Report blasts FCC leaks to lobbyists

by Louis Hau and Brian Wingfield, Forbes

Consumer advocates have often accused the Federal Communications Commission of favoring big business interests. Now a government investigation appears to back up some of those complaints.

In a report released Wednesday, the General Accountability Office criticized the FCC for leaking information about regulatory proceedings to phone and cable company lobbyists before the information was released to the public.

The report was prepared at the request of U.S. Rep. Edward Markey (D-Mass.), chairman of the House of Representatives Subcommittee on Telecommunications and the Internet.

"When the 'corporate insiders' and 'K-Street' crowd have the inside track on decisions critical to telecommunications, media, broadband or wireless policy, then the public and consumers, are at an inherent disadvantage," Markey said Wednesday in a statement.

In response to the report, FCC spokesman David Fiske said, "the commissioners regularly meet with parties on all sides of issues — corporations and trade associations and public interest groups — and works very hard to be open and transparent to all parties on all issues."

The report can be found be found at the General Accountability Office Web site. The GAO is the non-partisan investigative arm of Congress.

The GAO reviewed four FCC cases affecting landline phone companies, wireless carriers, cable companies and amateur radio services.

While the commission "generally followed the rulemaking process," the GAO said it uncovered instances where the FCC staff tipped off industry lobbyists about when proposed rulings were scheduled for votes well before that information was released to the public.

Other parties "who generally represent consumer and public-interest groups" told the GAO "that they do not know when FCC is about to vote on a [case] or when it would be best to meet with FCC staff to make their arguments," the report said.

Advance word of FCC votes can be critically important because companies, consumer groups and other interested parties are prohibited from lobbying commissioners once an agenda for a vote is made public.

"This unequal access to information could create an unfair advantage for FCC stakeholders who know when FCC is about to vote on a [case] and, therefore, would know when it is most effective to present their arguments to FCC officials," the GAO said in its report.

Industry lobbyists and the FCC have a deeply intertwined relationship. The FCC trails only the White House and the House of Representatives in the number of employees who have passed through Washington's "revolving door" from the public to the private sector, or vice versa, according to the Center for Responsive Politics, a non-partisan group that tracks lobbying and campaign spending.

That's not entirely surprising — both the government and K Street, D.C.'s lobbying corridor, need telecom experts. But other agencies, including the Department of Energy and the Department of Health and Human Services, do not appear to have as close a relationship to the private sector as the FCC does.

A few examples: FCC Chairman Kevin Martin is a former lobbyist for Gannett, Viacom and Belo, according to the CRP. Before joining the commission last year, Commissioner Robert McDowell had a long career as a lobbyist for two industry groups, the Competitive Telecommunications Association and America's Carriers Telecommunications Association.

And while not technically a lobbyist, former FCC Chairman Reed Hundt is the vice chairman of Frontline Wireless, an organization that had a significant role in shaping the rules the FCC recently released for the broadband spectrum auction early next year.

article originally published at http://www.forbes.com/business/2007/10/03/fcc-gao-report-biz-wash-cx_bw_lh_1003b....

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