By Tory Newmyer
January 26, 2017

The Affordable Care Act isn’t the only public policy legacy of the Obama era that could draw Republicans into a political minefield if they try to roll it back. While the stakes are hardly life or death, net neutrality likewise presents a tempting but perilous target for the incoming administration. Obama’s Federal Communications Commission enshrined rules banning internet service providers like Comcast and Verizon from giving preferential treatment to some of the content flowing through their pipes. And the restrictions survived a court challenge last year. Now, Ajit Pai — a former Verizon lawyer and current FCC commissioner — is in line to lead the agency, after President Trump tapped him Monday for the role. Pai has made clear he’d like to dismantle the standard, and the FCC could move to begin that process immediately.

It won’t be easy. “Because it’s the FCC, it isn’t a simple reversal,” says R. David Edelman, who worked on the issue in both the Bush and Obama administrations, most recently at the National Economic Council. “There’s politics, the technical case, and the courts, none of which is a slam dunk. Then there’s the grand paradox: If all those stars align for a reversal, it’d create even more uncertainty for business.”

The politics alone are daunting enough: When the FCC was formulating the rule in 2014, it got swamped by nearly 4 million public comments, a record, with one analysis showing roughly 99% favored net neutrality enforcement. Rolling it back would mean siding with giant telecoms that remain deeply unpopular with consumers and whose power Trump directly challenged on the trail. Then there’s the legal hurdle. Last summer, a federal court upheld the agency’s move to reclassify high-speed internet service as a utility, affirming the FCC’s authority to more strictly police broadband providers. Gutting net neutrality would force the agency to survive a legal challenge, justifying why the move wasn’t arbitrary and capricious. Congressional Republicans could pursue a legislative fix, but that would invite the same political blowback facing the agency and take time. Meanwhile, the FCC could just decline to pursue the sort of robust enforcement that would’ve been expected from the previous regime. That would likely leave some barebones protections in place. The strategy would satisfy nobody — but it may be the best or even practicable one.

Tory Newmyer
@torynewmyer
tory_newmyer@fortune.com

Must Reads

The Fragile Economic Foundation of Dow 20000

Investors are betting the world is getting less risky, not more, even as signs point to a fundamental shakeup of the international order.

Trump’s flashy executive actions could run aground

In their rush to launch with a blitz of executive orders, Trump’s team failed to consult agency lawyers and lawmakers, fanning concern that the actions could be unworkable or even illegal.

Republicans Plan Obamacare Repeal as 3-Day Philadelphia Retreat Begins

Congressional Republicans aim to repeal the healthcare overhaul by spring, though they’re still a long way from settling on a replacement plan.

Paul Ryan Says Congress Will Pay for Mexico Border Wall

The House Speaker says the project will cost $12 billion to $15 billion, and lawmakers will pay for it by this fall.

Donald Trump’s Hotel Empire Is Set to Expand

The CEO of Trump’s hotel-management company says it plans to triple the number its U.S. locations.


Number of the Day

$137.5 billion

The amount Trump wants to spend on infrastructure projects, according to documents obtained by newspapers in Kansas and Washington. The presentation, which circulated among governors’ offices in December, calls for half the funding for the projects to come from private investment. It’s unclear how complete the list of projects is. Trump on the trail talked up a $1 trillion investment in rebuilding roads, bridges, ports and other critical infrastructure.


SPONSORED FINANCIAL CONTENT

You May Like

EDIT POST