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Wednesday, July 16, 2014

Cap ↦ Law?

Commissioner Pai said that Chairman Wheeler has been promising "outside parties" that he'll increase the E-Rate fund.  Representatives Upton and Walden said they were troubled by those allegations.

Now it seems there is a possibility that an amendment is coming to the House floor that will limit the FCC's ability to increase the size of the E-Rate fund.  Man, I hate it when politics come to the E-Rate.

I'm no political expert, but faithful readers know that a lack of expertise never stops me from shooting my mouth off.  So here's my thinking.

First, I don't see this amendment getting through the Senate.  So nothing is going to happen until after the election.

After the elections, look for an FCC decision on raising the cap.  Right now, an increase seems likely, but I'm not betting my life savings on it.  How much of an increase?  Well, Commissioner Rosenworcel has said: "At a minimum, we need to...[bring] back what inflation has taken away....  But we should go beyond this...."  According the Bureau of Labor Statistics, if the E-Rate had been indexed since 1998, it would be $3.28 billion now.  And hey, that's about the same as the $1 billion/year that the Chairman seems to think is enough to get where he wants to go.

After January, my analysis splits.
  • If a Republican wins the White House, I'll bet Commissioner Pai's ideas on the E-Rate get more attention.  Within a year or two, we'll be looking at a tightly capped E-Rate and a per-student allocation for everything.  Eventually the Tea Party will notice that a fee on their phone bill is being used to give schools a per-student subsidy, and then who knows.
  • If a Democrat wins the White House, the increase will probably stick; even if the Republicans get a majority in the Senate and a "cap the E-Rate" bill passes, there won't be enough votes to override a presidential veto.
I'd feel a whole lot better if the increase had been decided now (or 6 months ago).

1 comment:

  1. For now, the cap remains at the discretion of the FCC: