Economy Is FCC’s Top Job

McDowell says stimulus issues trump “arbitrage”

Robert McDowell, the FCC’s lone Republican commissioner, believes that in the coming year, job one for the commission should be economic stimulus. Given current business conditions, McDowell stresses that doing its part to help bolster the sagging economy is a more important FCC responsibility than what he calls the “regulatory arbitrage” that would favor one player over another.

McDowell would not comment on his prospects for renomination, but he did discuss other elements of what will be a wide-ranging FCC agenda with B&C’s Washington Bureau Chief John Eggerton: from cross-ownership concerns to why he thinks the Fairness Doctrine issue isn’t going away. What follows is an edited transcript of the interview.

What do you think the FCC’s priorities should be in the next year?

I think they should be to do our part to help turn around the economy. That would include creating a regulatory environment that is hospitable to new investment.

What does that mean?

It means creating windows of investment that are opportunities to create real value and not merely regulatory arbitrage schemes. In other words, not just taking away from one market player to give to another. That doesn’t create value or wealth. For instance, maybe finding new spectrum that then could be exploited by the marketplace for the ultimate benefit of consumers.

What should the FCC do about the cross-ownership rule?

I think the Third Circuit [Court] should address the issue and the case should proceed. We start our quadrennial review of media ownership again next year, 2010. Time flies. And second, broadcasters and newspapers are disproportionately hard-hit by this recession. So we should look at every opportunity to lift any regulatory boulders off their chests to give them the opportunity to survive.

And you think that is more likely to happen expeditiously at the court than at the FCC.

Yes. I think the record at the court is full. The court has everything it needs in front of it to make a decision except for some briefs and oral arguments. But that can be all handled this year, well before the FCC could have a chance to look at that issue again.

Why won’t the Fairness Doctrine issue go away?

When I travel the country speaking about the digital TV transition, almost invariably I get a question about the Fairness Doctrine from local broadcasters. In addition to that, there was a period of time where every couple of weeks a prominent member of Congress would voice support or opposition to the Fairness Doctrine.

And that has kept the story alive. I think we have seen it settle down since the White House issued a statement that expressed its preference that [the doctrine] not be reinstated. But then others have countered by saying that some of the tentative conclusions teed up in our 2007 localism NPRM [Notice of Proposed Rulemaking] could be a back-door way of bringing back the doctrine.

There are other potential ways to influence the kind of political speech broadcasters might air.

It is possible. As I said in a speech at The Media Institute, a mandatory community advisory board that could have legal sway over a broadcaster’s license renewal could start dictating content under such a rule. There are comments in the record supporting that, so it is not just a law-school hypothetical horrible situation. There are actually ideas suggesting that should be the case.

And that concerns you?

I think that any kind of additional regulation of political speech—core protected speech under the First Amendment—would be struck down by the Supreme Court. The only time the court examined this issue was in 1969. Then it relied on the “spectrum scarcity” rationale to uphold government regulation of political speech. Due to a limited number of media outlets, and electronic outlets in particular, the state had a compelling reason to regulate political speech under “spectrum scarcity,” according to the court. It went on to add in that case, however, that should the media landscape become more competitive, it might have to re-examine the constitutionality of the doctrine.

Well, today we enjoy a plethora of new sources of information and opinion, and low barriers to entry for their dissemination. For instance, virtually anyone can connect to the Internet and blast to the world their news and opinion; billions of people do every day. Human beings are more awash in information and opinion today than at any time in history. As a result of a factual situation that is dramatically more competitive than it was in 1969, there is no doubt that the court would strike down any reinstitution of anything that resembled the doctrine.

I think it is healthy to discuss it. I think we need to be dispassionate about it. And if folks want to have a debate about it, I think it is only constructive.

Were you encouraged by Acting Chairman Copps’ instructions to the diversity committee that that was not part of its charter?

Absolutely, that’s encouraging. And from what I read, a lot of people of all political stripes will be watching what the diversity committee does very closely.

What is the status of your renomination?

You know, I am still trying to figure out how I got this job to begin with, so I am probably not qualified to talk about how the renomination process would work.

How does it feel to be the only Republican?

It feels great, but keep in mind that probably 95%, 98% of our votes are unanimous and therefore bipartisan. We have been working very hard to be nonpartisan and collegial while we are a 2-to-1 commission. I have the highest regard for both my colleagues, and party labels really never come up.

How do you think the DTV transition is going?

I think we have seen a big improvement in the number of prepared consumers in the market. We still have a long ways to go, and it will be messy regardless, so we have to be prepared to pivot quickly to a mopping-up campaign after June 12. And that could prove to be the most difficult part.

Do you think moving the date was necessary?

I think the big problem that sparked moving the date was the fact that the Antideficiency Act did not allow for the backlog of those [converter-box] coupons to be processed. A minor amendment to the act late last year could have greatly helped with that; it would have shrunk the number of unprepared [viewers]. But I am not in the business of telling Congress what to do. They are in the business of telling me what to do. So I follow their orders and not the other way around.