The Federal Communications Commission has demonstrated its regulatory powers over the past few months by sinking AT&T's attempt to buy T-Mobile, issuing rules on net neutrality, and stopping LightSquared's proposal to build a cellular network that would interfere with the operations of GPS devices.

So it's no secret that cable and wireless companies would love to make it harder for the FCC to regulate their industries. On Tuesday, the Republican-led House of Representatives passed a bill that would do just that. HR 3309, the FCC Process Reform Act of 2012, would restrict the FCC's authority to issue rules and impose conditions on transactions if passed through the Senate.

Any conditions would have to be "narrowly tailored to remedy a harm arising as a direct result of the specific transfer or transaction, and within the FCC's jurisdiction apart from its authority to review the transaction," according to a bill summary on the Library of Congress website. The bill also adds various notification requirements that the FCC would have to follow during rulemaking processes, and require cost-benefit analyses before issuing any rule that could have a "material" economic impact. The FCC would be required to "analyze the specified market failure, actual consumer harm, burden of existing regulation, or failure of public institutions that warrants the rule or amendment; and determine that the benefits justify its costs."

There are good reasons to reform the FCC. Several years ago, former FCC Commissioner Reed Hundt said his former agency has a reputation for "capture by special interests, mind-boggling delay, internal strife, lack of competence, and a dreadful record on judicial review."

FCC needs power to promote competition, Democrats argue

But this legislation goes too far, opponents say. The bill reportedly has no chance of passing the Democrat-controlled Senate, and the White House has opposed it as well.

The Obama administration said the proposed limits on the FCC's power "would harm the Federal Government’s ability to promote the most effective competitive outcome in any given transaction involving communications firms."

The House Committee on Energy and Commerce report on the bill includes a dissent from US Reps. Henry Waxman (D-CA), Anna Eshoo (D-CA), and John Dingell (D-MI), who said they support alternative legislation to improve the FCC's operational efficiency without adverse effects on the agency's ability to regulate industry. The FCC bill passed by the House would add to regulatory confusion by singling out one agency for unique process requirements, they argued.

In past years, conditions imposed by the FCC forced AT&T to make job commitments in its 2006 acquisition of Bellsouth. The FCC also limited subscription price increases for three years after the 2008 merger of the XM and Sirius satellite radio services, the dissenters wrote.

"HR 3309 fundamentally alters the FCC’s role," Waxman, Eshoo, and Dingell argued. "The agency could no longer insist on conditions that protect the public interest unless it could demonstrate that it could impose such conditions under other statutory authority. This would put in jeopardy a broad range of conditions in many mergers. HR 3309 could also have a paradoxical result. It could force the FCC to deny mergers and transactions that otherwise could have been granted if the parties were able to commit voluntarily to certain conditions."

The Republicans don't see it that way, arguing that the FCC today is far too powerful. "They hold you hostage," bill sponsor Rep. Greg Walden (R-OR)—whose biggest campaign donors include Comcast, Cablevision, and various telecom companies—said during floor debate, according to the Wall Street Journal. "Outside of the (FCC) they call that extortion. I don't think that's an appropriate role for the federal government."

Industry representatives applauded the measure, with the National Cable & Telecommunications Association saying "this reform legislation will ensure that private enterprise can continue to invest and innovate with more consistent and precise federal government oversight." The cable industry group applauded its members for "providing consumers with an endless array of competitive products and services that are transforming commerce, communication and education." The CTIA Wireless Association also supports the bill.

While the FCC will continue to be the subject of legislation, this particular bill seems likely to die in the Senate. Bloomberg reported that the Senate has no plans to take up the bill, and House Democrat Alcee Hastings of Florida predicted a swift demise.

"This is never going to go beyond this chamber," he said, according to the Journal. "Republicans would rather see their partisan bill die rather than allow a compromise bill to live."