The Senate last night approved legislation curtailing the regulatory authority of the Federal Trade Commission after voting 67 to 30 to halt the commission's proceedings against television advertising aimed at children.
Before final action on the bill, which now goes to conference with the House, the Senate also voted 70 to 28 to bar the FTC from imposing rules on industry-dominated groups that set voluntary standards for consumer products.
The vote on final passage was 77 to 13.
The actions came within hours after President Carter, in an address to the Consumer Federation of America, vigorously defended the FTC against charges of excessive regulatory zeal and vowed to veto any bill that "cripples" the agency.
But, aside from a hint that he would reject any legislation allowing Congress to veto FTC rules, Carter pointedly avoided saying what he thought would be crippling.
An administration source said the Senate's action thus far would not "necessarily" invite a presidential veto, explaining that a decision will hinge on the "mix" of provisions finally adopted in a Senate-House conference.
The House last year approved a bill under which either house of Congress could veto an FTC rule. The Senate narrowly rejected such a one-house veto on Wednesday but agreed to suspend future FTC rules for as many as 80 days to give both houses time to override them. The president could veto such an override resolution, making the Senate provision something less than a flat legislative veto.
The restrictions on FTC authority over children's television and product standards both were recommended by the Senate Commerce Committee as part of legislation sponsored by Sen. Wendell Ford (D-Ky.) to restrain the increasingly active and controversial FTC.
Yesterday's votes came on amendments by Sens. Warren Magnuson (D-Wash.) and Bob Packwood (R-Ore.) to eliminate the restrictions from the bill.
Under the so-called "kid-vid" amendment, the FTC would be barred from continuing its two-year-old investigation into television advertising for children and severely restricted in imposing rules on television commercials generally.
When the FTC indicated it might ban sugary cereal and other such "kid-vid" advertising, which amounts to a $600 million-a-year industry, its inquiry became a lightning rod for critics of federal regulation, who argued that it was a prime example of excessive government interference in the marketplace. A vigorous lobbying campaign was mounted by both the television and advertising industries.
"Why don't we say we've been wrong for once?" asked Ford in arguing against FTC restrictions on things like cereal advertising for children. "I like sugar," he said. "I have grandchildren . . . love 'em to death. I'd hate to have to get up in the morning and say you can't eat that."
In a more serious vein, he said the FTC has gone beyond congressional intent in trying to regulate advertising it considers "unfair" as opposed to false or deceptive.
Disagreeing with Ford, Sen. Howard Metzenbaum (D-Ohio) said television advertising for children is "more than a nuisance to parents . . . dangerous to the health of our children." He said the Senate was voting "for a special interest against the children of America" in exempting children's advertising from FTC jurisdiction.
The FTCs probe of standard-setting by private industry groups, prompted by complaints that some products were being unfairly excluded from the market, also drew strong although less publicized opposition from industry. t
Commerce Committee Chairman Howard Cannon (D-Nev.) contended that standard-setting groups were already policing themselves adequately, but Metzenbaum argued that their restrictive practices are driving up health, energy and other costs.
In an earlier vote yesterday, the Senate bowed to the FTC on one point. At the urging of the Commerce Committee, it rejected, 38 to 55, an amendment sponsored by Sen. Alan K. Simpson (R-Wyo.) to slash fees paid to individuals and groups that participate in FTC rule-making.
The FTC, which was created in 1914 to promote competitive and fair commercial practices, became the target for antiregulatory fervor in Congress only recently as it shed its once somewhat musty image and emerged as a consumer-promoting activist.
In addition to differing over the legislative veto issue, the House and Senate bills differ on where to trim the agency's sails. The House chose to keep the FTC out of the funeral industry and agricultural cooperatives, while the Senate drew the line at children's television advertising, product standards and insurance industry practices.
All Washington-area senators voted for the bill although they split on "kid-vid," with Maryland senators voting to let the probe proceed and Virginia senators voting against it.