A House subcommittee is moving quietly toward banning the Federal Trade Commission from continuing major antitrust investigations of the big oil companies and the auto industry, and a raft of other regulatory actions.
Language approved tentatively by the Appropriations subcommittee that handled FTC funding would bring to a virtual standstill a long string of consumer protection activity at the agency.
The probes of the petroleum and automobile industries would be stopped, as would rule-making activity on the funeral industry, used cars, health spas, hearing aids, mobile homes, children's television advertising, home insulation, apparel labeling, protein supplements and nonprescription drugs, among others.
Although the subcommittee's plan might be popular in the House, where anti-FTC sentiment has grown, subcommittee Chairman John M. Slack (D-W.Va.) said a final decision will not come until next week.
But after an unannounced meeting Wednesday, Slack yesterday circulated a memo to subcommittee members formalizing the steps discussed at the meeting for reining in the FTC.
Apparently caught by surprise, FTC officials were stunned by the sweeping prohibitions the panel wants to place on their agency. FTC Chairman Michael Pertschuk was unavailable for comment yesterday.
The subcommittee action came in connection with approval of a continuing resolution to assure that the FTC receives operating funds for fiscal 1980, which begins Oct. 1.
Slack's panel would give the FTC an appropriation of $59.5 million, but prohibit it from spending any money on all but a handful of major regulatory actions it is considering.
The continuing resolution is a legislative device used to assure that a government program continues when Congress has not completed basic authorizing or appropriating action for the coming fiscal year.
In the case of the FTC, the agency has not had a fresh authorization bill for three years, largely because of growing controversy in Congress over its regulatory actions and complaints from business and industry.
The controversy in part involves efforts to impose a "legislative veto" over the FTC by attaching it to the authorization bills. The House has approved the idea of congressional vetoes of FTC actions, but the Senate has resisted.
Slack said yesterday in an interview that his intention is to force the committees in charge of the FTC authorization bills to take up that legislation by putting a halt to many of the agency's important consumer protection activities.
If the appropriations subcommittee has its way, two of the principal activities that would stop would be the antitrust investigations of the auto and petroleum industries.
The petroleum case, known as Exxon et al, involves the nation's eight largest oil companies and an FTC effort to make them more competitive. The case is at a crucial discovery stage and a spending ban would seriously impair it.
The automobile case, the first fullscale antitrust probe of the industry since the late 1930s, began in 1976 but has been tangled by the companies' resistance to subpoenas. Their pleas to federal courts to halt the investigation have failed.
Among the corporate lobbyists at the unannounced Wednesday session of the subcommittee was attorney James G. O'Hara, a former Michigan congressman whose law firm represents General Motors and Chrysler Corp.
Another corporation lobbyist who said he "stumbled onto" the session described the atmosphere as "a train running down the track -- they went around the table and each member added something he didn't like."
Rep. Mark Andrews (R-N.D.), for example, added a ban on the FTC from getting involved in agricultural marketing orders. The FTC has an antitrust case pending against Sunkist Growers Inc., and may move similarly against the Ocean Spray Co.
Rep. George M. O'Brien (R-Ill.) added language that would stop the FTC from moving under another law to cancel the trademark of Formica Corp. -- a controversial step that has brought an outcry from big industry.
Slack said yesterday that he had some second thoughts about his subcommittee's ban of FTC spending on the Exxon antitrust case, but was satisfied with the rest of the approved language.
"It is not that I am for or against Exxon, or that I am for or against the auto companies, but maybe we shouldn't put the brakes on the antitrust actions," he said. "But then, I'd hate to see the FTC spend the $65 million they say one of these cases will cost and then have it not show anything."