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The Net Neutrality Coup

The campaign to regulate the Internet was funded by a who's who of left-liberal foundations.

By JOHN FUND

The Federal Communications Commission's new "net neutrality" rules, passed on a partisan 3-2 vote yesterday, represent a huge win for a slick lobbying campaign run by liberal activist groups and foundations. The losers are likely to be consumers who will see innovation and investment chilled by regulations that treat the Internet like a public utility.

There's little evidence the public is demanding these rules, which purport to stop the non-problem of phone and cable companies blocking access to websites and interfering with Internet traffic. Over 300 House and Senate members have signed a letter opposing FCC Internet regulation, and there will undoubtedly be even less support in the next Congress.

The FCC has approved rules that would give the federal government authority to regulate Internet traffic and prevent broadband providers from selectively blocking web traffic. WSJ's Amy Schatz explains what the new rules really mean.

Yet President Obama, long an ardent backer of net neutrality, is ignoring both Congress and adverse court rulings, especially by a federal appeals court in April that the agency doesn't have the power to enforce net neutrality. He is seeking to impose his will on the Internet through the executive branch. FCC Chairman Julius Genachowski, a former law school friend of Mr. Obama, has worked closely with the White House on the issue. Official visitor logs show he's had at least 11 personal meetings with the president.

The net neutrality vision for government regulation of the Internet began with the work of Robert McChesney, a University of Illinois communications professor who founded the liberal lobby Free Press in 2002. Mr. McChesney's agenda? "At the moment, the battle over network neutrality is not to completely eliminate the telephone and cable companies," he told the website SocialistProject in 2009. "But the ultimate goal is to get rid of the media capitalists in the phone and cable companies and to divest them from control."

A year earlier, Mr. McChesney wrote in the Marxist journal Monthly Review that "any serious effort to reform the media system would have to necessarily be part of a revolutionary program to overthrow the capitalist system itself." Mr. McChesney told me in an interview that some of his comments have been "taken out of context." He acknowledged that he is a socialist and said he was "hesitant to say I'm not a Marxist."
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For a man with such radical views, Mr. McChesney and his Free Press group have had astonishing influence. Mr. Genachowski's press secretary at the FCC, Jen Howard, used to handle media relations at Free Press. The FCC's chief diversity officer, Mark Lloyd, co-authored a Free Press report calling for regulation of political talk radio.

Free Press has been funded by a network of liberal foundations that helped the lobby invent the purported problem that net neutrality is supposed to solve. They then fashioned a political strategy similar to the one employed by activists behind the political speech restrictions of the 2002 McCain-Feingold campaign-finance reform bill. The methods of that earlier campaign were discussed in 2004 by Sean Treglia, a former program officer for the Pew Charitable Trusts, during a talk at the University of Southern California. Far from being the efforts of genuine grass-roots activists, Mr. Treglia noted, the campaign-finance reform lobby was controlled and funded by foundations like Pew.

"The idea was to create an impression that a mass movement was afoot," he told his audience. He noted that "If Congress thought this was a Pew effort, it'd be worthless." A study by the Political Money Line, a nonpartisan website dealing with issues of campaign funding, found that of the $140 million spent to directly promote campaign-finance reform in the last decade, $123 million came from eight liberal foundations.

After McCain-Feingold passed, several of the foundations involved in the effort began shifting their attention to "media reform"—a movement to impose government controls on Internet companies somewhat related to the long-defunct "Fairness Doctrine" that used to regulate TV and radio companies. In a 2005 interview with the progressive website Buzzflash, Mr. McChesney said that campaign-finance reform advocate Josh Silver approached him and "said let's get to work on getting popular involvement in media policy making." Together the two founded Free Press.

Free Press and allied groups such as MoveOn.org quickly got funding. Of the eight major foundations that provided the vast bulk of money for campaign-finance reform, six became major funders of the media-reform movement. (They are the Pew Charitable Trusts, Bill Moyers's Schumann Center for Media and Democracy, the Joyce Foundation, George Soros's Open Society Institute, the Ford Foundation, and the John D. and Catherine T. MacArthur Foundation.) Free Press today has 40 staffers and an annual budget of $4 million.

These wealthy funders pay for more than publicity and conferences. In 2009, Free Press commissioned a poll, released by the Harmony Institute, on net neutrality. Harmony reported that "more than 50% of the public argued that, as a private resource, the Internet should not be regulated by the federal government." The poll went on to say that since "currently the public likes the way the Internet works . . . messaging should target supporters by asking them to act vigilantly" to prevent a "centrally controlled Internet."

To that end, Free Press and other groups helped manufacture "research" on net neutrality. In 2009, for example, the FCC commissioned Harvard University's Berkman Center for Internet and Society to conduct an "independent review of existing information" for the agency in order to "lay the foundation for enlightened, data-driven decision making."

Considering how openly activist the Berkman Center has been on these issues, it was an odd decision for the FCC to delegate its broadband research to this outfit. Unless, of course, the FCC already knew the answer it wanted to get.

The Berkman Center's FCC- commissioned report, "Next Generation Connectivity," wound up being funded in large part by the Ford and MacArthur foundations. So some of the same foundations that have spent years funding net neutrality advocacy research ended up funding the FCC-commissioned study that evaluated net neutrality research.

The FCC's "National Broadband Plan," released last spring, included only five citations of respected think tanks such as the International Technology and Innovation Foundation or the Brookings Institution. But the report cited research from liberal groups such as Free Press, Public Knowledge, Pew and the New America Foundation more than 50 times.

So the "media reform" movement paid for research that backed its views, paid activists to promote the research, saw its allies installed in the FCC and other key agencies, and paid for the FCC research that evaluated the research they had already paid for. Now they have their policy. That's quite a coup.

Mr. Fund is a columnist for WSJ.com.