Brief of Amicus Curiae – Case No. 22-60008

UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

Case No. 22-60008

Consumers’ Research, et al.,  

v.

Federal Communications Commission, et al.,

Brief of Amicus Curiae Competitive Enterprise Institute, et al.

INTEREST OF AMICI CURIAE

Amici include the following organizations and individuals:

The Competitive Enterprise Institute is a nonprofit organization headquartered in Washington, D.C., dedicated to promoting the principles of free markets and limited government.  Since its founding in 1984, the institute has focused on raising public understanding of the problems of overregulation.  It has done so through policy analysis, commentary, and litigation.

The Free State Foundation is a nonprofit, nonpartisan think tank.  Its purpose is to promote, through research and educational activities, understanding of free markets, free speech, limited government, and rule of law principles at the federal level and in Maryland, and to advocate laws and policies true to these principles.

Christopher DeMuth is a distinguished fellow at the Hudson Institute, an organization dedicated to the nonpartisan analysis of economic, security, and political issues.  Mr. DeMuth previously served as president of the American Enterprise Institute for Public Policy from 1986 to 2008.  He frequently speaks and writes about government regulation, government policies, and legal controversies. 

Harold Furchtgott-Roth is a senior fellow and director of the Center for the Economics of the Internet at Hudson Institute.  He frequently comments on issues related to the communications sector of the economy.  From 1997 through 2001, Mr. Furchtgott-Roth served as a commissioner of the Federal Communications Commission. 

Professor Michael S. Greve teaches administrative law at the Antonin Scalia Law School, George Mason University.  Professor Greve also specializes in constitutional law, courts, and business regulation.  A prolific writer, Professor Greve has authored nine books and a multitude of articles appearing in scholarly publications, as well as numerous editorials, short articles, and book reviews.

Randolph J. May is the Founder and President of The Free State Foundation.  He is a past Chair of the American Bar Association’s Section of Administrative Law and Regulatory Practice, a Fellow of the National Academy of Public Administration, and has served as a Public Member of the Administrative Conference of the United States, where he currently is a Senior Fellow.  Mr. May has published more than two hundred articles and essays on communications, administrative, and constitutional law topics.

INTRODUCTION

Americans love their phones.  Today, there are more assigned phone numbers in the United States than there are residents.  Americans own more than 300 million cell phones and have more than 100 million fixed telephone line subscriptions.  Nearly everyone is familiar with a monthly phone bill, even if most people gloss over the nitty-gritty details.     

Nowadays, most phone bills include a line item for the “Universal Service Fund Fee”—which is nothing more than an unconstitutional tax masquerading as a statutory “contribution” that the Federal Communications Commission quantifies each quarter and purportedly exacts from interstate service providers.  As it turns out, however, service providers do not contribute much (if anything) because they pass along the costs of the universal service program to their customers as a “fee.”

Only Congress has the power to lay and to collect taxes for the general welfare of all Americans.  Regardless of the public policy that it seeks to advance, Congress cannot delegate this power to the FCC or any other executive branch agency.  Yet that is exactly what Congress did when it enacted the Telecommunications Act of 1996 to create a universal service program for the Commission to raise revenue however it sees fit “for the protection of the public interest” in seeking to provide greater access to telecommunications services.  47 U.S.C. § 254(b)(7).

The Constitution does not permit Congress to circumvent the legislative process by allowing an independent agency (guided by a private company owned by an industry trade group) to raise and to spend however much money it wants every quarter for “universal service” at the expense of every American who pays a monthly phone bill.  Elected representatives of the people, not the Federal Communications Commission, must be responsible for making the difficult decisions to raise the revenue that funds this program.