The Elephant in the Ethernet Port – City Journal

Nancy Pelosi famously said that Congress had to pass the Affordable Care Act so that we could find out whats in it. Perhaps misconstrued, the line still perfectly captures modern legislative practice at the federal level. Congress produces enormous laws filled with broad general directives; government agencies, trade associations, pressure groups, and regulated entities then hash out what the actual rulesthe true substanceof those laws should be. A striking example of this process is playing out at the Federal Communications Commission, where progressives, latching on to an obscure provision in one of Congresss latest mega-bills, seek a government takeover of the broadband industry.

Enacted in late 2021, the Infrastructure Investment and Jobs Act runs more than a thousand pages. The table of contents starts off tolerably enough: early headings include Bridge investment and National highway performance program. Scan down, though, and you can practically watch the legislators lose focus. Before long they drift into Sport fish restoration, Best practices for battery recycling, and Limousine compliance with federal safety standards. But dont nod off. On page 10, youll abruptly stumble on Broadband. (If you hit Indian water rights settlement completion fund or Bioproduct pilot program, youve gone too far.) This rather cryptic caption refers to a segment that begins on page 754. Start reading there, and youll eventually arrive at the last section of Title V of Division FSection 60506, to be precise, on pages 817 and 818which contains about 300 words on digital discrimination.

The relevant provision directs the FCC to adopt rules to prevent digital discrimination of [broadband] access based on income level, race, ethnicity, color, religion, or national origin. Note the phrase based on: the Supreme Court has held that similar language, such as on the ground of, refers to intentional discriminationalso known as disparate treatment. Everyone agrees that the FCCs Section 60506 rules should bar deliberately withholding broadband service from an area out of animus for people in one of the protected classes.

But progressive advocacy groups want to go much further, arguing that Section 60506 targets not disparate treatment but disparate impact. Under that standard, a risk of liability arises whenever outcomes among classes differ, even when the gap is entirely unintended. The progressive groups rely on Texas Department of Housing v. The Inclusive Communities Project (2015), in which Justice Anthony Kennedy, joined by the Supreme Courts liberals, found that disparate-impact claims are allowed under the Federal Housing Act. That statute bars discrimination because of a renters or buyers membership in a protected class. The four dissenting justices objected that the phrase because of prompts only disparate treatment liability and laid out the Courts precedents confirming as much.

Inclusive Communities is an outlier. Todays Courtwhere three of that decisions dissenters now form part of a six-justice conservative majoritywould likely decline to extend its holding. But at least the ruling placed reasonable limits on disparate-impact liability. A plaintiff suing under the Fair Housing Act must show that the defendant created the imbalance in question, and that it did so for no economically sensible reason. Imposing liability based solely on a showing of a statistical disparity, the Court observed, would raise serious constitutional questions. All nine justices wanted to avoid reading the statute as a push to perpetuate race-based considerations rather than move beyond them.

The progressive groups seeking to exploit Section 60506 have no such concerns. They believe that existing broadband infrastructure is infused with structural racism. Race-neutral decision making, in this telling, is racist decision making; whats needed instead is race-driven decision making. Broadband providers must make affirmative efforts, as one group puts it, to remediate historic inequities. A finding of unlawful discrimination can stand, the groups contend, on a statistical difference in broadband access between any two communitiesor even between any two census blocks.

The progressive groups comments to the FCC set forth a social-justice wish list that has almost nothing to do with the law Congress wrote. Access means Internet availability and performance. Yet the groups press for the concept to embrace such factors as the caliber of customer service, the timeliness of resolving outages, the amount of notice regarding upcoming or past-due bills, and approaches to advertising. (They also want businesses that offer Wi-Fithink of Starbucksto fall within the rules.) There can be no doubt about which classes are protectedthe statute provides a list. Yet one group urges the FCC to add in disability status, age, sex, sexual orientation, gender and identity expression, familial status, domestic survivor abuse status, homelessness, English language proficiency[,] and citizenship status. (For good measure, this outfit invites the FCC to pitch any additional historically marginalized groups that it can think up.)

Under the Constitution, civil rights laws generally must protect individuals rather than cohorts. If blacks may complain of mistreatment, so may whites. In the same spirit, Section 60506 prohibits discrimination in any direction. It bans discrimination based on income, for example, rather than just poverty. The progressives granular, expansive, trigger-happy system of liability would give everyone grounds for complaint. The upshot is that broadband providersand even, perhaps, stores, restaurants, and hotels that offer Wi-Fiwould have to provide exactly the same products, terms, and services to every person at every place at every time, with every shortfall worthy of government investigation.

Just a few years ago, the FCC repealed its short-lived net neutrality regime for the Internet, which treated broadband providers as common carriers in certain respects. Democrats breathlessly asserted that, without the net neutrality rules in place, people would get the Internet one word at a time. Obviously, they were wrong. Yet activists persist in claiming that the repealwhich simply returned broadband to the light touch form of regulation that prevailed until 2015was a disaster. They seek not just to restore the old net neutrality order but to transform broadband into a utility.

The progressive groups insist that, in enacting Section 60506, Congress reject[ed] the FCCs light touch deregulatory approach and reimposed common carrier rules insofar as necessary to achieve . . . universal service. Dont be fooled: this is not a call for net neutrality. It is not even a bid for common carriage. It is a demand that broadband providers construct new facilities, on government order and without regard to rudimentary business logic, and then provide service subject to price controls. In the words of one group: [Section 60506] require[s] providers to build out to areas where otherwise they would not. In the words of another: consumers ability to pay must be balanced against the providers ability to provide service with less profit, at cost, or even at a loss.

These advocates are not bothered by the fact that (as some candidly acknowledge) Congress has tried and failed to reimpose common-carrier status on broadband providers via legislation. Nor do they have a good explanation for why, if Section 60506 all but nationalizes the broadband market, Congress bothered to set aside tens of billions of dollarsin the same statute of which Section 60506 is a part, no lessfor broadband providers that voluntarily expand into underserved areas. This subsidy program, not an investment-killing command-and-control scheme, is Congresss chosen means for trying to bridge the digital divide.

Can a small provision buried deep in a thousand-page law revolutionize an entire industry? The answer, the Supreme Court has said with increasing clarity, is no. It is by now a clich, among lawyers, that Congress should not be assumed to hide elephants in mouseholes. The line comes from an opinion authored by Justice Antonin Scalia in 2001, and it stands for the proposition that big, bold policy decisions require big, bold legislative statements. The Court recently formalized this principle, known as the major questions rule, in West Virginia v. EPA (2022), which tells Congress that it may not convey extraordinary grants of regulatory authority through modest words, vague terms, or subtle devices.

The FCC has until November to issue its Section 60506 rules. What will the agency do? It can adopt rules that prevent intentional discrimination in future broadband deployment. Or it can let ideologues lead it by the nose to attempt a surprising and dramatic expansion of broadband regulation. Option one is sound. Option two defies the text of the statute, the major-questions rule, and common sense. The right answer is clearno more passing laws so that we can find out whats in them.

Photo: johnason/iStock

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The Elephant in the Ethernet Port - City Journal