[Senate Hearing 106-981]
[From the U.S. Government Publishing Office]



.                                                       S. Hrg. 106-981
  NOMINATIONS OF THOMAS B. LEARY TO BE A COMMISSIONER ON THE FEDERAL 
  TRADE COMMISSION; AND GREGORY L. ROHDE TO BE ASSISTANT SECRETARY OF 
              COMMERCE FOR COMMUNICATIONS AND INFORMATION

=======================================================================

                                HEARING

                               before the

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                               __________

                           SEPTEMBER 9, 1999

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation






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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                     JOHN McCAIN, Arizona, Chairman
TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
CONRAD BURNS, Montana                DANIEL K. INOUYE, Hawaii
SLADE GORTON, Washington             JOHN D. ROCKEFELLER IV, West 
TRENT LOTT, Mississippi                  Virginia
KAY BAILEY HUTCHISON, Texas          JOHN F. KERRY, Massachusetts
OLYMPIA J. SNOWE, Maine              JOHN B. BREAUX, Louisiana
JOHN ASHCROFT, Missouri              RICHARD H. BRYAN, Nevada
BILL FRIST, Tennessee                BYRON L. DORGAN, North Dakota
SPENCER ABRAHAM, Michigan            RON WYDEN, Oregon
SAM BROWNBACK, Kansas                MAX CLELAND, Georgia
                       Mark Buse, Staff Director
                  Martha P. Allbright, General Counsel
     Ivan A. Schlager, Democratic Chief Counsel and Staff Director
               Kevin D. Kayes, Democratic General Counsel









                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held September 9, 1999...................................     1
Statement of Senator Ashcroft....................................     1
Statement of Senator Burns.......................................     2
Statement of Senator Wyden.......................................     2

                               Witnesses

Conrad, Hon. Kent, U.S. Senator from North Dakota................     5
Dorgan, Hon. Byron L., U.S. Senator from North Dakota............     4
Leary, Thomas B., Commissioner-Designate, Federal Trade 
  Commission.....................................................    28
    Prepared statement...........................................    29
    Biographical information.....................................    29
Pickering, Hon. Charles W. ``Chip'', U.S. Representative from 
  Mississippi....................................................     6
Pomeroy, Hon. Earl, U.S. Representative from North Dakota........     5
Rohde, Gregory L., assistant secretary, Communications and 
  Information-Designate, U.S. Department of Commerce.............     7
    Prepared statement...........................................    11
    Biographical information.....................................    16

                                Appendix

Rowe, Bob, chairman, NARUC Telecommunications Committee, letter 
  dated September 3, 1999, to Hon. Conrad Burns..................    43
Stevens, Hon. Ted, U.S. Senator from Alaska, prepared statement..    43










  NOMINATIONS OF THOMAS B. LEARY TO BE A COMMISSIONER ON THE FEDERAL 
  TRADE COMMISSION; AND GREGORY L. ROHDE TO BE ASSISTANT SECRETARY OF 
              COMMERCE FOR COMMUNICATIONS AND INFORMATION

                              ----------                              


                      THURSDAY, SEPTEMBER 9, 1999

                                       U.S. Senate,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 2:21 p.m., in 
room SR-253, Russell Senate Office Building, Hon. John 
Ashcroft, presiding.
    Staff members assigned to this hearing: Virginia Pounds, 
Republican professional staff; and Jonathan Oakman, Democratic 
staff assistant.

           OPENING STATEMENT OF HON. JOHN ASHCROFT, 
                   U.S. SENATOR FROM MISSOURI

    Senator Ashcroft. Good afternoon. I am grateful for your 
attendance here today.
    The Commerce Committee meets today to examine 
qualifications of two individuals who have been nominated by 
the President of the United States to serve this great Nation 
in important governmental responsibilities.
    This committee takes its advice and consent role very 
seriously, and I will note that each of the nominees has 
responded in detail to the committee's request for biographical 
and financial data, and we are grateful for your having so 
responded. I have had the opportunity to review your responses 
to the committee's questionnaire and I know that the chairman 
looks forward to moving your nominations quickly.
    Our first nominee is Greg Rohde who has been nominated to 
be Assistant Secretary of Commerce for Communications and 
Information and Administrator of the National 
Telecommunications and Information Administration.
    Our second nominee will be Thomas Leary who has been 
nominated to be a Commissioner on the Federal Trade Commission.
    I would like to take this opportunity to thank both of the 
nominees for being here today. I know that your nomination is a 
great honor and that your families are very proud.
    I would like quickly to welcome the family members and 
special guests of our nominees who are in attendance today. I 
thank you all for coming.
    We will begin with a panel of our distinguished colleagues 
from both the House and Senate, here to introduce Mr. Rohde and 
to support his nomination. Before I do, I would ask if the 
Senator from Oregon would have any remarks.

     STATEMENT OF HON. RON WYDEN, U.S. SENATOR FROM OREGON

    Senator Wyden. I would and I will be very brief, Mr. 
Chairman.
    I want to welcome both of the nominees. I think we have got 
two first-rate individuals. I was very pleased to be a strong 
and early supporter of Greg Rohde for this position. I think he 
will do an outstanding job.
    Just so he knows, I am going to want to explore with him a 
little bit this morning how we can get the Federal 
Communications Commission off the dime and actually implement 
section 706 of the 1996 Telecommunications Act. As he knows, I 
sat on the Communications Subcommittee for a long, long time, 
and this issue, of course, is critical to the program that was 
held this morning, Senator Daschle's excellent program, to get 
high speed Internet access to rural communities. The Federal 
Communications Commission is authorized, directed to implement 
section 706 of the Telecommunications Act, and frankly, getting 
the FCC to move on broadband is sort of like trying to coax a 
dog off a meat wagon. It is just impossible to get them to act, 
and I am very hopeful that we will see some action on that and 
that is an issue I would like to explore with Mr. Rohde. But he 
will be an outstanding nominee.
    Then with respect to our other nominee, Mr. Thomas Leary, 
Commissioner-Designate of the Federal Trade Commission, I am 
going to want to talk to him about his views with respect to 
bringing back some competition to the market for gasoline on 
the west coast. Oregon is now paying the highest gasoline 
prices in the Nation. In fact, the whole west is now getting 
shellacked in terms of gasoline prices. We are facing the 
prospect of another big merger in the gasoline market. The BP-
Arco merger that is being discussed in Alaska in my view would 
be poison for the west coast of the United States.
    I have asked the Federal Trade Commission to investigate 
pricing in the west. They have put subpoenas into the hands of 
the major oil companies at this time, so there are some 
limitations on what Mr. Leary is going to be in a position to 
say, but I would certainly like to discuss some of the policy 
issues with respect to gasoline pricing with him.
    But my sense is we have two outstanding individuals before 
us today, Mr. Chairman, and I look forward to supporting them 
and to hearing from them. Thank you.
    Senator Ashcroft. Thank you very much, Senator Wyden.
    It is my pleasure now to call upon the Senator from 
Montana.

   STATEMENT OF HON. CONRAD BURNS, U.S. SENATOR FROM MONTANA

    Senator Burns. Thank you, Mr. Chairman. Nice to have a 
couple of nominees before us that we can all enthusiastically 
support.
    Greg's mom is here. She is from Hill County, Montana.
    [Laughter.]
    If folks do not know what that is, that is the largest town 
on the Milk River.
    [Laughter.]
    If that does not help you any, it is called Havre. And it 
is nice to have her here today with Greg.
    I also want to say that we have worked with Greg a long 
time here on this committee on telecommunications issues, and I 
do not know of anybody that has been any more helpful in 
furthering legislation on a bipartisan basis than Greg has. I 
cite the passage of the ORBIT bill and several landmark pieces 
of legislation, the 1996 telecom bill, which played extremely 
important roles in shaping and fashioning that legislation.
    One always has to wonder why our inflation has not run away 
and yet our economy continues to boom. I want to state 
emphatically here today that the passage of the 1996 bill 
probably has extended this economic cycle much further than we 
even thought was possible, and I think maybe we will have to 
take a look in our productivity and our technologies. What this 
is providing is something that some of us recognized many, many 
years ago, and Greg was one of those. Of course, representing a 
rural State, understanding that distance is our biggest enemy 
when it comes to infrastructure and the growth of rural 
America, a very keen understanding, and that also was extremely 
helpful in shaping that legislation.
    So, we welcome him here today.
    Larry Irving and I have always had a great working 
relationship. We hate to see Larry move on--but we understand 
that--because I think he has done a commendable job at the 
Commerce Department. And I think Greg probably is stepping into 
some shoes now that are going to be hard to fill, but I have no 
doubt that he will be able to do that.
    So, we welcome him here to this committee and I support his 
nomination wholeheartedly, as I do the nomination for our 
Federal Trade Commission.
    So, Mr. Chairman, thank you for allowing me those words 
because I really feel like that this is really a good 
nomination. Thank you.
    Senator Ashcroft. Thank you.
    We will begin with a panel of distinguished colleagues from 
both the House and Senate here to introduce Mr. Rohde and to 
support his nomination. Senator Conrad from North Dakota is the 
senior Senator from North Dakota. He will be followed by 
Senator Dorgan who is Greg Rohde's current employer or boss. 
Congressman Earl Pomeroy of North Dakota, Mr. Rohde's 
Congressman, and Congressman Chip Pickering from Mississippi. 
He is serving his second term in the House and knows Mr. Rohde 
from a time when Chip worked for Senator Lott and did Commerce 
Committee work. So, it is a pleasure to introduce you in that 
order unless you have arranged among yourselves to follow some 
other order. Senator Conrad.
    Senator Conrad. Mr. Chairman, I would like to defer to my 
colleague, Senator Dorgan, who is Greg's employer and I think 
Greg would attest to the fact that Byron is his boss.
    [Laughter.]

  STATEMENT OF HON. BYRON L. DORGAN, U.S. SENATOR FROM NORTH 
                             DAKOTA

    Senator Dorgan. Only in an unguarded moment.
    [Laughter.]
    Mr. Chairman, as a member of this distinguished committee, 
it is unusual to get this view of the committee. I will reserve 
comment for the moment, but I am really pleased to be here.
    Greg Rohde, I hope, will be from this nomination the next 
Assistant Secretary of Commerce running NTIA and related 
functions. I am delighted to be joined by my colleagues from 
North Dakota, the entire North Dakota congressional delegation.
    [Laughter.]
    And my friend, the Congressman Chip Pickering, who has been 
willing to come today to provide testimony as well.
    Greg Rohde and I have worked together for over 10 years and 
worked on a wide variety of issues. Greg, as all of us on this 
committee know, played a significant role in organizing the 
farm team and working on the Telecommunications Act with me and 
with many other members of this committee. He is talented, 
dedicated, very skilled, very knowledgeable. I do not just come 
to a table and endorse everybody for these kinds of positions, 
but I certainly give him my unqualified endorsement. He is 
going to be a real asset in this job.
    He is, if you do not know, also an All-American athlete. He 
was All-American at cross country as a younger man, and likely 
has lost a little of that time.
    [Laughter.]
    But that will not disadvantage him. It did not in my office 
and will not in this administration.
    But I want to say that in a town of many factions and in a 
town with a fair amount of partisanship, in a town where there 
are many aggressive battles, it is quite remarkable to be able 
to see someone be able to operate the way Greg Rohde has 
operated, creating and making friends on all sides of the aisle 
with all kinds of viewpoints. He has carved out I think a 
reputation, justly deserved, for excellence. You would hear 
Senator Lott say good things about Greg Rohde. You would hear 
Senator Daschle say good things about him. We would hear 
Senator McCain say good things about him. We just heard good 
things from the members on the dais today. And that is not an 
accident.
    This appointment I think is an important step for this 
country. It is an important step for those of us that care 
about telecommunications policy. I just finished this morning 
with some of my colleagues, including Senator Daschle, a CEO 
summit on the build-out of broadband capability in our country. 
It is very important. The movement of Greg Rohde to this 
Assistant Secretary job will be critical to resolving some of 
these issues that will be resolved by public policy. Yes, some 
in the FCC, but by public policy generally working between the 
administration and this Congress.
    Greg's family is here today. I have known his mother as 
long as I have known Greg. I must say that she overcame that 
problem of being born in Montana.
    [Laughter.]
    She has been a wonderful citizen of North Dakota and good 
friend to all of us and a wonderful mother to Greg. She is, I 
am sure, as proud today as I am. We are joined not only by his 
mother, but other family and his fiancee.
    Let me again say that this is in the end for this committee 
not about friendship at all. It is about public policy and it 
is about making our country a better place in which to live. 
The willingness of good men and women to offer themselves for 
public service is something all of us cherish, and I think Greg 
Rohde is one of those unique people who have offered themselves 
to public service. This country I think will be justifiably 
proud of that service.
    Senator Ashcroft. Senator Conrad.

 STATEMENT OF HON. KENT CONRAD, U.S. SENATOR FROM NORTH DAKOTA

    Senator Conrad. Thank you, Mr. Chairman, Senator Burns, 
Senator Wyden.
    It is good to be here to strongly endorse the candidacy of 
Greg Rohde for what is really an important position not only to 
this Department but I think really to the country. Greg Rohde 
is simply outstanding. I think every member of this committee 
knows that. I think any member who has worked with Greg Rohde 
knows that. He demonstrates a professionalism and an integrity 
that really are first-rate, and I think he is going to make a 
very positive contribution to this position.
    I have found that Greg is one of those few people that can 
take these extraordinarily complex telecommunications issues 
and make them understandable to people who do not work with it 
frequently. I am not a member of this committee, but I have 
found that he has a rare talent for explaining the key elements 
of these telecommunications issues to me and to my staff. I 
have always had very high regard for him.
    His demonstrated performance, as Senator Dorgan's staff 
member on this committee, I think is well known by the other 
members of the committee.
    One other thing I wanted to mention. Greg has a degree in 
theology, and I think that is also going to be useful because 
he has access to a higher power.
    [Laughter.]
    And he really is a very rare person of very high integrity, 
tremendous professional skills, and I am very pleased to be 
here to enthusiastically endorse his candidacy.
    I thank the chairman and thank the members of the 
committee.
    Senator Ashcroft. Congressman Pomeroy.

STATEMENT OF HON. EARL POMEROY, U.S. REPRESENTATIVE FROM NORTH 
                             DAKOTA

    Mr. Pomeroy. Thank you, Mr. Chairman. It is very good to be 
here. Senator Wyden, we still miss you in the House. Senator 
Burns, your comments were so well taken, I will forego the 
customary Montana joke.
    [Laughter.]
    Senator Burns. Do you want Wyden back?
    [Laughter.]
    Mr. Pomeroy. I think if there were three things that kind 
of sum up Greg's wonderful potential for this position, it 
would be his knowledge, his work ethic, and his integrity. And 
I cannot think of three more important attributes that you 
might look to.
    I can certainly speak to the knowledge part and ascribe 
myself fully to Senator Conrad's remarks when he speaks of 
Greg's unique ability to take the tremendous technical 
sophistication of these issues and put them in a way that 
someone without the background can understand. Across the North 
Dakota delegation, we share the wealth, which means on more 
than one occasion I have been on the phone to Greg doing 
telecom remedial learning, and he has just simply been 
excellent. We are all very proud of the expertise that one of 
our own has now achieved on this breaking, terribly important 
area.
    Work ethic and personal energy unmatched. He still runs 
like a rabbit, and I think that just captures the kind of 
vitality that he has. A very, very hard worker, as you know.
    Integrity. Unquestioned integrity. Certainly in a public 
responsibility of this nature, that is very important and Greg 
offers it in spades.
    This is a tremendously important post for us in rural 
America, and so we are particularly concerned about it and urge 
your favorable consideration. I am very heartened by what I 
have heard from you all today. We really care about this one 
and think it is just an excellent opportunity for the country.
    Thank you.
    Senator Ashcroft. I am pleased now to call on Congressman 
Chip Pickering from Mississippi, not someone that Greg has 
worked for, but someone he has worked with. I am delighted to 
have you come and present your remarks in behalf of Mr. Rohde.

       STATEMENT OF HON. CHARLES W. ``CHIP'' PICKERING, 
              U.S. REPRESENTATIVE FROM MISSISSIPPI

    Mr. Pickering. Thank you, Senator Ashcroft, Senator Burns, 
Senator Wyden. It is good to be back over on the Senate side in 
the Commerce Committee where I have many great memories and 
experiences. I still have memories of working together to draft 
the Telecommunications Act, Senator Burns, that you talked 
about in 1996 and what we are seeing now as a result of that. 
But one of the great experiences was working together with 
staff, both Republicans and Democrats, trying to find common 
ground to move that policy forward.
    Today I am here--it is a privilege to be here--to talk 
about Greg Rohde and to encourage and endorse his confirmation 
and nomination for the position that he is being considered for 
because I saw firsthand not only the dedication and the 
integrity but the work ethic. He did have a great spirit about 
him, and we have had not only political and philosophical but 
theological conversations that hopefully will guide him as he 
goes forward.
    [Laughter.]
    You talked about being quick as a rabbit. In 
telecommunications, you need to be quick as a rabbit to survive 
in a rapidly changing environment.
    But it was here in this room that I learned firsthand that 
public policy and constituent politics work very much in an 
integrated sense of what we eventually end up doing and that we 
have to be guided by our principles, but we have to be able to 
reach across the aisles to find the common positions and the 
common ground. And that working together is in the best spirit 
and the best legacy of this committee.
    Now, I do have some bad news for Greg. I thought, by going 
over to the House and becoming a Member of Congress, I would 
actually gain in influence, but I have learned that being a 
Member is somewhat less than a Senate staffer as far as 
influence.
    [Laughter.]
    So, Greg, my one advice is to always remember, even though 
you may be the Assistant Secretary, that you still must answer 
and be accountable to the Commerce Committee here in the Senate 
and in the House. Your role is to implement. So, we look 
forward to working with you.
    [Laughter.]
    It is a great privilege also to be with the entire North 
Dakota delegation, and when North Dakota and Mississippi join 
forces, the south and the midwest, we can do some tremendous 
things. One of the things this committee is known for is 
balancing the issues of rural and urban, and I can think of no 
one better qualified than the advocate and one of the leaders 
of the farm team in Greg Rohde of being able to promote 
competition, to see that vision implemented, but also to make 
sure that the technology and the advantages that come with this 
new world benefit rural America. We have a true friend in Greg 
Rohde in being able to accomplish that whether it is in 
education, telemedicine, and all of the exciting technological 
applications that we are seeing in the marketplace.
    In short, I am very proud to endorse and urge the 
committee's approval of Greg Rohde. We cannot have a better 
person or friend from this area, from this committee, and with 
a better knowledge and understanding and character to do a 
great job for all of us.
    So, Mr. Chairman, I appreciate the time you have given me 
and look forward to seeing Greg Rohde confirmed. Thank you very 
much.
    Senator Ashcroft. Thank you very much. To all of you who 
are members of the panel who have been so kind and willing to 
remark favorably upon this nominee, I would now suggest that 
you proceed to your next pursuit, whether it be on this panel 
or not, and I would invite Mr. Rohde to come forward.
    It has already been mentioned that Mr. Rohde's mother, Ms. 
Gladys Rohde, from Bismarck, North Dakota, through Hill County, 
Montana, has come and his brother Bryan are both here today. 
Would you please stand? Brother Bryan, thank you very much. It 
is nice to welcome you. Thank you very much for being here.
    [Applause.]

    STATEMENT OF GREGORY L. ROHDE, ASSISTANT SECRETARY FOR 
 COMMUNICATIONS AND INFORMATION-DESIGNATE, U.S. DEPARTMENT OF 
                            COMMERCE

    Mr. Rohde. Thank you, Mr. Chairman. I cannot tell you how 
happy I am to finally find a seat in this room behind a 
microphone.
    [Laughter.]
    There has been a lot I have wanted to say over the last 
6\1/2\ years.
    [Laughter.]
    But Shakespeare said, ``Brevity is the soul of wit.'' I 
guess after such a wonderful introduction and gracious remarks, 
it might also be the essence to confirmation, so I will keep my 
remarks very brief.
    First of all, I want to begin by thanking Chairman McCain 
and you, Mr. Chairman, for scheduling this hearing. Senator 
McCain and his staff have been extremely supportive, gracious, 
and cooperative to me in this process. They have been so 
helpful that it has caused me to wonder if they may have a 
variety of reasons for wanting me to leave my present job, but 
I am very grateful for their support and help.
    I want to thank President Clinton for nominating me for 
this post and also Vice President Gore and Secretary Daley for 
their support in this nomination. If I am confirmed, I will 
consider it a very high honor to serve in this administration, 
and I very much would look forward to working with the 
excellent staff in NTIA and the Commerce Department.
    I also want to thank Senator Daschle. Senator Daschle has 
been very helpful and supportive to me in this process, and I 
am very grateful for that.
    I am also grateful for Congressman Pickering for coming 
over. As he said, Chip and I had the privilege of working 
together on, among other things, the Telecommunications Act of 
1996. During the development of that legislation, as everybody 
in this room knows, we had a lot of battles, a lot of dust-ups, 
a lot of deadlocks, and a lot of difficulties. During that 
process, it was Chip and Senator Lott who were among the first 
to jump into the middle of the controversy to reach out and try 
to break the deadlocks and try to move the process forward. So, 
I learned a great deal from Chip and his boss about 
bipartisanship and I really enjoyed working with them.
    I am also extremely grateful for the North Dakota 
delegation, for Senator Dorgan, Senator Conrad, and Congressman 
Pomeroy, for coming here and supporting me.
    One of the little known facts about the North Dakota 
delegation here in Washington is that when Senator Dorgan first 
ran for Congress in the 1970's, Kent Conrad was his campaign 
manager and Earl Pomeroy drove the car.
    [Laughter.]
    It gives you an idea of how tight this delegation is.
    Senator Dorgan. I lost that race.
    [Laughter.]
    Mr. Rohde. Yes, but you corrected the problem.
    I have had the privilege of working for Senator Dorgan for 
over 10 years, and not a day goes by that I do not forget what 
an incredible privilege it has been not only to work with him 
but also to work in the North Dakota delegation. It is an 
extremely wonderful opportunity to be able to associate myself 
with people like Senator Dorgan and Senator Conrad and 
Congressman Pomeroy and be so proud to be part of the work that 
they do. As Senator Conrad mentioned, I have a degree in 
theology. When I started working for Senator Dorgan, I had 
never taken a political science class, I had never taken a law 
class. Everything I have learned about politics and public 
service has been through his excellent example and the example 
of Senator Conrad and Congressman Pomeroy.
    I also want to say a couple of words about my predecessor, 
Larry Irving, who I think has served at NTIA with great 
distinction and with great honor. Larry has been a personal 
friend of mine for the last 6 years, as well as a professional 
colleague. I consider it a great honor to have the challenge to 
try to build upon the legacy that he has set.
    I am nothing less than thrilled at the prospect of working 
at NTIA. The reason is that NTIA is really at the very heart of 
Federal policymaking for telecommunications and information 
services. This is an industry where the maxims are innovation, 
growth, and opportunity. It is an industry like no other. It is 
driving our economy. It is creating enormous efficiencies and 
creating great benefits to consumers.
    I grew up on the upper banks of the Missouri River in the 
Dakotas, and when I was in junior high and high school, I used 
to run the rural roads south of Bismarck. I remember, as I 
would be training for track out there, I would run underneath 
all these signs for Lewis and Clark, pointing out historic 
places of the expedition. About 60 miles north of my hometown 
of Bismarck is the Knife Indian River Village. In 1805, 
Meriwether Lewis wintered there (and it does get cold) and 
wrote his mid-trip report to Thomas Jefferson. From North 
Dakota, it took 5 months for that report to reach President 
Jefferson's desk in Washington, DC. Today school students in 
Stanton High School, which is adjacent to the Knife River 
Indian Village, can travel through cyberspace and send e-mails 
to Senator Dorgan's office in Washington within an instant. 
They can download volumes of data within minutes. The changes 
in telecommunications have been enormous and the implications 
have been incredible.
    My mother, who is here today, grew up on a little farm 14 
miles north of Havre, Montana, where her father homesteaded in 
the early 1900's. That farmhouse had no electricity and no 
phone service until the 1950's when a local cooperative secured 
REA financing in order to string a wire out there to provide 
telephone service and electrical service.
    My mother told me that when she was a young girl, she used 
to listen to a radio that my grandfather would hook up to a 
battery that was the size of a microwave in order to listen to 
the grain report. Although the price of wheat has not changed a 
whole lot since then--it is still about $2 a bushel----
    [Laughter.]
    Mr. Rohde [continuing]. Technology has changed 
tremendously. My brother-in-law, who currently farms outside of 
Grand Forks, North Dakota, now follows the market on line or on 
direct satellite links that are hooked up to a local grain 
elevator in Larimore, North Dakota.
    The change in recent years has been dramatic. In 1993, when 
my predecessor, Larry Irving, took his oath of office and began 
service at NTIA, the Internet was nothing more than a research 
tool used by a few thousand academics. There was no such thing 
as household access to the Internet. Today over 26 percent of 
American households have access to the Internet at home and 
there are over 179 million users of the Internet.
    And e-commerce, which was not even in the lexicon of the 
most technically savvy members of this committee or anywhere 
else in 1993, is a $9 billion industry today.
    In 1993, there were 16 million cellular users. There was no 
PCS. Today there are 60 million wireless users, and many of 
those people are receiving services at about half the rates of 
what they were paying just 6 years ago.
    In 1993, there was no such thing as DBS. The satellites 
were just being launched. Today there are over 10 million 
subscribers and DBS has become a very formidable competitor to 
the cable industry.
    In my mind, the Commerce Committee has provided the right 
framework to develop policies that are going to foster 
innovation and creativity in the marketplace and ensure that 
all these benefits in the telecommunications and information 
industries will spread throughout all of our society. That 
framework is the Telecommunications Act of 1996.
    NTIA's responsibility, in my mind, is to utilize the tools 
that are in that Act; the tools of universal service and 
competition, to promote and foster growth and innovation and 
access to all these telecommunications services. I remain 
firmly committed to the dual maxims of the act of competition 
and universal service as the way to deliver a coherent policy 
in telecommunications.
    Certainly the Act has had a number of struggles in its 
implementation, and we have a long way to go before we can 
declare the Telecommunications Act a complete success, but 
wonderful things are happening. The competitive model producing 
incredible results. The wireless industry is one example where 
consumers in many markets of this country have multiple 
choices. The results are that rates go down, and consumers have 
choices and better service.
    We have over 6,000 independent ISP's in this country which 
have thrived and developed in an open, competitive market.
    The long distance industry is another example. We are now 
looking at competition over nickel rates, something that was 
unheard of 10 years ago.
    The competitive model works and it is producing incredible 
results.
    Even under the Telecommunications Act, we still are 
struggling in many areas to transform a number of sectors of 
the industry from monopoly markets into competitive ones. Local 
competition is one of those areas. Still 96 percent of 
Americans do not have a choice in local phone service, but we 
are making some progress.
    Back in 1995 when this committee was meeting in this very 
room (as we developed the Telecommunications Act), there were 
less than a dozen competitive local exchange carriers. Today 
there are over 150, and those 150 are offering competitive 
local phone service in over 90 percent of the local exchange 
markets in this country. Much to my surprise, one of those 
markets is, of all places, Regent, North Dakota, where citizens 
there have access to a fixed wireless competitor.
    These kinds of things never would have happened without the 
Telecommunications Act. But, as many members of this committee 
know, the Telecommunications Act was not simply about promoting 
competition. It was also about preserving universal service and 
building upon our Nation's commitment to universal service that 
has existed for years. I remain deeply committed to developing 
policies that are built on these two fundamental pillars.
    The Telecommunications Act is especially important as we 
move into the debates about the new generations of services, 
especially when it comes to broadband capabilities and the 
kinds of new services that can be offered through such 
capability, such as high speed Internet access. The 
Telecommunications Act is going to be our map for that future.
    When Thomas Jefferson bought the Louisiana Territory, the 
purchase was not just simply a great bargain land deal in his 
mind. Jefferson saw the West as a great new opportunity. He saw 
it as America's future. His instructions to Meriwether Lewis 
and William Clark, when they left Washington in 1803 on July 
4th, were to explore the rivers of commerce of this new 
continent. Today I see broadband as the new continent, 
providing many more new rivers of opportunity for us to 
explore. As we move forward and explore these new rivers of 
commerce, we need to do it with our traditional American values 
of openness, equal opportunity, and making sure that all 
Americans can participate.
    Usually at about this time, the red light goes on, but I 
think maybe some of my friends in the corner did not turn the 
timer on.
    [Laughter.]
    So, I will conclude my remarks by saying a couple of 
things. One is that I want to recognize some very special 
people here, and those are the folks that sit on the back bench 
behind the dais. For the last six and a half years, you have 
all been my friends. You have been my colleagues and you have 
been my teachers. But more importantly, you have been my 
friends. We have spent many, many hours, long nights, weekends, 
and holidays, in this room, in our conference rooms, and our 
offices. If I am confirmed and I move on, I will take many 
great memories from the Senate, but one of the most important 
memories I will take will be the time I spent with my friends 
and colleagues here and the witness that I have had of your 
great dedication to public service and to the constituents that 
you represent. It has been an absolute pleasure to serve with 
all of you, as well as all the members of this committee.
    With that, I will be happy to take any questions.
    [The prepared statement and biographical information of Mr. 
Rohde follow:]
    Prepared Statement of Gregory L. Rohde, Assistant Secretary for 
 Communications and Information-Designate, U.S. Department of Commerce
    Mr. Chairman, thank you for holding this hearing. It is indeed an 
honor to appear before this Committee today on the matter of my 
nomination to be Assistant Secretary of Commerce for Communications and 
Information and Administrator of the National Telecommunications and 
Information Administration (NTIA). I have had the distinct privilege of 
working with the Members of this Committee for the past six and a half 
years. My work with the Committee Members and staff has been one of the 
most fonnative and enjoyable experiences of my life. I have benefitted 
tremendously for having witnessed daily the integrity of the Senators 
of this Committee and their uncompromising commitment to the public 
good. I have had a fortunate opportunity to see how well our Nation is 
served by all of you and I am honored to have had the opportunity to 
work here. I believe that the many things I have learned working with 
the Members of this panel has prepared me well to serve as 
Administrator of NTIA if confirmed.
    I wish to thank President Clinton for nominating me to serve in the 
Department of Commerce. I also want to thank Vice President Gore and 
Secretary Daley for their gracious support of me. I am grateful for the 
opportunity to serve the public in this capacity and I will I seek 
through my actions and efforts to be worthy of this office and the 
confidence that has been bestowed upon me.
    I also want to express my admiration and gratitude to Larry Irving 
who has served, with  distinction as the Assistant Secretary of 
Commerce for more than 6 years. He is a model public servant and he 
deserves the highest of praise for his dedication to the public, 
particularly the ``have nots'' among telecommunications consumers, and 
for the many talents he brought to that effort. He has left big shoes 
to fill. NTIA and the nation will long be indebted to Mr. Irving for 
the energy and passionate leadership he has provided on many 
telecommunications and information issues. It will be a challenge and 
an honor to build upon his legacy.
    I am nothing less than thrilled about the opportunity to serve in 
NTIA. Who wouldn't be? Telecommunications and information technologies 
and services are evolving and growing at an unrivaled pace, creating 
new avenues of opportunity in so many aspects of our lives. At the turn 
of the century, natural resources such as oil fueled the engine of our 
economy. Today, telecommunications and information technologies have 
our economy roaring. This is a growth industry like no other, even in 
our booming economy. The opportunities flowing from telecommunications 
and information technologies are bounded only by our collective 
imagination. According to the recent Commerce Department report The 
Emerging Digital Economy II, information technologies have accounted 
for more than one-third of our nation's economic growth during this 
period of unprecedented expansion. Telecommunications and information 
industries are creating jobs, cutting inflation, and bringing new 
efficiencies to the American economy. This revolution, however, is not 
just about the creation of wealth, but about enhancing the social well 
being of all citizens. It is about improving the way we teach and learn 
in schools. It is about extending the reach of health care. And, it is 
about fostering public safety and bringing people together.
    The information revolution is by no means limited to the great 
expanse between the Atlantic and Pacific oceans--it is worldwide. 
America is once again leading the way by championing a competitive 
marketplace that is a magnet for capital investment. The economic 
challenge the telecommunications revolution poses for policy makers 
today is how to foster innovation and investment in the U.S. 
telecommunications and information industries using a competitive model 
and assert our leadership in the new global digital economy. The social 
challenge is how to ensure privacy and universal access.
    Technology transforms human society. Today, at the advent of the 
next millennium, telecommunications and information technologies are 
transforming our world at an unprecedented pace. From the time of the 
ancient Greeks to the invention of the telegraph, technology and 
information did not even belong in the same sentence. When Lewis and 
Clark set out to explore the territory acquired under the Louisiana 
Purchase, information traveled at the speed of a horse. Meriwhether 
Lewis' mid-trip report to President Jefferson from the Corps of 
Discovery's winter home in North Dakota in 1805 took 5 months to get to 
Jefferson's desk in Washington. Today, high speed Internet access can 
allow students in Stanton, North Dakota, adjacent to the Knife River 
Indian Village where Lewis and Clark spent a chilly winter, to travel 
across cyberspace, download volumes of data and information in an 
instant, and communicate in real time around the globe.
    The changes in my own lifetime have been astonishing. I was born at 
the time President Kennedy launched the modern space program and began 
the race to the moon. Now there is more computing power in most of the 
laptop computers carried around every day by millions of people than 
there was on the Apollo mission that landed on the moon 30 years ago. 
Supercomputers that took rooms to house in the 1980's can now fit 
inside a desktop computer that can be bought off the shelf. In 1975, 
there were 50,000 PC's sold. Today, there are twice that number sold 
every day. Technology is evolving so rapidly that computers and 
wireless phones are out-dated the moment they appear in the store. It 
is astonishing that over 75% of the revenues generated by computer 
companies today come from products that did not exist two years ago.
    My mother, who is here today, grew up in a small farm house outside 
of Havre, Montana, where my grandfather homesteaded in the early 
1900's. The house had no electricity or phone service until a local 
cooperative was able to string a wire to his house 14 miles north of 
Havre, with the help of REA (Rural Electrification Administration) 
financing. The farm house had kerosene lamps and windmills for power. 
As a young girl, my mother used to listen to the grain report on a 
radio my grandfather rigged up to a large battery the size of a 
microwave oven. Although the price of wheat has not changed much since 
then--it is about $2 per bushel, about the same it was in the 1940's--
telecommunications technology has changed enormously. Today, my 
brother-in-law who farms outside of Grand Forks, North Dakota, follows 
the grain market online or through satellite feeds direct from the 
market.
    The rapid pace of change in telecommunications and information 
technology provides unprecedented opportunities to connect people with 
each other, create jobs, improve the quality of life, and rectify 
social, economic, and personal challenges resulting from disabilities, 
economic disadvantage, or geographic isolation. Geographic distance can 
be a thing of the past with an advanced telecommunications network. 
Storefront businesses on a small town's main street can become 
worldwide distribution centers and small country libraries equipped 
with computers linked to high speed modems will no longer be limited to 
their local collections, but will enable students to access all the 
great books and minds of the world with the click of a ``mouse.''
    But all this bounty comes with new challenges. Technological 
advances in telecommunications and information services also pose new 
threats to national security, public safety, and personal privacy. 
Moreover, the globalization of the new digital economy increases our 
dependency on infonnation technology and electronic commerce, 
challenging our nation's schools to supplement blackboards with 
computer terminals so they can train a workforce for the new digital 
economy.
    Addressing the challenges of the information age while capitalizing 
on its opportunities is the central mission of NTIA. The agency also 
shares in the mission of the Commerce Department to promote commerce 
and NTIA is the agency uniquely focused on the promotion of commerce 
through information and communications systems. Indeed, NTIA is the 
electronic commerce agency whose function is to: (1) promote 
technological innovation and investment; (2) protect security and 
privacy; and (3) develop technological applications to advance the 
social, economic, and equal opportunity goals of our democracy.
    In the era of electronic commerce, NTIA needs to advance policies 
that will foster infrastructure investment and ensure universal access 
to advanced telecommunications networks that make electronic commerce 
possible. This mission can only be accomplished through faithful 
adherence to the twin principles of competition and universal service. 
Furthermore, the agency's spectrum management responsibilities must 
ensure the efficient federal use of this important resource and promote 
the development of new wireless technologies by the private sector.
    NTIA has a primary responsibility to protect national security and 
public safety in telecommunications and information networks and 
technologies. The information age brings with it a new generation of 
electronic terrorists, hackers, and intruders into personal privacy. 
The agency's spectrum management and research functions play a critical 
role in the defense and stability of our nation's telecommunications 
and information infrastructure. In addition to national security 
concerns, the telecommunications and information infrastructure need to 
be protected so that consumers can feel as comfortable about their 
personal privacy while shopping online as they are while shopping at 
the local mall. Through non-regulatory support and guidance, NTIA helps 
to make the Internet a user-friendly tool that consumers can trust.
    We, as a nation, also need to invest in the future by creating a 
technologically advanced educational system that will ensure our place 
as the world's leader in the new digital economy. Shortly after the 
turn of the millennium, about half of the entire workforce of the 
United States is going to be employed either by information technology 
producers or by businesses that are intense consumers of information 
technologies. The agency's grant programs are designed to identify and 
promote innovative applications of new technologies that improve 
education, community development, and electronic coerce. NTIA has the 
additional responsibility of advancing policies to help the U.S. retain 
its global leadership in the new digital economy and enable all 
Americans to participate in the benefits of the information revolution. 
The agency's demonstration grant programs and its promotion of 
competition and universal access form the foundation of that vision of 
leadership and inclusiveness.
    We are only beginning to see the potential of the dynamic force of 
policies based on the new vision of competition and universal service--
the dual maxims under the Telecommunications Act. I am convinced that 
an open, competitive environment will most effectively foster 
innovation and investment in the telecommunications and information 
industries in this country and deliver services at the lowest prices. 
Spawned in large part by the Telecommunications Act of 1996, many 
segments of the telecommunications industry are currently in the midst 
of a transition from a monopoly environment to a deregulated 
competitive one. If confirmed, I will work to advance competition and 
universal access faithful to the framework created under the 
Telecommunications Act.
    Certainly there have been implementation struggles with respect to 
some of the provisions of the Telecommunications Act and there are many 
challenges that lie ahead before the Act can be declared a complete 
success. The Act has spurred unprecedented consolidation in some areas 
of broadcasting and telephony. Some of these alliances are going to 
help foster competition in the new era where the old distinctions are 
giving way to a new structure. In some cases, however, consolidation 
poses new challenges to ensure a competitive marketplace and will 
require creative and innovative policy responses to preserve the 
important tenants of diversity and localism.
    Nevertheless, the Act has given rise to many positive developments 
and promises many more for the future. There were only about a dozen 
competitive local exchange carriers (CLECs) in existence in 1995 when 
the Telecommunications Act was written. Today there are more than 150 
CLECs with a total market capitalization of more than $40 billion and 
are competing in about 90% of all the local exchanges in the country. 
While CLEC penetration is still only about 4 percent, local competition 
is happening. To my surprise, there is local competition even in 
Regent, North Dakota. That simply would not have been possible without 
the Act.
    Just prior to the enactment of the Telecommunications Act, 
telecommunications services generated about $200 billion in revenues. 
Today, the industry has grown to about $250 billion. The capital 
markets are investing billions into telecommunications and information 
companies and consumers are presented with more choices and 
opportunities than ever. Information technology industries and 
electronic commerce (a classification hardly in the common lexicon 
until just a couple of years ago) account for more than one-third of 
the growth in the gross domestic product over the past three years. The 
Act has certainly played a role in stimulating the investment and 
opportunity that has expanded the overall economy.
    Vice President Gore characterized it best at the signing ceremony 
of the Telecommunications Act when he said that the Act was ``not a 
mid-course correction'' but rather ``a new flight path to an entirely 
new world.'' That new world is an era of fascinating technologies, 
broadband capability, and advanced telecommunications and information 
services that create unprecedented opportunity for communication and 
connection.
    The roll out of advanced telecommunications services such as high 
speed Internet access is due, in part, to the pro-competitive policy 
established under the Telecommunications Act. New competitive local 
exchange carriers alone have the infrastructure available to provide 
broadband services to 25 million customers. The incumbents are not 
showing any signs of ceding broadband delivery to the newcomers and 
themselves are investing billions to provide DSL (digital subscriber 
line) services to millions of customers. Cable modem service is 
available to 32 million households ``which is about 30% of all homes 
passed by cable'' and on average there are about 2,500 new cable modem 
customers each day.
    We have seen that competition is the most efficient means to spur 
innovation and lower prices. While consumer choice in local phone 
service or cable service is still more the exception than the rule, 
continuing down the road to competition is the best path for 
telecommunications policy to follow. Competition in broadcasting, 
cable, satellite and other media industries will also provide the most 
efficient means to curtail prices, expand choices, and create 
opportunity for new ownership and diversity. The competitive model 
should also be carried to the international area, where the U.S. needs 
to lead the way to help create an open, competitive global environment.
    I am also very mindful, however, that the information wave sweeping 
across the country is not sweeping up everyone. According to a recent 
Commerce Department report, Falling Through the Net, ninety-four 
percent of U.S. households have access to basic phone service. But 
computer access at home is only around 40% and a mere one-quarter of 
all American households have access to the Internet. While the overall 
numbers are impressive and indicate that we live in a Nation that 
provides vast opportunity through telecommunications and information 
services, it is important to note that access to these opportunities 
still lags behind for people in some segments of our society. People 
living in rural areas, minorities, and low-income families, for 
instance, tend to have less access than others. Telecommunications 
policy must, before all else, be grounded in the value of enhancing the 
social and economic well being of all citizens. The telecommunications 
revolution cannot become telecommunication nihilism. The growth of 
telecommunications and information services must enhance value and 
meaning in peoples lives and be built upon the values of our democracy, 
including equal opportunity.
    One of the principle tenants of the Act was a policy obligation 
that ``access to advanced telecommunications and information services 
should be provided in all regions of the Nation.'' The Act provided all 
Americans with an assurance that they will not be left behind. If we, 
as a Nation, want to ensure that access to the Internet and advanced 
telecommunications and information services will be a shared benefit 
throughout the Nation, we will need to implement a policy of inclusion, 
such as that envisioned under the Act. In my judgment, bridging the gap 
in access will require a faithful implementation of the principles of 
both competition and universal service--the driving forces to 
investment for advanced capability. Broadband is more than just greater 
bandwidth--it is an expansion of opportunity. It is the new frontier 
that can allow more Americans the chance to participate and succeed in 
our democracy. Broadband access will enable small, previously isolated 
communities to create thriving businesses--making location virtually 
irrelevant. Broadband will help exorcize the demon of distance that has 
been the scourge of rural communities in their pursuit of equity and 
opportunity.
    If confirmed, one of my top priorities will be to advance a 
strategy to stimulate broadband deployment using the pro-competitive 
tools and universal service assurance provided under the 
Telecommunications Act. Federal policy should strive to stimulate open, 
competitive markets and at the same time establish mechanisms to 
prevent certain classes of people--whether rural, minority, or low-
income--from falling behind. Ubiquitous deployment of broadband 
capability will help to uncover the human capital that has historically 
been buried by geographic and other barriers that can be stripped away 
by new communications technologies and services. Abraham Lincoln 
learned his lessons by writing on the back of a shovel with a piece of 
chalk. While he managed to succeed, how many more great leaders and 
contributors to our society remain hidden because of isolation from 
great libraries and laboratories? If all Americans have better learning 
and training tools than shovels, how many more Lincoln's, Martin Luther 
King's, or an astronaut like Eileen Collins will arise? Without 
ubiquity, there is less opportunity for the diversity of our nation's 
human capital, which has always been the source of America's greatness.
    Thomas Jefferson saw the West as America's future. To Jefferson, 
the purchase of the Louisiana territory was much more than a bargain 
land acquisition. It was an opportunity to unleash the national energy 
to explore, establish new avenues of commerce, and build a new way of 
life for a young nation. His instructions to Lewis and Clark when they 
began their expedition in 1803 was to explore the ``rivers of 
commerce'' of the continent. Two centuries later, broadband capability 
is creating new rivers of commerce for us to explore and fulfill the 
hopes and dreams of a nation that believes in the values of democracy, 
equal opportunity and freedom. The consumers, producers, and policy 
makers of the information age are looking towards the future, much like 
Lewis and Clark did as they rowed their keelboat up the Mississippi and 
Missouri rivers. While we are not certain about what lies ahead, the 
idea of broadband, like the image of the Western frontier, seizes our 
imagination. Somehow, we know that this previously uncharted territory 
holds great promise and opportunity.
    In concluding my remarks, I want to express my deep appreciation to 
all the Senators who have supported me to become the Administration's 
nominee for this position, including all the Senators on this 
Committee. I especially want to thank Senator Daschle for all of his 
support and help. And finally, no words are adequate to express my 
profound gratitude to Senator Dorgan for not only supporting me as a 
nominee but for the granting me the honor and privilege of working for 
him for the past ten years. Senator Dorgan took a big risk ten years 
ago by giving a Seminarian a chance to work in the world's greatest 
deliberative body, Congress. He has been my mentor and friend ever 
since and I will always treasure and call upon all that I have learned 
from him.
    If confirmed, I intend to work to create a cooperative, inclusive 
approach to policy making within the Administration and with Congress. 
As one of the many staffers who had the privilege of working on the 
Telecommunications Act, I understand that a bipartisan and inclusive 
process can achieve the best results and accomplish the difficult task 
of crafting consensus and compromise that balance a diversity of 
interests. I have truly enjoyed working with the Senators and staffers 
on the Senate Commerce Committee and I hope that, if confirmed, I will 
have the opportunity to continue working closely with you on 
telecommunications and information service policy issues.
    Mr. Chairman, thank you once again for scheduling this hearing. You 
and your staff have been very cooperative and helpful to me in this 
process and I am very grateful.
    I will be happy to answer any questions from the panel.
                                 ______
                                 
                      a. biographical information
    1. Name: (Include any former names or nicknames used.) Gregory 
Lewis Rohde.
    2. Position to which nominated: Assistant Secretary of Commerce for 
Communications and Information and Administrator of the National 
Telecommunications and Information Administration.
    3. Date of nomination: August 3, 1999.
    4. Address: (List current place of residence and office addresses.) 
Home: 509 15th Street, N.E. Mandan, North Dakota 58554. D.C. Residence: 
222 10th Street, S.E. Washington, D.C. 20003. Office: 713 Hart 
Washington, D.C. 20510.
    5. Date and place of birth: November 7, 1961 Pierre, South Dakota.
    6. Marital status: (Include maiden name of wife or husband's name.) 
Single.
    7. Names and ages of children: (Include stepchildren and children 
from previous marriages.) None.
    8. Education: (List secondary and higher education institutions, 
dates attended, degree received and date degree granted.) Graduate: 
Bachelor of Sacred Theology, the Catholic University of America, 
Washington, D.C., 1988.
Undergraduate: Bachelor of Science in Education with majors in 
Philosophy and Sociology, North Dakota State University, Fargo, North 
Dakota, 1985.
Attended Colorado University, Boulder, Colorado, 1980 - 1982.
High School: Diploma. Century High School, Bismarck, North Dakota, 
1980.
    9. Employment record: (List all jobs held since college, including 
the title or description of job, name of employer, location of work, 
and dates of employment.) Senior Legislative Assistant to U.S. Senator 
Byron L. Dorgan, Washington, D.C.; (February 1993 - present). Serves as 
chief policy advisor for all areas of jurisdiction under the Senate 
Committee on Commerce, Science, and Transportation, of which Senator 
Dorgan is a member.
Team Coordinator for the Health Care Financing Administration Section 
in the Health and Human Services Cluster for the Presidential 
Transition Team of the Clinton-Gore Administration, Washington, D.C. 
(December 1992 - January 1993). Drafted briefing materials for the 
President, Vice President, and Cabinet nominee on all issue and 
personnel matters related to the Health Care Financing Administration 
(HCFA) in the Department of Health and Human Services (HHS); 
interviewed senior HHS and HCFA officials and constituency 
organizations to prepare guidance to incoming Administration officials 
on administrative and substantive issue matters within HHS and HCFA.
Campaign Manager for the Nicholas Spaeth for Governor Campaign (D-North 
Dakota), Bismarck, North Dakota (January 1992 - November 1992). Managed 
all aspects of the state wide campaign, including the campaign staff 
directed fund raising; coordinated media strategy; worked with local, 
state, and federal Democratic party officials; and represented the 
candidate in public speeches and press conferences.
Legislative Assistant to Representative Byron L. Dorgan, Washington, 
D.C. (May 1988 - January 1992). Served as chief policy advisor for 
health care, social security, and human resource issues on the House 
Committee on Ways and Means, of which Rep. Dorgan was a member. 
Additional legislative areas of responsibility included education, 
judiciary, environment, and transportation. Responsibilities included 
drafting legislation, speeches and correspondence for the Senator; 
legislative negotiations; public speaking on behalf of the Senator; and 
serving as a liaison to Executive branch agencies and departments.
Instructor at Mackin Catholic High School, Washington, D.C. (September 
1987 - May 1988). Served as classroom instructor for high school social 
justice classes for senior students, developed curriculum; and managed 
student community service projects.
    10. Government experience: (List any advisory, consultative, 
honorary or other part-time service or positions with Federal, State, 
or local governments, other than those listed above.) See above.
    11. Business relationships: (List all positions held as an officer, 
director, trustee, partner, proprietor, agent, representative, or 
consultant of any corporation, company, firm, partnership, or other 
business enterprise, educational or other institution.) None.
    12. Memberships: (List all memberships and offices held in 
professional, fraternal, scholarly, civic, business, charitable and 
other organizations.) None.
    13. Political affiliations and activities: (a) List all offices 
with a political party which you have held or any public office for 
which you have been a candidate. None.
(b) List all memberships and offices held in and services rendered to 
all political parties or election committees during the last 10 years. 
None.
(c) Itemize all political contributions to any individual, campaign 
organization, political party, political action committee, or similar 
entity of $500 or more for the past 10 years. None.
    14. Honors and awards: (List all scholarships, fellowships, 
honorary degrees, honorary society memberships, military medals and any 
other special recognitions for outstanding service or achievements.) 
Academic scholarship to Colorado University and North Dakota State 
University for track and cross-country. All-American High School 
Athlete, Track, 1980.
    15. Published writings: (List the titles, publishers, and dates of 
books, articles, reports, or other published materials which you have 
written.) None.
    16. Speeches: Provide the Committee with two copies of any formal 
speeches you have delivered during the last 5 years which you have 
copies of on topics relevant to the position for which you have been 
nominated. I have only provided extemporaneous remarks, mostly in 
appearances with Senate colleagues, under my current capacity as a 
Legislative Assistant to Senator Dorgan.
    17. Selection:
    (a) Do you know why you were chosen for this nomination by the 
President?
Yes, I believe I was chosen because of my experience of working 
directly on the issues under the jurisdiction of the agency and my 
demonstrated ability to work cooperatively and in a bipartisan manner 
with the executive and legislative branches of government and the 
various stakeholders affected by the agency.
    (b) What do you believe in your background or employment experience 
affirmatively qualifies you for this particular appointment?
As a senior legislative assistant for Senator Dorgan, I have worked 
extensively in the area of telecommunications policy for the past 6 and 
a half years, including working on the Telecommunications Act of 1996 
and other significant areas of telecommunications legislation. In 
particular, my experience in working with the Congress on key 
legislative initiatives in a bipartisan manner enables me to ensure a 
close, cooperative relationship between the executive and legislative 
branches on key areas of telecommunications policy.
                   b. future employment relationships
    1. Will you sever all connections with your present employers, 
business firms, business associations or business organizations if you 
are confirmed by the Senate? Yes.
    2. Do you have any plans, commitments or agreements to pursue 
outside employment, with or without compensation, during your service 
with the government? If so, explain. No.
    3. Do you have any plans, commitments or agreements after 
completing government service to resume employment, affiliation or 
practice with your previous employer, business firm, association or 
organization? No.
    4. Has anybody made a commitment to employ your services in any 
capacity after you leave government service? No.
    5. If confirmed, do you expect to serve out your full term or until 
the next Presidential election whichever is applicable? Yes.
                   c. potential conflicts of interest
    Describe all financial arrangements, deferred compensation 
agreements, and other continuing dealings with business associates, 
clients or customers. None.
    2. Indicate any investments, obligations, liabilities, or other 
relationships which could involve potential conflicts of interest in 
the position to which you have been nominated. None.
    3. Describe any business relationship, dealing, or financial 
transaction which you have had during the last 10 years, whether for 
yourself, on behalf of a client, or acting as an agent, that could in 
any way constitute or result in a possible conflict of interest in the 
position to which you have been nominated? None.
    4. Describe any activity during the past 10 years in which you have 
engaged for the purpose of directly or indirectly influencing the 
passage, defeat or modification of any legislation or affecting the 
administration and execution of law or public policy. None, other than 
under my current capacity as a legislative assistant to Senator Dorgan.
    5. Explain how you will resolve any potential conflict of interest, 
including any that may be disclosed by your responses to the above 
items. (Please provide a copy of any trust or other agreements.) I will 
consult with the General Counsel of the Department of Commerce and, if 
appropriate, divest myself of conflicting interests, recuse myself or 
obtain a conflict of interest waiver under 18 U.S.C. Sec. 208(b) if the 
interest is not substantial.
    6. Do you agree to have written opinions provided to the Committee 
by the designated agency ethics officer of the agency to which you are 
nominated and by the Office of Government Ethics concerning potential 
conflicts of interest or any legal impediments to your serving in this 
position? Yes.
                            d. legal matters
    1. Have you ever been disciplined or cited for a breach of ethics 
for unprofessional conduct by, or been the subject of a compliant to 
any court, administrative agency, professional association, 
disciplinary committee, or other professional group? If so, provide 
details. No.
    2. Have you ever been investigated, arrested, charged or held by 
any Federal, State, or other law enforcement authority for violation of 
any Federal, State, county, or municipal law, regulation or ordinance, 
other than a minor traffic offense? If so, provide details. No.
    3. Have you or any business of which you are or were an officer 
ever been involved as a party in interest in an administrative agency 
proceeding or civil litigation? If so, provide details? No.
    4. Have you ever been convicted (including pleas of guilty or nolo 
contendere) of any criminal violation other than a minor traffic 
offense? No.
    5. Pease advise the Committee of any additional information, 
favorable or unfavorable, which you feel should be considered in 
connection with your nomination. None.
                     e. relationship with committee
    1. Will you ensure that your department/agency complies with 
deadlines set by congressional committees for information? Yes.
    2. Will you ensure that your department/agency does whatever it can 
to protect congressional witnesses and whistle blowers from reprisal 
for their testimony and disclosures? Yes.
    3. Will you cooperate in providing the committee with requested 
witnesses, to include technical experts and career employees with 
firsthand knowledge of matters of interest to the committee? Yes.
    4. Please explain how you will review regulations issued by your 
department/agency, and work closely with Congress, to ensure that such 
regulations comply with the spirit of the laws passed by Congress. If 
confirmed, I will do my best to ensure that all regulations accurately 
conform to the plain reading of the law and I pledge routinely to 
consult with the appropriate committees in the Congress regarding 
regulations promulgated by the agency. Before final regulations are 
issued I will work to ensure such regulations are accurate and 
faithfully implement the letter and intent of the law.
    5. Describe your department/agency's current mission, major 
programs, and major operational objectives. NTIA is the Executive 
Branch's principal policy and planning voice on domestic and 
international telecommunications and information technology issues. 
NTIA works to spur innovation, encourage competition, promote universal 
service, help create jobs and provide consumers with more choices and 
better quality telecommunications products and services at lower 
prices.
    NTIA administers the Telecommunications and Information 
Infrastructure Assistance program (TIIAP), which is a competitive, 
merit-based grant program that provides matching grants to bring 
benefits of advanced telecommunications technologies through innovative 
projects demonstrating practical applications of advanced 
telecommunications and information technologies to rural and 
underserved areas. NTIA also administers the Public Telecommunications 
Facilities Program (PTFP), which assists, through matching grants, in 
the planning and construction of public telecommunications facilities 
and distance learning facilities utilizing nonbroadcast technologies.
    The Institute for Telecommunication Sciences (ITS) is the research 
and engineering branch of NTIA. ITS supports NTIA objectives, such as 
promoting advanced telecommunications and information infrastructure 
development in the United States, enhancement of domestic 
competitiveness, improvement of foreign trade opportunities for U.S. 
telecommunications firms, and facilitation of more efficient and 
effective use of the radio spectrum. ITS also serves as a principal 
Federal resource for solving the telecommunications concerns of other 
Federal agencies, state and local Governments, private corporations and 
associations, and international organizations.
    Spectrum management is a critical responsibility of NTIA and vital 
to national security and public safety. The Office of Spectrum 
Management (OSM) is responsible for managing the Federal Government's 
use of the radio frequency spectrum. OSM establishes and issues policy 
regarding: allocations and regulations governing the Federal spectrum 
use, plans for the peacetime and wartime use of the spectrum; 
preparation for, participation in, and implementation of international 
radio conferences, assignment of frequencies; maintenance of spectrum 
use databases; review of Federal agencies' new telecommunications 
systems and certification that spectrum will be available; providing 
the technical engineering expertise needed to perform specific 
investigations; participation in all aspects of the Federal 
Government's communications related to emergency readiness activitiesy 
and participation in Federal Government telecommunications and 
automated information systems security activities.
    6. Are you willing to appear and testify before any duly 
constituted committee of the Congress on such occasions as you may be 
reasonably requested to do so? Yes.
                  f. general qualifications and views
    1. How have your previous professional experience and education 
qualified you for the position for which you have been nominated. I 
have been intimately involved in the issues falling under NTIA's 
jurisdiction, including the development and implementation of the 
landmark Telecommunications Act of 1996, for the past 6 and \1/2\ 
years. My work, which has included participating in the Senate Commerce 
Committee's oversight role of NTIA, involved working directly with the 
agency's programs and functions. This experience has provided me with a 
good knowledge of the agency, its employees, programs and functions.
    2. Why do you wish to serve in the position for which you have been 
nominated? I believe NTIA has an exciting and challenging mission to 
promoting innovation and development of telecommunications and 
information technologies and services. I want to help carry out that 
mission. I am eager to help America prepare for the new global digital 
economy and I believe this agency can be of great assistance to U.S. 
consumers and industry so they may excel and benefit in the new 
economy.
    NTIA has a very important role to play to promote competition and 
universal service in telecommunications and information services, which 
are becoming more and more essential to the social, economic, and 
cultural well-being of American citizens and people throughout the 
world. Advances in telecommunications and information services provide 
unprecedented opportunities to create jobs, connect people with each 
other, improve the quality of life, and ameliorate social and personal 
challenges of the past which resulted from disabilities, geographic 
isolation, or economic disadvantage. I desire to utilize the talents 
and resources of the agency to promote the development of 
telecommunications and information services and the benefits such 
services can provide to people.
    3. What goals have you established for your first two years in this 
position, if confirmed? First, protecting national security and 
enhancing public safety are primary functions of NTIA and one of my 
goals is to further these objectives through efficient management of 
radio spectrum and enhancing the security of telecommunications 
networks.
    Second, I desire to foster job creation and innovation by promoting 
competition and universal service in telecommunications and information 
technologies. Information technologies account for more than a third of 
the present economic boom our nation is experiencing; creating new 
jobs, cutting inflation, and instituting unprecedented efficiencies. 
Within a decade, about half of the entire U.S. workforce will be 
employed by information technology producers or intense users of 
information technologies. I intend to direct the functions and programs 
of NTIA to promote the expansion and the availability of advanced 
services, such as high speed Internet access, through competition and 
universal service.
    Third, consumers need to he comfortable using telecommunications 
and information services and assured that their personal privacy is 
protected. One of my goals is to improve privacy protection in 
telecommunications and information services by working with the 
industry and the Congress to establish the right balance between 
private sector initiative and government guidance.
    4. What skills do you believe you may be lacking which may be 
necessary to successfully carry out this position? What steps can be 
taken to obtain those skills? In more than a decade of service in the 
Congress and campaign management experience, I have gained certain 
valuable skills that will be help me serve at NTIA. Nevertheless, I 
recognize and appreciate that there are many significant differences 
between working in the Executive and Legislative branches of government 
and, if confirmed, I will identify and install experienced staff to 
ensure efficient functioning of the agency.
    5. Please discuss your philosophical views on the role of 
government. Include a discussion of when you believe the government 
should involve itself in the private sector, when should society's 
problems be left to the private sector, and what standards should be 
used to determine when a government program is no longer necessary. 
With respect to telecommunications and information services, I believe 
that governmental regulations should be as minimal as possible.
    In my judgment, competition, not regulation, is the most efficient 
and effective means to spur innovation and lower prices. Competition is 
already thriving in many areas, but many other areas are still in 
transition to a competitive market. Where robust competition exists in 
open markets, governmental interference ought to be avoided. A 
governmental role is necessary under some circumstances, such as in 
areas where markets are transitioning from a monopoly-controlled 
environment to a competitive one. Governmental action in these 
instances must be clear, fair, understandable, competitively neutral, 
and directed toward obtainable goals that are designed to foster 
competition and allow market forces to work. Once an open competitive 
market does exist, governmental regulations must adjust accordingly.
    A governmental obligation also exists to ensure universal access in 
areas where market forces fall short. Yet steps to ``preserve and 
advance'' universal service ought to work in tandem with competition, 
not hinder it; consistent with the balance established under the 1996 
Telecommunications Act to ensure universal service and access for all 
Americans and promote competition.
    Finally, I believe that government can play an important role in 
working with industry and consumer advocates to develop private sector 
initiatives to address society's problems as the first and preferred 
solution.
    6. In your own words, please describe the agency's current 
missions, major programs, and major operational objectives.
    NTIA is the principal agency to develop amid articulate 
Administration domestic and international telecommunications and 
information policies. NTIA plays a lead role in working with Congress 
and advocates the Administration's positions before the Federal 
Communications Commission (FCC) and other independent regulatory 
agencies on telecommunications and information issues. Policy 
objectives advanced by NTIA should be consistent with the goals of 
competition, universal service and diversity.
    NTIA has a primary responsibility to protect national security and 
public safety with respect to telecommunications networks and services. 
The agency fulfills this responsibility in its management of federal 
spectrum and its research and grant programs which are designed to 
foster innovation and development of new technologies and applications 
of new technologies in the area of telecommunications and information 
services. NTIA's management of federal spectrum provides for efficient 
use of this public resource for national security and public safety 
purposes, while balancing these needs with the need to make spectrum 
available for private sector industry innovation and development.
    NTIA provides the leadership for the United States to be a world 
leader in the new global digital economy. The agency works to advance 
the goals of competition and universal service in telecommunications 
and information services, including advanced services, and investing in 
innovative applications and research. The Telecommunications and 
Information Infrastructure Assistance Program (TIIAP) and the Public 
Telecommunications Facilities Program (PTFP) provide matching grants to 
develop essential telecommunications and information services that 
would otherwise not occur. TIIAP identifies innovative demonstration 
projects in underserved areas which provide practical applications of 
new technologies for educational, health, and community needs. PTFP 
supports planning and construction of facilities for public 
broadcasting stations in order to strengthen the ability of public 
broadcasting to serve the public and distance learning facilities 
utilizing nonbroadcast technologies.
    Through these grant programs, the Institute for Telecommunications 
Services (ITS), and the Office of Spectrum Management, the agency helps 
to foster innovation and development of new technologies and 
applications.
    7. In reference to question number six, what forces are likely to 
result in changes to the mission of this agency over the coming five 
years. The rapid pace of growth and development of telecommunications 
and information technologies pose new challenges to protect national 
security, public safety, and personal privacy. NTIA needs to maintain a 
flexible and evolving mission to continually update its functions and 
programs to the rapid pace of change in technology.
    Further, the globalization of markets and the growth of 
telecommunications and information services impose an increasing 
dependency on technology and e-commerce. NTIA needs to be a vigorous 
advocate for the U.S. market in telecommunications and information 
technologies and e-commerce and utilize its programs and research 
functions to enhance U.S. competitiveness.
    8. In further reference to question number six, what are the likely 
outside forces which may prevent the agency from accomplishing its 
mission? What do you believe to be the top three challenges facing the 
department/agency and why? NTIA resources need to keep pace with 
technical advances. A reduction in resources in the agency could impose 
serious difficulties in carrying out the agency's mission. In my 
judgment, the following are the top three challenges facing the agency 
at this time:
    (1) Balancing budgetary constraints with the growth in technology 
is a significant challenge facing NTIA. The telecommunications and 
information industries, fueled by rapid technological advancement, are 
among the fastest growing aspects of our nation's economy. Among the 
consequences of this technological explosion are new challenges to 
protect national security, public safety, and personal privacy. NTIA's 
resources need to keep pace with the industry and technologies which 
relate to the agency's mission.
    (2) Efficient spectrum management is a continuing challenge to the 
agency as it attempts to balance the objectives of protecting national 
security and pubiic safety with allocating the limited resource of 
spectrum for private development. The agency and the statute are 
resilient, but the agency needs to remain focused on the increasing 
pressures to allocate spectrum for private development and not threaten 
national security and public safety needs.
    (3) Another challenge facing the agency is how to assert leadership 
in maintaining the appropriate balance between deregulation/private 
sector initiative and governmental involvement in the area of 
protecting privacy and security over telecommunications networks and 
services. While private sector-led solutions are preferable to 
regulation, NTIA needs to work with industry to provide guidance and 
help define what governmental actions, if any, are necessary to protect 
national security and individual privacy.
    9. In further reference to question number six, what factors in 
your opinion have kept the department/agency from achieving its 
missions over the past several years? The agency has done a good job in 
carrying out its mission and the programs under its administration have 
been run efficiently and mindful of the need to target taxpayer 
resources to areas of greatest need. But, resources for the agency have 
remained relatively level while the challenges to address rapid changes 
in the industry have grown dramatically.
    10. Who are the stakeholders in the work of this agency? First and 
last, the American people are the primary stakeholders. The national 
security and public safety communities are major stakeholders and NTIA 
also has significant implications on companies that provide 
telecommunications and information services, the businesses and 
consumers that rely upon those services, and the general public which 
benefits through economic efficiency, job creation, and public safety 
enhancement.
    11. What is the proper relationship between your position, if 
confirmed, and the stakeholders identified in question number ten. I 
believe that it is imperative that NTIA maintain a very close 
relationship with national security, public safety and consumer 
organizations and all the various industry segments. Given the 
deregulatory environment which is characteristic of the competitive 
aspects of the telecommunications and information industries, NTIA 
needs to work closely with industry and consumers to establish as many 
solutions as possible that do not require federal regulation. Further, 
a cooperative bi-partisan relationship with the Legislative Branch is 
necessary.
    12. The Chief Financial Officers Act requires all government 
departments and agencies to develop sound financial management 
practices similar to those practiced in the private sector.
    (a) What do you believe are your responsibilities, if conflrmed, to 
ensure that your agency has proper management and accounting controls?
    I believe that proper financial management is essential and cannot 
be compromised and it is my responsibility to ensure proper management 
for the agency.
    (b) What experience do you have in managing a large organization?
    More than a decade of work in the Congress has prepared me to work 
on complex issues in large organizations.
    13. The Government Performance and Results Act requires all 
government departments and agencies to identify measurable performance 
goals and to report to Congress on their success in achieving these 
goals.
    (a) Please discuss what you believe to be the benefits of 
identifying performance goals and reporting on your progress in 
achieving those goals.
    The benefits are good, effective management, efficient allocation 
of resources, and successful completion of the agency's mission. 
Reporting keeps the agency focused on the right priorities and 
identifies where resources should be directed.
    (b) What steps should Congress consider taking when an agency fails 
to achieve its performance goals? Should these steps include the 
elimination, privatization, downsizing or consolidation of departments 
and/or programs? Regulations issued by your department/agency comply 
with the spirit of the laws passed by Congress.
    In my experience in working in Congress, I understand the 
importance of working closely with the Committee and the sponsors of 
legislation that becomes law to ensure that regulations and 
implementation remain faithful to the letter and intent of the statute. 
If confirmed, I will do my best to ensure that all regulations 
accurately comport with the language and the spirit of the law and I 
pledge to routinely consult with the appropriate committees in the 
Congress. Before regulations are finalized I will work with the 
appropriate Committees and the stakeholders to ensure such regulations 
are accurate and faithfully implement the letter and intent of the law.
    18. In the areas under the department/agency's jurisdiction, what 
legislative action(s) should Congress consider as priorities? Please 
state your personal views.
    The telecommunications and information industries are in a period 
of rapid growth and change, driven in part by the enactment of the 
Telecommunications Act of 1996. In my judgment, it is in the best 
interests of the industry and consumers to have a stable, predictable 
regulatory and legal environment to allow the marketplace to excel. 
Broad sweeping legislative changes at this time could disrupt the path 
of growth of the industry. However, that does not suggest that 
regulations implementing the statute ought not be revised or adjusted. 
There have been many bumps in the road to implementing the sweeping 
changes under the Telecommunications Act and many challenges lie ahead. 
It seems to me that NTIA needs to work in close cooperation with the 
Congress to advocate policies before independent regulatory agencies, 
such as the FCC, to implement the law in a manner that is faithful to 
the Act.
    There are areas, such as in protecting national security, public 
safety, and personal privacy, where rapidly changing technologies are 
imposing unprecedented challenges. While I do not advocate any 
particular legislation at this time, I do believe that it is important 
that NTIA needs to work closely with the Congress in a bi-partisan 
manner to monitor and assist private sector initiatives and, if 
necessary, develop any appropriate legislation.
    19. Within your area of control, will you pledge to develop and 
implement a system that allocates discretionary spending based on 
national priorities determined in an open fashion on a set of 
established criteria? If not, please state why. If yes, please state 
what steps you intend to take and a time frame for their 
implementation.
    Yes. Early in my tenure, I intend to examine the NTIA strategic 
plan and meet with NTIA senior managers to ensure the agency's goals 
and objectives address Congressional, Administration, and Departmental 
priorities and are reflected in an appropriate distribution of 
discretionary resources.

    Senator Ashcroft. Well, thank you very much for your 
presentation and your remarks. You have been most gracious and 
we appreciate not only your service but the way in which you 
present yourself.
    You have had a lot of opportunity to look around. You have 
observed things while we were in the process of changing 
things. Managing change is perhaps the greatest of all the 
privileges we have because we have the opportunity, if we do 
not think things are working well, to change them.
    Do you have any changes in mind for the National 
Telecommunications and Information Administration in the way it 
would operate and what it would do?
    Mr. Rohde. I think the best way to answer that is to say 
that I think circumstances are quite different today than they 
were in 1993 at the beginning of this administration. I believe 
that we are on the cusp of some watershed events in the area of 
telecommunications policy. I think, to the extent that there 
are changes, they will be in terms of emphasis and focus. 
Because of what is going on in the industry such as some of the 
very significant decisions on 271 applications, on the debate 
over broadband access, the debates over privacy, NTIA is likely 
to have a greater focus on these areas and you may see a little 
more activity in these areas.
    Senator Ashcroft. Since you have responsibility of advising 
the administration on telecommunications and information 
technology, what kind of advice will you be giving them 
regarding broadband and the availability of broadband? In 
particular, do you see technology as solving the broadband 
challenge by providing it without significantly greater 
infrastructure in terms of hard line communication? Or how 
would you see that working out?
    Mr. Rohde. Technology is what is driving the broadband 
debate. It is new technology such as digital subscriber line 
service that are providing this greater capability and the 
technology that is retrofitting the cable systems that is 
driving the whole broadband debate. In my mind, broadband 
deployment is thriving in competitive environments. I think 
that competition will drive investments. However, I also 
understand that there are markets in this country where 
competition will not be the driving force for broadband 
deployment, and that is where universal service plays a role.
    With respect to the broadband debate, I think the framework 
in the Telecommunications Act got it right. It is a framework 
to create open, competitive markets and preserve and advance 
universal service to make sure that benefits of broadband 
deployment are spread throughout the country.
    Senator Ashcroft. Do you see broadband as being provided 
through hard wire access, or do you see that coming as part of 
the wireless capacity? I think that makes a big difference 
because if you can have the wireless stuff, those who own the 
wires now are not in a unique position.
    Mr. Rohde. I think it is going to come through both. Right 
now most of what we refer to as broadband capability is coming 
over wires, but there are wireless technologies out there in 
the development stage that can provide broadband. There are, 
for example, a number of satellite providers that already have 
licenses from the FCC and are seeking licenses to deploy 
wireless broadband access. So, I think broadband is going to 
come through a variety of technologies.
    It is important that public policy be technologically 
neutral, as the Telecommunications Act requires, so that we 
promote a variety of technologies to meet a variety of 
circumstances.
    Senator Ashcroft. There are Members of Congress and of 
industry that are critical of the way that the Government uses 
the spectrum that it occupies. Their belief is that Government 
is holding on to spectrum that it does not need, given the fact 
that technology has made spectrum use far more efficient.
    As the Administrator of the NTIA, how would you address 
these concerns, and in what way would you respond to Government 
when it says, well, we just need all the spectrum we have had 
historically? What sort of considerations would enter your mind 
in your advice-giving capacity in evaluating those situations?
    Mr. Rohde. First of all, I think it is important to point 
out that currently about 93 percent of all the spectrum that is 
used in this country is shared spectrum between the Government 
and private users. About 1.4 percent is exclusively Government 
use, and a little over 5 percent is exclusively nongovernment 
use. The NTIA, through the instructions of the OBRA 1993 and 
the OBRA 1997 acts, has already allocated over 255 megahertz to 
the Federal Communications Commission to make available for 
private use.
    Many of the debates that we are in currently and will be in 
in the future are going to involve sharing questions and 
interference issues. NTIA has a responsibility to try to 
resolve these in a manner that protects the national security 
and public safety as well as allow for private sector 
innovation and use. I think also NTIA has a number of assets it 
can bring to these debates. It has a wonderful research lab in 
Boulder, Colorado that can help try to resolve a lot of these 
interference issues.
    I think the agency has a dual responsibility. It has the 
responsibility to ensure national security and public safety 
with the Federal users, but it also has a responsibility to 
promote the innovation of new technologies. The approach that I 
want to bring to this matter is that I do not want the agency 
to just say no all the time. I want it to try to work out the 
interference sharing issues so that we do not have to sacrifice 
public safety and national security for the sake of developing 
new technologies, that these can work hand in hand.
    Senator Ashcroft. Senator Dorgan.
    Senator Dorgan. Mr. Chairman, having worked for so long 
with Greg, I have no need to inquire of his views.
    [Laughter.]
    I would simply say I read a press report in which there was 
some speculation that if his nomination came to the Congress, 
that he should not necessarily be blamed for the positions I 
had taken while a member of the Commerce Committee.
    [Laughter.]
    So, I absolve you of all of that.
    [Laughter.]
    I think Greg has provided a statement that really reflects, 
for all of the members of this committee, the value of his 
ability and intellect that he has offered to me for so many 
years. So, I do not have any questions. Thank you, Greg, and 
thank you for a wonderful statement.
    Senator Ashcroft. Senator Wyden.
    Senator Wyden. Thank you, Mr. Chairman.
    As I said earlier, I think Greg Rohde is going to do a 
terrific job in this position. I think he probably, last night, 
was worried that I was going to ask about 150 questions about 
the Internet Tax Freedom Act.
    [Laughter.]
    Mr. Rohde. You already know how I would respond.
    Senator Wyden. And also, we all know it is Senator Dorgan's 
fault, as he just said.
    [Laughter.]
    I only wanted to have followup on this broadband issue, and 
I think you could tell from my opening statement that I would 
be interested in your thoughts about how the administration 
would proceed at this point with respect to carrying out 
section 706 of the act.
    The act, as you know, puts the focus on really getting a 
broadband capability into every nook and cranny in the country, 
and the reason that we had this excellent conference this 
morning, put together by Senator Daschle and Senator Dorgan, is 
that obviously a lot of these rural communities, from the 
standpoint of communications, are being turned into sacrifice 
zones. They are just being left out. My concern is that the 
Federal Communications Commission just seems absolutely 
unwilling to get off the sidelines and get serious about 
implementing the act.
    In fact, in February basically--and I quote here--they said 
the deployment of broadband capability is reasonable and 
timely. They said this year that everything is just hunky-dory, 
and I think when we go out to rural communities in Oregon and 
North Dakota and other places, they say, well, they may think 
everything is reasonable and timely in Washington, D.C., but it 
certainly is not in rural Oregon and other parts of the 
country.
    I think just by way of a friendly question, obviously, is I 
would be interested in your thoughts this afternoon what you 
would say to Chairman Kennard and the FCC in terms of actually 
getting them off the sidelines to carry that out.
    Mr. Rohde. Thank you.
    Well, first of all, before I directly answer your question, 
I would really like to commend you and Senator Dorgan and 
Senator Daschle and others who have really entered this debate 
and are really driving the aspect of the debate about making 
sure that broadband comes to a lot of rural areas.
    There are a lot of issues out there. There are a lot of 
very significant constituencies behind aspects of this debate 
that are pushing their agenda with respect to their solution 
for getting broadband out there. I think the work that you and 
other Democratic Senators are doing is really helping to drive 
that debate in the right direction and is having a big impact 
on how the Federal Communications is going to look at these 
issues.
    To directly answer your question, what I would say to 
Chairman Kennard and my advice the administration is I think 
broadband deployment is a very high priority. I think the 
administration needs to be heavily engaged in this debate and I 
think NTIA needs to work very closely with the FCC. The FCC 
under 706 is charged with looking at ways in which to encourage 
the deployment of broadband services. Also advance services are 
mentioned elsewhere in the act, such as in section 254 and 
section 271. As you know, the FCC is looking at universal 
service reforms under section 254 right now.
    So, I agree with you, Senator, that we need to be very 
aggressive. We need to push very hard for the Commission to be 
focused on broadband deployment. It is not the time to delay 
consideration. We should not act too quickly to disrupt the 
positive things going on in the marketplace, but yet decisions 
need to be made now about how this broadband is going to be 
deployed in a manner to accomplish the goals we want, such as 
ubiquitous deployment.
    Senator Wyden. I am looking forward to seeing you in this 
new position.
    I do not have any other questions, Mr. Chairman.
    Senator Ashcroft. Senator Burns.
    Senator Burns. Greg, congratulations on your nomination.
    Mr. Rohde. Thank you.
    Senator Burns. I appreciate that very much.
    I want to ask you one question. As we see wireless continue 
to grow in rural areas and we see competition in rural areas 
where probably as near as 5 or 6 years ago we did not think 
there would ever be any competition in rural areas for the 
simple reason that the co-ops and the independents were there, 
do you see a time when universal service becomes more of a 
detriment to allowing competition into a market? Do you see a 
time when the universal service will have to be looked at 
again? There is a point of diminishing returns. We have seen in 
the competitive areas what competition has done. Do you see 
when universal service becomes a detriment?
    Mr. Rohde. Well, Senator, as you know, the 
Telecommunications Act called for reform of universal service, 
and the instructions of the act are to ``preserve and advance 
universal service.'' I know the intent of this committee--which 
paid a great deal of attention to those provisions of the 
bill--understood that universal service needed to be reformed 
in order to accommodate a competitive model. Traditionally, 
local phone service has been provided by Government sanctioned 
monopolies that have been regulated largely at the State level. 
Congress, in passing the Telecommunications Act, said that it 
wanted to change that model and move to a competitive model. As 
a result, universal service needs to be reformed in order to 
accommodate competition and deal with competition..
    Can universal service in instances be a barrier to entry? 
Yes, it can be. That is why we need the reform. But at the same 
time to the local incumbent, needs the reform as well because 
if competition rolls out without any adjustments to universal 
service and we have what we call cherry-picking going on, the 
local incumbent who may only have a few thousand in their 
subscriber base could see a substantial portion of their 
revenues whittled away. So, we need to have a reformed 
universal service system consistent with the act that 
accommodates competition and also helps the incumbent carrier 
survive competition.
    Senator Burns. I ask that question because there are two or 
three different models out there, but I think we have to be 
very agile here in Government and to make sure that policy is 
reformed.
    I had the feeling, whenever we passed the 1996 Act, that 
maybe some of us would like to go a little bit further, as you 
well know, but it ended up to be an act that was more of a 
transition law than anything else because we were taking 
entities that had been under the umbrella in the regulatory 
environment since 1935 and we were trying to regulate 1990's 
technology with a 1935 bill. In fact, the whole world was going 
off and leaving us in the dust because things are going to 
happen no matter what the policy of this Government. Once you 
go home, you find out how irrelevant Washington really is when 
it comes to the innovative juices of how we do things in this 
country.
    So, that was my question because I think no matter who the 
administration is, it has to be very agile and aware of when 
that policy change may have to take place.
    Congratulations again.
    Mr. Rohde. Thank you very much, Senator.
    Senator Burns. You bet.
    Senator Ashcroft. Senator Brownback from Kansas.
    Senator Brownback. Thank you very much, Mr. Chairman. I am 
not here to ask any questions but just to support the nominee. 
I am delighted that he has been nominated to the post. His 
work, the Senator's work they have done on universal service 
has been outstanding certainly from a rural State's perspective 
like mine and like what was in North Dakota. Your work in the 
1996 Act in particular I want to recognize.
    I think these are critically important fights and I hope, 
as you go into this new position, you continue to fight for 
rural interest and rural areas. That is parochial for me to 
say, but I think it is very important for the country so that 
we just do not create two different economies when we go to 
more and more information needs that the rural areas continue 
to be able to have that. We have historically done that as a 
country, whether it be rural electrification or telephony or 
other things, but we have got continuing needs to make sure 
that we do not create two societies between rural and urban.
    I applaud your past work in there and I just encourage you 
to continue it.
    Mr. Rohde. Thank you very much.
    Senator Brownback. Thank you, Mr. Chairman.
    Senator Ashcroft. Thank you very much, Senator Brownback.
    Thank you very much, Mr. Rohde, for your attendance here, 
for your service to the committee, and for your service to the 
Senate. We look forward to your service to the country.
    Mr. Rohde. My pleasure. Thank you very much.
    Senator Ashcroft. At this time I would like to call Mr. 
Thomas Leary. I would also like to mention that Mr. Leary's 
wife, Stephanie Abbott, is in the audience and welcome you. 
Thank you very much for being here.
    Some of you have wondered when these items might be 
scheduled for an executive session and reported to the Senate. 
The chairman of the committee, through his staff director, has 
indicated that he plans to expedite this and to move these 
nominations as soon as possible.
    Senator Dorgan. Mr. Chairman?
    Senator Ashcroft. Yes.
    Senator Dorgan. Mr. Chairman, I am going to have to leave, 
but before I did, I wanted to offer my support for Mr. Leary's 
nomination. I think he has excellent qualifications. I regret I 
am not able to stay and make a longer comment, but let me say I 
am pleased he is here. I am pleased he is offering himself for 
service to our country and I think that service will greatly 
benefit America.
    Senator Ashcroft. Thank you very much, Senator.
    Mr. Leary currently is a partner at Hogan & Hartson, 
although he frequently litigated consumer fraud issues before 
the Federal Trade Commission, his practice has focused 
primarily on antitrust litigation. Prior to his move to 
Washington, he served as an associate and then a partner at 
White & Case and then Assistant General Counsel for General 
Motors. He received his bachelor degree at Princeton, his law 
degree at Harvard, and a Harvard degree and a Princeton 
education is a thing of note.
    We welcome you to the committee and may I suggest that we 
just observe a moment of not silence, until the doors close, 
and then I would invite you to proceed.
    [Pause.]

 STATEMENT OF THOMAS B. LEARY, COMMISSIONER-DESIGNATE, FEDERAL 
                        TRADE COMMISSION

    Mr. Leary. Mr. Chairman and members of the committee, I 
just have a very brief opening statement and at the beginning I 
really want to express my gratitude to this committee for the 
courtesy you have extended to me in scheduling this hearing so 
quickly after the summer recess.
    And I also want to thank all of the people who have helped 
me to get to this stage in the process, a lot of whom I know 
and, frankly, a lot of whom I do not. As a Republican nominee 
in a Democratic administration, as you can imagine, I have 
needed a lot of help from people in both political parties. I 
particularly want to express my gratitude both to Senator Lott 
and to Senator McCain who have done so much for me, in addition 
to the people who are here now, and also to the President who 
appointed me and to the people in the White House who have been 
unfailingly courteous and helpful to me.
    I also am honored that my wife is here and that some of my 
present colleagues and some of my colleagues-to-be are here, 
including Commissioner Orson Swindle who has been good enough 
to accompany me. I appreciate his presence and support.
    Like other nominees, I responded to the best of my ability 
to your written questions, and I would like to respond today, 
as best I can, to any additional questions that you may have.
    I want to make clear that, as far as I am concerned, this 
commitment to be responsive does not end with this appearance. 
To the extent that it is proper for me to do so, I want to be 
responsive on an ongoing basis to members of this body and the 
other one and to people in the administration. I think I made 
clear in my written submissions that I have a very firm belief 
that agency independence is not the same thing as agency 
isolation, and I hope to have the opportunity to work with you 
all in the future.
    I have a fundamental belief in the vigor and adaptability 
of the free market system.
    Senator Ashcroft. May I ask you to suspend your remarks for 
a minute? I would like to go and ask the folks in the hall if 
they would----
    [Pause.]
    I apologize. Your appointment and the responsibility to 
which the President has appointed you is a very serious one and 
it is important that we be able to hear what you have to say 
and for you to be able to say it without reference to--no 
matter how joyful the celebration is.
    Mr. Leary. I appreciate it, Senator.
    Senator Ashcroft. I wish you would proceed. I apologize.
    Mr. Leary. Let me just repeat. I want to express my 
fundamental belief in the vigor and the adaptability of the 
free market system, and I do not see the mission of the FTC as 
being in any way inconsistent with that basic belief.
    Obviously, I cannot comment on individual matters that are 
now or may in the immediate future come to the Commission for 
consideration, but I promise you an open mind. I think one of 
the benefits of advancing years is that it becomes increasingly 
easy to admit from time to time that initial impressions I have 
may just be mistaken. In that spirit I want to entertain this 
new challenge and I welcome your help.
    That concludes my remarks, Senator.
    [The prepared statement and biographical information of Mr. 
Leary follow:]
    Prepared Statement of Thomas B. Leary, Commissioner-Designate, 
                        Federal Trade Commission
    Mr. Chairman and Members of the Committee:
    At the outset, I would like to express my gratitude to this 
Committee for the courtesy you have extended to me in scheduling this 
hearing so quickly after your return from the summer recess. I would 
also like to take this opportunity to thank all of those people who 
have helped me get to this stage in the process. I am familiar with 
some of the efforts made on my behalf, but I am no less grateful for 
the many efforts that I know nothing about.
    I am pleased to respond today, as best I can, to any questions or 
concerns that you may want to express. And I want to make an open 
commitment to be similarly forthcoming in the future if I am confirmed. 
My written submissions set out my firm belief that agency independence 
is not the same thing as agency isolation, and I really hope to have 
the opportunity to work with you in the future.
    I have no preconceived agendas, and I promise you an open mind. One 
of the side benefits of advancing years is that it becomes easier to 
admit that some of my first reactions may just be wrong. I want to 
approach this challenge in that spirit, and I welcome your help.
                                 ______
                                 
                      a. biographical information
    1. Name: (Include any former names or nicknames used.) Thomas 
Barrett Leary (``Tom'').
    2. Position to which nominated: Commissioner, Federal Trade 
Commission.
    3. Date of nomination: July 28, 1999.
    4. Address: (List current place of residence and office addresses.) 
Home: 615 E Street, N.W. Washington, D.C. 20003. Office: Hogan & 
Hartson L.L.P. 555 13th Street, N.W. Washington, D.C. 20004.
    5. Date and place of birth: July 15, 1931; Orange, New Jersey.
    6. Marital status: (Include maiden name of wife or husband's name.) 
Married to Stephanie Lynn Abbott.
    7. Names and ages of children: (Include stepchildren and children 
from previous marriages.) Thomas Abbott Leary (41), David Abbott Leary 
(39), Alison Leary Estep (35).
    8. Education: (List secondary and higher education institutions, 
dates attended, degree received and date degree granted.) Harvard Law 
School--1955-58 (JD 1958); Princeton University--1948-52 (AB 1952).
    9. Employment record: (List all jobs held since college, include 
the title or description of job, name of employer, location of work, 
and dates of employment.) Partner, Hogan & Hartson, Washington, D.C. 1/
1/83 to Present; Assistant General Counsel General Motors Corp. 
Detroit, Michigan, 9/77-12/82; Attorney-in-Charge, Antitrust General 
Motors Corp. Detroit, Michigan, 10/71-9/77; Partner, White & Case New 
York, New York, 1/69-10/71; Associate, White & Case, New York, New 
York, 7/58/-12/68; Worker on Road Gang, Coronado, California, Summer 
1956; Officer, U.S. Naval Reserve, Active Duty, U.S. and WestPac, 10/
52-8/55; Officer Candidate, Newport, Rhode Island, 6/52-10/52.
    10. Government experience: (List any advisory, consultative, 
honorary or other part-time service or positions with Federal, State, 
or local governments, other than those listed above.) None.
    11. Business relationships: (List all positions held as an officer, 
director, trustee, partner, proprietor, agent, representative, or 
consultant of any corporation, company, firm, partnership, or other 
business enterprise, educational or other institution.) Partner, Hogan 
& Hartson 1983-Present; Assistant General Counsel, General Motors 
Corp., 1977-82; Partner, White & Case, 1969-71;
    [Note: I was a non-officer employee on the Legal Staff of General 
Motors from 1971-77, and an associate of White & Case from 1958-68.]
    12. Memberships: (List all memberships and offices held in 
professional, fraternal, scholarly, civic, business, charitable and 
other organizations.)
    Member, American Bar Association, 1959-Present; Council, ABA 
Antitrust Section, 1979-83; Chairman, Antitrust Committee, ABA 
Business, Law Section, 1991-94; Member, D.C. Bar Association,1983-
Present; Board Member, Lawyer Counseling, approx. 1985-Present; 
Committee, D.C. Bar, (separate terms); Member, Michigan Bar 
Association, 1971-82; Member, New York State Bar Association, 1958-71; 
Council, New York Bar, Antitrust Section approx., 1969-71; Board 
Member, National Council on Alcoholism, Detroit, Michigan, approx. 
1978-82.
    13. Political affiliations and activities:
    (a) List all offices with a political party which you have held or 
any public office for which you have been a candidate. None.
    (b) List all memberships and offices held in and services rendered 
to all political parties or election committees during the last 10 
years. None.
    (c) Itemize all political contributions to any individual, campaign 
organization, political party, political action committee, or similar 
entity of $500 or more for the past 10 years. Two gifts totaling $500 
to Republican National Committee in 1998; One gift of $500 to Bush 
campaign in 1988; Following amounts to Hogan & Hartson PAC: 1999--$500; 
1998--$500; 1997--$500; 1996--$500; 1995--$550; 1994--$625.
    14. Honors and awards: (List all scholarships, fellowships, 
honorary degrees, honorary society memberships, military medals and any 
other special recognitions for outstanding service or achievements.) 
National Defense, Korean Theater, and UN Medal for service with U.S. 
Navy in Far East in 1953-54.
    15. Published writings: (List the titles, publishers, and dates of 
books, articles, reports, or other published materials which you have 
written.)
Book Chapters:
Chapter 10, Prevention of Liability for Antitrust Violations, in BNA/
ACCA Compliance Manual: Prevention of Corporate Liability (1993)
Chapter 1, Antitrust Problems in International Trade--The Congressional 
Response, in Southwest Legal Foundation, Private Investors Abroad--
Problems and Solution in International Business in 1985 (1986)
Articles and Columns:
How to Avoid Negotiations on Second Requests: A Comment, Antitrust 41 
(Summer 1999) (Co-authors: Janet McDavid and Philip Larson)
The Uncertain Future of Food Advertising, Frozen Food Report 16-17 
(July/August 1995)
The Defense of Mergers in the Defense Industry, Antitrust 4 (Summer 
1993) (Co-author: Janet McDavid)
Avoiding Corporate Punishment, Snack World 12 (October 1991)
The U.S. Sentencing Commission Guidelines, Preventive Law Reporter 
(September 1991)
New Antitrust Legislation, Snack World 12 (March 1991)
State Indirect Purchaser Laws Should Be Preempted, Antitrust 25 (Fall/
Winter 1990)
Antitrust Planning in an Era of Uncertainty, CCH Business Strategies 
para. 2450 at 15,201 (1984)
Use and Misuse of Economic Experts, 52 Antitrust Law Journal 823-31 
(Summer 1983)
Is There a Conflict in Representing a Corporation and Its Individual 
Employees, 36 Business Lawyer 591-95 (March 1981)
Other (Panel Comments and Letters)
Letter, McArthur Draws Sharp Response, Antitrust 48 (Spring 1989)
Panel, The Merger Transaction, 56 Antitrust Law Journal 607-55 (Fall 
1987)
Panel, Antitrust Litigation, A Corporate Counsel's Perspective, 51 
Antitrust Law Journal 447-58 (Summer 1982)
Panel, Practical Aspects of Internal Antitrust Investigations, 51 
Antitrust Law Journal 123-51 (Winter 1982)
Panel, Do the [no-fault monopoly] Proposals Make Any Sense From a 
Business Standpoint?, 49 Antitrust Law Journal 1281 (Summer 1981)
Panel, Current Issues in the Attorney-Client Relationship, 36 Business 
Lawyer 597-603 (March 1981)
Panel, Experience Curve Theory, in Conference Board Information 
Bulletin 28 (1980)
Panel, What Is the Real Issue?, in ABA, Industrial Concentration and 
the Market System 278 (1979)
Panel, A Managerial View of Corporate Compliance, 46 Antitrust Law 
Journal 481-507 (Spring 1977)
    16. Speeches: Provide the Committee with two copies of any formal 
speeches you have delivered during the last 5 years which you have 
copies of on topics relevant to the position for which you have been 
nominated. Most of my speeches are based on handwritten notes, which I 
do not retain. One speech delivered during the last five years was 
transcribed, and I have the text of two others. (See Attachments A and 
B)
    17. Selection:
    (a) Do you know why you were chosen for this nomination by the 
President?
    I understand that Senator Trent Lott asked the President to 
nominate me to fill the vacant Republican seat on the Commission. I 
understand that I also have been recommended by others.
    (b) What do you believe in your background or employment experience 
affirmatively qualifies you for this particular appointment?
    For almost 40 years, I have advised clients on antitrust and 
consumer deception matters. I have litigated these matters in federal 
courts and have represented clients in internal deliberations at the 
Department of Justice and the Federal Trade Commission. I have written 
and spoken publicly on these issues, and have on occasion lobbied and 
prepared comments for clients with respect to pending antitrust 
legislation. I am a lifelong Republican but, at the same time, have had 
for many years a congenial professional relationship with the current 
Democratic chairman of the Commission.
                   b. future employment relationships
    1. Will you sever all connections with your present employers, 
business firms, business associations or business organizations if you 
are confirmed by the Senate? Yes.
    2. Do you have any plans, commitments or agreements to pursue 
outside employment, with or without compensation, during your service 
with the government? If so, explain. No.
    3. Do you have any plans, commitments or agreements after 
completing government service to resume employment, affiliation or 
practice with your previous employer, business firm, association or 
organization? No.
    4. Has anybody made a commitment to employ your services in any 
capacity after you leave government service? No.
    5. If confirmed, do you expect to serve out your full term or until 
the next Presidential election, whichever is applicable? Yes.
                   c. potential conflicts of interest
    Describe all financial arrangements, deferred compensation 
agreements, and other continuing dealings with business associates, 
clients or customers. As stated in response to the financial disclosure 
question G1, I presently have a deferred compensation arrangement with 
Hogan & Hartson. This compensation would be paid in one lump sum before 
I assumed a government position, and I would have no ongoing financial 
connection with the firm. I also have a vested pension based on my 11 
years of service with General Motors Corp., which amounts to $1,040 per 
month. The pension is not contingent on any activities I may undertake, 
and I have no other relationship with General Motors.
    2. Indicate any investments, obligations, liabilities, or other 
relationships which could involve potential conflicts of interest in 
the position to which you have been nominated. None.
    3. Describe any business relationship, dealing, or financial 
transaction which you have had during the last 10 years, whether for 
yourself, on behalf of a client, or acting as an agent, that could in 
any way constitute or result in a possible conflict of interest in the 
position to which you have been nominated. I have represented clients 
in various matters before the Federal Trade Commission during the past 
10 years, and am aware of--and will abide by--the applicable conflict 
rules for these situations. I am not personally representing clients on 
any matters now pending before the Commission, and have been screened 
off from any pending FTC matters that are being handled by others in 
the firm.
    4. Describe any activity during the past 10 years in which you have 
engaged for the purpose of directly or indirectly influencing the 
passage, defeat or modification of any legislation or affecting the 
administration and execution of law or public policy. During the years 
1989 through 1995, I was registered as a lobbyist for The Business 
Roundtable with respect to antitrust legislation generally and certain 
specific bills that were under consideration at that time. My 
activities focused on the Senate and House Judiciary Committees.
    5. Explain how you will resolve any potential conflict of interest, 
including any that may be disclosed by your responses to the above 
items. (Please provide a copy of any trust or other agreements.) Other 
than the matters disclosed, I am not aware of any potential conflicts 
of interest. I will, of course, abide by any applicable conflicts 
rules.
    6. Do you agree to have written opinions provided to the Committee 
by the designated agency ethics officer of the agency to which you are 
nominated and by the Office of Government Ethics concerning potential 
conflicts of interest or any legal impediments to your serving in this 
position? Yes.
                            d. legal matters
    1. Have you ever been disciplined or cited for a breach of ethics 
for unprofessional conduct by, or been the subject of a compliant to 
any court, administrative agency, professional association, 
disciplinary committee, or other professional group? If so, provide 
details. No.
    2. Have you ever been investigated, arrested, charged or held by 
any Federal, State, or other law enforcement authority for violation of 
any Federal, State, county, or municipal law, regulation or ordinance, 
other than a minor traffic offense? If so, provide details. No.
    3. Have you or any business of which you are or were an officer 
ever been involved as a party in interest in an administrative agency 
proceeding or civil litigation? If so, provide details. I was involved 
in litigation from the years 1991 to 1994, as a result of a domestic 
dispute with a woman to whom I had been engaged between my marriages. 
Consolidated lawsuits, titled Leary v. Skarstrom, No. 91-CA12217RP, and 
Skarstrom v. Leary, No. 91-CA12809, are a matter of public record in 
the Superior Court of the District of Columbia.
    I was represented in these actions successively by a domestic 
relations lawyer, Ms. Susan Friedman, Kuder Smollar & Friedman, 1925 K 
Street, N.W. Washington, D.C. 20006 (202-331-7522), and by a trial 
lawyer, Mr. Steven Gordon, Holland & Knight, 2100 Pennsylvania Avenue, 
N.W., Suite 400, Washington, D.C. 20037 (202-955-3000). These lawyers 
have been notified that I waive all privilege with respect to this 
matter, and have been instructed to answer any questions.
    The actions were settled in June 1994, and general releases were 
exchanged. There are no ongoing obligations of either party.
    4. Have you ever been convicted (including pleas of guilty or nolo 
contendere) of any criminal violation other than a minor traffic 
offense? No.
    5. Please advise the Committee of any additional information, 
favorable or unfavorable, which you feel should be considered in 
connection with your nomination. None.
                     e. relationship with committee
    1. Will you ensure that your department/agency complies with 
deadlines set by congressional committees for information? Yes.
    2. Will you ensure that your department/agency does whatever it can 
to protect congressional witnesses and whistle blowers from reprisal 
for their testimony and disclosures? Yes.
    3. Will you cooperate in providing the committee with requested 
witnesses, to include technical experts and career employees with 
firsthand knowledge of matters of interest to the committee? Yes.
    4. Are you willing to appear and testify before any duly 
constituted committee of the Congress on such occasions as you may be 
reasonably requested to do so? Yes.
                  f. general qualifications and views
    1. Please describe how your previous professional experience and 
education qualifies you for the position for which you have been 
nominated. See response to Questions A9, A15, Al7(b), and F3.
    2. What skills do you believe you may be lacking which may be 
necessary to successfully carry out this position? What steps can be 
taken to obtain those skills? I have had extensive dealings with the 
Federal Trade Commission from the ``outside,'' but I have never worked 
on the ``inside.'' There is a great deal about the day-to-day operation 
of the Commission that I do not know, and the Commission has 
enforcement responsibilities in some areas that I have not encountered 
in my legal practice. Fortunately, commissioners are able to select 
their own attorney and economic advisors, and I intend to select some 
people who have had extensive experience within the agency.
    In addition, I am fortunate in that a number of present and former 
Commission employees are personal friends. They have been generous in 
their offers to brief me on Commission processes and procedures if I 
actually am confirmed.
    3. Why do you wish to serve in the position for which you have been 
nominated? There are a number of reasons, some related to my perception 
of the public interest and some that are purely personal.
    I did not initially seek the position but was urged to be a 
candidate by a number of people, from both political parties, who are 
interested in the work of the Federal Trade Commission. I have not been 
politically active, in the sense of participation in campaigns, but I 
have actively participated for many years in public debate over 
antitrust policies and processes. Although my lifelong immersion in 
antitrust issues is not a prerequisite for FTC service -- and many 
commissioners have served and are serving very ably without it -- I 
believe that my experience should help me to be an effective member of 
the collegial group.
    Antitrust issues, particularly as they relate to large global 
mergers, will continue to be important for the foreseeable future. I 
have been involved in these issues as a lawyer for individual clients, 
and I would welcome the opportunity to help shape antitrust policy more 
directly on the Commission. Based on my experience, I have some modest 
ideas about ways to make the Commission more effective, and I would 
like to help put these into effect.
    On a purely personal level, I have always believed, as a private 
citizen, that it is a privilege to have an opportunity for public 
service. Because of family responsibilities, it would have been 
difficult for me to take advantage of that opportunity earlier in my 
life--but I can now, and I don't want to miss it.
    4. What goals have you established for your first two years in this 
position, if confirmed? The resources of both the Federal Trade 
Commission and the Antitrust Division of the Department of Justice are 
stretched to the limit today because of the explosion of merger 
activity. The Hart-Scott-Rodino Act, which established the thresholds 
for pre-merger reporting, was passed over 20 years ago and Congress 
never anticipated that the agencies would have to review so many 
mergers, both large and relatively small.
    In addition, despite recent improvements in the pre-merger 
enforcement program, some internal processes are still overly 
burdensome. There is a substantial waste of both public and private 
resources, and, perhaps more important, the agencies have insufficient 
resources to pursue really significant matters as effectively as they 
could because they are required to deal with many that are 
insignificant. There is broad agreement that some reform is necessary, 
but comprehensive changes are inhibited by the agencies' present 
dependence on ore-merger filing fees.
    As one of five peer commissioners with an equal vote, I cannot do 
much without consensus. But if I am confirmed, I intend to work for 
constructive change in the pre-merger reporting process. Some changes 
can be achieved by the antitrust enforcement agencies on their own; 
some will require congressional action. I believe that my previous 
association with the business community, and consequent credibility in 
that group, may help to make the needed changes workable and 
acceptable.
    I would also like to encourage discussion of a more efficient 
allocation of enforcement tasks both between the two federal agencies 
and between federal and state authorities. They have individual 
strengths and weaknesses, but they have broadly overlapping 
jurisdictions. Significant improvements have been made in the 
allocation of responsibility, but I believe enforcement can be 
rationalized in an even more systematic and efficient way. This is a 
long-term project, but I would like to see it advance.
    I support an even more intensive effort to enlist the help of the 
business community in self-regulatory programs. There are always 
dangers in this approach because concerted business initiatives aimed 
at ``unethical'' practices can easily be transmuted into illegal 
agreements to limit vigorous competition. The Commission, however, is 
specially qualified to support these initiatives because of its in-
house expertise in both the competition and consumer deception areas.
    Finally, I recognize that any government agency must, to some 
degree, enlist support for its mission among the people that it 
regulates. This should not be confused with ``regulatory capture'' or a 
process that would temper outcomes to please particular constituencies. 
I am also not primarily concerned with support for the Commission as an 
institution. What I mean is support for the laws and principles that 
the Commission upholds. Like other incumbent commissioners and their 
predecessors, I expect to give a lot of speeches to groups affected by 
the Commission's work.
    It is equally important to listen. Commissioners can listen in 
relatively formal settings, as they did during the hearings on Global 
and Innovation Competition three years ago, but it is also important to 
solicit outside opinions in a less formal way. I expect a lot of my 
time will be spent listening.
    5. Please discuss your philosophical views on the role of 
government. Include a discussion of when you believe the government 
should involve itself in the private sector, when should society's 
problems be left to the private sector, and what standards should be 
used to determine when a government program is no longer necessary. In 
my view, the primary roles of any national government are to defend 
that country's citizens against external threats and to ensure that 
internal differences are settled by rules of law rather than by force. 
Most people probably agree that these roles are basic; opinions differ, 
however, on what the rules of law should be. My fundamental position on 
this issue is that government should intervene only when free market 
institutions, for some reason, fail to work the way they should. In 
some situations, however, involving so-called ``externalities'' (like 
environmental harm), market forces alone will not work, even in 
principle.
    In the last century, particularly, government regulation has 
expanded dramatically, and it is still expanding. My personal view is 
that there always should be a presumption against expansion of 
government regulations--that it should be the last alternative 
``solution,'' rather than the first. We need to recognize that public 
institutions are likely to be just as imperfect as private ones and 
that all regulations--even if well crafted and well implemented--are 
likely to have unintended side effects. At the same time, however, 
regulators cannot be paralyzed by the search for an objectively perfect 
solution. There really is no such thing as pure ``public interest''; 
regulatory decisions always have to strike a pragmatic balance between 
competing private interests.
    The issue of when it is appropriate to phase out government 
regulation, and possibly entire government departments, is one that 
could be addressed in a more systematic way than it has been in the 
past. Government regulation imposes immense burdens on private 
citizens, just like direct government expenditures. At the same time, 
both regulation and direct expenditures confer substantial benefits. 
For regulatory agencies, both the ultimate burdens and benefits can far 
exceed the dollar appropriations for running the agency.
    Direct expenditures, however, are disciplined not only by scrutiny 
of individual programs but also by a bottom-line budget, which forces 
the Executive Branch and the Congress to choose between competing 
priorities. Regulatory burdens are not subject to this overall 
discipline. It would be useful to monitor the overall regulatory burden 
in a more systematic way in order to supplement existing cost-benefit 
comparisons and to facilitate the termination of some old programs that 
are of less compelling benefit than some newly-created programs. (I 
recognize, of course, that it is not an easy task to quantify 
regulatory burdens, but incremental and comparative effects, rather 
than absolute numbers, are of primary importance. A methodology does 
not have to be perfect, so long as it is consistent.)
    These are general observations outside the immediate scope of the 
position for which I am being considered, but the question seemed to 
ask for them. With regard to the Federal Trade Commission specifically, 
I believe that the agency imposes relatively small regulatory burdens 
and can confer substantially higher benefits. This opinion may simply 
reflect my occupational bias; most people tend to believe in the 
importance of their chosen fields of labor. I would also support an 
objective burden analysis of the work of the Federal Trade Commission.
    Incidentally, the FTC, as a matter of internal practice, now 
imposes time limits on regulatory decrees, and is engaged in an ongoing 
program to ``sunset'' unneeded regulations.
    6. In your own words, please describe the agency's current 
missions, major programs, and major operational objectives. The Federal 
Trade Commission traditionally is considered to have two primary 
missions that are reflected in its two operating branches: the Bureau 
of Competition and the Bureau of Consumer Protection. The former Bureau 
focuses on ``antitrust'' issues; the latter Bureau focuses on practices 
that are unfair or deceptive to consumers. In my view, however, the two 
bureaus deal with two aspects of the same fundamental objective: 
namely, the preservation of effective consumer sovereignty. Consumer 
sovereignty is impaired if companies with market power can raise prices 
above competitive levels, and it is also impaired when false 
advertising distorts product choices. There are considerable advantages 
to having both of these problems addressed by a single agency.
    The major program on the ``antitrust'' side, as mentioned above, is 
prevention of potentially anti-competitive mergers. The workload in 
this area has recently tended to overshadow attention to non-merger 
anti-competitive practices and competition advocacy before other 
government agencies. Reform of the pre-merger notification process 
could help to restore a better balance.
    On the consumer protection side, the Commission increasingly sets 
priorities by identifying those practices that cause the greatest 
consumer injury. I understand that, in this area, the Commission also 
relies to a considerable degree on consumer complaints, and that there 
are recent initiatives to facilitate consumer communications via 1-800 
numbers and the Internet.
    7. In reference to question number six, what forces are likely to 
result in changes to the mission of this agency over the coming five 
years? The two separate but interrelated missions of the Federal Trade 
Commission are likely to remain intact for the next five years. There 
were proposals for major change in the early l970s and l980s that 
failed politically, and I believe there is even less pressure for 
wholesale restructuring today. In part, this is the result of sensitive 
leadership at the agency during the last decade.
    Redeployment of agency resources is not likely to come from outside 
political direction, but rather from internal agency initiatives. As 
mentioned, one likely area would be reform of merger reviews. Another 
area of increasing concern is the challenge of new technology for both 
the competition and consumer protection missions. Uncertainties about 
the long-term effects of government intervention or, alternatively, of 
benign neglect are persistent and perhaps growing. Economic and 
behavioral understanding is expanding all the time, but technological 
change may be moving faster.
    Similarly, the rapid disappearance of trade barriers and true 
globalization of commerce raise myriad issues of substantive policy and 
of process. The Commission will not only have to deal with new 
competitive and consumer issues but find new ways to address these 
issues. The world of commerce is not only growing more uncertain, but 
the stakes are getting higher and U.S. regulators are not the only 
significant players. (The recently-formed International Competition 
Advisory Committee has begun to study these issues in detail.)
    8. In further reference to question number six, what are the likely 
outside forces which may prevent the agency from accomplishing its 
mission? What do you believe to be the top three challenges facing the 
board/commission and why? The Commission is future-oriented in the 
sense that its primary focus has always been on prospective 
improvements in the competitive process. The greatest constraint is 
therefore the inherent inability of human beings, singly or 
collectively, to predict the future. Military leaders are sometimes 
accused of preparing to fight the last war, and others in government 
can also be overly fixated on old problems, simply because they are 
familiar. The challenges identified in response to the previous 
question require a formidable expenditure of effort, but money and more 
people alone will not solve the problems. They require imagination and 
a modest recognition that experts can always be wrong.
    I believe the major challenges for the Commission are the 
following:
    (1) Immersion in immediate problems, in both private and public 
institutions, always tends to preempt long-term planning. Overwhelmed 
as they are with current burdens, the leaders of the Commission always 
need to set aside some time to address the challenges of the future and 
to test their views in public debate.
    (2) Acquisition of the necessary economic understanding to cope 
with a fast-changing world is, as mentioned, a formidable task. Any 
regulator must always be open to the possibility that long-held tenets 
are simply wrong but, at the same time, must be appropriately skeptical 
of transitory fads and fashions. Achieving an appropriate balance is 
not easy.
    (3) The Commission was originally designed by Congress to have a 
strong educational mission. It has made significant improvements in 
recent years, but needs to find ways to even better implement that 
original intent. Education of the private bar can have a particularly 
potent effect on law enforcement because private counselors then, in 
effect, enforce the law for you.
    9. In further reference to question number six, what factors in 
your opinion have kept the board/commission from achieving its missions 
over the past several years? I am not prepared to say that the Federal 
Trade Commission has failed to achieve its mission in recent years. On 
balance, I believe it has done a pretty good job, in part because its 
goals have been set prudently.
    As a purely subjective matter, I give the Commission higher marks 
on the antitrust side than on the consumer protection side -- not 
because of a lack of commitment or imagination but because the variety 
of possible consumer frauds is almost infinite and because the 
perpetrators are myriad and transient.
    There are no easy solutions to this problem, but it is of greater 
importance than people may appreciate. The ultimate damage done by 
fraud and deception is not measured simply by the losses of particular 
disappointed buyers; these activities can also engender cynicism and 
disillusionment about the entire commercial system, even among people 
who have not been duped. Honest sellers have a stake in honest 
advertising that goes far beyond protection of their particular market 
position against dishonest competitors. We need to find even better 
ways to enlist the help of the private sector.
    10. Who are the stakeholders in the work of this agency? The 
ultimate stake-holders in the work of the agency are ordinary 
consumers, which is to say the general public. Both the Competition and 
the Consumer Protection wings are dedicated to the preservation of open 
and honest competition for the benefit of consumers.
    Obviously, survival of open and honest competition depends on the 
continued presence of competitors. Competition is not dependent on the 
survival of a particular competitor or group of competitors, however, 
so long as the opportunity exists for others to take their place. 
Competitors are therefore not the primary stake-holders that consumers 
are, but, in some circumstances, persistent injury to particular 
competitors will cripple the competitive process.
    11. What is the proper relationship between your position, if 
confirmed, and the stake-holders identified in question number ten? The 
Commission's consumer stake-holders are an immense and diffused group, 
largely unacquainted with what the Commission does, so it is not 
practical to depend solely on direct communication of their views. 
Commissioners have to rely for guidance on agency expertise and the 
views of various surrogates.
    The agency has internal expertise both in the dynamics of a 
competitive market system and in the principles of consumer protection. 
It can apply this expertise in determining whether particular practices 
are anti-competitive or deceptive--for the ultimate benefit of 
consumers but often without their direct input.
    Consumer interests are also represented by various surrogates and 
it is appropriate for commissioners to consider their views in 
formulating policy. Representatives of business or consumer 
organizations, for example, often have useful information to 
contribute.
    Congress and the Executive Branch, as representatives of people/
consumers at large, also have played an important role in the 
development of Commission policy. Congress can intervene directly 
through the appropriation process, through the formal oversight 
process, and in less formal ways. To the extent that a commissioner is 
acting in a quasi-judicial capacity, there may be legal constraints on 
communications that can be entertained, but commissioners are otherwise 
able to communicate freely with interested officials, including 
representatives of other agencies with some consumer protection 
responsibilities.
    I personally do not believe that antitrust issues are somehow 
beyond the purview of other government policy-makers. So-called 
``independent agencies,'' like the Federal Trade Commission, are 
designed to be insulated to a degree from partisan politics, but this 
does not mean that commissioners should be indifferent to the concerns 
of elected or appointed officials.
    12. Please describe your philosophy of supervisor/employee 
relationships. Generally, what supervisory model do you follow? Have 
any employee complaints been brought against you? No employee 
complaints have ever been brought against me.
    I have never thought of myself as subscribing to a particular 
``supervisory model,'' but I have been guided by a few basic principles 
that I derived from various sources. For example, I believe in 
delegation of authority and trust in the competence of those who report 
to me because people perform better when they are given responsibility 
and because, frankly, it makes my life a lot easier. I do not believe 
in management by intimidation; in my experience, the best managers 
invariably are those who lead by example and by fostering a sense of 
teamwork. I learned in the military that you never, ever, criticize a 
junior in the presence of that junior's own subordinates. And I learned 
from my father that you should always treat subordinates with 
particular courtesy because they usually are not in a position to 
defend themselves if you behave otherwise.
    13. Describe your working relationship, if any, with the Congress. 
Does your professional experience include working with committees of 
Congress? If yes, please describe. My experience with committees of 
Congress has been limited to preparation of statements for 
congressional hearings and occasional lobbying calls on Members or 
their staff. See response to Question C(4) above.
    14. Please explain how you will work with this Committee and other 
stakeholders to ensure that regulations issued by your board]commission 
comply with the spirit of the laws passed by Congress. My views on the 
future working relationships are set out in response to Questions E4, 
F-10 and F-11 above.
    The principal spokesman for the Commission in its dealings with 
Congress is, of course, the Chairman. As explained, however, I firmly 
believe in the value of congressional oversight and will cooperate to 
the maximum extent, both inside the agency and outside, if requested.
    15. In the areas under the board/commission jurisdiction, what 
legislative action(s) should Congress consider as priorities? Please 
state your personal views.
    As indicated, I believe that reform of the pre-merger notification 
process should be given high priority. Although the Commission can take 
a number of steps internally, some congressional action will be 
required if, for example, threshold reporting levels are raised to take 
account of changes in the value of the dollar (or overall size of the 
economy). In addition, I believe it would be desirable to phase out the 
agency's reliance on pre-merger filing fees as a funding source. I 
recognize that any such step involves larger appropriation issues, but 
the overall effect on the budget could be neutral.
    16. Please discuss your views on the appropriate relationship 
between a voting member of an independent board or commission and the 
wishes of a particular president. The short answer is that an 
independent agency like the FTC--with bipartisan members serving 
staggered terms--is structured the way it is precisely to avoid 
subordination to the wishes of a particular president. I endorse the 
basic scheme without reservation. It is necessary to add, however, that 
commissioners should not function in total isolation. It is obviously 
inappropriate to entertain off-record communications from anyone when a 
matter is in adjudication, and there are established procedures for 
outside comment in administrative rulemaking. On broad policy 
questions, however, a commissioner should give respectful 
consideration--which is not the same thing as deference--to the views 
of other people in both the executive and legislative branches.
    I also believe I have an obligation to be consistent. I assume that 
I have been proposed and nominated, and hopefully will be confirmed, 
because my philosophical views on the relevant issues lie in the 
mainstream. In my opinion, any sudden reversal of form would be a 
betrayal of trust.

    Senator Ashcroft. I am very pleased to have you here. The 
FTC, of course, has a very important responsibility. It was a 
pleasure to know that a member of the Commission has attended 
you here, Orson Swindle, and we are pleased and honored to have 
him here.
    Have you got any ideas for the ways in which you think the 
FTC could improve its performance or the changes that you would 
like to see happen at the FTC?
    Mr. Leary. Well, Senator, as I have discussed with some 
people, I have a number of notions. I think that my top 
priority for the Commission's possible constructive changes 
would be reform of the premerger notification process. At the 
moment, the advance notification of mergers requires 
notification of mergers at a dollar level that was set over 20 
years ago. It has not been indexed for inflation and it has not 
been indexed for the massive growth of the economy in the last 
20 years, so that the antitrust agencies, both the FTC and the 
Department of Justice, are today reviewing relatively minor 
transactions, which not only imposes a burden on the private 
sector but, equally important, imposes a burden on the public 
sector. There are a number of initiatives underway right now 
for careful study of this situation with some hope for 
achieving constructive change in the relatively near future, 
and I am optimistic that it can be done. That would be my top 
priority.
    Senator Ashcroft. Is it possible that by requiring 
submissions which are really not above a threshold of necessity 
that we bog the agencies down and divert resources from their 
focus?
    Mr. Leary. That is my biggest concern, Senator. The Federal 
Trade Commission, as you may know, has two wings: one, the 
consumer protection wing, and the other, the so-called 
competition or antitrust wing. The competition/antitrust 
resources are to a tremendously large degree preempted by the 
need to attend to these merger filings, and I think it 
distracts from other things that the agency might usefully 
accomplish.
    Senator Ashcroft. I think you have mentioned changing the 
pre-reporting process for mergers.
    Mr. Leary. Yes.
    Senator Ashcroft. One thing would be to probably delete 
some of those filings which have grown by inflation into the 
category but do not deserve the chance to be there. Are there 
other----
    Mr. Leary. There may be other categories of filings that 
may ultimately prove to be unnecessary. Let me just give one 
example of an idea, which I do not know to be practical or not 
because I have not tested it out in debate. But one possibility 
would be to have a very, very simplified process for mergers 
where there does not appear to be any horizontal overlap; that 
is, the two businesses are not in any respect competitors or de 
minimis competitors. And maybe there is some way where a whole 
class of transactions could be given a more summary treatment.
    Senator Ashcroft. Let me just yield some of the time now to 
other Members of the Senate who are here. Senator Wyden.
    Senator Wyden. Thank you, Mr. Chairman. Mr. Leary, I think 
you heard me say earlier that my constituents have the dubious 
honor or paying the highest gasoline prices in the United 
States now, consistently near $1.60 per gallon. We see the 
Federal Trade Commission as our last line of defense against 
anticompetitive practices that are contributing to this price 
situation. We are particularly concerned that with the 
possibility of additional oil company mergers, that would mean 
even fewer choices and even less competition for the consumers.
    Now, you may be aware that the Federal Trade Commission has 
been very responsive when I and Senator Boxer, who has faced 
many of the same problems in California, have brought 
information to the Commission's attention. We are pleased that 
you are moving forward on this. It has been reported in the 
press that subpoenas are in the hands of the oil companies with 
respect to this matter.
    What I would like to do is ask you a few theoretical 
questions so as to be able to assess your views with respect to 
competition in the gasoline business.
    Now, I am sure you are familiar with the Robinson-Patman 
statute which makes it illegal to discriminate in price between 
different purchasers of commodities of like grade and quality. 
In fact, the Supreme Court has ruled that an oil company 
engaged in illegal price discrimination by selling the same 
grade and quality of gas at different prices to different 
buyers. In fact, there was a Supreme Court case on that, the 
Texaco v. Hasbrook case.
    In the Pacific Northwest right now we have oil companies 
charging gasoline dealers different prices for the same grade 
and quality of gas. In fact, the CEO of Arco recently admitted 
to me during a hearing before the Senate Energy Committee that 
Arco charges purchasers different prices by using a practice 
known as zone pricing. The Arco CEO, Mr. Bolan, stated that 
Arco was charging purchasers different prices to meet 
competitive pressure.
    But this defense, the meeting competition defense, under 
the Robinson-Patman Act only applies when a seller is lowering 
prices to meet competition. That is certainly not what we have 
going on in the Pacific Northwest. We have been seeing these 
constant increases in gasoline prices for many months now, 
probably the last 6 months.
    My question then is, if there is a Federal law prohibiting 
price discrimination and the oil companies are not lowering 
prices to meet competition, what theory could possibly justify 
zone pricing?
    Mr. Leary. Senator, obviously, as you know, I am 
constrained not to discuss any particular matter that is 
presently before the Commission.
    Senator Wyden. I am asking you only about theory.
    Mr. Leary. As a matter of principle or matter of theory?
    Senator Wyden. Right.
    Mr. Leary. I agree with you 100 percent that the meeting 
competition defense does not apply to meeting the competition 
of somebody who is offering a higher price. That is not what 
the meeting competition defense is meant to achieve.
    As far as zone pricing is concerned, whether that is legal 
or not depends upon whether there is an effect on competition 
between the favored and the disfavored customers. In other 
words, the Robinson-Patman Act--there may be some 
misunderstanding about it--does not prohibit selling at 
different prices to someone in California than to someone in 
New York because those two people are not in competition with 
one another.
    The issue will be whether or not there is a competitive 
nexus or a competitive effect between the dealer that gets the 
high price and the dealer that gets the low price. You have to 
look at what the impact is really along the demarcation line 
because the people who are far apart are not going to be either 
advantaged or disadvantaged by the lower price. I am 
speculating now because obviously I am not familiar with the 
facts of the case, but that may well be an issue here.
    There are also questions under the Robinson-Patman Act 
about different prices for people who take different volumes. 
There are also questions about whether or not people get 
different prices because they have other purchase terms that 
differ, and all of those complications may be present.
    Senator Wyden. Well, we certainly do not question that 
California and New York are in different zones.
    Mr. Leary. Right.
    Senator Wyden. What we have found in our State and have 
turned over invoices and documents to the Commission--you may 
have heard--is evidence of this pricing discrimination on the 
basis of zones where the people are located very, very closely 
to each other.
    Mr. Leary. That could well be true, Senator.
    Senator Wyden. All right.
    My second question is in my State as well there is very 
limited competition in the gasoline business. We have seen a 29 
percent decrease in the number of gas stations since 1990. The 
independents have been virtually squeezed out. Right now four 
oil companies currently control 80 percent of the retail 
market.
    In addition, if the proposed merger between BP and Arco is 
allowed to go forward, BP and Arco would have a virtual 
monopoly over oil supply on the west coast. They would control 
not only 70 percent of the Alaska North Slope crude, they would 
have the virtual strangle hold on the delivery system that 
brings the gas to west coast markets.
    Now, supporters of this sort of merger want the FTC to look 
only at local retail markets where there is little overlap 
between current operations such as the BP and Arco operations. 
My sense is it is not that simple.
    Again, I would like to know whether in theory you think 
that it is appropriate for the FTC to look at the entire array 
of operations, the retail operations, to determine if there are 
anticompetitive concerns from a merger like this.
    Mr. Leary. Again, Senator, without commenting on the 
specific case, it is certainly appropriate for an agency to 
look at both the supply side as well as the demand side. The 
agency guidelines specifically provide for looking at supply 
side concentration as well as demand side concentration.
    Senator Wyden. Mr. Chairman, I have just a couple of other 
questions, and I appreciate your indulgence because this is 
probably one of the top two concerns in my State and I 
appreciate your letting me pursue this.
    Mr. Leary, you might be aware that earlier this year I 
raised concerns with the Commission about the potential merger 
between Barnes & Noble, the very large retail bookseller, and 
Ingrahm, the major wholesaler. Not only having a dad in the 
publishing business but from a State with perhaps the largest 
number of small bookstores in the country, I had a lot of 
constituents up in arms about this. I asked the Federal Trade 
Commission to investigate. They did and there was a staff 
recommendation that the merger not be allowed to go forward. 
And as you know, Barnes & Noble eventually pulled out.
    Mr. Leary. Yes.
    Senator Wyden. The BP-Arco situation is obviously not 
identical in all particulars because there are refineries in 
between the crude oil supply and the retail gasoline supply.
    But again in theory, would you agree that there are similar 
anticompetitive concerns raised if you would have a mega-merger 
like BP and Arco controlling the crude oil supply for the west 
coast and also that firm having retail operations?
    Mr. Leary. Senator, again speaking as a matter of 
principle, that could be a matter of concern. Yes, indeed.
    Senator Wyden. One last question, if I might.
    Given the spree of mega-mergers with last year BP acquiring 
Amoco, Exxon and Mobil having a merger in the works that is now 
under review by the Commission, the ink barely dry on BP-Amoco, 
and they are already off acquiring Arco, we are seeing this 
sort of communications-utilities industry after industry. What 
I am hearing from my constituents is that with so many sectors 
now being dominated by fewer and fewer hands, there is just 
virtually no local accountability in some of these key areas as 
it relates to health and communications and energy.
    My question is, when the FTC looks at these mega-mergers, 
should it look only at what the combined companies' share of 
the market will be after the merger, or should issues like how 
the merger affects customer service and other consumer 
considerations be included before a merger is approved?
    Mr. Leary. Senator, my answer to the question, the short 
answer, is yes. I believe that service and product quality are 
dimensions of competition just like price, and I might say 
frequently neglected dimensions of competition, again speaking 
generally.
    Senator Wyden. Well, let me just tell you, I am sure you 
did not expect a member of this committee to go into this kind 
of detail with you this afternoon, but you can probably tell 
this is an area I am very interested in, have been since the 
days when I was director of the Gray Panthers at home in 
Oregon. I happen to think that the Commission that you have 
been nominated to serve on is one of the most important places 
in the Government because it is one of the last lines of 
defense for consumers in these key areas. I think Bob Pitofsky 
is doing an excellent job. He has been very responsive to us, 
and I think you have been very thoughtful in terms of how you 
have tackled some very complicated issues that I am sure you 
did not anticipate this afternoon.
    I look forward to seeing you serve at the Commission and to 
working very closely with you on these matters.
    I want to thank Chairman Ashcroft for indulging me this 
afternoon to be able to ask these questions.
    Senator Ashcroft. Well, thank you, Senator Brownback.
    Senator Wyden. And my colleague from my birthright, Kansas.
    Senator Brownback. One of our great representatives from 
Wichita, one of three or four I think that are from Wichita.
    Mr. Leary, I do not have any particular questions for you. 
I want to congratulate you on going into this position.
    I want to draw your attention to one particular issue that 
is coming up in front of the FTC, a study that they are doing 
on the marketing of violence to children. We have held a 
hearing in this room on that topic. I met with the Chairman 
about that issue. I think it is a very important topic, 
obviously, and that is why I raise it with you.
    I just got back from southern California and some meetings 
with entertainment industry people, and they talk there about 
trying to attract a certain set of eyeballs on watching 
television. Now, there they were talking about, they were 
saying Madison Avenue is driving us to try to get as many 
people from the age 18 to 34 and really the age of 18 to 24 and 
really male is what they want watching that television. So, 
that is why we put all the sex and violence on because you want 
to keep them from channel surfing, so let us put that up.
    I do not know the accuracy of any of those statements that 
people made to me. I just know that overall that this society 
has grown far too course and really vulgar and rough, and a lot 
of it is put out through the microphone of a mass media or an 
entertainment industry.
    And if it is particularly targeted below that age 18 
audience, then I think there is a reason for us to look more 
thoroughly and directly and caustically and critically at the 
industry that is doing that. I suspect that they are in 
particular areas, video games, movies, particularly like teen 
slasher movies that are movies that are set in high school, 
teen idol starts on it, and yet rated R, which teens are not 
even supposed to be able to go in to them. Yet, I am not sure 
who all else would go to a movie or who it is really targeted 
toward. There is even marketing of some of the more violent 
video games in toy stores right next to places where 10- and 
11-year-olds reach and shop.
    If that is a targeted area by the industry, I think that is 
an area of concern and one that really needs to be looked at 
critically. I would just ask that you take some real time and 
focus on it because this is overall a very important topic to 
the American culture and society as we try to really pull back 
from the abyss and move to a better place where our families 
feel like the culture is a little more supportive instead of 
all the time on them and trying to harm them.
    Mr. Leary. Senator, I am aware of this assignment, and I 
can assure you that I take it very, very seriously. My own 
children are a little too old now to be directly involved in 
this, but I have grandchildren coming along and I am concerned 
about them, as well as children everywhere.
    Senator Brownback. Well, my kids are younger, so I go to 
the store. But go with your grandkids sometime to look at 
records or video games just some day on a weekend just to get a 
look yourself, or look in some of the magazines or see the 
video games that they are playing just to take a look. Your 
grandkids may be better than mine are, but you may be shocked 
at what you see.
    Thanks. Thank you, Mr. Chairman.
    Senator Ashcroft. Thank you, Senator Brownback.
    I want to thank Mr. Leary for coming before the committee 
today. I want to thank Commissioner Swindle for being with us 
today and thank him for his participation. I want to thank all 
the Members of the Senate who came to participate in this 
hearing.
    Let me just indicate, as I indicated earlier, that the 
chairman has indicated, through his staff director, that it is 
his intention to move these through an executive session as 
soon as possible so that we will try and report these items 
promptly.
    [The prepared statement of Senator Stevens and the letter 
of Mr. Rowe may be found in the appendix:]
    Senator Ashcroft. It appears as if no other Senators have 
pressing inquiries. With that, I adjourn this hearing. Thank 
you very much.
    [Whereupon, at 3:36 p.m., the committee was adjourned.]
                            A P P E N D I X

    Prepared Statement of Hon. Ted Stevens U.S. Senator from Alaska
    Mr. Chairman. It is nice to see a hard working young man move 
forward in his career. My former chief of staff, Greg Chapados, was the 
head of NTIA during the Bush administration, so I know the pride that 
Senator Dorgan must feel in seeing Greg Rohde before us today.
    NTIA is an important agency and has been well led by Larry Irving 
and his staff.
    With the changes we are all experiencing in the world of 
telecommunications, it is good to know that bright young professionals 
such as Mr. Rohde will continue the excellent leadership of this 
agency.
    Greg, I want to thank you publicly for your tireless efforts in 
support of universal service. Many of you know that Greg was 
instrumental in helping to bring the Telecommunications Act of 1996 
together. What you may not know is that Greg took a leadership role at 
the staff level to fight for the concept of universal service. And 
since the Act, he has been a true leader in ensuring that the concerns 
of rural areas are considered in the various telecommunications bills 
this committee considers.
    Greg, your knowledge of rural issues and of universal service will 
be of even more importance over the coming months. I believe the 
concept of universal service is under attack and I hope you will be a 
strong voice in this administration for furthering the goals we both 
sought to achieve in the Telecommunications Act.
Thank you.
                                 ______
                                 
                                                  September 3, 1999
The Honorable Conrad Burns
Chairman
Communications Subcommittee
Senate Commerce Committee
United States Senate
Washington DC 20510

Re: Nomination of Greg Rohde as Assistant Secretary for Communications 
and Information, U. S. Department of Commerce

Dear Senator Burns:

    I am delighted to support the nomination of Greg Rohde as Assistant 
Secretary for Communications and Information at the United States 
Department of Commerce. I request that you introduce this statement 
into the record of his confirmation hearing.
    As you know so well, Mr. Rohde is one of the most knowledgeable and 
experienced telecommunications hands in Washington. He played a key 
role in development and passage of the 1996 Telecommunications Act, and 
especially in ensuring a central role for universal servicein Section 
254.
    As do his colleagues on Capitol Hill, state public utility 
commissioners rely on Greg's wisdom and good counsel. We appreciate his 
problem-solving approach and his ability to move beyond the arguments 
that bog down so many others.
    It is no secret that Greg Rohde is passionate about providing 
excellent telecommunications service to rural America. My work with 
Greg persuades me that he is equally committed to using the 
Telecommunications Act's tools to serve urban America. In the past, 
I've talked with Greg about his vision, which I believe is your vision 
and is the vision of the Commerce Committee. I am eager to get him ``on 
the job'' at the Department of Commerce so that we can work with him on 
universal service, competition, and technology, and on specific 
projects such as the Section 706 federal-state conference.
    There are big shoes to fill as Assistant Secretary for 
Communications and Information. I am confident that Greg Rohde is an 
ideal choice to fill them.

Sincerely,

Bob Rowe

Chairman,

NARUC Telecommunications Committee

                                    
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