regulatory Accountability Act would shake up the regulatory process across the board, it would have a particularly constraining effect on the Federal Communications Commission, an independent government agency that patrols the practices of some big time financial backers of Smith.

The media trade publication Broadcasting and Cable wrote on October 3 (via Nexis):

[T]he bill, motormanned by Rep. Lamar Smith (R-Tex.), would modify the Administrative Procedures Act (APA), which is a de facto technical manual for the process of regulation, to make it harder for agencies looking to keep a heavy hand on industry to "manipulate" rules.

Tightening the reins could affect the FCC more than other agencies. Unlike the Environmental Protection Agency or Food and Drug Administration, whenever the FCC vets mergers, it has some extra discretion provided by the "public interest" standard to range into non-empirical areas such as unserved communities (broadband), diversity (ownership) or speech (indecency).

The Act's list of proposals (see box at right) includes requiring more advanced notice of "major" rulemakings (ones with an economic cost of at least $100 million) and holding administrative hearings on "highest-impact rulemakings" (estimated cost to economy of at least $1 billion), along with toughening the standard for studying regulatory rules from its present "arbitrary and capricious" norm to a "substantial evidence" standard.

If this were the case, for example, the Supreme Court might have had a tougher time reversing the lower court smackdowns of FCC indecency decisions. In those cases, the Supremes said the FCC had met the less stringent "arbitrary and capricious" standard in the APA rules.

The bill would also prevent what Republicans saw as a lack of notice on the final version of the FCC's network-neutrality rules. Republican Commissioner Robert McDowell opined at the time that he and his staff did not get to see the draft they would be voting on until 11:42 the night before the meeting. That point was picked up by Republican legislators who took aim at the rules.

As it happens, Smith has received quite a bit of money from industries and individuals for whom the FCC is a thorn in the side of their profit margins.

This year alone, according to OpenSecrets.org, Smith has received $51,500 from PACs representing the TV/Movies/Music industry, $49,500 from those backed by the Computer/Internet industry, $11,000 from telephone utility company PACs, and $10,000 from telecom services PACs. This money is on top of the longstanding financial relationship Lamar Smith has had with AT&T, the telecommunications giant whose acquisition of T-Mobile is being opposed by FCC chairman Julius Genachowski. AT&T is the second largest contributor to Smith since he was elected to Congress in 1987.

Additionally, on March 25 of this year, Smith received 13 donations from Clear Channel executives totaling over $18,000. He received additional donations in March from members of the board of directors of CC Media Holdings, Inc., Clear Channel's parent company — $1,000 from Irving Azoff, $2,500 from Blair Hendrix and $2,500 from David Abrams. Smith received a grand total of $24,300 from Clear Channel's leadership in 2011 before introducing his FCC-crippling bill on September 22.

Now it appears their investment in our democratic process is starting to pay some dividends.

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