[Congressional Record Volume 141, Number 95 (Monday, June 12, 1995)]
[Senate]
[Pages S8188-S8198]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




        THE TELECOMMUNICATIONS COMPETITION AND DEREGULATION ACT

  The Senate continued with the consideration of the bill.
  Mr. PRESSLER. Mr. President, I would like to summarize where we are 
with this bill and take a look at tomorrow and finishing this bill, 
which I hope we will be able to do.
  We have a very tough vote coming up tomorrow regarding adding the 
Department of Justice to the regulatory scheme. I would just like to 
point out that referral to the Department in the past precludes timely 
resolution, because the Department does not take timely action.
  Now, the Department is filled with very brilliant lawyers and they 
have a reputation of moving very slowly on these waiver applications. I 
will show a couple of charts that illustrate how slow the Department 
has been.
  In the original 1982 MFJ, it was suggested that the Department 
complete its work on each waiver request within 30 days.
 And, although the decree itself contemplates that waiver requests will 
be filed directly with the court, in July 1984 the court announced that 
it would consider application for waivers of the line of business 
restrictions only after review by the Department of Justice.

  This procedure was imposed after only 7 months' experience with the 
waiver process and was not expected substantially to delay the 
processing of waiver requests. To the contrary, in establishing this 
procedure, the court noted the length of time that previously filed 
waiver requests have been pending and accordingly directed the 
Department to endeavor to return those requests to the court with its 
views within 30 days.
  I am going to repeat that because I think it is very important. The 
court noted how slow the Justice Department was moving on these waivers 
and told them the length of time requests had been pending and 
accordingly directed the Department to endeavor to return these 
requests to the court with its views within 30 days.
  So the framework for what I am saying is that the Justice Department 
was asked to do this within 30 days; not 90 days, as my friends have 
put into their bill. But what actually happened? Let us look at the 
facts. Let us go to the videotape, so to speak.
  Contrary to the court's expectations, delays in administrative 
processing of waiver requests soon began to grow. In 1984 the 
Department disposed of 23 waivers. The average age of waivers pending 
before it was a little under 2 months. By 1988 the average age of 
pending waivers topped 1 year. Then, in 1993, when the Department 
disposed of only seven waivers, the average age of pending waivers at 
year end had increased to 3 years. More recently, in 1994, the 
Department disposed of only 10 waivers. This left over 30 waivers with 
an average of 2\1/2\ years still pending.
  The Department now takes almost as long on the average to consider a 
single waiver request as the total time intended to elapse before 
comprehensive triennial reviews--which the Department has refused to 
conduct. This has occurred notwithstanding significant decreases in the 
number of waiver requests. While requests have decreased substantially 
since 1986, the Department had not even made a dent in the backlog. To 
the contrary, because the Department disposes of fewer and fewer waiver 
requests each year, the number of pending requests continues to grow. 
No matter how few waiver requests the BOC's file, the Department simply 
cannot keep up. In light of the multiyear delays in processing waiver 
requests, it is remarkable the court originally directed Department 
review within weeks, not months or years.
  So the court directed the Department of Justice to act within a few 
weeks. And it has taken it years to act. So the point is, if we adopt 
the Dorgan-Thurmond amendment, we will be adding probably 2 or 3 years 
to this so-called deregulatory process, because that is what has 
happened in the past.
  More significantly, the court ordered virtually immediate Department 
action because of prior delays that now seem comparatively minor. The 
eight waivers at issue since July of 1984 had been pending just an 
average of 5 months, with none more than 6 months old. Today, a waiver 
request rarely makes it through the Department in less than a year, and 
2\1/2\ years is the mean.
  Think about that; it takes 2\1/2\ years for the Department of Justice 
to approve or disapprove a waiver request that originally the district 
court thought could be done in 30 days. What is going on? Why is that?
  As AT&T argued in 1986, and the court noted in 1988, the Department 
is clearly overwhelmed by its decree responsibilities. Aware of this, 
the Bell operating companies several years ago attempted to reform 
waiver procedures within the limits of the court's orders to eliminate 
the mounting backlog of pending requests. Following consultation with 
the Department, during 1991 the Bell operating companies agreed to 
consolidate the large number of pending waiver requests into a handful 
of generic requests and to limit their filings of new individual waiver 
requests. In exchange, the Department committed to acting promptly on 
generic waiver motions.
  Once again the Department has not kept its part of the bargain. Four 
generic waiver requests have been filed. The first covered 
international communications. It was filed with the Department in 
December 1991 but did not receive departmental approval for 7 months, 
even though AT&T indicated within 3 months of the waiver request that 
it had no objection. Thus, we have a circumstance where the company, 
AT&T--a party to the consent decree-- [[Page S8189]] said, after 3 
months, we have no objection. It still took them 7 months to issue it. 
And the amendment proposes to add this bureaucracy to the present FCC 
review. That would lead to costs and delays. It has in the past.
  As I stated before, the court suggested 30 days and it has taken an 
average of 2\1/2\ years. In the example I just cited there was no 
controversy. After 3 months, AT&T said it had no objection. It still 
took the Department of Justice 7 months to issue that. It is tortuously 
slow, and businessmen waiting for that paperwork have been torturously 
treated, because they sit there with that investment ready to go, there 
is no objection, and they wait and wait. This huge bureaucracy with all 
these brilliant lawyers cannot produce the paper.
  The second generic request, which consolidated 23 then-pending 
waivers, covered interLATA wire services such as cellular phones, two-
way paging, and vehicle locators. It, too, was filed in December 1991. 
It then languished before the Department for 3 years before finally 
being submitted to this court. Now, 4 years after it was originally 
filed, the waiver is still pending; 4 years, a simple waiver in that 
Department of Justice--the same department that the Assistant Attorney 
General for Antitrust is asking this body to give an additional 
review--that would simply hold things up. I think that would be a very 
great mistake.
  The period for public comment and investigation spent in connection 
with the generic wireless waiver request alone is more than three times 
as long as the period allowed by the court for public comment and 
review of the entire decree in 1982.
  It is also eight times longer than it took for AT&T to get a 
factually and theoretically correct request processed. When AT&T sought 
relief in connection with the cellular properties in McCaw 
Communications, it was able to file its requests directly with the 
court and obtain a decision in just 7 months. During those 7 months, 
however, the BOC's motion for generic wireless relief continued to 
languish before the Department, just as it had for the 3 years before. 
This is 3 years waiting for one simple piece of paper.
  Surely the referral procedures were not intended to bring about such 
disparate treatment of the BOC and AT&T when they made similar 
requests. The remaining BOC generic requests have followed the same 
path of delay upon delay.
  The third request covering delivery of information services across 
LATA boundaries was submitted in June 1993 and, now, 20 months later, 
still awaits Department action.
  So I will go on to a fourth. The fourth, covering interexchange 
services provided outside of SBC's region, was filed in July 1994 and 
was fully briefed before the Department by September 27, 1994. The 
blame for these delays simply cannot be laid at the BOC's feet. The 
number of requests filed with the Department held steady at roughly 20 
to 30 per year from 1987 through 1991 and dropped sharply thereafter. 
More important, none of these requests have been frivolous and 
virtually every one of them has been granted.
  I have identified 266 waiver applications that have been presented to 
the court either directly or in the form of a consolidated generic 
waiver. Of these, the court has approved 249 in their entirety and 5 in 
part. The court has denied only six, and another six remain pending.
  So, while the record is clear about the failure of the Justice 
Department to act in a timely manner, the Department of Justice is here 
now, on the Hill, lobbying for still more power and authority and an 
unprecedented decisionmaking role. Whatever the excuses one may offer 
as to why delay has taken place, the facts are undeniable. Referral to 
the Department of Justice precludes timely resolution because the 
Department does not take timely action, even if ordered to do so.
  Now my friends who are offering this amendment tomorrow, which will 
be voted on, and I think it is one of the key votes of this session, 
glibly say we have a requirement that everything has to be offered and 
dealt with within 90 days. Well, the district court had a requirement 
that they be dealt with within 30 days. This is notwithstanding all the 
efforts to speed them up.
  I think Senator Exon of Nebraska has eloquently explained that 
Congress has passed many deregulation measures--for airlines, trucking, 
railroads, buses, natural gas, banking and finance. None of those 
measures, according to Senator Exon, give an executive branch 
department coequal status as regulators. What Justice is seeking here 
is essentially a front-line role with ad hoc veto power. Justice would 
be converting from a law enforcement to a regulatory agency. It would 
end up focusing chiefly on just this sector of the economy.
  Why does Justice want to do this? They have their Assistant Attorney 
General for Antitrust lobbying, so I am told, calling Senators, and 
urging that this be so.
  Why do they wish this? It is very unusual, because the Justice 
Department has the Sherman and the Clayton Acts oversight. They have 
the Hart-Scott-Rodino preapproval on antitrust. They have plenty to do. 
In fact, I have the statistics that they are way behind on a lot of 
their other work. The Justice Department is not supposed to be a 
regulatory agency. It is supposed to be a law enforcement, antitrust 
enforcement agency. But they have gotten into this habit because of the 
district court action in 1982. They have a bunch of lawyers and staff 
over there, who are regulators. That is what the FCC is for.
  So we just do not need to create the equivalent of a whole new 
regulatory agency just for telecommunications. It is just not needed. 
The sort of extraordinary power is just not needed here.
  Let us look. There are nearly two dozen existing safeguards that are 
already contemplated and required by this bill. There is a 
comprehensive, competitive checklist of 14 separate compliance points--
unbundling, portability, the requirement for State regulator 
compliance, the requirement that the Federal Communications Commission 
make an affirmative public interest finding, the requirement that Bell 
companies comply with separate subsidiary requirements, the requirement 
that the FCC allow whole public comment and participation, including 
full participation by the antitrust division in all its various 
proceedings, the requirement that Bell companies comply with all the 
existing FCC rules and regulations that are already on the books, 
including an annual attestation, very rigorous audits, elaborate cost 
accounting manuals and procedures, computer assisted reporting and 
analysis systems such as the FCC's new automated regulatory and 
management information systems, and all the existing tariff and pricing 
rules, full application of the Sherman Antitrust and Clayton act, and 
full application of the Hart-Scott-Rodino Premerger Notification Act 
requiring Justice clearance in most acquisitions.
  I think our present Attorney General, and the Assistant Attorney 
General for Antitrust, have done a good job in many of the Hart-Scott-
Rodino areas that I have observed. That is what the Justice Department 
is supposed to do, and not worry about creating a bureaucracy and 
keeping several hundred lawyers employed over there.
  There is also the full application of the Hobbs Civil Appeals Act, 
Section 402(a) of the Communications Act which makes the Antitrust 
Division automatically an independent party in every FCC common carrier 
and rulemaking appeal.
  Finally, a consensus approach in this bill has been hammered out in 
the most bipartisan way possible. It has strong support on both sides 
of the aisle.
  We are all aware that several States have moved in the direction of 
deregulating telecommunications. I know that Nebraska, Illinois, 
Tennessee, North Carolina, Florida, New Jersey, Pennsylvania, 
California, Wisconsin, Michigan--none of those States has given their 
Governors or attorneys general the kind of extraordinary new powers 
which this Dorgan-Thurmond amendment would create here at the Federal 
level for the U.S. Department of Justice.
  There are plenty of safeguards in this bill and existing law already. 
If any competitive challenges arise because the Antitrust Division is 
not allowed to convert itself into a telecommunications regulatory 
agency, Congress can revisit the issue. Justice already has adequate 
statutory powers. This amendment represents the sort of undesirable 
approach toward regulation that the American public rejected last 
[[Page S8190]] fall and which we as a country cannot afford. The 
Justice Department already has a big role in telecommunications 
regardless of whether this amendment is adopted. The Department 
enforces the Sherman and Clayton antimerger laws, and they certainly 
apply to telecommunications.
  The Department has been an active participant in dozens of Federal 
Communications Commission proceedings over the years, and it will 
remain an active participant. Under section 402(a) of the 1934 
Communications Act, moreover, the Antitrust Division has special status 
in every FCC common carrier and rulemaking appeal. They are what is 
called a statutory respondent, which means they are automatically an 
independent party in all of those appeals in court actions.
  So what we are really talking about here is whether to give the 
Antitrust Division even more of a role than they will have, and will 
continue to have. And, frankly, I would like to know why we need to 
have this enormous amount of overlapping and duplicative effort focused 
on telecommunications. I do not think the case has been made that 
existing law is inadequate. In fact, I think it would be almost 
impossible to do so because, it seems to me, Justice has all the 
enforcement tools it needs without additional surplus legislation.
  I expect what all this boils down to is the Justice Department has 
about 50 people spending $2 or $3 million a year trying to operate like 
a telephone regulatory agency, a telephone regulatory agency, and they 
like their jobs. They are up here telling us, if we do not adopt this 
amendment, all sorts of bad things are going to happen.
  They simply do not need this amendment if they want to stick to their 
traditional role of being an antitrust enforcement agency.
  When this bill was introduced before the Commerce Committee, my 
distinguished colleague, the Senator from Arizona, noted that with more 
of the little provisions we added the more jobs we were creating for 
the Federal bureaucracy. That is exactly what we have here, the 
functional equivalent of a jobs bill for the bureaucracy which we just 
do not need.
  The historic role of the Antitrust Division of the U.S. Department of 
Justice has been to operate as a law enforcement agency, not a 
regulator deciding which company can or cannot get into the market. 
That kind of market entry decisionmaking has not been one of the 
Justice's roles until very recently--indeed, not until they drafted the 
AT&T antitrust consent decree.
  I do not agree that the Justice Department and the executive branch 
should be placed in this kind of industrial policymaking role. The 
Department should remain a law enforcement agency. I simply do not 
agree that it should transform itself into the functional equivalent of 
a regulatory agency.
  I am also a bit concerned about what the long-run effect of this kind 
of institutional transformation might be. On April 2, the Associated 
Press reported that the total dollar volume of corporate mergers and 
acquisitions reached a record $135.2 billion worldwide during just the 
first quarter of 1995. Last year, there were an all-time record number 
of these megamergers totaling some $339.4 billion. That was up to 43 
percent compared with 1992.
  At the same time this tremendous number of mergers and acquisitions 
is taking place the Antitrust Division seems to be focusing upon 
becoming a telephone regulatory agency. I agree that telecommunications 
is critically important. But we have the Federal Communications 
Commission. We have the Public Service Commissions in all 50 States 
plus the District of Columbia. I do not think the taxpayers should be 
forced to pay to create and then support yet another telecommunications 
regulatory agency, namely the Antitrust Division. The Antitrust 
Division should concentrate on its traditional role of enforcing the 
antitrust laws. They should be examining all those massive mergers and 
acquisitions that are taking place. They should not be spending all of 
this time and effort focusing on duplicating what the FCC and the State 
commissions are perfectly capable of handling.
  Mr. President, I have pointed out before how slow the Justice 
Department is. We all know that my friends in the long distance 
industry, some of them, are pushing for this amendment. They see it as 
another promising way to game the process. They want to game the 
process rather than deregulate, to use the Federal Government to block 
additional competition. And remember, delay in this area has genuine 
cash value.
  I am very concerned that we take a look at some of the hopes of some 
of these companies. I consider them my friends, but I think that they 
are acting against consumers here. We really need to pass this bill. 
This bill sets up a system for competition.
  So, Mr. President, this bill represents the work of a bipartisan 
group of Senators who started work in November. This telecommunications 
bill received a vote of 17 to 2 coming out of the Commerce Committee 
with all the Democrats on the committee. There is a wide range of 
ideological spectrum there among the 9 Democrats and 10 Republicans, 
but it happened to receive all the votes of the Democratic Senators. 
Now the White House is raising questions. My friend from Nebraska is 
raising questions. But we included them in our process. We did our best 
to get a bipartisan bill.
  It is going to be tough to pass this bill because in 
telecommunications legislating, as we found last year and over the 
decades, each group can be a checkmate. Any one of the economic 
apartheid groups in telecommunications can checkmate at any point in 
the process. It is like playing chess with several people and anybody 
can checkmate.
  What has happened since the 1934 Communications Act is an economic 
apartheid has sprung up and companies have done very well with this 
company doing local service, this area doing long distance service, 
this area doing cable TV, this area doing broadcasting, and utilities 
prohibited from participating in all of this. This is a massive bill 
that brings everybody into competition. It is procompetitive, 
deregulatory if we can keep it that way.
  What is happening, however, is that each day and each month that this 
bill has moved forward, a lot of companies have said, wait a minute, 
when we said deregulation we meant deregulation of for me, not the 
other guy. When we presented them a fair playing field, they said, wait 
a minute, we want a fair playing field with just a slight advantage. 
And virtually every lobbyist in America has been working on this bill 
in one form or another.
  We have held off granting certain special deals to certain groups in 
this Senate bill. For example, the newspaper publishers group sought 
special treatment for their electronic subsidiaries, and in the Senate 
we said, no, everybody has to compete. Now, they have obtained that 
special treatment in the House bill.
  Who knows, I may well be outvoted on that. But that is an example of 
how we have tried to hold the line on competition. We have tried to 
make it a procompetitive bill.
  Now, in our history, in terms of telecommunications, this bill will 
take us into the wireless age, which I think is about 10 or 15 years 
away. Some people think it is only 5 years away. But that will be an 
age when wires may be obsolete, and we are a ways away from that. But 
we need this bill as a road map to get everybody into everybody else's 
business.
  Right now, regional Bells have to invest abroad if they want to 
manufacture because they are restricted from doing so here at home. 
Other companies have this line of business or that line of business 
restriction on them. This will let everybody into everybody else's 
business. It will allow a great deal of competition.
  Now, some will say, that will just result in a group of monopolies. 
It will not, because we have the antitrust laws. But also let us look 
back to that day in 1982 when the Justice Department made two decisions 
on the same day. The Justice Department decided to allow IBM and the 
computer industry to go into the marketplace and to let there be 
winners and losers. It decided to place the MFJ ruling under Judge 
Greene on the telecommunications companies and break up into regional 
Bells under heavy government regulation.
  Now, you can argue this forever. This will be argued forever in 
industrial history. But what happened in the computer area has been 
magnificent. We [[Page S8191]] have new technology and product cycle 
every 18 months. The turnover is so great. There are not Government 
standards. There have been winners and losers, some big winners and 
some big losers, some have gone out of business, some have become the 
Bill Gateses of this world. It has been truly amazing to compare the 
two tracks: one a highly regulated area and the other deregulated. And 
we will have that sort of an industrial argument.
  Now we have come to a point in our history when we need another 
industrial restructuring, and this one should be done by Congress. 
Congress should assert its responsibility for a change. The reason the 
courts acted regarding the telecommunications area was because Congress 
could not, because it is so politically sensitive. It is going to be 
tough to get through conference. It is going to be tough to get it 
through the House. It is going to be tough to get it signed because we 
have some indications that the President might not be willing to sign 
it. I hope he is because I think it is the best bipartisan bill that we 
will be able to get.
  So I am going to step back to my charts once more and explain exactly 
what the bill is one final time.
  The Telecommunications Competition and Deregulation Act of 1995 is 
designed to get everybody into everybody else's business in 
telecommunications. It is a massive bill. What does it do? First of 
all, in order to get into other businesses in telecommunications, they 
would first comply with State market opening requirements.
  Second, they would go to the FCC where there are two tests. The first 
one is the standard of public interest, convenience and necessity test 
that has been going on for years and years.
  Third of all is the FCC would certify compliance with the 14-point 
checklist. That is the checklist that I will explain here in just a 
minute.
  The regional Bell telephone companies would have to comply with the 
separate subsidiary requirement, the nondiscrimination requirement, and 
cross-subsidization ban.
  The fifth step would be the Federal Communications Commission would 
allow the DOJ full participation in all its proceedings.
  Now, the Bells must comply with existing FCC rules in rigorous annual 
audits, elaborate cost accounting, computer-assisted reporting, and 
special pricing rules. So there are a lot of requirements here that 
will force the Bell operating companies to open up their businesses, to 
unbundle, and to interconnect so that people can form a local telephone 
service and be successful with it.
  Meanwhile, the full application of the Sherman Antitrust Act would 
continue with the Justice Department, and the Clayton Act, and the 
Hart-Scott-Rodino Act. The Hobbs Civil Appeals Act involving DOJ as an 
independent party and all FCC appeals would continue, so the Justice 
Department is already involved. What we would create through the 
Dorgan-Thurmond amendment is just another layer of bureaucracy.
  The competitive checklist has been distributed to all Senators. This 
checklist was developed as a compromise to the VIII(c) test to 
determine when companies should be deemed eligible to enter the market, 
when they have opened up their local markets.
  The problem with competition in telecommunications is that you have 
to use somebody else's wires to get where you are going. There have to 
be some ground rules. So we came up with this checklist that the FCC 
would use, in addition to the public interest standard.
  The first one is access to network functions and services. That is an 
interconnection. I went over to visit the Bell Atlantic facility here, 
and I've seen what interconnection and unbundling actually is.
  Next is capability to exchange telecommunications between Bell 
customers and competitors' customers.
  Next, access to poles, ducts, conduits, and rights of way.
  Next, local loop transmission unbundled from switching. There are 
three points on unbundling the system so other people can get into it 
and market things through the Bell company's system and wires.
  Next, local transport from trunk side unbundled from switch.
  Next, local switching unbundled.
  Next is access to 911 and enhanced 911--which for emergency you might 
push one button--directory assistance and operator call completion 
services.
  Next, white pages directory listing available at a reasonable price.
  Next, access to telephone number assignment.
  Next, access to databases and network signaling.
  Next, interim number portability.
  Next, local dialing parity.
  Next, reciprocal compensation.
  And last, resale of local service to competitors.
  So there we have the measures to assure the breakup of local Bell 
monopolies. Now the big question is, will the regional Bell companies 
let competition in? Well, if they do not, under S. 652 they will pay 
immense financial penalties.
  This checklist was agreed to. We had night after night of meetings in 
January and February. We first wrestled with the VIII(c) test. Other 
Senators wanted a LeMans start. We came up with this checklist on a 
bipartisan basis, and I think it is the thing that will move us towards 
competition.
  I have already talked a little bit about the problem with the 
amendment tomorrow. I wanted to just point out again the average length 
of time that some of these waivers require. This first chart shows the 
number of days from zero to 1,200, starting in 1984, how the length of 
time has expanded for the average age of waivers pending before the 
Department of Justice at year end.
  What has happened is the Department of Justice has gotten slower and 
slower and slower. As the court has told it to go faster and faster, it 
has arrogantly gone slower and slower. What is going on? Can someone 
give me an explanation?
  How can it be in 1993 it averaged nearly 1,200 days to get an answer, 
a piece of paper, out of the Department of Justice?
  What the Dorgan-Thurmond amendment is suggesting is that we finish 
all the checklist, all the public interest requirements, all the other 
requirements and all the other safeguards, then we go to the Justice 
Department. My friends say, ``That will only take 90 days,'' but look 
at the record, look at the videotape, as they say in reporting sports.
  On this chart it illustrates the number of requests with the 
Department of Justice and how frustrated industry has become. They 
start out about at 86, shortly after that they were hopeful, up to 80. 
It dropped way down in 1992 and 1993. It is not because there are too 
many requests filed. People are just giving up. There is a lot of 
business not being done. That is what we mean by drying up enterprise, 
discouraging competition. Imagine how it is when a business faces 3 
years of delays and 3 years of hiring lawyers and 3 years of having 
nothing but uncertainty to offer investors. Imagine asking your 
investment people to wait 3 years just for a decision. You do not get 
competition that way, and that is what the anticompetitive forces are 
looking to. They want to use Government to keep other people out of 
their business. They want to use Government regulation to stop 
competition.
  I say let us deregulate, let us be procompetitive and not go on with 
practices such as waiting 1,200 days for a piece of paper that the 
district court thought could be issued in 30 days.
  Mr. President, we have before us a procompetitive deregulatory bill. 
Everybody says they want to deregulate. Al Gore has a commission for 
privatizing and deregulating and cutting Government. This bill before 
us will reduce the size of Government, it will protect those people who 
are applying, but it will not allow this sort of thing--1,200 days 
waiting for a piece of paper.
  This bill will also provide, for the first time, a number of market 
openings: Utilities will be able to get into telecommunications with 
safeguards, the subsidiary safeguard; the cable companies in this 
country will move towards deregulation and will be deregulated when 15 
percent of their market has direct broadcast satellite or video dial 
competition. With the Dole, Pressler, Hollings, Daschle amendments 
there is further deregulation for small cable; the newspaper publishers 
will be in the electronics subdivision though there is a difference in 
the [[Page S8192]] House and Senate versions; the broadcasters will get 
further deregulation because they are facing more competition, radio 
with satellites, so forth.
  The giant regional Bell companies will be forced to open up their 
markets to competition. They will be allowed to manufacture in this 
country. A long distance company will be able to get into the local 
markets.
  So this is a vast, vast bill. If we do not pass this bill this year, 
it will be 1997 before we can try it again. We tried it last year. 
Senator Hollings did a terrific job, so did other Senators, Republicans 
and Democrats. But as I said, this sort of bill can be checkmated even 
at the last minute by any one of the interest groups.
  I compare passing a telecommunications bill and some of the problems 
like being in a room with a giant buffet table stacked high with food 
and people gathering about it ready to eat, but no one starts to eat 
because they want to be guaranteed that no body else is going to be 
getting an extra carrot. The fact is, there is plenty for all.
  I have never seen companies and groups so nervous, so anxious to get 
one final slight advantage. This bill affects the burglar alarm 
business because they have to go on to using other companies' wires. 
Tomorrow there is going to be an amendment offered to give the burglar 
alarm companies 6 years protection before they have to compete. In the 
bill as it stands the burglar alarm companies get 3 years protection. 
That is more than most others get. But now there is going to be an 
amendment to give them 6 years of protection.
  So every group wants to delay their entry into competition 3 to 6 
years. They are trying to figure out ways to get amendments. I say for 
the American consumer that that is not right. The American consumer 
wants all these companies to compete, they want new small businesses to 
be able to be formed to get into telecommunications. Today nobody but 
the monopolies can get into local telephone service in this country, 
but if this bill passes, two people can go out and form a local 
telephone company.
  This bill was not drafted by industry, as some may suggest. There has 
seldom been more of a bipartisan effort in this Senate. When we 
finished the first draft, I walked a copy of this bill to every 
Democratic Senator on the Commerce Committee, of whom there are nine, 
and put it into the Senator's hand. I said I wanted their staffs there. 
We sent a memo around to everybody, saying, if you want to get involved 
in meetings at night and Saturdays and Sundays, come on around. I 
commend my friend from Nebraska, because he sent a very able staffer 
who helped write much of it. We are very glad for that assistance. We 
worked on this bill in a bipartisan way.
  I said earlier this year that I felt if we did not get legislation 
out of the Senate by June, it is going to be tough going. I thank the 
leadership on both sides. My colleague Senator Daschle has been very 
helpful, Senator Dole has been extraordinary, and Senator Lott, too--
all of the leadership. My colleague here, Senator Hollings, has done a 
great job on the Democratic side. But if we do not get this bill 
through conference and to the President's desk and signed this year, it 
is not going to happen next year.
  I say to all those legions of lobbyists and others who are calling in 
and doing their jobs--this is a democracy and people can petition their 
Government--I say to them that whatever their interest is, they have an 
interest in this bill passing because it is procompetitive and 
deregulatory.
  People who want to work and compete will do well under this bill. I 
think we should all remember that, because this bill is, in my opinion, 
the most important bill in terms of creating jobs for the next 10 or 15 
years. This bill will cause an explosion of new investment, it will 
cause an explosion of new jobs, the kind of jobs we want in this 
country.
  Now, Mr. President, I have cited frequently that our regional Bell 
companies, and others, frequently are investing overseas. For example, 
England has deregulated its telecommunications. Many years ago, when I 
was a student there, they were a socialistic economy. Now they have 
privatized, deregulated, de-nationalized. England is, at last, coming 
out of its long recession as it deregulates. They have deregulated 
their telecommunications area, and our people can go there and build 
cable systems, as NYNEX and U.S. West, I believe, are doing. Our 
investors can go over there and participate. If they keep deregulating, 
they are going to have a booming economy. You can mark my word on that. 
They are on the way back. They figured it out that socialism was not 
beneficial.
  We are doing somewhat the same thing in our telecommunications area. 
Our telecommunications industry has not moved forward as fast as our 
computer industry has. There are all these companies which want to keep 
regulation to keep others out. They want Government-set standards, so 
that the private standards cannot leap forward. They want another 
review at the Justice Department after they have gone through two 
reviews. This is inside-the-beltway thinking. The further west I get in 
this country the more agreement I find that we should deregulate and 
privatize wherever possible.
  So in conclusion, Mr. President, I may have some more remarks later. 
But I think the Telecommunications Competition and Deregulation Act of 
1995 will be a signal point in our Nation's history if we pass it. If 
we do not, we will remain locked up in economic apartheid--each sector 
protected from the other, kept from getting into the other's business. 
We will see more of our jobs going overseas and more and more of our 
manufacturing and innovation going overseas, American workers not 
getting the new kinds of jobs we need.
  Many of our industries are aging industries, and we read in the paper 
about this many people being laid off here and that many being laid off 
there. This is one of the great jobs bills ever to come before 
Congress. I remember being in the House and we used to debate the 
Humphrey-Hawkins job creation bill--whether or not the Government could 
create jobs through the Federal Government paying people to do make-
work types of things. I opposed it many years ago in the 1970's when I 
was in the House of Representatives.
  But S. 652 is a jobs creation bill that does not cost the Government 
anything. In fact, the government costs will be reduced. There will be 
less in regulation than there is now, provided we do not adopt the 
Dorgan amendment tomorrow, which would add another layer of regulation.
  Mr. President, I yield the floor. I may have some more remarks to 
make later.
  Mr. KERREY. Mr. President, I do not know how long I am going to 
respond, but we will have time tomorrow to discuss this.
  In my judgment, the Senator from South Dakota just misdescribed both 
our amendment and what the Department of Justice is doing and why the 
people of the United States of America should want this amendment 
adopted.
  He repeatedly comes to the floor and says that this is ``another 
layer of bureaucracy,'' and describes himself as being beleaguered with 
opponents who are trying to prevent something from happening, that we 
are deregulating, and we ought not interfere with this process.
  I say again for emphasis, Mr. President, that nobody in my campaign 
in 1994 came to me and said, gee, I hope you deregulate the telephone 
companies. I am an advocate of doing this. But the Senator from South 
Dakota says, gee, this was not written by industry. It may not have 
been written specifically by industry, although I daresay you would 
have to struggle long and hard to find a Member of this Congress that 
could come up with that 14-point checklist. That is a technical 
checklist that does not look like it is in the language that at least I 
hear us using as we describe telecommunications.
  It may not have been written by industry, but American industry is 
asking for this legislation. It allows them to do things they are 
currently prohibited from doing. I am an advocate of allowing them 
doing some things they are prohibited from doing. I favor deregulation. 
I am tired of hearing the straw man set up time after time that somehow 
you are either for deregulation and therefore against this amendment, 
or you are against deregulation and, therefore, you support the 
amendment. That is a nonsense straw man argument. [[Page S8193]] 
  The questions for consumers, for citizens to ask is, what is this 
thing all about? What do you mean, Senator Kerrey, that these companies 
want to do something they cannot currently do? The long distance 
companies want to come in and sell us local telephone service. So there 
is a section in here that tells them not only how they get in the 
business but how others can get in the business.
  Section 251 is a pretty darn good section. Section 255 is the one 
that is in question now, which is the local companies saying we want to 
provide long distance service. We want to enter the long distance 
service market. By the way, I heard the Senator from South Dakota 
talking about the Humphrey-Hawkins Act and full employment. The 
companies that are arguing the loudest and strongest for this 
legislation have reduced their employment. They have reduced their 
employment in the decade of the 1980's, since divestiture occurred. Do 
we have more jobs in computers? No. We have 150,000 fewer. Do we have 
more jobs in local telephone companies? No, smaller employment. Do we 
have more jobs at AT&T long distance? No, smaller employment.
  I would be, as a Member of this body, real careful not to promise 
that somehow when I deregulate and say to a company, you can start 
pricing at cost, that that is going to result in an increase in 
employment. I will bet you this results in additional downsizing of 
businesses. This promise of jobs is going to taste real bitter to the 
families who get laid off. You can say, well, Senator, but there are 
going to be jobs created in other sectors. I think that is likely to be 
the case. It is likely to be the case.
  The Senator from South Dakota asks why would I want the Department of 
Justice role, and says, look at the lousy job they have done. Those 
charts misrepresent what the Department of Justice has done. They are 
the competition agency, not the Congress. This Congress did not have 
the guts to stand up to the AT&T monopoly in 1982. It did not have the 
guts to stand up to them. Who filed the consent decree? Who sued the 
AT&T monopoly? Who led to this competitive environment in long 
distance? Was it the people's Congress, out of concern for the citizens 
and the rates they were paying? No, siree, it was not. It was the 
Justice Department suing on our behalf.
  Because we did not have the guts to take them on. That is what 
happened.
  So citizens say, why do I want the Justice Department to be involved? 
The answer, plain and simple, is when it comes time to go after a 
monopoly who is preventing competition, they are the ones that have 
done it. They are the ones that have done it.
  The second reason we want them involved, I would argue, is they are 
the ones, for a relatively small amount of money, that are likely to 
make the tough calls.
  I am not going to get into a great discussion about this here this 
evening, but there was a newspaper article this morning in the New York 
Times. It talked about whether or not the Federal Communications 
Commission, the agency that has all the responsibility here, is doing a 
very good job.
  I have not up until now, and indeed even now I will not say as the 
Senator from South Dakota just said, ``I suspect that the reason 
Senator Kerrey wants a DOJ rule is there are a few lawyers that want to 
keep their job.'' What baloney. Leave that argument off the floor. That 
is baloney. That is not what is going on.
  Go back to airline deregulation. When we passed deregulation for the 
airline industry, we said precisely what we are saying in this bill. We 
said we are not going to give the Department any role beyond 
consultation.
  Guess what happened when TWA proposed to acquire Ozark, when 
Northwest Airlines proposed to acquire Republic? What happened? The 
Department opposed it, objected to it, offered strenuous objections, 
but they had no ability to say no. They had no legal authority.
  We are trying to correct, based upon lessons of the past, mistakes of 
the past. That is what we are trying to do, on behalf of consumers. If 
we do not get a competitive environment, they will not get any 
advantages.
  I bet, of the seven regional Bell operating companies, there is at 
least $1.5 billion cash flow average from these corporations. These are 
big corporations. These are big businesses. They are hungry to expand 
their business, and I want to allow them to expand their business.
  Unless we get competition at the local level, we will end up having 
what we had with airline deregulation, when the Department, with only a 
consultative role, only could object to the mergers in question. And 
look what happened to St. Louis when TWA was allowed to come in and 
acquire Ozark. Look what happened in Minneapolis when Northwest 
proceeded without any obstacle being offered to the acquisition of 
Republic Airlines.
  Mr. President, all the Dorgan-Thurmond amendment says is, do the 
citizens want the Department of Justice to be able to say yes or no? Do 
you want the Department to be able to say yes or no? All the 
presentations about the waiver requests that have been slowing up; the 
very people that filed the applications very often cause the cases to 
go slow because they make an overly broad application for waiver of the 
problems that the Department can say, we can, in an expeditious 
fashion, say no. Or we can sit with a company and try to work through 
this application that they know is too broad, that goes at the core of 
the restrictions under the modified final judgment.
  I ask unanimous consent that the article that appeared in this 
morning's New York Times be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                       [From the New York Times]

                    Has the F.C.C. Become Obsolete?

                         (By Edmund L. Andrews)

       WASHINGTON, June 11--David Margolese is a bit player on the 
     information highway, barely a footnote in the $700 billion 
     communications industry. But his experience over the last 
     five years provides a textbook example of why the Federal 
     Communications Commission is under attack as never before.
       Mr. Margolese, head of a tiny company called CD-Radio Inc., 
     has gambled $15 million since 1990 to develop a satellite 
     service that beams 30 channels of music to radios nationwide. 
     He thinks it would fill a big gap, reaching rural hamlets and 
     lonely stretches of interstate highway that ordinary radio 
     stations do not reach.
       There is a problem, though: the F.C.C. will not let him do 
     it. Traditional radio broadcasters have adamantly fought 
     satellite radio, fearing it as a competitor. Agency officials 
     are torn. Having repeatedly inched forward and back, the 
     agency plans to inch forward again as early as Monday by 
     proposing rules about what kind of service a satellite radio 
     company will be allowed to provide.
       Mr. Margolese is fuming. ``All we want to do is give people 
     a choice that they don't have now,'' he said. ``That's all we 
     want to do--give consumers a chance to choose whether our 
     idea is a better idea.''
       Anti-government fever is a given in Newt Gingrich's 
     Washington, and agencies ranging from the Food and Drug 
     Administration to the Commerce Department are under sustained 
     attack. But bureaucrat for bureaucrat, few agencies wield as 
     much influence over industry and consumers as the F.C.C. 
     Created during the Depression, when AM radio was king and 
     government regulation was considered essential by many 
     people, the F.C.C. was chartered as the guardian of the 
     public airwaves, charged with insuring that they were used 
     wisely.
       ``Do you or do you not want a consumer protection function 
     in this arena?'' asked Reed E. Hundt, the commission's 
     chairman. ``If you don't, where else would literally tens of 
     thousands of complaints go?''
       Today, the agency has an immense impact on almost every 
     communications medium. It has opened the air-waves to 
     cellular phones and direct-broadcast satellites. It parcels 
     out billions of dollars worth of broadcast licenses, defining 
     the terms of competition for television, radio, satellites 
     and phone service.
       But the word into which it was born has gone the way of 
     Norman Rockwell, and critics abound. Conservatives argue that 
     the commission does more harm than good, hindering 
     competition and delaying valuable new services. Consumer 
     advocates say it is often a captive of the industries it 
     regulates. Little mentioned in all this is that the F.C.C.'s 
     most-criticized restrictions have been initiated at the 
     behest of business groups.
       Mr. Gingrich has said he would like to abolish it entirely. 
     Republicans on the House Commerce Committee, vowing to cut 
     back its authority, held a series of closed-door meetings 
     with industry executives and agency officials last week to 
     explore ideas intended to curb the agency's powers.
       Examples of gridlock are abundant. Nearly three years ago, 
     the F.C.C. moved to promote competition in cable television 
     by adopting rules to let telephone companies offer a rival 
     service called video dial tone. But telephone companies saw 
     their applications to offer the service languish as agency 
     [[Page S8194]] officials insisted on changes in many plans. 
     Today, only a handful of tiny experiments exist, and many 
     telephone companies have decided to ask cities for 
     traditional cable TV franchises.
       If the agency and its video dial tone rules had never 
     existed, economists say, telephone companies might have 
     offered cable service two decades ago and perhaps have 
     prevented cable television monopolies in local markets.
       In the meantime, the F.C.C.'s efforts to regulate cable 
     prices have been plagued by policy shifts and the complexity 
     of its pricing rules. The first set of such rules, intended 
     to carry out a law passed in 1992, inadvertently sent rates 
     up rather than down for many customers.
       A second effort early in 1994 pushed cable rates down 17 
     percent. But after incurring a storm of criticism from the 
     industry and from conservatives in Congress, the agency has 
     in recent months adopted still another series of rules that 
     give breaks to small cable systems and to companies that add 
     programming.
       Today, some critics of the cable industry say the price 
     regulations are more trouble than they are worth. ``The 
     system is a brain-dead patient on life support,'' said Barry 
     Orton, a professor of telecommunications at the University of 
     Wisconsin and a consultant to many small towns that want to 
     start regulating cable prices. ``The smaller towns and cities 
     that I work with say that they've had it. It's too 
     complicated, and it's too full of holes.''
       But for all the complaints by businesses and their 
     Congressional champions, it is business groups that typically 
     have sought to have the agency umpire their disputes. Some of 
     the most onerous and ridiculed F.C.C. rules are those 
     resulting from intense industry lobbying.
       For instance, Hollywood studios fought ferociously three 
     years ago to keep television networks out of their business, 
     until a Federal court overturned the F.C.C.'s rules. Local 
     phone companies lobby fiercely to preserve universal service 
     and to delay rules exposing them to new competition. Cable 
     companies have filed more than 20,000 pages of briefs to 
     block phone companies from providing TV programming.
       But defenders of the commission, who argue that it is the 
     crucial guardian of the public interest, note that it has 
     consistently tried to promote market competition and move 
     away from traditional regulation. And even the staunchest 
     conservatives have praised one of the commission's 
     initiatives--the auctioning of thousands of new licenses for 
     wireless telephone and data services, a revolutionary 
     departure that raised more than $9 billion in the last year 
     and is expected to increase competition sharply in the 
     cellular telephone market.
       ``Everybody agrees that you want competition,'' said Mr. 
     Hundt, the F.C.C. chairman, who was appointed by President 
     Clinton. ``But you have to have rules of fair competition if 
     you want to have competitors to enter the market.'' He 
     conceded that the agency had in the past been guilty of 
     micromanagement, but passionately defended its charter to 
     protect the public interest.
       A schoolmate and soulmate of Vice President Al Gore, Mr. 
     Hundt promotes a vision of linking all schools to advanced 
     computer networks, and he has proposed rules to expand 
     educational television programs for children. He also 
     vigorously defends the commission's duty to protect consumers 
     from overpricing and to open traditional monopolies in 
     telephone and cable television.
       Republican lawmakers agree on that point. They are seeking 
     to pass a sweeping bill deregulating the telecommunications 
     industry, in part by knocking down barriers that prevent 
     cable television and phone companies from attacking each 
     other's markets. The same bill asks the F.C.C. to start 
     dozens of new proceedings, some to find ways of insuring 
     affordable prices for rural areas and for the poor.
       In addition to the flak it takes from Capitol Hill, the 
     agency has its own civil strife. It never seemed more at war 
     with itself than in its attempt to let telephone companies 
     offer video dial tone services. The goal of the rules, 
     adopted in 1992, was to break the monopolies enjoyed by most 
     cable companies.
       Yet the phone companies became bogged down, and F.C.C. 
     officials complained that the companies were reserving too 
     many channels for themselves and leaving too few for 
     independent programmers. They argued about how the phone 
     companies were allocating for construction costs and sought 
     volumes of technical information.
       ``It makes no sense,'' said Peter W. Huber, a senior fellow 
     at the Manhattan Institute. ``After 15 years of cable 
     monopolies, almost anything would be an improvement. Even if 
     the phone company keeps most of the channels for itself, you 
     would at least have two competitors instead of only one.''
       F.C.C. officials say they are not entirely to blame for the 
     delays, noting that many phone companies had voluntarily 
     withdrawn applications, citing technological uncertainties.
       ``At a minimum, there has got to be dramatic reform,'' said 
     Representative Jack Fields of Texas, chairman of the House 
     Commerce telecommunications subcommittee.
       Business interests may turn out to be the agency's white 
     knight. With competition heating up among industries, cable, 
     phone and even satellite companies will all be looking to the 
     agency for help in attacking each other's market while 
     defending their own turf.
       Some consumer advocates add that the agency has often 
     provided crucial support for competition. Though it stalled 
     MCI's effort to enter long-distance service in the 1970's, 
     the F.C.C. later adopted a wide variety of rules that helped 
     it compete with AT&T.
       ``What many critics fail to see are the tremendous 
     benefits,'' said Gene Kimmelman, a lobbyist for Consumers 
     Union. ``It's unlikely that MCI and Sprint would have been 
     able to make it without regulatory protections designed to 
     move the long-distance industry from monopoly to 
     competition.''

  Mr. KERREY. Mr. President, it is an interesting article for citizens 
saying what is going on here.
  Will the consumer get a fair shake? Let me call your attention to the 
amendment that actually is in front of the Senate, which is the 
amendment of the Senator from California and from Idaho, on behalf of 
cities saying, ``Wait a minute.''
  In the midst of all this talk, is it not part of the Republican 
Contract With America to shift more authority back to the States? Those 
engines of innovation. What happened to the engines of innovation 
argument? Forget that.
  Thirty-some States that have deregulated from rate-based rate of 
return, we are saying, that is enough. We will preempt all and go to 
price caps. States do not have authority any longer in this regard. 
They have authority under price caps, or pricing regulation, but no 
longer do they have a choice.
  If you are a State legislature or citizen out there wrestling with 
the early stages of debate, the Federal Government will decide it for 
you. Rate-based rate of return is out the window, and we are going to 
price caps.
  The Senators from California and from Idaho point out not only that, 
but anything that local government does, if it interferes with a 
competitive environment, can be prohibited under reducing and 
eliminating the barriers to competition. This is a substantial move, I 
think a correct move, in general.
  By the way, I am not trying to come to the floor and say I think the 
FCC is a lousy organization or I think there is a bunch of lobbyists 
trying to influence my vote or anybody else's vote.
  I am trying to say on behalf of consumers based upon the experience 
both that created the breakup of AT&T in the first place and the 
airline deregulation case where the Department of Transportation now 
says they made a mistake not asking for more than merely a consultative 
role from the Department.
  Mr. President, the story in the New York Times this morning is 
headlined ``Has the FCC Become Obsolete?'' I understand the Senator 
from South Dakota is basically saying let the FCC do it all, with only 
a nominal Department of Justice role. We will run this whole thing 
through the Federal Communications Commission. We do not want 
duplication of the bureaucracy. We know how the bureaucracies get. They 
tie things up.
  Let me read things in this article. This touches the tip of the 
proverbial iceberg. CD Radio, Inc, that says, with $15 million since 
1990 to develop a satellite service that beams 30 channels of music to 
radios, they think they fill a big need.
  The FCC will not let them do it. Why? Because traditional radio 
broadcasters have adamantly fought satellite radio, fearing it as a 
competitor. The FCC is blocking competition in this case, not allowing 
it, nervous about it. Why? Because they are the most vulnerable to 
political pressure, frankly, Mr. President, a lot more vulnerable than 
the Department of Justice.
  That has been the competitive agency, the one that has promoted the 
most competition between the FCC and the Department of Justice. I get a 
lot more citizens questioning the existence of the FCC than I get 
citizens coming to me saying, ``Why don't you abolish the Antitrust 
Division of the Department?''
  I do not get people saying, ``I think the Antitrust Division 
overstepped its bounds. Why not get rid of them?'' But I am hearing 
complaints from people who question decisions of the Federal 
Communications Commission.
  This agency, as I indicated, is an interesting agency. We will hear 
businesses complain about it an awful lot. ``They are slowing me 
down,'' and all the arguments that the Senator from South Dakota makes, 
``Poor old businesses. They are making it difficult for 
[[Page S8195]] me to get the approval, my waiver, granted,'' and all 
that.
  It says for all the complaints by businesses and their congressional 
champions, it is business groups that typically have sought to have the 
agency umpire their disputes. Some of the most ridiculed FCC rules are 
those resulting from intense, industry lobbying.
  For instance, Hollywood studios fought ferociously to keep television 
networks out of their business, until a Federal court overturned the 
FCC's rules. Local telephone companies lobby fiercely to preserve 
universal service and to delay rules exposing them to new competition. 
Cable companies have filed more than 20,000 pages of briefs to block 
phone companies from providing TV programs.
  Mr. President, I do not believe that the FCC intentionally is 
creating bottlenecks so as to employ themselves. I do not come down 
here to the floor saying I know why they are doing this.
  There is nothing devious going on. The fact of the matter is our 
problem is we have a tough time making political decisions. I have a 
business come and say, ``I want to compete,'' and the next day someone 
says, ``I don't want to compete.'' It is tough to say you have to 
compete. That is what this legislation purportedly attempts to do.
  The Department needs a role, Mr. President. The Department can, on 
behalf of consumers, say, not that you have a 14-point checklist. You 
could have the 14-point checklist and a consumer not have any choice. 
How do I know I have a choice with a 14-point checklist? I would rather 
abolish the checklist and have the DOJ with a role in this deal, if 
that is what the Senator from South Dakota wants to do, wants to get 
rid of some of the things the FCC does under this legislation, I am 
willing to do it.
  I am willing to deregulate the companies, so you have less regulation 
for them. I am not an advocate of the status quo, of maintaining the 
status quo. But I want the agency that has had, I think, the best 
success, being able to say to the monopoly we are not going to allow 
you to prevent competition. I want that agency on behalf of consumers 
to make sure I do have competition. I do not want a bunch of mumbo-
jumbo rules and regulations that everybody can cook and game and hire 
lawyers to try to figure out how to come out on the winning side. That, 
it seems to me, is what happens if you set up all these little rules 
and regulations and hoops you have to jump through, down at the FCC. I 
would sooner have the Department of Justice sitting there saying: We 
want competition at the local level. If we see competition at the local 
level we are going to allow you to go into long distance. I would much 
sooner have the Department of Justice be that arbiter--not regulator, 
but an arbiter of the question: Do we have competition? Yes or no? Is 
it competitive down there at the local level? Do we have the kind of 
competition that allows us, now, to run the risk--and it is a risk--of 
allowing the telephone companies to get into long distance?
  I hope this amendment is accepted. I hope the Thurmond amendment is 
accepted, because I believe it is one of the few proconsumer things in 
this legislation. I think consumers will benefit enormously the quicker 
we get to competition, where true competition exists at the local level 
and across the range of telecommunications industries.
  This bill does not get us there immediately. It sets a structure in 
place to move from a monopoly to a competitive environment. That is 
what it does. No one denies that. The idea that somehow we are 
deregulating these companies automatically--it is not true. We allow 
them to keep their monopoly in place. We phase it out. We set 
timetables in place. We have tests they have to meet and all that sort 
of thing. They are allowed to stay in a monopoly situation. The sooner 
you get to a competitive environment where the consumers are deciding 
what they want and what is best for them the sooner we are going to get 
rapid decreases in prices and rapid increases in quality.
  I believe the Senator from South Dakota is well-intended with this 
legislation, as I have indicated before. I support large portions of 
this. I do not come down here and say this bill is anticompetitive or 
anticonsumer. But I do believe strongly that if we want the consumer to 
benefit from competition then we have to make sure the Department of 
Justice has a role in telling us when competition exists.
  The PRESIDING OFFICER (Mr. Brown). The Senator from South Dakota is 
recognized.
  Mr. PRESSLER. Mr. President, I would like to say that, first of all, 
in the drafting of this bill, it was done by Senators and staff. But 
Republican and Democratic staff sat down together. I do not know if 
that has ever been done before with a bill. This bill was not drafted 
by industry. It was drafted by Senators and staff here in the Senate. 
They negotiated and worked, and met with Senators with the product of 
their work, and invited the input from other Senators, and came up with 
the competitive checklist, which was not proposed by industry. It was 
proposed by staff as a compromise between the ``actual and 
demonstrable'' and VIII(c) tests that had been used last year and the 
concept of a date certain standard which was utilized by my initial 
chairman's draft--to find a way in this complex telecommunications 
arena to have a test of when markets are open.
  This has not been easy. For instance, let us say you are in the 
spaghetti business and you have to have somebody else deliver your 
spaghetti for you. Can you imagine what shape it is going to be in when 
it is delivered? Especially when the person delivering it is your 
competitor.
  But in this telecommunications area it is so complicated to get 
competition in because you have to depend frequently on your 
competitors' wires to get to where you are going. That is why we still 
need some level of regulation. That is why we still need an FCC at this 
point. Although I hope in the very near future we can see the FCC 
reduced a great deal and ultimately whither away.
  This bill was drafted with the public interest in mind. This bill 
continues to have universal service, which will assure that those high 
cost areas and regions of the country will have telecommunications. Our 
antitrust laws continue under this bill. In fact, the Justice 
Department has a major role.
  But assigning a decisionmaking role, as the Dorgan-Thurmond amendment 
does, to the Justice Department, is unprecedented. The Department is 
always required to initiate a lawsuit in the event it concludes the 
antitrust laws were violated. It has no power to disapprove 
transactions or issue orders on its own, generally speaking.
  Indeed, Judge Greene's court kept the power to make the decisions 
through all these years. The people who work there really work for him, 
or for his court. This would be the first time we are giving the 
Justice Department this kind of regulatory power--a decisionmaking 
role.
  If you look at history, the law, regulation and history of railroads 
closely mirrors that of telephony. The Telecommunications Act of 1934 
was modeled on the Interstate Commerce Act of 1887. The Federal 
Communications Commission was modeled on the Interstate Commerce 
Commission. Both industries involved common carriage, and the 
establishment of networks. Both industries have been required to 
provide essential service to rural areas. Both industries have been 
regarded as monopolies. They share issues related to captive customers, 
competitive access, the desire to enter related lines of business, and 
the loss of traffic to alternative carriers.
  Congress has delegated exclusive Federal authority to the Interstate 
Commerce Commission to decide whether a railroad should be permitted to 
enter into new lines of business. The Department of Justice may file 
comments in the proceeding but is given no specific statutory role. 
Even in proceedings involving mergers, acquisitions and other 
transactions between two class I railroads, Justice has no specific 
statutory role. Although the Department can and usually does submit its 
views on the excessive effects of a proposed transaction, the ICC can 
approve a merger over the objections of Justice.
  Indeed, the potential adverse effect of competition is only one of 
five factors considered by the ICC in its determination whether to 
permit a proposed merger or acquisition between the Nation's largest 
railroads. Congress has given the ICC a broader mandate than 
[[Page S8196]] simply competition. As the agency of expertise, Congress 
has directed it to balance transportation and employee interests, among 
others, with competitive concerns and to accord substantial weight--not 
to recommendations of Justice--but to any recommendation of the 
Secretary of Transportation. Justice is not even mentioned in the 
statutory mechanism.
  I could go on through various other areas. But the point is, it is 
the intent of our structure that this be done at the FCC. What we in 
Congress want the FCC to do, if it is universal service or whatever it 
is, or if it is compensation or whatever is decided, the idea is that 
the representatives of the people are supposed to decide, not the 
courts. And if it is good or bad, Congress should be thrown out of 
office or held accountable for it.
  Presently we have no one here who is accountable for what is 
happening in telecommunications because the courts have taken it over. 
And that is a major part of this bill, to put Congress back in charge 
of telecommunications and information policymaking and to let the 
people make judgments on us as they do in elections. That is the basis 
of democracy. That is what democracy is about.
  So, the Federal Communications Commission regulates the communication 
industry. It should. The Department of Justice should enforce the 
antitrust laws. Or we can change the antitrust laws if we want. But to 
create a group of regulators over at the Department of Justice is not 
wise. Legislation pending before Congress supersedes the provisions of 
the modification of final judgment that governed Bell company entry 
into business now prohibited to them. Once legislation is signed into 
law, a continued Department of Justice role in telecommunications 
policy is no longer necessary except in the area of enforcing the law.
  DOJ does not need an ongoing regulatory role as part of an update of 
our Nation's communications policy. Such a role would be duplicative of 
the FCC's authority. Actual regulatory oversight is not what DOJ is 
equipped to provide. DOJ's claim that it ``alone among Government 
agencies understands marketplace issues as opposed to regulatory 
issues'' is inaccurate. I agree with many of the objectives as my 
friend from Nebraska. Indeed, I think the Senator from Nebraska and I 
have the same objectives. But we have carefully crafted this bill over 
months of work, included universal service, included more competition, 
included more deregulation, included more freedom. It has been a very 
delicate balance.
  Dual Department of Justice and FCC bureaucracies to regulate the 
communications industry delay the benefits competition brings 
consumers.
  These benefits include lower prices, new services, and more choices 
for communications services. I have already gone through the length of 
time and the cost, and ultimately these costs are paid by consumers. 
You know you can do more for a senior citizen by helping them have 
lower gas prices to heat their home in the winter than you can by 
giving them a check, frequently. For example, when we deregulated 
natural gas in the late 1970's, early 1980's-- I must say that it was a 
Democratic President who took the lead on that-- and we followed 
through with a Republican President. But when that occurred I was over 
in the House and coming to the Senate. I heard all the speeches about 
how, if we deregulate natural gas prices will skyrocket, the companies 
will gouge the public, and senior citizens will need subsidies to pay 
their heating bills. Look at what has happened with natural gas prices. 
They collapsed. They have been low. They almost give the stuff away 
there is so much competition. Senior citizens have had cheaper gas 
bills, and farmers have had cheaper bills in drying corn.
  Some people think you are compassionate if you give checks out to 
people, if the Federal Government gives a senior citizen a check every 
month. That is nice, if we can afford it, and it is needed in some 
cases. But I say that you do just as much for consumers in this country 
of providing competition for cheaper products and new innovations.
  Let us take the computer industry. Forty percent of our homes have a 
personal computer. The price is dropping and dropping. There is new 
technology of every 18 months because there is not Government 
regulation, because there is competition. Some people would say the 
Government should set standards for computers or provide for regulation 
of the computer industry. Then it would take 10 years to get a new 
computer. Some people would say why not model the computer industry on 
the telecommunications model. But the fact is that prices are dropping, 
technological innovation flourishing and America's leading the world 
because of the fierce free market competition in the computer industry. 
So I say let us model the telecommunications sector on the computer 
model.
  Let us look at cellular telephones, for example. That is one of the 
few parts of the information highway that we have. Everybody talks 
about the so-called information superhighway. What is it? It is cable 
TV, it is some cellular, and some computer Internet. But in reality we 
have not gotten much of it yet, whatever it is going to be. But it is 
going to be invented and sold when we have competition and 
deregulation. Cellular technology was invented in the late fifties. 
Then Government regulation took 30 years before it was approved for 
sale. Government regulation said it could only be sold in certain areas 
by certain people. It was not until the 1990's that we finally got full 
deregulation and competition in cellular phones. And within a few 
years, everybody is carrying a cellular phone. They are getting smaller 
and smaller. Government regulation is off. But it was delayed from the 
late 1950's until the late 1980's--30 years of delay because of 
Government regulation. We could have had this in the 1960's or the 
1970's. It is estimated that that delay cost American consumers $89 
billion. That stimulates our economy when people can communicate 
better, and do business deals faster. They can be safer. A senior 
citizen can push a button on an emergency communications device in 
their bathroom and have an emergency call placed. These things were not 
available. They were known since the 1950's but because of Government 
regulation they did not come into being until very recently.
  So I could cite computers. I could cite cellular phones. I could go 
on and cite many other areas. But in this particular area of 
telecommunications we are going to see a boom of new devices, and a 
dropping of prices. We are going to see telephone prices drop 
substantially. We are going to see long distance rates drop. We are 
going to see cable television rates drop. Presently people are paying 
too much for telephone calls. As I have indicated in an earlier stage 
of this debate, based on the same ratio as how much computer prices 
have dropped and processing power increased, you should be paying only 
a few cents for most long distance calls and fewer cents for most local 
calls. That is the fact.
  So we need competition and deregulation. This bill has it in it but 
it is being opposed. Talk about corporate interest, the companies who 
are supporting the Dorgan amendment have been running full-page ads in 
our newspapers. That is fine. They can do so. But this idea that one 
side is all corporate interests and the other side is not is not true. 
There are large corporations on both sides of this amendment. But the 
people supporting the Dorgan amendment have been spending millions on 
lobbyists and full-page ads just like the opposition has been.
  So those people who cry corporate interests, pick up yesterday's 
newspapers and read the full-page ads. Both sides have done it. But 
lately, all the spending has been done by people who supported the 
Department of Justice role because they want to slow competition down 
and game the process.
  So there is corporate interests on both sides of this. I do not like 
pontificating by either side. I hope I am not pontificating. But the 
point is, look at the newspapers of last week and see who was buying 
the full-page ads.
  So, Mr. President, I conclude by saying that I think we have a good 
bill. I hope that we hold it together. I am confident we will pass this 
bill with overwhelming bipartisan support. I yield the floor.
  Mr. KERREY. Mr. President, one very quick response. One of the rules 
of debate is say something over and over and over and pretty soon 
people begin to believe it is true. This amendment [[Page S8197]] does 
not give the Department of Justice a regulatory role. It gives them a 
responsibility to make a determination as to whether or not there is 
competition. That is what it does. It does not carve out some new area 
of the Department of Justice to regulate. Indeed, the legislation 
itself is as a consequence of our recognizing that there is too much 
confusion in current law; that there are too many bottlenecks in 
current law. That is what we are attempting to do about the underlying 
legislation, to come up with a simplified test in a simplified way for 
businesses to know what it is that they can do and try to remove the 
regulatory hurdles of entry into various markets. That is what we are 
trying to do.
  This underlying amendment very simply says, first by Senator Dorgan 
and now by Senator Thurmond, merely that the Department of Justice 
should not just have a consultative role. ``Oh, by the way. What do you 
think?'' Instead, the Department would have a role based on section 7 
of the Clayton Act in making a determination as to whether RBOC entry 
into interLATA services would substantially lessen competition or tend 
to create a monopoly. That is the idea.
  I just appeal to the consumers out there trying to figure out which 
side to come down on. Look at that 14-point test. It all looks fine to 
me. They say, ``Well, this was put together by staff or it was put 
together by us here in Congress.'' It took me a long time to figure out 
what all 14 mean, and I am still am not sure what each one means. I do 
not know if they will produce competition.
  I can imagine a scenario under which you get no competition with 
those 14 items. Competition again means the consumers have real 
choices. The Senator from South Dakota talks about the cellular 
industry being restricted. It was restricted by the monopoly of AT&T. 
The monopoly kept the technology from coming online. It was not 
Congress. Congress did not say in the 1970's we have this great new 
technology, cellular. So what we are going to do is take on the 
monopoly, and we do not care what AT&T says. We are going to disregard 
this influence on Congress and we will come down here and pass 
legislation that will break them up. That did not happen, I say to 
consumers now who have benefited from reduced rates for long distance 
and increased quality in long distance. The increase in quality and 
deployment of fiber occurred as a consequence of this competition. That 
benefit did not come as a result of Congress having the courage to take 
on the monopoly. It came as a consequence of the Department of Justice 
suing on behalf of the American consumer.
  So this amendment is simply something that says to consumers you are 
going to have the Department of Justice who brought you competition in 
the long-distance arena, who objected to mergers that were allowed to 
go forward in airline deregulation which reduced competitive choice and 
increased prices, we are going to give this agency not a consultative 
role but the opportunity to say that there is or there is not 
competition.
  If there is competition, have at it. It may be that they say it is a 
heck of a lot faster. Judging from the evidence at hand, it is likely 
they come at least as quick to the conclusion as to whether or not 
there is competition as the FCC looking at this 14-part test.
  So we are going to have a vote on this tomorrow at 12:30. We will 
have an opportunity to debate it a little bit in the morning. I look 
forward to it, and I hope it will be that the amendment passes because 
I believe on behalf of American consumers it is going to ensure 
competition and only by ensuring competition are we going to get the 
benefits that both the Senator from South Dakota and I wish to see 
happen in the United States.
  I yield the floor.
  Mr. PRESSLER. Mr. President, I would disagree with my colleague on 
cellular. I do not think it was AT&T. It was Government regulation. 
Maybe AT&T went to the Government. Maybe AT&T used Government 
regulations. But cellular phones were held up by Government regulation, 
by all accounts. But that is the point. A lot of companies use 
Government regulation to hold up competition and to hold up 
deregulation.
  Also, I would be in disagreement with my friend that the computer 
industry has lost 150,000 jobs. Maybe they have lost 150,000 but 
overall they have gained. One measure of the relative market growth is 
the number of employees. In 1980, there were a little more than 300,000 
Americans employed in the computer industry while more than 1 million 
were engaged in the provision of telephone products. And our statistics 
show there has been a steady increase. There have been some jobs lost 
but overall there has been a substantial gain, and I shall put that 
into the Record.
  By 1993, computer products and services accounted for more than 1.2 
million jobs, a fourfold increase. At the same time, the number of 
telephone employees had dropped to less than 900,000. So unless those 
numbers are incorrect, I think we have to say that the computer 
industry has been an expansive industry operating largely without 
Government standards and regulation where there has been fierce, free 
market competition.
  Indeed, I also serve on the Senate Finance Committee, and every 18 
months the computer industry wants to get depreciation; that is, they 
want their schedule to be 2 or 3 years or less because product cycles 
change so quickly because there is rigorous competition.
  This chart tells what we are trying to do with S. 652--The 
Telecommunications Competition and Deregulation Act of 1995. This is 
the most comprehensive deregulation of the telecommunications industry 
in history and it will promote international competitiveness, job 
growth, productivity, and a better quality of life. It provides open 
access to full competition. Interconnection and unbundling will put new 
competitors including cable and long distance on the same footing with 
former monopolies. Consumers will use the same phone number and dial 
the same number of digits no matter what local telecommunications 
companies they choose, and the competitive checklist for compliance 
with open access will assure certainty and simultaneity.
  Let me also say that universal service is preserved. All providers 
contribute. We make subsidies explicit. There have been some people who 
have said, well, this is like a new tax. In fact, it has been reduced 
from $10 to $7 billion. But all on a bipartisan basis felt strongly 
that universal service should be preserved.
  Removal of restrictions to competition in all markets. Telephone and 
cable firms are free to compete in each other's markets. For the first 
time we end this economic apartheid. We let them go into each other's 
markets and compete and some of them do not like that. But they will 
have to do it. This is transition to the wireless age, but we have to 
make them compete.
  Utility companies free to enter telecommunications markets. And there 
are some safeguards here, but we need to unleash our utility companies 
so they will come into the other markets with a burst of energy and 
will create new jobs, new products, new service offerings.
  The removal of long distance and manufacturing restrictions for Bell 
companies. Presently, the Bell companies cannot manufacture in this 
country, so they go abroad to do it. This will unleash new investment 
in this country, create jobs in this country, instead of having them 
send their money overseas. And they will be able to get into the long 
distance business if they wish.
  Let me say that some people are worried that the Bell companies are 
going to become monopolies. We still have Hart-Scott-Rodino. We can 
change the antitrust laws.
  That is something I should say here. Everybody has been saying what 
the Justice Department should and should not do. If we do not like the 
antitrust laws, we should change the antitrust laws. We should not 
create a group of bureaucrats over there who are regulators. Let us 
change the antitrust laws if we wish to. And I would say that regarding 
the airlines if necessary.
  Market pricing, not Federal price controls for cable. And I predict 
that the same thing will happen to television in cable rates as 
happened in natural gas. We will have video dial tone from regional 
Bell or some other telephone companies. We will have other cable and 
video providers coming into the market, plus we will have 
[[Page S8198]] cable TV, plus we will have broadcast and more than one 
DBS operator--probably three or four. So you will be able to choose 
between seven or eight television services. When that happens, the 
prices are going to go down because there is real competition. But if 
we do not pass this bill, frequently the average consumer will only 
have one choice. And that is what competition and deregulation will do. 
The prices will drop, will just collapse when they have to compete, 
just as telephone prices will as well. When there are more providers, 
those telephone calls are only going to cost a few cents and long 
distance calls are only going to cost a few cents. That is all that 
they should be costing.
  Next, rate of return regulations for large telcos eliminated.
  New flexibilities for broadcasters who offer digital service.
  End arbitrary limits on broadcast ownership because they are really 
out of date. And I know that we have increased to 35 percent the amount 
of the national audience one television broadcast group can have. I 
would like to raise it to 50 or 100 percent if I could do it. In my 
original chairman's mark, it did. There will be an effort tomorrow to 
lower it to 25 percent. I think the old line networks are trying to use 
Government regulation to avoid competition. They need to get in there 
and compete instead of coming to Washington to the FCC and to Congress 
for limits on what can be owned, and so forth, because it will take 
care of itself. Just as in computers we saw this immense resurgence and 
regurgitation and these bursts of energy from new companies, we will 
see the same thing in media and telecommunications.
  Extend broadcast license term to 10 years with expedited renewal 
procedures. Most of the broadcast limitations, in my opinion, are 
obsolete and should be eliminated.
  State and local barriers to market entry repealed. I hope we can hold 
on to that one tomorrow. We have another crucial vote tomorrow 
afternoon on preemption of local barriers to entry. Because we cannot 
allow States and cities to just grant monopoly franchises if we are 
going to have real competition.
  Now, also we are working on investment and growth in the global 
markets.
  We open U.S. telecommunications markets for more investment on a fair 
and reciprocal basis. A reciprocal basis. This is international law at 
its best. We will allow other countries to invest here on the same 
basis that they permit U.S. invest there.
  U.S. comparative advantage in products, services, and software with 
no domestic content provision. That is a very significant change from 
last year.
  Let me explain that. Some of our large unions want to have a domestic 
content provision but that is anticompetitive. Through GATT and these 
other international trade agreements we want international competition. 
We want deregulation and competition. And we did not put the domestic 
content provision in this year's bill. And that is what Mickey Kantor 
and members of the administration say they want--members of the 
administration should be supporting this bill. These are all things 
that, as I understood it, Al Gore and the administration are for. 
Mickey Kantor came up last fall and told us in the Commerce Committee 
that he did not like the bill last year because it had domestic content 
in it, and we took domestic content out this year. This is 
deregulatory. We are making some progress toward being an international 
competitor, and we cannot go on demanding domestic product content and 
say that we are for international trade.
  Next we have sunset for regulation. Biennial review of all remaining 
Federal, State, and local rules, regulations and restrictions.
  It is time we reduce the Federal bureaucracy. We are going to have 
systematic regulatory review and reform through S. 652. This means 
every 2 years after reviewing every regulation, we will do away with as 
many as we can. Inside the beltway, these agencies grow and grow, and 
they do not want to give up their turf. That is what we have, a turf 
battle. The Justice Department wants to do the same thing the FCC is 
doing, and some big companies say, ``That is good, because that will 
slow down competition.'' They are running full-page ads supporting that 
concept.
  Next we have regulatory forbearance authority ordered, then 
deregulatory parity for telecommunications providers offering similar 
services, so that we can get them all competing.
  So there it is. That is what we are trying to do. That is what is in 
this bill. It is not a perfect bill, but it passed the Commerce 
Committee 17 to 2. We had two Republicans who had some concerns. They 
wanted it to be more deregulatory, and I sympathize with them. Every 
Democrat on the committee voted for it. Now the White House says it has 
concerns. I took this draft over to Al Gore in January. I gave it to 
him and asked for his help.
  We need the administration's help when we get into conference on this 
bill. It really delivers on all the reform ideas we hear them talk 
about all the time. This is what the President says he is for. This is 
what the Vice President says he is for. Let us pass it.
  Tomorrow we have two crucial votes. We have to defeat the Dorgan 
amendment, which would add another level of bureaucracy. We also have 
to beat back the effort to erect new State and local barriers when we 
are tearing down Federal barriers.
  So, Mr. President, I will conclude by thanking the Members of the 
Senate for the debate today. I have tried to accelerate the pace of 
this bill.
  I do not see any other Senators who wish to speak.

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