WASHINGTON-House telecommunications subcommittee Chairman Billy Tauzin (R-La.), attempting to play off GOP tax-cut and anti-big-government campaign themes, said he will push legislation this year to kill the telecom excise tax, to further deregulate the wireless industry and to downsize a Federal Communications Commission he said is corrupted by shakedowns.
“I think the FCC has been an enabler of corruption and we need to fix that,” Tauzin told RCR in a phone interview Friday from Louisville, Ky. Tauzin did not offer any examples of FCC shakedowns.
An FCC spokeswoman said FCC Chairman William Kennard has asked Tauzin for specific examples of abuse. At a hearing last year, Tauzin said industry lobbyists feared going public with FCC criticism for fear of reprisal.
Tauzin was in Louisville debating House Majority Leader Dick Armey (R-Texas) on how best to give Americans tax relief and pay down the federal debt.
Tauzin, particularly angered by recent FCC decisions on religious and low-power broadcasters and by revelations about the White House giving cash credits to major media outlets in exchange for government-reviewed anti-drug programming, said FCC corruption that takes the form of shakedowns and green mail during its review of telecom mergers.
FCC Chairman William Kennard and his predecessor, Reed Hundt, have been criticized by some in Congress and industry in recent years for extracting `public interest’ concessions from firms that need FCC merger approval.
Kennard’s GOP colleague, Commissioner Harold Furchtgott-Roth, has been arguably the loudest critic of Kennard on that score.
“I frankly think there’s a national disgrace” about how the FCC holds up applications in multibillion-dollar telecom transactions reviewed by the agency, said Tauzin.
Tauzin said he is working with Reps. Chip Pickering (R-Miss.) and Richard Burr (R-N.C.) on targeted FCC reforms and will continue the debate on sweeping FCC restructuring this year.
However, Tauzin said he does not believe he’ll be able to push through an FCC reform bill in this election year. Congress returns to work Jan. 24, recesses on Feb. 18 for Presidents’ Day and then reconvenes Feb. 28.
“Do you need all these bureaus?9 asked Tauzin, noting the diminishing distinction between local and long-distance service and the emergence of the Internet as a replacement for traditional telephone service. “What are the new rules of the FCC in the new environment?”
Of interest to the wireless industry is Tauzin’s plan to eliminate the 3-percent telephone excise tax and to direct the FCC to be more aggressive in exercising its authority to forebear from regulating paging, mobile phone, radio dispatch and other commercial wireless carriers.
“Is there a need for this level of regulation? We’re going to try to give [the FCC] guidance on forbearance,” said Tauzin.
The wireless industry is in lockstep with Tauzin on forbearance but differs with his approach on the telephone excise tax.
“We very much support Chairman Tauzin’s concept that the FCC should forbear from regulating a competitive industry like ours,” said Steven Berry, senior vice president for congressional affairs at Cellular Telecommunications Industry Association.
Berry, noting falling service and equipment prices and the abundance of wireless carriers in many markets, said regulation should not be the government’s first option.
CTIA, Barry said, favors shifting the forbearance burden from industry to the FCC. Today the burden is on industry to show why it should not be regulated.
Congress gave the FCC authority to forbear from regulation in the 1996 telecom act, three years after lawmakers drastically removed state oversight of commercial wireless carriers. “The best regulator is the competition itself,” said Berry. “Congress has been sending the right message to the FCC for seven years, but they haven’t picked up on it.”
Berry said CTIA supports a wholesale repeal of the century-old federal excise tax on telephone service.
Tauzin is sponsoring legislation that would repeal the 3-percent telecom excise tax after five years. During the five years, the bill would earmark 1 percent of the 3 percent to fund Internet discounts for schools and libraries.
Tauzin, likely to face a challenge from Rep. Mike Oxley (R-Ohio) for the House Commerce Committee chairmanship in 2001 if Republicans retain control of the House after this fall’s elections, said the 3-percent telephone tax is akin to an Internet tax.
While national policy-makers oppose e-commerce taxation, local and state officials are deeply divided on the issue. A congressionally mandated three-year moratorium on local and state Internet taxes is due to expire in October 2001. The issue takes on added significance for the wireless industry in light of predictions that wireless devices will be a big driver of e-commerce in the future.
Elsewhere, Tauzin said he wants copyright-like protection for certain Internet data.
