[Congressional Record Volume 141, Number 94 (Friday, June 9, 1995)]
[Senate]
[Pages S8055-S8058]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




        THE TELECOMMUNICATIONS COMPETITION AND DEREGULATION ACT

  The PRESIDENT pro tempore. Under the previous order, the Senate will 
now resume consideration of S. 652, the telecommunications bill, which 
the clerk will report.
  The assistant legislative clerk read as follows:

       A bill (S. 652) to provide for a pro-competitive, 
     deregulatory national policy framework designed to accelerate 
     rapidly private sector deployment of advanced 
     telecommunications and information technologies and services 
     to all Americans by opening all telecommunications markets to 
     competition, and for other purposes.

  The Senate resumed consideration of the bill.

       Pending:
       Dole amendment No. 1255, to provide additional deregulation 
     of telecommunications services, including rural and small 
     cable TV systems.
       Dorgan modified amendment No. 1264, to require Department 
     of Justice approval for regional Bell operating company entry 
     into long distance services, based on the VIII(c) standard.
       Thurmond modified amendment No. 1265 (to amendment No. 
     1264), to provide for the review by the Attorney General of 
     the United States of the entry of the Bell operating 
     companies into interexchange telecommunications and 
     manufacturing markets.
       Hollings/Daschle amendment No. 1266, to clarify the 
     requirements a Bell operating company must satisfy before 
     being permitted to offer long distance services.

  Mr. PRESSLER. Mr. President, I suggest the absence of a quorum.
  The PRESIDENT pro tempore. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. KERREY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Thomas). Without objection, it is so 
ordered.


  Amendment No. 1265, as Modified, to Amendment No. 1264, as Modified

  Mr. KERREY. Mr. President, we now resume the discussion of S. 652, in 
particular the amendment before us, which is, as I understand it, the 
second-degree amendment offered by the Senator from South Carolina to 
the amendment from the Senator from North Dakota; is that correct?
  The PRESIDING OFFICER. The Senator is correct.
  Mr. KERREY. I have not yet read, or we have not yet seen the 
amendment from the distinguished Senator from South Carolina. But I am 
going to make some presumptions here that I understand in general terms 
what it is about. I think in that amendment, there is a possibility of 
a compromise here, something that could satisfy both sides and get us 
to a point where we have a bill where we are going to get large numbers 
of people rather than a relatively smaller number of people supporting 
the legislation.
  I believe that S. 652 in its current form, unamended, is not good for 
the American consumer. I will make it [[Page S8056]] clear on that. I 
do not believe the American consumer will enjoy the full benefits of 
competition with S. 652 in its current form. The reason I believe that 
is that competition will not bring the kinds of benefits to the 
American consumer unless that competition comes from the bottom up, 
from entrepreneurs who have a chance to come to our households--100 
million households total in the United States of America--and offer us 
packaged information services through two alternative lines coming into 
our home--a telephone line and a cable line.
  If they have an opportunity to come into that environment and say, 
well, Mr. Kerrey, we would like to sell you a packaged service of 
voice, video, or text; you are purchasing services today of $120 to 
$150 a month, and we can sell that to you for $75, $80, or $90 a month, 
in that kind of a competitive environment, the prices will come down 
and the quality is going to go up in the four big areas where 
households tend to see services.
  No. 1, the price is going to go down for the switching services; that 
is, the movement of the bundled data from household to household or 
from household to business or vice versa.
  We will see reductions in the cost of the manufactured hardware that 
is used in the home, regardless of what that hardware is, as the market 
tries to give better and better service.
  We will see prices come down in the content--that package I described 
earlier--and we will see prices come down and quality come up in a 
range of services that household services buy.
  My fear is that in a good faith effort to produce a means to replace 
the VIII(c) test--I apologize for getting a little technical--what the 
committee did in a good faith effort to replace the VIII(c), test which 
I believe 18 members of the committee last year voted for in S. 1822 
that was tied up late last fall, to replace that test, the committee 
came up with 134 individual things that the ARBOC, the local telephone 
company, has to have before they are allowed into long distance 
service.
  That is kind of a summary, I believe, the distinguished Senator from 
South Carolina last evening gave as to how those 14 items did, in fact, 
replace this old test that was S. 1822, a bill that was supported by 18 
members of the Commerce Committee last year.
  The reason I say with respect that I do not feel that is adequate is, 
again, the Justice Department has the expertise of managing 
unprecedented movements from a monopoly situation to a competitive 
situation. We need that. That is a service that the people of the 
United States of America need. That is what this whole bill is about.
  If we look at the title, title I is ``Transition to Competition''; 
title II, ``Removal of Restrictions to Competition''; title III, ``An 
End to Regulation.''
  Mr. President, the only people in the U.S. Capital, the people's 
Capital, with experience in all these three of those areas is the 
Antitrust Division of the Department, approximately 800 people. We will 
not fall into the illusion that this is an enormous bureaucracy over 
there just busting at the seams with all sorts of people. It is 
approximately 800 people that run the Antitrust Division at Justice, 
and they managed the movement from a monopoly, AT&T, to our current 
competitive environment we have in long distance.
  We are talking about doing the same thing with local telephone 
service. It seems to me, Mr. President, for those who want to survive 
this vote, who want to not just get a pat on the back as we walk out of 
here on final passage from those folks in industry that are out there 
hoping we vote the right way, whichever way that is, if we hope to get 
a pat on the back by our consumers, by our citizens, by our voters--and 
I would argue that is, in the end, the ultimate test--then we need to 
go to that agency that has experience in managing an unprecedented 
event, a movement from a monopoly situation at the local telephone 
service to a competitive environment.
  This is going to be an extremely difficult thing to do. As I 
understand it, the distinguished Senator from South Carolina has 
proposed an amendment. I have not seen that amendment yet. He has 
proposed an amendment that might, in fact, solve problems that people 
have about having dual authority here. As I understand it, it may 
reduce the role of the FCC while giving the Department of Justice some 
additional authority. It seems to me that that is the right direction 
to go.
  I want to walk through a little bit here this morning, and I will 
stop and yield afterward to anyone else that wants to talk on this 
issue.
  There is, I think, legitimate concerns about what this will mean in 
terms of the time that is taken. In a time we are trying to get rid of 
regulation, which we are trying to do, we ought not have any 
unnecessary regulation.
  I am prepared to support any person that has an amendment that says, 
here is something we will regulate that does not add any value at all; 
all it does is slow things down. I am prepared to vote for the 
elimination of any regulation that still is in the bill that might be 
unnecessary and that might add unnecessary costs.
  The procedures for a Bell operating company entering into long 
distance--under the amendments proposed, the underlying Dorgan 
amendment, the Bell operating company would file an application to get 
into long distance. The Department of Justice and the Federal 
Communications Commission would review and proceed simultaneously. 
Their reviews go forward at the same time. We do not go to one and then 
to the other. We go to both simultaneously and each reviews something 
different. The Bell operating company has an answer within 90 days 
after application in accordance with a date certain established by 
Congress.
  For Members that are wondering about how this will all work out and 
whether or not this is going to delay things, the language of the 
Dorgan amendment provides a date certain for an answer to be given by 
the Department of Justice to the Bell operating corporation applying 
for permission to get into long distance. The procedure is fast--90 
days. It is fast.
  We can set into the Record, with people who are experienced with how 
the courts work, if we need stronger colloquies filed so the courts 
understand that 90 days means 90 days, then we will do that and make 
certain that the time will be 90 days and that extensions are not 
granted for this particular procedure.
  The standard for DOJ is clear, Mr. President. There is not ambiguity 
here. It is based on a well-established law applying both the Clayton 
Act and, by the way, the VIII(c) test under MFJ. The procedure will 
reduce litigation. Make no mistake about it. In my estimation, the 
existing law as written will encourage litigation and prolong the 
process. If Members believe it will do the opposite, come and say that 
it will do the opposite.
  I am saying that my concern, as one Member that has one vote here, is 
that we come here and try to satisfy citizens--in this case, citizens 
as consumers--and I say that the existing law, in my judgment, will 
produce consumer confusion, it will produce consumer dissatisfaction, 
and it will produce problems that are going to cause Members who vote 
for it in its current form to say, well, I did not realize it would do 
that. Maybe we can come back in afterward and fix it with an amendment. 
Unfortunately, it is likely to be the very amendment we are considering 
today.
  I said at the beginning that somewhere in the mix, somewhere in the 
mix, and I appreciate what we are basically doing is trying to figure 
out some way to continue the work that the senior Senator from Nebraska 
came up with this compromise language in committee. He is the one that 
has taken the lead on this. I understand the committee had a difficult 
time balancing and getting this stuff done.
  Somewhere in the mix is a way for Members to give DOJ a role, perhaps 
limit and reduce some of the regulation that is at the FCC, and give 
those Members who are concerned about how we will manage this 
transition from monopoly to competition, give those Members that have 
that kind of concern some satisfaction.
  I yield the floor.
  Mr. DOLE. Mr. President, I wanted to inquire, if the regular order is 
called for, it is my understanding that the amendment I offered would 
be pending; is that correct?
  The PRESIDING OFFICER. The majority leader is correct.
  Mr. DOLE. That would be subject to a second-degree amendment? 
[[Page S8057]] 
  The PRESIDING OFFICER. That is correct.
  Mr. DOLE. I am not certain when we can agree on a vote. I know for 
the Senator from North Dakota, this is a central issue, the one we are 
debating now. I am not trying to crowd anyone. I want to try to make 
some headway this morning. If Members believe that Friday is Friday and 
we do not vote on Friday, nobody will ever be here on Friday.
  We are going to have votes this morning, and I would like to 
accommodate everybody's request. I wonder if there is any objection--
and I do not want to offend anyone--to calling for the regular order.
  As I understand, the Senator from Pennsylvania has a second-degree 
amendment to my amendment. We are still trying to work out my amendment 
and the Daschle amendment, so we do not have one leader getting his 
adopted, the other not. We are trying to work that out.
  Is there any objection if we proceed on that basis?
  Mr. HOLLINGS. No objection.
  Mr. DOLE. I ask unanimous consent to lay aside the pending amendment 
for Senator Santorum to offer an amendment.
  Mr. KERREY. Reserving the right to object, I do not believe I intend 
to object. As I understand, the Senator is asking to proceed to the 
Santorum amendment with no agreement as to how long we will debate the 
Santorum amendment.
  Mr. DOLE. Yes, we will lay aside the big amendment that the Senator 
is concerned about, Senator Dorgan's, and my amendment--just go ahead 
and offer it, period. That is all right.
  Mr. DORGAN. Reserving the right to object. I would like to speak for 
a moment on the Department of Justice amendment, after which I have no 
objection to setting it aside and going to the Santorum amendment.
  Mr. DOLE. I ask unanimous consent to lay aside the pending amendment 
for the Senator from Pennsylvania to offer an amendment with the 
understanding the Senator from North Dakota is going to be first 
recognized for a moment to make a statement.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from North Dakota is recognized for a moment.
  Mr. DORGAN. Mr. President, the Senator from Nebraska, appropriately 
framed the issue of the role of the Department of Justice in the 
telecommunications legislation--or more appropriately put, the role the 
Department of Justice does not yet have in the telecommunications 
legislation and the reason many of us believe the legislation should be 
amended. For those who have not been involved in studying this 
legislation, I want to describe, again, why I think a role for the 
Justice Department is central to telecommunications legislation.
  In 1934, when the Telecommunications Act was written originally, the 
issue was regulating a monopoly. Why must you regulate a monopoly? If 
you do not regulate a monopoly, a monopoly will do whatever it chooses 
to do to the American citizens and to the consumers. Regulating a 
monopoly was important in 1934.
  Mr. President, we are rewriting that telecommunications law today in 
the Senate. The issue is no longer reregulating or regulating a 
monopoly; the issue is deregulation and competition. That requires a 
different legislative approach.
  The breakup of AT&T into the regional Bell operating companies and 
the long distance companies, has created a substantially different kind 
of telecommunications network in our country.
  In the long distance area we have robust, healthy, vibrant 
competition. Literally, hundreds of companies are involved in 
competitive efforts to market long distance services. These competitive 
efforts bring choice to consumers, generally at lower prices. We have 
seen a very substantial drop in charges for long distance services.
  We have not seen similar circumstances in local service. This 
telecommunications bill must provide conditions under which local 
services will also have competition. The Bell operating companies are 
not now free to go out and compete with the long distance companies 
because they have a monopoly in most places in local service. It is not 
fair for the Bell operating companies to have a monopoly in local 
service, retain that monopoly and get involved in competitive 
circumstances in long distance service.
  Most of the Bell companies want to get involved in the long distance 
business and this piece of legislation establishes the conditions under 
which that will occur.
  The question before us is, When is competition in local service 
sufficient so that the Bell companies will be freed to provide long 
distance service? The piece of legislation before us establishes a role 
for the Federal Communications Commission to evaluate or to judge when 
that competition exists. Traditionally, that judgment role would be 
made at the Department of Justice. That is what the Justice Department 
does. That is their background and expertise. The Justice Department 
evaluates competition. It is the agency that deals with antitrust, 
monopoly, and competition issues.
  The role of the Justice Department was, I assume, deliberately left 
out of this legislation for a number of reasons. I assume some people 
wanted there to be less aggressiveness in determining whether there is, 
in fact, real competition at the local level before the Bell operating 
companies are allowed to compete in the long distance area. One 
interesting point, last year, when the Senate Commerce Committee passed 
this legislation, and last year when the House of Representatives 
passed this legislation with 420 votes, a role for the Justice 
Department was in the telecommunications bill.
  Last year the Justice Department was to have a full role in 
evaluating whether competition exists. This year, it does not. The 
question is, Why? What has changed? Nothing has changed. Consumers 
still need protection. Our responsibilities to make certain consumers 
are served the way they should be served has not changed. If we are 
moving from a period where we talked about regulated monopolies to a 
period where we are talking about deregulated competition, why should 
those who talked the loudest about deregulation not also be those who 
are most aggressive in making sure that competition really exists? 
Because competition, it seems to me, is the linchpin of a free market 
system.
  If you have less competition, then your free market system does not 
work very well; it is not very free. If you have broader competition, 
robust, healthy competition, that is when the free market system works. 
In this legislation, the role of the Justice Department is to make sure 
that there is real competition before we release the Bell operating 
companies to get involved in long distance services.
  I think a Department of Justice role is the most important issue we 
will deal with on the floor of the Senate in this legislation. It deals 
with literally hundreds of billions of dollars. The consumers are at 
substantial risk if we make the wrong decisions. I believe if we think 
our way through this issue as we construct this legislation on the 
floor of the Senate, we will reach the right result. And the right 
result clearly is for the Department of Justice to have a role.
  The Senator from South Carolina believes it should happen. That is 
why he has offered an amendment. I believe it should happen that is why 
I offered an amendment. It is true we come at it in different ways, but 
they are, in many ways, not so far apart. And I am hoping in not too 
many hours we can reach some sort of common understanding between our 
amendments and resolve the differences we have. The technical 
difference is I am proposing what is called an VIII(c) standard, and he 
is dealing with a Clayton 7 standard. These standards are not so 
different. The best approach will be if we can, the Senator from South 
Carolina and others on both sides of this issue, find a way to merge 
these two approaches so the Justice Department retains a strong role in 
this legislation to protect the public interest. After all, protecting 
the public interest is what this legislation must do in the final 
analysis.
  I appreciate very much the work and the words of my colleague from 
Nebraska, Senator Kerrey.
  I think the coalition of us, Senator Kerrey, myself, Senator 
Thurmond, Senator Leahy, Senator Simon, and so many others, can amend 
this legislation before this debate is over. [[Page S8058]] 
  If we do that, I think the winner will be the American people and the 
free market system in our country that works only when there is healthy 
and robust competition.
  So I know we are going to set this legislation aside and go to a 
Santorum amendment, after which we will come back to it. There are a 
number of Members who wish to come to the floor and speak on this 
issue--Senator Simon, Senator Leahy, and others. I hope at the end of 
the debate we will have succeeded in amending the telecommunications 
bill to include a Justice Department role. I think it is important for 
the American people.
  Mr. President, I yield the floor.
  Mr. SANTORUM addressed the Chair.
  The PRESIDING OFFICER. The Senator from Pennsylvania.
  Mr. SANTORUM. Mr. President, I ask unanimous consent to proceed as in 
morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. KERREY. Reserving the right to object. As in morning business? I 
thought the Senator was going to offer an amendment.
  Mr. SANTORUM. I am still waiting to hear if there is an agreement on 
my offering the amendment. We are waiting to hear from Members on your 
side of the aisle.
  Mr. KERREY. Did the majority leader not earlier ask? Is that what we 
are proceeding under? I thought we were going to----
  Mr. DOLE. Mr. President, in response to the Senator from Nebraska, 
what we are trying to do is get an agreement on when we are going to 
vote, if we can get a 10:30 agreement to vote. Does anybody object to 
voting at 10:30? Otherwise, we will have a Sergeant at Arms vote. There 
is going to be a vote. Either vote on the amendment or have a live 
quorum and we will have a vote. It is up to the Senator from Nebraska.
  Mr. KERREY. I just got this amendment. I am not going to agree to a 
time of 10:30 or any other time at the moment until I review this 
amendment.
  Mr. DOLE. We had an agreement last night, I understand, with the 
Senator for 10 o'clock. He had the amendment in his hand last night.
  Mr. KERREY. Mr. President, 10 o'clock--my understanding last night 
was we were going to take it up at 10 o'clock. I did not understand.
  Mr. DOLE. Take it up at 9:15, vote at 10. Now we are going to take it 
up at 9:45, vote in 45 minutes. I understand it is a very technical 
amendment.
  Mr. KERREY. Let me just continue what I am doing, which is reviewing 
the amendment which I am looking at now for the first time.
  Mr. SANTORUM. Mr. President, I ask unanimous consent that I may 
proceed as in morning business.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  The Senator from Pennsylvania.
  Mr. SANTORUM. I thank the Chair.

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