[Congressional Record Volume 143, Number 98 (Friday, July 11, 1997)]
[Senate]
[Pages S7284-S7295]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                             CLOTURE MOTION

  Mr. NICKLES. Mr. President, I send a cloture motion to the desk.
  The PRESIDING OFFICER. The cloture motion having been presented under 
rule XXII, the Chair directs the clerk to read the motion.
  The assistant legislative clerk read as follows:


                             Cloture Motion

       We, the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     do hereby move to bring to a close debate on Executive 
     Calendar No. 104, the nomination of Joel I. Klein to be 
     Assistant Attorney General:
         Trent Lott, Orrin Hatch, Kay Bailey Hutchison, John 
           McCain, Olympia Snowe, Dan Coats, Pat Roberts, Rod 
           Grams, R.F. Bennett, Thad Cochran, Jim Inhofe, Sam 
           Brownback, W. V. Roth, Chuck Hagel, J. Warner, Larry E. 
           Craig.

  Mr. NICKLES. Mr. President, I further ask unanimous consent that the 
cloture vote occur at 6 p.m., on Monday, July 14, and the mandatory 
quorum under rule XXII be waived.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. NICKLES. Mr. President, I further ask unanimous consent that if 
cloture is invoked, there be 3 hours remaining for debate, with 2 hours 
under the control of Senators Hollings, Dorgan, and Kerrey of Nebraska, 
and 1 hour under the control of Senator Hatch.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. NICKLES. Mr. President, I yield the floor.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I rise today on behalf of Mr. Joel Klein, 
who has been nominated for the position of Assistant Attorney General 
of the Antitrust Division of the Department of Justice. Mr. Klein was 
reported out of the Judiciary Committee unanimously on May 5. As his 
record and testimony reflect, Joel Klein is a fine nominee for this 
position, and I am pleased that his nomination has finally been brought 
before the full Senate today. He has my strong support and, I believe, 
the strong support of every member of the Judiciary Committee.
  Now, I believe Mr. Klein is as fine a lawyer as any nominee who has 
come before this committee. He graduated magna cum laude from Harvard 
Law School before clerking for Chief Judge David Brazelon of the D.C. 
Circuit and then Supreme Court Justice Lewis Powell. Mr. Klein went on 
to practice public interest law and later formed his own law firm, in 
which he developed an outstanding reputation as an appellate lawyer 
arguing--and winning--many important cases before the U.S. Supreme 
Court. For the past 2 years, Mr. Klein has ably served as Principal 
Deputy in the Justice Department's Antitrust Division, and for the past 
several months he has been the Acting Assistant Attorney General for 
the Antitrust Division.
  It is clear, both from his speeches and his enforcement decisions, 
that Mr.

[[Page S7285]]

Klein is well within the mainstream of antitrust law and doctrine and 
will be a stabilizing influence at the Antitrust Division of the 
Justice Department. While no one doubts his willingness to take 
vigorous enforcement actions when appropriate, it is a credit to Mr. 
Klein that the U.S. Chamber of Commerce and the National Association of 
Manufacturers and other business associations have written in strong 
support of his nomination to lead the Antitrust Division. They believe 
he will be good for American business. And I think they are right.
  At the same time, Mr. Klein has demonstrated a sense of direction and 
a vision for the Antitrust Division, which is important in a leader. He 
is committed to enforcing our Nation's antitrust laws in order to 
uphold our cherished free enterprise system and protect consumers from 
cartels and other anticompetitive conduct. So, I am certain that Mr. 
Klein will also be very good for consumers.
  Antitrust doctrine has had its ups and downs over the years--although 
we may not all agree on which times were which. At this point, however, 
I am hopeful that antitrust is entering a more mature and more stable 
period. Although antitrust analysis is fact-intensive and will always 
contain gray areas, I hope Mr. Klein will work to help make antitrust 
doctrine as clear and predictable as possible so that companies know 
what is permitted and what the Antitrust Division will challenge. This 
will help businesses compete vigorously without the worry and chilling 
effects that result from uncertainty. I suggest that the Division's 
goal should be to avoid burdens on lawful business activities while 
appropriately enforcing the law against those who clearly violate it.
  Finally, I would like to add that personally I have been very 
impressed with Mr. Klein. He strikes me as a person of strong 
integrity, as a highly competent and talented lawyer who is well-suited 
to lead the Antitrust Division. While I expect we may not always agree 
on every issue, I believe that Mr. Klein's skills and expertise and his 
personal integrity will be a service to the Department of Justice, to 
antitrust policymakers, and to the health of competition in our 
economy. I look forward to working with him in the coming years.

  In what appears to be a last-ditch effort to scuttle Mr. Klein's 
nomination, there are some who have now floated an allegation that the 
nominee's participation in a particular merger decision was somehow 
improper. Upon examination, let me say that it appears to me that these 
reports are wholly unfounded and provide no basis whatsoever for 
questioning Mr. Klein's conduct. I understand that, with respect to the 
matter at issue, Mr. Klein consulted with the proper ethics officials 
and was assured that his participation raised no conflict of interest 
or even the appearance thereof. Based on what we know, this judgment 
appears sound, and I am confident that the nominee has conducted 
himself appropriately. I hope that nobody in this body will use this 
extraneous, ill-founded notion as an eleventh hour basis for opposing 
Mr. Klein's nomination. I am confident, having worked with him over the 
years, knowing him personally as well as I do, having watched him in 
action, having seen him make decisions, and having seen him apply the 
law, that Mr. Klein is a man of high integrity, and I urge my 
colleagues to cast their votes in his favor.
  I might add that some will suggest that Mr. Klein is misapplying the 
Telecommunications Act and has taken questionable positions on 
particular mergers. I will refrain here from passing judgment on any 
particular decision and from engaging in a detailed debate on 
telecommunications antitrust policy. I fully recognize that there are 
some very, very important issues at stake here, especially in light of 
a number of ambiguities left in the wake of the telecommunications law. 
I also recognize that there have been some controversial mergers in 
this area, and yet other potentially landmark mergers which have not 
yet come to pass.
  In short, telecommunications competition and antitrust policy is one 
of the most important, yet somewhat unsettled, policy areas affecting 
our emerging, transforming economy. The looming policy decisions to be 
made in this area cannot be ignored. Indeed, I plan to have the 
Judiciary Committee and/or our Antitrust Subcommittee fully explore 
these issues.
  But I believe it is neither fair nor wise to hold a nominee hostage 
because of such concerns, especially one as competent and decent as 
Joel Klein. In my view, sound public policy is best served by bringing 
this nominee up for a vote, permitting the Justice Department to 
proceed with a confirmed chief of the Antitrust Division, and for us in 
Congress to move forward and work with the Department and other 
involved agencies in the formulation and implementation of 
telecommunications policies.
  I hope that all Senators, and especially those of the President's own 
party, will permit the administration's nominee to be voted on.
  Finally, let me just say this: I believe that the President deserves 
a great deal of credit for picking Joel Klein as one of his chief 
nominations for this year. There are times when I disagree with the 
President, but I have to say when he does a good job and when he does 
nominate good people, as he has in these areas in the past in some of 
the areas of law, in particular, and I cite with particularity some 
people at Justice, the Director of the FBI and so many other law 
enforcement aspects of our Government, then I will support the 
President.
  I will do what I can to show support for him and to encourage him to 
continue to pick the highest quality people for these positions. I am 
confident that Joel Klein is of the highest quality. I am confident 
that he is one of the finest lawyers in this country in this field and 
I feel absolutely confident that he will do one of the best jobs in 
history at the Antitrust Division. Anything less than that, I would be 
disappointed in. I believe he will. He is a fine man. I hope this body 
will support him.
  I hope when we have the cloture vote on Monday we will invoke cloture 
and have the debate, allow anybody to say what they want to, but then 
hopefully vote Mr. Klein up for this position so he can fully embrace 
this position and fulfill it and do what needs to be done. That is all 
I will say today.
  I know my colleagues on the other side may have some comments. I 
yield the floor.
  Mr. HOLLINGS. Mr. President, the Telecommunications Act of 1996 was 
an historic achievement of bipartisan consensus. The act was intended 
to promote competition in every sector of the communications industry, 
including the broadcast, cable, wireless, long distance, local 
telephone, manufacturing, pay telephone, electronic publishing, cable 
equipment, and direct broadcast satellite industries. At the time of 
its passage, the law had the support of the Clinton administration and 
almost every sector of the communications industry.
  Mr. President, the Telecommunications Act was the result of many 
years of debate in the Congress. In 1991, I authored legislation to 
allow the Regional Bell Operating Companies [RBOC's] into 
manufacturing. That bill passed the Senate by almost two-thirds of the 
Senate, but the House could not pass it. In 1993 I introduced S. 1822 
which was a comprehensive effort to update the Communications Act of 
1934. Again, we tried to pass the legislation, but at each stage, one 
industry blocked the other. As a result, communications policy was set 
by the courts, not by Congress and not by the Federal Communications 
Commission [FCC], the expert agency.
  It is now almost 18 months after the historic law was passed and 
critics are already hailing it as a failure because of recent mergers 
and the apparent lack of competition. In actuality we will not know the 
impact of the law for years to come. Yet a critical factor that will 
determine its success has more to do with how the law is being enforced 
than what the statutory language says.
  First, it is important to note that many of the decisions we made 
were based on the commitment that the respective industries were going 
to compete against each other. Telephone companies were going to enter 
the cable television market. The cable industry was going to enter the 
local telephone service market. And long distance companies would enter 
the local telephone service market.

[[Page S7286]]

  Now, 18 months later, we're seeing more of the opposite. But I am not 
ready to simply blame the industry for deciding not to compete. 
Everyone knows that it's more natural for monopolies to defend their 
market share than to willingly give it up. Furthermore, competition can 
only occur if the new competitors are provided the legal and economic 
opportunity to compete for market share. Thus, the success of the law 
depends upon its implementation and oversight.
  One major element of the implementation is the rules adopted by the 
FCC. The FCC has been working nonstop for the past 18 months to adopt 
rules to implement the law. I have some concerns about how the FCC has 
interpreted certain provisions, and I have been working with the FCC on 
those issues. One problem, though, has been that the rules themselves 
are not in effect because these same companies that pledged competition 
have instead sought consolidation and litigation.

  An example of why vigorous enforcement of the act is necessary is 
reflected in the difficulty new entrants are experiencing in trying to 
enter the local telephone market. Financial reports today detail MCI's 
problems that it faces in trying to break into the local telephone 
market. MCI will record approximately $800 million in losses this 
year--almost double its expected loss. AT&T also wrote to the FCC 
outlining the need for greater enforcement of the act if new entrants 
are to be successful in trying to enter the local market.
  Three of the FCC's major rulemakings are now tied up in the courts. 
The interconnection rules have been stayed by the Eighth Circuit Court 
of Appeals since last fall. The universal service rules and access 
charge rules also were recently challenged in the courts. The list goes 
on with a number of other proceedings being tied up in the courts. The 
most outrageous example thus far is last week's announcement that SBC, 
the Bell Telephone Co. for the Southwestern United States, is 
challenging the constitutionality of the statute itself--18 months 
later!
  It is important to note that SBC already has merged with Pacific Bell 
and almost merged with AT&T. At the same time SBC was trying to merge 
with AT&T, it was seeking to enter the long distance market to 
supposedly compete with AT&T. SBC was denied in its initial request to 
enter the long distance market, so instead of challenging the FCC 
decision, SBC simply decided to seek continued protection from the 
courts. The irony, of course, is that for 10 years, the 
telecommunications industry argued that the courts should not 
administer communications policy.
  With all this litigation going on, it's no wonder the media believes 
the law was a failure. I think it's time we focused more on why there 
appears to be more consolidation than competition. Also, I think the 
Congress needs to be more attentive to whether the administration's 
nominees support the policies advocated by the administration during 
consideration of the legislation.
  Let there be no doubt that much of the competition provisions were 
combined with a transition to greater deregulation. In exchange for 
less regulation, there had to be competition to protect consumers. That 
is not happening. Competition and deregulation were all we heard on the 
floor of the Senate, but all we're now seeing is consolidation and 
deregulation without the competition. It doesn't appear that some in 
the administration today share the same views about competition as the 
administration did in 1995 when the law was being debated.
  Because the litigation strategy of some incumbents appears to have 
prevented competitors from entering the various markets, the Antitrust 
Division at the Department of Justice is now tasked with a far greater 
role than anyone envisioned. But the nominee before us today has made 
certain statements and taken certain actions in his acting capacity 
that concern me greatly. His actions raise further concern with the 
direction of the administration's policies with respect to its 
interpretation of the Telecommunications Act of 1996. I believe that 
these issues need clarification before Mr. Klein's nomination should be 
brought to a vote in the Senate.
  Whether or not robust competition develops in the local telephone 
service market depends upon the administration's commitment to vigorous 
enforcement of the act. Unfortunately, while serving as Acting Chief of 
the Antitrust Division, Mr. Klein has explicitly contradicted specific 
statutory mandates and conference report directions that the Congress, 
working with the White House, fought against all odds to have added to 
the Telecommunications Act of 1996. Several Members have asked Mr. 
Klein, Attorney General Reno, and the White House about these concerns 
and have asked them to demonstrate that the Antitrust Division will 
follow the explicit meaning of the Telecommunications Act. So far, 
there has not been a satisfactory response to our concerns.
  Mr. President, with respect to my colleague in discussing the 
character of Mr. Klein, there is no question about Mr. Klein being of 
the highest character and integrity.
  But what really occurs, Mr. President, and I have had to respond to a 
lot of calls from good friends, it was not his character but his 
ability, even though he is a smart lawyer, to administer the law as 
written.
  There is no question in my mind that, of course, you have those who 
believe in weak antitrust. We went through that in the Reagan years. I 
have been the chairman of the State, Justice, Commerce Subcommittee of 
appropriations for the Antitrust Division, and during those particular 
years the Reagan administration cared less whether we had antitrust. To 
the credit of the distinguished wife of our distinguished Senator from 
New Mexico, Anne Bingaman, came in there and we really beefed up the 
department, and we even brought to task none other than Bill Gates of 
the computer world. So when you can do that you know you have a good 
antitrust head in power.
  When I saw this particular gentleman take over it gave me misgivings. 
Right to the point, as the newspaper said, from the very beginning when 
I put my hold on this particular nomination, I said I would be glad to 
discuss it that afternoon, I was not going to politic it around, I have 
other work to do. But as a matter of conscience, I thought I ought to 
bring these things to the attention of my colleagues.
  There is no better place to look at the nominee than this particular 
New York Times editorial entitled ``A Weak Antitrust Nominee.'' I ask 
unanimous consent to have this printed in the Record.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

                [From the New York Times, July 11, 1997]

                        A Weak Antitrust Nominee

       The next head of the Justice Department's antitrust 
     division will have a lot to say about whether the 1996 
     Telecommunications Act breaks the monopoly chokehold that 
     Bell companies exert over local phone customers. He will rule 
     on mergers among telecommunications companies and advise the 
     Federal Communications Commission on applications by Bell 
     companies to enter long-distance markets. Thus it is 
     disheartening and disqualifying that President Clinton's 
     nominee, Joel Klein, is scheduled to come up for confirmation 
     today in the Senate with a record that suggests he might 
     knuckle under to the powerful Bell companies and the 
     politicians who do their bidding.
       Senators Bob Kerrey, Ernest Hollings and Byron Dorgan have 
     threatened to block the vote today and put off until next 
     week a final determination of Mr. Klein's fate. But the 
     Administration would do its own telecommunications policy a 
     favor by withdrawing the nomination and finding a stronger, 
     more aggressive successor.
       Mr. Klein, who has been serving as the Government's acting 
     Assistant Attorney General for Antitrust, demonstrated his 
     inclinations when he overrode objections of some of his staff 
     and approved unconditionally the merger of Bell Atlantic and 
     Nynex. That merger will remove Bell Atlantic as a potential 
     competitor for Nynex's many dissatisfied customers. Mr. Klein 
     refused even to impose conditions that would have made it 
     easier for state and Federal regulators to pry open Nynex's 
     markets to rivals such as AT&T.
       Worse, Mr. Klein sent a letter to Chairman Conrad Burns of 
     the Senate communications subcommittee, who runs political 
     interference for the Bell companies, that committed the 
     antitrust division to pro-Bell positions in defiance of the 
     1996 act.
       That act invites the Bell companies to provide long-
     distance service, but only if the Bells first open their 
     systems to rivals that want to compete for local customers. 
     Yet in the letter to Mr. Burns, Mr. Klein explicitly rejected 
     Congress's interpretation of requirements to be imposed on 
     the Bells in favor of his own, weaker standard.

[[Page S7287]]

       In a subsequent submission to the Federal Communications 
     Commission, Mr. Klein further weakened a requirement that 
     before the Bells enter long-distance service they face a 
     competitor that is serious enough to build its own switches 
     and wires. Mr. Klein has also upset some senators by seeming 
     to minimize the importance, provided in the 1996 
     Telecommunications Act, of Justice's advice to the F.C.C. on 
     applications by Bell companies to enter long distance.
       True, Mr. Klein has blocked applications by two Bell 
     companies, SBC and Ameritech, to offer long-distance service 
     before they had opened their local markets to competition. 
     But by pandering to Mr. Burns, he has created strong doubts 
     that he can provide aggressive antitrust leadership.

  Mr. HOLLINGS. And there is no better way to bring this right to the 
focus of concern.
  Let me refer, without having to put the entire article of the Wall 
Street Journal from this morning into the Record, a headline, Mr. 
President, that ``MCI Widens Local Market Loss Estimate.'' The very 
first sentence,

       MCI communications corporation is calling for tougher 
     regulatory action to break the competitive advantages enjoyed 
     by the regional Bell telephone companies and the local phone 
     markets,

and they said its losses from entering that business could total $800 
million this year, more than double its original estimate. And then the 
article continues.
  The point is, it is very difficult to break into a monopoly and it is 
very difficult to get a monopoly to give up marketshare. That has been 
quite obvious, working in telecommunications since I have been here, 30 
years, that this is the keenest, most competitive, most take-advantage 
crowd you have ever seen. We are bogged down right now into the courts. 
All the promises about going into each other's businesses to compete 
have been forestalled, and mergers on course and everything else of 
that kind, so in writing this legislation we had a back and forth with 
the best of Washington lawyers on all sides, on every word, coaching 
us, more or less, for the last 4 years, until February of this last 
year, when we passed the bill.
  For that 4-year period, we got into the requirements--we call it a 
checklist--that the regional Bell operating companies had to comply 
with to open up their markets before they could get into long distance, 
ipso facto, allow them into long distance, with the monopoly control of 
whoever is going to receive the call locally, and you have a 
monopolistic situation and they will run a touchdown and the long 
distance companies and all competition will be extinguished. So we had 
a debate over every particular facet.
  One particular requirement is labeled here in section 271 of the 
particular act and it is referred to in the actual conference report on 
page 33 in the report language, section 271. Let me read it so it is 
intelligently understood here:

       . . . the Bell operating company is providing access and 
     interconnection to its network facilities for the network 
     facilities of one or more unaffiliated competing providers of 
     telephone exchange services . . . [as defined in section 
     347(A)] to residential and business subscribers.

  For the unattuned, the emphasis should be to ``residential and 
business subscribers.''
  We wanted to have a facilities-based competitor operating there 
before that particular Bell company could take off into the long 
distance competition. There is no question in my mind that the 
distinguished gentleman under consideration, Mr. Joel Klein, understood 
this.
  He made a talk on March 11 at the Willard Inter-Continental Hotel 
here in Washington to the Glasser Legalworks Seminar, and the seminar 
was entitled ``Competitive Policy In Communications Industries: New 
Antitrust Approaches.''
  On page 9 of that particular talk, I quote Mr. Klein himself.

       Now, let me add a few words about how we will apply this 
     standard to RBOC applications under Section 271 of the Act. 
     Our preference, though we recognize that it may not always 
     occur, is to see actual, broad-based--i.e., business and 
     residential--entry into a local market.

  And it goes on and on explaining.
  When my friend from Montana, the chairman of the Subcommittee on 
Communications on the Committee of Commerce here in the U.S. Senate, 
Senator Conrad Burns saw that, he wrote a letter to Mr. Klein. I am 
sorry I do not have my hand immediately on that letter itself, but he 
listed a series of questions in his letter to the Acting Assistant 
Attorney General, and the Acting Assistant Attorney General, Joel Klein 
on May 20, answered the letter.
  I ask unanimous consent, so it will be understood, in fairness to 
everybody, the entire letter and the enclosure be printed in the Record 
at this point.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                            Department of Justice,


                                           Antitrust Division,

                                     Washington, DC, May 20, 1997.
     Hon. Conrad Burns,
     U.S. Senate, Washington, DC.
       Dear Senator Burns: Thank you for your letter of May 15, 
     1997. I welcome the opportunity to respond to your questions 
     and look forward to working with you and the Subcommittee on 
     Communications in implementing the Telecommunications Act of 
     1996.
       Before responding to each of your specific questions. I 
     thought it might be helpful if I made a few general 
     observations. To begin with, I wholeheartedly agree with your 
     statement that ``the basic point of the Telecommunications 
     Act is that regulators should stand aside and let market 
     forces work once fair competition is possible.'' I want to 
     assure you that the Department of Justice shares that view. 
     The sooner market forces can fully displace regulatory 
     efforts, the better the Nation's consumers will be.
       Second, we welcome the prospect of letting the Bell 
     Operating Companies (BOCs) into long distance service. 
     Additional entry into that business, under appropriate 
     circumstances, will enhance competition and will thereby 
     further longstanding goals of the Department of Justice.
       Third, the standard that we are applying under the Act is, 
     I believe, a competition standard, designed to ensure that 
     the local market is open to competitive entry; it is not a 
     metric test, and it does not require that a BOC lose any 
     particular portion of market share before the Justice 
     Department will support its entry into in-region long-
     distance. On the contrary, I agree with your point that 
     ``local telephone competition may be slow in coming to rural 
     states for reasons having nothing to do with BOCs' steps 
     to satisfy the checklist.'' If competition is slow in 
     coming to a rural state because of the independent 
     business decisions by potential competitors, and not 
     because of any BOC actions or non-actions that 
     unreasonably impair competition, the Department would 
     support in-region long-distance entry. If my speech 
     conveyed any other impression--i.e., that we were seeking 
     to use the metric or market-share test that Congress 
     rejected during the legislative process culminating in the 
     1996 Act--I regret the confusion.
       Let me amplify this point by setting forth my understanding 
     of the statutory requirements under section 271. The three 
     basic requirements are that a petitioning BOC must: (1) 
     satisfy either Track A or Track B's entry requirements; (2) 
     satisfy the 14-point checklist; and (3) satisfy the 
     ``separate subsidiary'' requirements of section 272. Beyond 
     that, and in addition to these requirements, the FCC must 
     find that ``the requested authorization is consistent with 
     the public interest, convenience, and necessity.'' 47 U.S.C. 
     Sec. 271(d)(3)(C). In making its decision, the FCC must give 
     ``substantial weight to the Attorney General's evaluation.'' 
     Sec. 271(d)(2)(A). The Attorney General, in turn, is required 
     to evaluate the application ``using any standard the Attorney 
     General considers appropriate.'' Sec. 271(d)(2)(A) (emphasis 
     supplied). It was in the context of this specific statutory 
     language--i.e., ``any standard''--that I said in my speech 
     that Congress had given the Department a ``broad swath'' in 
     terms of its ability to evaluate section 271 applications. At 
     the same time, I clearly share your view that any standard we 
     use should be a competition standard. I have also made clear 
     my view that we should explain our standard before any BOC 
     filed a 271 application so that we would not be seen as 
     playing a game of ``gotcha,'' whereby we would ``change the 
     rules of the game'' after an applicant had filed with the 
     FCC.
       In order to accomplish these goals, almost immediately 
     after I became Acting Assistant Attorney General last 
     October, I asked all BOCs as well as any other interested 
     party, to give me their views of an appropriate competition 
     standard under Section 271 and to answer several questions 
     that would help the Department to formulate its position in 
     that regard. Based on the comments the Department received, 
     we developed the standard that I announced in my March 11 
     speech.
       In formulating this standard, I specifically rejected using 
     the suggestion in the Conference Report that the Department 
     analyze BOC applications employing the standard used in the 
     AT&T consent decree--objecting to BOC in-region long-distance 
     entry unless ``there is no substantial possibility that the 
     BOC or its affiliates could use its monopoly power to 
     impede competition in the market such company seeks to 
     enter.'' H.R. Conf. Rep. 104-458, at 148 (1996). That 
     standard, which had barred BOC entry into long distance 
     since their divestiture from AT&T, struck me as 
     insufficiently sensitive to the market conditions, and I 
     was concerned that it would bar BOC entry even where it 
     would be competitively warranted.

[[Page S7288]]

       On the other hand, the Department's standard examines 
     whether a BOC's systems are sufficiently developed so that a 
     new entrant into its market can have confidence that, when it 
     signs up a new customer, that customer will be switched 
     effectively and will get service from the new carrier. Our 
     general preference is to see these systems operate in 
     practice. Once we are confident that this transitioning will 
     work effectively, we will be able to conclude that the local 
     market is open to competition. By the same token, we also 
     realize, as I indicated earlier, that in some areas--
     particularly rural States--it is certainly possible that due 
     to the business decisions of particular companies, there may 
     be no new entrants for local service, A BOC should not be 
     excluded from in-region long-distance entry in such cases.
       I believe that the standard we adopted is fair, balanced, 
     and reasonable. Most important, I believe it is consistent 
     with Congress's intent in the 1996 Act and that, if it is 
     implemented fairly, it will maximize the benefits to the 
     American public across the board--in local markets, long-
     distance markets, and with respect to one-stop shopping. As 
     you so well put it in your letter, ``once fair competition is 
     possible''--and that's what our standard is designed to 
     test--then ``regulators should stand aside and let market 
     forces work.'' That is a pro-market, antitrust view, and I 
     can assure you that the Division will work to implement it.
       I have responded to your specific questions in the 
     Attachment to this letter. I look forward to talking with you 
     regarding these and other telecommunications issues.
           Sincerely,
                                                    Joel I. Klein,
                                Acting Assistant Attorney General.
       Enclosure.

                         Questions and Answers

       1. In your speech you used the following terms--``real'' 
     and ``broad-based competition,'' ``actual, broad-based 
     entry,'' ``true broad-based entry,'' ``tangible entry,'' 
     ``large-scale entry,'' and entry on a ``large-scale basis.'' 
     What do those terms mean to the Department?
       By referring to ``real,'' ``actual, broad-based'' entry and 
     similar terms, I intended to express the Department of 
     Justice's general preference (though not mandatory 
     requirement) to see actual entry by competing carriers that 
     are selling both business and residential telephone service 
     on more than a non-trivial basis (though not in any specific 
     numbers). Such entry provides both (1) meaningful evidence 
     that the Bell Operating Company (BOC) has taken the necessary 
     steps to open its local market and (2) an opportunity to 
     measure the performance of the BOC in making available the 
     statutorily required services and facilities. The Department, 
     however, does not view such entry as a necessary precondition 
     to BOC long distance entry. Rather, we intend to look for 
     such entry where we would expect it to occur and, if it is 
     not occurring, to investigate why that is the case. Thus, in 
     my March 11 speech to which you refer, I stated that ``[o]ur 
     preference, though we recognize that it may not always occur, 
     is to see actual, broad-based i.e., business and 
     residential--entry into a local market.''
       2. How many residential customers have to be served by a 
     competitor to meet the Department's entry test?
       The Department's approach to whether the FCC should grant a 
     particular application by a BOC to enter into in-region long-
     distance service does not turn on any numerical threshold for 
     the amount of residential customers that must be served by a 
     competitor before a BOCC meets the threshold for entry into 
     in-region long-distance service. If a significant number 
     (though not necessarily a large percentage) of residential 
     customers are being served in a particular state, it is 
     likely that the BOC has taken appropriate steps to open that 
     state to local competition. At the same time, it is not 
     necessarily the case that, if no residential customers are 
     being served by a competitor of the BOC, the BOC has not 
     taken the appropriate steps to open up a state to local 
     competition. As the Department stated in its FCC filing in 
     the SBC Oklahoma matter, ``if the absence or limited nature 
     of local entry appears to result from potential competitors' 
     choices not to enter--either for strategic reasons relating 
     to the Section 271 process, or simply because of decisions to 
     invest elsewhere that do not arise from the BOC's compliance 
     failures or barriers to entry in the state--this should not 
     defeat long distance entry by a BOC which has done its part 
     to open the market.''
       3. How many business customers have to be served by a 
     competitor to meet the Department's entry test?
       The Department's approach to whether the FCC should grant a 
     particular application by a BOC to enter into in-region long-
     distance service does not turn on any numerical threshold for 
     the amount of business customers that must be served by a 
     competitor for a BOC to receive a recommendation from the 
     Department in favor of its entry into in-region long-distance 
     service. If a significant number (though not necessarily a 
     large percentage) of business customers are being served in a 
     particular state, it is likely that the BOC has taken 
     appropriate steps to open that state to local competition. At 
     the same time, it is not necessarily the case that, if no 
     business customers are being served by a competitor of the 
     BOC, the BOC has not taken the appropriate steps to open up a 
     state to local competition. As the Department stated in its 
     FCC filing in the SBC Oklahoma matter, ``if the absence or 
     limited nature of local entry appears to result from 
     potential competitors' choices not to enter--either for 
     strategic reasons relating to the Section 271 process, or 
     simply because of decisions to invest elsewhere that do not 
     arise from the BOC's compliance failures or barriers to entry 
     in the state--this should not defeat long distance entry by a 
     BOC which has done its part to open the market.''
       4. Does there have to be more than one competitor in the 
     local exchange market to meet the Department's entry test?
       No. Although it is likely that there will be more than one 
     competitor in many local exchange markets, in certain (most 
     likely rural) markets, it is possible that such entry will 
     not be forthcoming in the foreseeable future. If, in such 
     circumstances, the absence of entry does not reflect a BOC's 
     failure to help open the market to competition, the 
     Department would support long distance entry by the BOC.
       5. Does a BOC have to face competition from AT&T, MCI or 
     Sprint to meet the department's entry test?
       No. There is no single competitor, or combination of 
     competitors, that is required to compete with any particular 
     BOC in order for the Department to support its entry into in-
     region long-distance. For example, our analysis of SBC's 
     application in Oklahoma focused on the efforts of Brooks 
     Fiber to enter the local market in Oklahoma. At no point did 
     we suggest that the application was deficient because none of 
     the three major interexchange carriers had entered Oklahoma.
       6. How do you reconcile Congress' rejection of a metric 
     test for BOC entry into the long distance market with your 
     statement that ``successful full-scale entry'' is necessary 
     in order for the Department to ``believe the local market is 
     open to competition?''
       In my judgment, the Department's entry standard is 
     consistent with Congress's decision to reject a metric test. 
     We do not require any shift in the level of market share as a 
     condition of entry. Rather, we think that the openness of a 
     local market can be best assessed by the discretionary 
     judgment of the FCC, relying in part on the Department of 
     Justice's competitive assessment, and based on the evaluation 
     of the particular circumstances in an individual state. While 
     this inquiry may involve an assessment of actual competition, 
     it does not focus on any metric or market share.
       7. You have used the metaphor that the Department ``want(s) 
     to make sure that gas actually can flow through the 
     pipeline'' before allowing interLATA entry. How many orders 
     for resold services must be processed by a BOC in order to 
     satisfy this standard?
       The Department does not require any particular number of 
     orders to be processed as a precondition to receiving our 
     support for a Section 271 application. Our inquiry seeks to 
     determine, whether the systems offered by the BOC to its 
     competitors will hold up, as a practical matter. This is very 
     important to new entrants trying to compete for customers, 
     but it is also not always easy to effectuate because of real-
     world technical impediments which, in our experience, have 
     cropped up often. For example, in California, the orders for 
     resold services by competitors, when placed on a non-trivial 
     scale, led to a serious backlog in PacBell's wholesale 
     operations. This problem, in turn, created a real impediment 
     to entry by new competitors, whose customers and potential 
     customers became very concerned.
       8. How many orders for unbundled network elements must be 
     processed by a BOC to satisfy this standard?
       The Department does not require any particular use of 
     unbundled loops as a precondition to receiving our support 
     for a Section 271 application. Unbundled loops should be 
     available, as both a practical and legal matter, for use by 
     competitors without running into problems that will retard 
     competitive entry.
       9. How much market share must a BOC lose to its competitors 
     to demonstrate that ``gas can flow through the pipeline?''
       The ``gas in the pipeline'' metaphor does not reflect any 
     intention to measure the market share of competitors or any 
     shift in share to entrants, or to require any minimum shift 
     in share. In fact, our SBC evaluation notes that we are 
     willing to use alternate measures other than actual 
     commercial usage as proof that the ``pipeline can carry 
     gas.'' For example, if the same systems are in place in 
     different states, the use of those systems in other states 
     can be a useful indicator of whether or not competitors will 
     be able to receive what they need from the BOC. Similarly, in 
     some cases, we expect that comprehensive testing--carrier to 
     carrier, internal and/or independent auditing--may be able to 
     demonstrate that a BOC's support systems will enable entrants 
     to compete effectively.
       10. FCC Chairman Reed Hundt testified on March 12, 1997, 
     before the Senate Commerce Committee that a BOC that 
     satisfied the checklist but did not have an actual competitor 
     in its market would meet the entry standard. Do you agree 
     with Chairman Hundt?
       My answer would depend on the specific circumstances 
     presented by a given application. Under the Department's 
     approach, it is possible that a BOC satisfying the checklist, 
     but not facing an actual competitor, could merit entry into 
     in-region long-distance service under Section 271. The most 
     critical factor, as I have indicated, is whether the BOC has 
     taken the necessary steps to allow

[[Page S7289]]

     competition in its market. If there are no competitors in a 
     particular state because of market conditions--rather than 
     because of artificial impediments to entry--we would support 
     BOC entry into long distance in that state.
       11. If the Department opposes a BOC interLATA application, 
     do you believe the FCC should reject the application? If so, 
     wouldn't that give the Department's recommendation 
     ``preclusive effect'', something that the Act specifically 
     prohibited?
       We believe the FCC should give our analysis substantial 
     weight, which is the specific statutory requirement adopted 
     by Congress in the Telecommunications Act of 1996. The FCC, 
     however, is not required to follow our recommendation blindly 
     or reflexively and should certainly consider the statutory 
     framework and the comments of others in making its ultimate 
     decision.
       12. You have also stated that the checklist, the 
     facilities-based requirement, the separate subsidiary 
     requirement and the option of ``Track B'' (the statement of 
     terms and conditions) are all ``necessary, through not 
     sufficient, to support entry''. What more must a BOC 
     demonstrate to obtain the Department's support?
       The Department views the FCC's public interest 
     determination, which is expressly included in Section 
     271(d)(3)(C), as a fourth requirement. We view this 
     determination as reflecting Congress' decision to condition 
     BOC entry into long distance on a discretionary judgment by 
     the FCC, based in part on the Department of Justice's 
     competitive assessment, that a particular applicant will best 
     serve the interests of affected consumers in maximizing 
     telecommunication competition in all markets.
       13. Do you believe that Track B can be used only if no one 
     has requested interconnection under Track A?
       No. For Track A to apply, a potential facilities-based 
     carrier (be it predmoninantly or exclusively facilities 
     based) must request access to a checklist item. If no such 
     carrier requests such access, the BOC is free to proceed to 
     apply for long distance entry under Track B. Moreover, even 
     if a potential facilities-based carrier does request access 
     to a checklist item, the BOC still may utilize Track B if 
     ``the only provider or providers making such a request have 
     (i) failed to negotiate in good faith as required by Section 
     252, or (ii) violated the terms of an agreement approved 
     under Section 252 by a provider's failure to comply, within a 
     reasonable period of time, with the implementation schedule 
     contained in an agreement.'' 47 U.S.C. Sec. 271(c)(1)(B).
       14. Can a BOC rely on Track B if it has received 
     interconnection requests from potential competitors, but 
     faces no ``competing provider'' which is actually providing 
     telephone exchange service to residential and business 
     customers predominantly over its own facilities?
       As our evaluation of SBC's Section 271 application explains 
     in greater detail, a ``competing provider'' need not be 
     operational as of the date of its request to initially 
     qualify as a ``competing provider'' for purposes of 
     determining the application of Track A. See SBC Evaluation at 
     13-17. We believe this view comports with the language and 
     purpose of the statute and is expressly supported by the 
     Conference Report, which states that Track B serves only to 
     ensure that a BOC is not ``effectively prevented from seeking 
     entry into the interLATA services market simply because no 
     facilities-based competitor that meets the criteria set out 
     in [Track A] has sought to enter the market.'' H.R. 
     Conf. Rep. 104-458, at 148 (1996) (emphasis supplied). 
     Even so, a BOC's application may still be considered under 
     Track B if ``the only provider or providers making an 
     interconnection request have (i) failed to negotiate in 
     good faith as required by Section 252, or (ii) violated 
     the terms of an agreement approved under Section 252 by a 
     provider's failure to comply, within a reasonable period 
     of time, with the implementation schedule contained in an 
     agreement.'' 47 U.S.C. Sec. 271(c)(1)(B).
       15. What if the requesting interconnectors under Track A do 
     not ask for, or wish to pay for, all of the items in the 
     checklist? Can the BOC satisfy the entry test by 
     supplementing their interconnection agreements with a filing 
     under Track B to cover at least all remaining items in the 
     checklist?
       As explained in greater detail in our SBC filing, the basic 
     view of the Department is that ``[a] BOC is providing an 
     item, for purposes of checklist compliance, if the item is 
     available both as a legal and practical matter, whether or 
     not competitors have chosen to use it.'' SBC Evaluation at 23 
     (emphasis supplied). Accordingly, under certain 
     circumstances--i.e., where there are checklist items that 
     have not been requested by any Track A qualifying provider--a 
     firm offer to provide an item through a sufficiently clear 
     provision in a statement of generally available terms, 
     coupled with the requisite showing of practical availability, 
     would suffice to constitute ``providing'' that item for 
     purposes of checklist compliance.

  Mr. HOLLINGS. I refer by emphasis that he says on question one: ``In 
your speech''--Senator Burns is referring to the speech made by Mr. 
Klein--``In your speech you used the following terms--`real' and 
`broad-based competition', `actual, broad-based entry', `true broad-
based entry', `tangible entry', `large-scale entry', and entry on a 
`large-scale basis'. What do those terms mean to the Department?''
  The rest is right there, but by way of emphasis, let me quote Mr. 
Klein in response: ``Thus, in my March 11 speech to which you refer, I 
stated that `[o]ur preference, though we recognize it may not always 
occur, is to see actual, broad-based * * * business and residential--
entry into a local market.' ''
  Now, Mr. President, it is very interesting because these 
communications lawyers, and I ought to know, because if you work with 
them over the years you begin to learn. What should interest anybody 
looking at qualifications of this particular nominee, he puts in 
italics ``[o]ur preference, though we recognize it may not always 
occur''--and thereupon, you could not believe it, Mr. President, you 
could not believe it, our Mr. Klein had the unmitigated gall, in 
response to his italic to file an opinion here, an addendum to the 
evaluation of the Department, the U.S. Department of Justice in the 
matter of the application of SBC Communications, Inc., docket 97-121. 
When? The day after that letter was sent, and here is what he says--
because you get the hint in the letter but you get the fact in this 
addendum.
  Let me quote:

       The statute requires that both business and residential 
     subscribers be served by a competing provider, and that such 
     provider must be exclusively or predominantly facilities-
     based. It does not, however, require that each class of 
     customers (i.e., business and residential) must be served 
     over a facilities-based competitor's own facilities. To the 
     contrary, Congress expressly provided that the competitor may 
     be providing services ``predominantly'' over its own 
     facilities ``in combination with the resale of'' BOC 
     services. . . . Thus, it does not matter whether the 
     competitor reaches one class of customers--e.g., 
     residential--only through resale, provided that the 
     competitor's local exchange services as a whole are provided 
     ``predominantly'' over its own facilities.

  Now, Mr. President, you have section 271, that particular provision 
turned right on its head. I have no better authority, Mr. President, 
not if this particular Senator's opinion is of any value, and I might 
say that no one Senator wrote the Telecommunication Act of 1996, but 
immodestly, if there is one that had more involvement than anybody 
else, it was me. I had put out a bill S. 1822; Senator Pressler put out 
his bill, S. 652. We changed it around back to S. 1822. Everyone knows 
that. Look at the finished documents. I worked around the clock, and I 
worked with Chairman Bliley, the Republican chairman on the House side. 
Here in a letter of June 20, 1997, to the Honorable Reed Hundt by 
Chairman Bliley, Chairman of the FCC.

  Mr. President, I ask unanimous consent that that letter be printed in 
the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                    U.S. House of Representatives,


                                        Committee on Commerce,

                                    Washington, DC, June 20, 1997.
     Hon. Reed Hundt,
     Chairman, Federal Communications Commission, Washington, DC.
       Dear Chairman Hundt: I recently read with interest and 
     dismay the Department of Justice's additional comments 
     regarding SBC Communications Inc.'s (SBC's) application to 
     provide in-region, interLATA services in the State of 
     Oklahoma. The Department therein clarified its views on 
     section 271(c)(1)(A) of the Communications Act, as amended. 
     As the primary author of this provision, I feel compelled to 
     inform you that the Department misread the statute's plain 
     language. As you rule on SBC's application and future BOC 
     applications, you should not overlook the clear meaning of 
     section 271 or its legislative history.
       The Department argued that a BOC should be allowed to enter 
     the in-region, interLATA market under ``Track A'' (i.e., 
     section 271(c)(1)(A)) if a competing service provider offers 
     facilities-based services to business customers and resale 
     services to residential customers, so long as the combined 
     provision of both services is predominantly over the 
     competing service provider's facilities. In other words, the 
     Department wrongly takes the view that section 271(c)(1)(A) 
     is satisfied if a competitor is serving either residential or 
     business customers over its own facilities.
       Section 271(c)(1)(A), however, clearly requires a different 
     interpretation. To quote the statute, a competing service 
     provider must offer telephone exchange service to 
     ``residential and business subscribers . . . either 
     exclusively over their own telephone exchange service 
     facilities or predominantly over their own telephone exchange 
     service facilities.'' Track A is thus satisfied if--and only 
     if--a BOC faces facilities-based competition in both 
     residential and business markets. Neither the statute nor its 
     legislative history permits any other interpretation; I know 
     this because I drafted both texts.

[[Page S7290]]

       In the end, the Department's recent misinterpretation of 
     section 271 reinforces a point I frequently made during 
     Congressional debate over the Telecommunications Act of 1996: 
     the Department of Justice does not have the expertise to make 
     important telecommunications policy decisions. The FCC, by 
     contrast, does have the necessary expertise, which explains 
     why Congress gave you and your colleagues--and no one else--
     the ultimate authority to make important decisions, such as 
     the decision to interpret section 271. I remind you that the 
     Department's role in this matter is a consultative one, and 
     should be treated as such.
       Let me conclude by noting that, while this letter focuses 
     exclusively on Department's interpretation of section 
     271(c)(1)(A), it should not be construed to mean that the 
     balance of the Department's comments were either consistent 
     or inconsistent with Congressional intent.
           Sincerely,
                                                       Tom Bliley,
                                                         Chairman.

  (Mr. HUTCHINSON assumed the chair.)
  Mr. HOLLINGS. Mr. President, I see another Senator wishing to talk. 
But, Mr. President, there it is. Here we have a Deputy Attorney General 
nominee that is not going to carry out President Clinton's policy, nor 
the language of the statute.
  I ask unanimous consent to have printed in the Record a letter from 
President Clinton to me on October 26, 1995.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                              The White House,

                                 Washington, DC, October 26, 1995.
     Hon. Ernest F. Hollings,
     Ranking Member, Committee on Commerce, Science, and 
         Transportation, U.S. Senate, Washington, DC.
       Dear Fritz: I enjoyed our telephone conversation today 
     regarding the upcoming conference on the telecommunications 
     reform bill and would like to follow-up on your request 
     regarding the specific issues of concern to me in the 
     proposed legislation.
       As I said in our discussion, I am committed to promoting 
     competition in every aspect of the telecommunications and 
     information industries. I believe that the legislation should 
     protect and promote diversity of ownership and opinions in 
     the mass media, should protect consumers from unjustified 
     rate increases for cable and telephone services, and, in 
     particular, should include a test specifically designed to 
     ensure that the Bell companies entering into long distance 
     markets will not impede competition.
       Earlier this year, my Administration provided comments on 
     S. 652 and H.R. 1555 as passed. I remain concerned that 
     neither bill provides a meaningful role for the Department of 
     Justice in safeguarding competition before local telephone 
     companies enter new markets. I continue to be concerned that 
     the bills allow too much concentration within the mass media 
     and in individual markets, which could reduce the diversity 
     of news and information available to the public. I also 
     believe that the provisions allowing mergers of cable and 
     telephone companies are overly broad. In addition, I oppose 
     deregulating cable programming services and equipment rates 
     before cable operators face real competition. I remain 
     committed, as well, to the other concerns contained in those 
     earlier statements on the two bills.
       I applaud the Senate and the House for including provisions 
     requiring all new televisions to contain technology that will 
     allow parents to block out programs with violent or 
     objectionable content. I strongly support retention in the 
     final bill of the Snowe-Rockefeller provision that will 
     ensure that schools, libraries and hospitals have access to 
     advanced telecommunications services.
       I look forward to working with you and your colleagues 
     during the conference to produce legislation that effectively 
     addresses these concerns.
           Sincerely,
                                                     Bill Clinton.

  Mr. HOLLINGS. He writes:

       Dear Fritz: I enjoyed our telephone conversation today 
     regarding the upcoming conference on the telecommunications 
     reform bill and would like to follow up on your request 
     regarding the specific issues of concern to me as proposed 
     legislation.

  I am reading just part of it now.

       As I said in our discussion, I am committed to promoting 
     competition in every aspect of the telecommunications and 
     information industries. I believe that the legislation should 
     protect and promote diversity of ownership and opinions in 
     the mass media, should protect consumers from unjustified 
     rate increases for cable and telephone services, and in 
     particular, should include a test specifically designed to 
     ensure that the Bell companies entering into long distance 
     markets will not impede competition.

  Now, Mr. President, that is why we wrote 271 the way we wrote it. 
That is why we wrote it that way. There isn't any question, as the 
chairman has said, this is bipartisan. This isn't because some Senator 
is enraged or upset or something else like that. I have been here long 
enough to get enraged or upset. I have seen a lot of good ones go 
through and several bad ones.
  I thought having participated on the ground and worked for 4 years in 
getting this formative act that was voted on by 95 U.S. Senators--they 
voted on this particular language when it passed this particular body. 
They understand not only that this isn't just a singular mistake, we 
have the proposition of the gentleman, Mr. Klein, also coming forward 
and disregarding entirely, gratuitously, and summarily throwing out the 
VIII(c) test, which I will have time to refer to on here later on.
  My point here is that we really worked hard to get participation. 
There were those who didn't want the antitrust provision. They wanted 
one-stop shopping at the Federal Communications Commission. We worked 
hard to make sure that this was done right. We realized many times that 
they don't have antitrust lawyers like Reed Hundt, who is now the 
Chairman and understands the law, and you necessarily don't have 
antitrust lawyers coming in as members and commissioners at the Federal 
Communications Commission. So to give emphasis to opening up the market 
for free and open competition, we put in the antitrust provisions in 
there for its opinion to be provided to the Federal Communications 
Commission. We worked hard to provide it. We worked diligently on the 
VIII(c) test, which was Judge Greene's test for over 12 years now in 
the breakup of AT&T, and every one of the Bell Operating Companies 
attested to that particular language. And here comes the particular 
nominee casting aside, in a gratuitous fashion, that requirement, on 
the one hand, and changing over the statute just on a letter from a 
Senator, on the other hand.
  When you have that kind of weak nominee, you have thwarted the intent 
of the Congress and the President of the United States and the 
Telecommunications Act of 1996.
  I yield the floor.
  Mr. DeWINE addressed the Chair.
  The PRESIDING OFFICER (Mr. Roberts). The Senator from Ohio is 
recognized.
  Mr. DeWINE. Mr. President, as the chairman of the Antitrust, Business 
Rights and Competition Subcommittee of the Senate Judiciary Committee, 
I rise today to urge my colleagues to support the nomination of Joel 
Klein as Assistant Attorney General for the Antitrust Division.
  Mr. President, the head of the Antitrust Division, obviously, plays a 
critical role in assuring that our antitrust laws are enforced wisely 
and vigorously. The importance of that role really cannot be 
overstated. Strong enforcement of antitrust laws is necessary to foster 
and to protect competition. As we all know, competition is good 
business, it gives businesses increased incentives to innovate, either 
by creating new products and services, finding ways to improve existing 
products, or by lowering costs. That type of innovation is good for 
both business and for consumers.
  Maintaining the competitive foundation of the American economy has 
always been a difficult task. And as our economy grows and changes, 
it's only getting more difficult. We often discuss globalization of the 
economy as allowing more and more American companies the opportunity to 
compete in the international marketplace and, because of that, they 
have flourished in this international environment. In order to build on 
this success, it is essential that we apply the antitrust laws in order 
to protect our companies from unfair, anticompetitive actions on the 
part of foreign businesses and foreign governments.
  In my view, Mr. President, Joel Klein is qualified to lead our 
efforts toward that stronger, more efficient antitrust enforcement. Mr. 
Klein is a superbly qualified attorney, with a great deal of 
substantive knowledge regarding both the jurisprudence and the 
enforcement of the antitrust laws. He has shown his abilities over the 
last few months in his capacity as the Acting Assistant Attorney 
General. He has shown this by leading the Antitrust Division through a 
series of very complex, difficult analyses, particularly in the area of 
telecommunications.

  As we all know, telecommunications issues have become very important 
and, many times, quite controversial. Now, some have expressed concerns 
regarding Mr. Klein's interpretation of

[[Page S7291]]

section 271 of the Telecommunications Act in a way that some believe 
will make it too easy for the Regional Bell Operating Companies, or the 
RBOC's, to enter the long distance market. However, Mr. President, in 
both instances where the Antitrust Division has been called upon to 
evaluate an RBOC application to enter the long distance market, the 
Antitrust Division has recommended against the RBOC. In other words, 
Mr. President, some people believe that Mr. Klein has been too hard on 
The RBOC's. The ironic thing about this debate is that when you really 
analyze it, you will see that Mr. Klein has received criticism from 
both sides of these issues.
  Now, Mr. President, these decisions involve complex factual, complex 
legal, and complex economic analyses. Yes, each decision has angered 
some of the parties involved, but I believe Mr. Klein has done his job 
in a responsible and principled way. I may not agree with every 
decision made by the Antitrust Division, but what is important, I 
believe, is whether or not the nominee has interpreted the law 
responsibly and fairly. Interpreting a complex matter, such as the 
Telecommunications Act, is certainly not easy. I expect Mr. Klein's 
decisions will not please everyone. They certainly will not please 
everyone, given that it seems everyone has their own interpretation of 
this law. In fact, I think he should be praised for his willingness to 
take on these important and controversial issues. Rather than skirt 
controversy, Mr. Klein has done his job as best he can. I believe it is 
time that the U.S. Senate does its job. I believe that we need to 
discuss Mr. Klein's qualifications and the merits of this particular 
matter, and then I believe we need to vote on this confirmation.
  Mr. President, we cannot continue to move forward in this area of 
antitrust enforcement without the sort of calm, principled leadership 
that Joel Klein will provide. America will need an Assistant Attorney 
General with a strong understanding of antitrust doctrine and the 
willingness and ability to enforce the laws in an aggressive but 
evenhanded manner. I believe, Mr. President, that it is vitally 
important that the competitive foundation of our economy be maintained, 
and that the antitrust laws must be enforced and must be enforced 
fairly. Joel Klein, I believe, shares these goals, and I believe that 
he has proven he has the expertise and the ability to put those goals 
into practice. I believe, therefore, Mr. President, we should confirm 
his nomination without further delay.
  Mr. President, as we have already heard on this floor, there is going 
to be a vigorous debate about this nominee. Each Senator has to 
exercise his or her constitutional obligations. Each one of us has to 
decide whether we will vote ``yes'' or vote ``no.'' I merely ask, 
however, that we do vote, that after a good, thorough, and vigorous 
debate, we bring this matter to a close. Quite frankly, this 
administration has had some problems, for whatever reason, in filling 
some of the key positions at Justice. They are slowly beginning to take 
care of that matter. I believe that in the Senate we have an 
obligation--now that we have the nomination in front of us--to proceed, 
and to proceed without unnecessary and undue delay.
  Frankly, it is not helpful to have a vacancy in one of the key 
positions. Mr. Klein has, for some months, been the acting head of the 
Antitrust Division. I believe that he has carried out his duties well, 
as I have already said, in that particular job. But it is not helpful 
and it is not good for this nomination to continue to be pending, and 
it is not good for him to continue to be in the position of the acting 
head of the Antitrust Division.

  So, as we have this debate--and it will be a good debate; I am sure 
it will go on for some time--I merely urge my colleagues to bring this 
matter at some point to a vote in the near future so that we can move 
on with the business of antitrust in this country.
  I thank the Chair.
  I yield the floor.
  Mr. DORGAN addressed the Chair.
  The PRESIDING OFFICER. The Senator from North Dakota is recognized.
  Mr. DORGAN. Mr. President, no one in this country at any time should 
ever have a problem sleeping as long as there is an opportunity to talk 
about antitrust issues. It is for many some of the most boring, 
lifeless set of issues available to discuss anywhere in public 
politics. Antitrust enforcement--what on Earth is it?
  When I came to Washington, DC, I threatened to put the picture of the 
1,000 lawyers who are hired in our Government for antitrust enforcement 
purposes on the cartons of milk in grocery stores because I felt that 
these 1,000 lawyers hired by our Government for antitrust enforcement 
had surely vanished. I knew that we were paying 1,000 of them. But it 
was clear to me there was no antitrust enforcement, so they must have 
vanished.
  So it is a decade and half later and we are now talking about 
antitrust issues again. And the discussion today is with confirming a 
nomination to head the Antitrust Division at the Department of Justice.
  This is, while boring for many people, an important question because 
we have what is called a free market system in our country. A free 
market system only works to the extent that you have referees who are 
willing to intervene in circumstances where people try to rig the 
market and where there is not open competition and where there is 
monopoly pricing in circumstances where the market is not free. In many 
cases, that is the same as stealing.
  You go back to the beginning of the century and you will find 
examples in a range of industries--petroleum, natural gas, a whole 
range of industries, railroads--in which there were monopolies and 
trusts. They were stealing from the American public. We put in place a 
number of things to deal with that.
  One, we prosecuted some people and threw some people in jail.
  Second, we put in place certain legislation which said that if the 
free market is going to be free, then let's make sure there are some 
referees to keep it free. That is the whole issue of antitrust 
enforcement.
  Today the issue is, shall a Mr. Joel Klein from the Justice 
Department, who is now acting in this role as Assistant Attorney 
General for Antitrust Enforcement, be confirmed by the Senate? 
President Clinton sent his name down here and asked for confirmation. 
And I am standing here to say that Mr. Klein, by all accounts, has a 
distinguished career.
  I met with Mr. Klein yesterday. He is a very likable fellow who has 
much to commend him. But I believe it is not the time to proceed to 
this nomination because a number of very important questions remain 
unanswered. The Senator from South Carolina mentioned some of them.
  We had an enormous fight on the floor of the Senate about the 
Telecommunications Act. For the first time in 60 years, we reformed the 
telecommunications laws in this country. One of the fights we had on 
that legislation was about what the role of the Justice Department with 
respect to whether or not there is competition with local phone service 
providers so that the Bell system can be freed then to go to compete 
against long distance companies. When is there effective competition 
locally that would free the Bells to compete in the long distance 
system? We said let's have an important role for the Justice Department 
in that area. We specifically talked about the test for that role, what 
is called the 8(c) test.

  Now we have a person who is down at the Justice Department and writes 
a letter to a colleague of ours when questioned about all of these 
issues, and he says, ``Well, I specifically reject the so-called 8(c) 
test,'' in terms of how the Justice Department will evaluate the kinds 
of activities that are involved in whether or sufficient competitive 
market place conditions exist before a Bell company can enter the long 
distance market.
  There are a range of issues that we want to have answered. I have 
written to the President and Senator Kerrey has written to the Attorney 
General. We have received no responses at this point. We would like 
responses to a series of questions about positions taken by this 
nominee.
  I am not standing here suggesting that Mr. Klein is unworthy. I am 
saying at this point that the questions, which are very serious 
questions, have not yet been answered. We have asked them, but they 
have not yet been answered.
  In light of that, I don't think any name should proceed until we 
receive answers to very important questions.

[[Page S7292]]

  The Bell Atlantic-NYNEX merger was approved by Mr. Klein. Why was 
that approved without conditions? We had some abbreviated discussion of 
that yesterday. But I think we need more information about that. Why 
was that not approved with some conditions? We had the opportunity to 
establish conditions. How does this decision relate to the stated 
objective that the Department of Justice is really concerned about 
promoting competition?
  I would like more information about the Justice Department's 
interpretation of facilities-based competition, which is a standard 
that we discussed at some length in the Telecommunications Act. Why? I 
would like to ask and like to get some additional answers.
  Does the nominee before us specifically reject the so-called 8(c) 
standard outright when Congress specifically recommended that standard 
for evaluating the issues of competition? And where does the nominee 
stand on the issue of media concentration?
  It is very hard to see that a telecommunications bill, which by its 
nature was to promote more competition, is moving in the direction of 
being successful when we have, instead of more competition, more 
concentration. We have behemoth organizations marrying up and two 
becoming one or four becoming two and two becoming one. So, by 
definition, you have less competition. We have more and more galloping 
concentration in the telecommunications industry--television, radio, 
and all the rest of it. And, yet, I would like to know, where does the 
Justice Department and where does this nominee stand on the issue of 
concentration?
  Is that alarming, or do we have people who want to shake the pom-poms 
to become cheerleaders for it, as Mr. Baxter did when he was at the 
Department of Justice? There wasn't any merger that wasn't big enough 
for him. It didn't matter. The bigger, the better. That is not the role 
of the Department of Justice and antitrust enforcement, in my judgment.
  I am here to say that this is premature. This nomination should not 
be considered until we have received sufficient answers to some of 
these questions.
  Again, let me reemphasize. I am not standing here today to say that 
Mr. Klein is not someone without distinguished credentials. I have met 
him. I kind of like him. But there are a number of questions 
unresolved, and those questions should be resolved. The Senate should 
insist that they be resolved before we move this nomination forward.
  So I will speak at some length on Monday. The Senator from Nebraska, 
Senator Kerrey, Senator Hollings, and I believe, will also speak and 
explain the kinds of answers we are awaiting from the administration, 
from both the President and the Attorney General, before we proceed on 
this nomination.
  We have every right in this nomination process to say that before 
this nomination proceeds, there are certain questions we think the 
American people deserve an answer to. I intend to ask them not only 
today but on Monday, and we hope perhaps before this process is 
complete, that the Attorney General might respond or the White House 
might respond to the questions that have been put to them about some of 
the things that have been written, some of the things that have been 
spoken and said, and some of the decisions that have been made by the 
Acting Assistant Attorney General in the Antitrust Division.
  Mr. President, I will speak at greater length on this subject on 
Monday. I yield the floor.
  I make a point of order that a quorum is not present.
  The PRESIDING OFFICER. 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. Without objection, it is so ordered.
  Mr. KERREY. Mr. President, I have come to the floor to talk about the 
nomination of Joel Klein to be the head of the Antitrust Division of 
the Department of Justice.
  I have had the opportunity on a couple of occasions to meet and to 
talk with Mr. Klein, and I like him personally and I admire his career 
and what he has done as an individual.
  However, I have serious reservations about his capacity to serve in 
this position. He has been nominated. I appreciate and respect the 
President's confidence in him. But it is with deepest sincerity that I 
say, although I would like to support his nomination for high office 
and hope that by the time the Senate votes on this nomination I can 
support him, at this time I believe that his nomination requires much 
more deliberation. I am especially troubled by many of the 
administration's telecommunications policies and especially in this 
case Mr. Klein's interpretation of the 1996 Telecommunications Act.
  I have asked Attorney General Reno by letter to clarify the policy 
Mr. Klein will be required to implement should Mr. Klein be confirmed. 
In 1995, when this bill was being debated, I led, unfortunately, at 
times a filibuster in the Chamber when this bill was being discussed 
because I wanted the Department of Justice to have a role in 
determining whether or not there was competition before other entities 
were going to be allowed to expand their services. The 
Telecommunications Act should work, but it will only work if we have an 
unrelenting dedication on the part of all Government agencies, the FCC 
and the Antitrust Division of the Department of Justice, their 
unrelenting attention and dedication to making certain we have 
competition.
  Mr. President, just recently, I met with Joel Klein. I like him and 
admire him. It is the second time I have had a chance to visit with him 
since he was nominated by the President to serve as the Assistant 
Attorney General for Antitrust. It is with the deepest sincerity, that 
I say that I would like to support his nomination for this high office. 
I hope that by the time the Senate votes on this nomination that I can 
support him.
  At this time, however, I believe that this nomination requires 
considered deliberation. I am deeply troubled by the administration's 
telecommunications policies and Mr. Klein's interpretation of the 
Telecommunications Act of 1996. I have asked the Attorney General to 
clarify the policy Mr. Klein will be required to implement should he be 
confirmed.
  My colleagues know that in 1995, I led a filibuster against the 
Senate Commerce Committee version of the Telecommunications Act to 
assure that the American people were fully aware of the monumental 
decisions being made by the Senate. I believed then, as I do now, that 
only an unrelenting dedication to competition and universal service by 
the Congress and the executive branch could make that legislation 
beneficial to consumers.
  For days, with the support of the Clinton administration, my 
colleagues and I fought to assure that the law would embrace real 
competition and universal service. If it did not, it would simply be 
one more piece of legislation for the big, the powerful, and moneyed 
interests.
  On the Senate floor we were successful in making the commitment to 
vigorously pursue competition central to the decision to end the court 
supervised Modified Final Judgement [MFJ] which controlled the 
activities of the seven Baby Bells and AT&T following the breakup of 
the Bell System.
  The bottom line, Mr. President, was that the American people did not 
ask for the Telecommunications Act. I do not recall one Nebraskan 
complain to me that telephone service was too expensive or that their 
service was poor. For most Americans, when asked about their phone 
service, they might quote Andy Griffth from the old AT&T commercial, 
and say ``rings true, and not a lick of trouble * * *.''
  While there was satisfaction for most residential consumers, there 
were a host of new technologies and opportunities to bring the benefits 
of the information revolution to all Americans which the monopoly 
organization of the telecommunications marketplace was stifling. Every 
day of the status quo represented a lost opportunity for American 
homes, schools, and economic development.

  There were proposals to invest Government funds in building the 
utopian information superhighway, there were regulatory initiatives to 
prod monopolies to invest in the future.
  The pathway chosen to bring advanced services, lower prices, and more

[[Page S7293]]

choices to consumers was to fundamentally change the economics of 
telecommunications services from a regulated monopoly to a competitive 
market. The price for opening all markets to competition, however, was 
an obligation by all telecommunications carriers to contribute to the 
support of universal service.
  The vision of telecommunications reform was that competition would 
spur investment, innovation, and choice and universal service support 
would assure that no American would be left behind.
  It was and is a grand vision. One which if properly implemented can 
energize the economy, enhance productivity, build wealth, enhance 
freedom, and revolutionize the way Americans work, learn, and relax.
  A significant part of the battle on the Telecommunications Act 
centered on the appropriate role for the Department of Justice in 
telecommunications policy. The first draft of the Telecommunications 
Act, written by Senator Pressler on behalf of the Republicans on the 
Senate Commerce Committee had no role for the Department of Justice and 
did not even explicitly reserve the Department's preexisting antitrust 
powers.
  As passed by the Senate Commerce Committee and the full Senate, the 
Department's antitrust authority had been preserved and the Department 
was given an advisory role in the FCC's decision to allow the Regional 
Bell Operating Companies, RBOCs, to enter the long-distance market 
within their own regions.
  To strengthen the bill Senators Dorgan, Leahy, Thurmond, and I 
proposed amendments to strengthen the role of the Department of 
Justice.
  I believed and continue to believe that the Department of Justice 
using its powers under the antitrust laws and the new law would and 
should be the bulwark against the abuse of monopoly power. I was 
confident that the Department of Justice would steadfastly be on the 
side of the consumer and fight for a vision of telecommunications 
competition which served the interests of all Americans.
  I opposed the Senate passed bill, because it did not have a strong 
enough role for the Department of Justice.
  I voted for the conference agreement in large part, because the role 
of the Department had been strengthened. Specifically, the bill as 
enacted, gave the Department's opinion on Bell entry into long distance 
``substantial weight,'' and eliminated the ability of the Federal 
Communications Commission to approve a merger of telephone companies 
which bypassed antitrust review.
  Mr. President, the effort to protect and enhance the role of the 
Department of Justice was a hard fought fight. President Clinton, even 
threatened a veto of the bill if it had a weak role for the Department.
  Having fought and won the legislative battle, I am particularly 
concerned about recent comments made by Acting Assistant Attorney 
General Klein regarding the Department of Justice's role in 
facilitating competition under the Telecommunications Act of 1996.
  In response to questions by the chairman of the Senate Communications 
Subcommittee, Mr. Klein said that he ``specifically rejected using the 
suggestion in the Conference Report that the Department analyze Bell 
Operating Company (BOC) applications employing the standard used in the 
AT&T consent decree''. This standard, known as the 8(c) test would 
reject BOC entry into in-region long distance unless ``there is no 
substantial possibility that the BOC or its affiliates could use its 
monopoly power to impede competition in the market such company seeks 
to enter.''
  While the Telecommunications Act gave the Attorney General the 
authority to choose any standard she sees fit to evaluate Bell entry 
into in-region service, I have asked the Attorney General to clarify 
the Department's policy on this matter. I am hopeful that a 
clarification from the Attorney General can put Mr. Klein's comments 
into a fuller and more appropriate context.
  I certainly hope that Mr. Klein's statement does not mean that a Bell 
Operating Co. should be allowed to enter the in-region long distance 
market even if there is a ``substantial possibility that the BOC or its 
affiliates could use monopoly power to impede competition.''
  In fairness to Mr. Klein, he put forward an alternate test known as 
the ``irretrievably open to competition test.'' Unfortunately, it is 
placed in a context, which at least implies that the 8(c) test is too 
tough on Bell Operating Companies.
  During the consideration of the Telecommunications Act, President 
Clinton wrote in a letter to Members of Congress that the 
Telecommunications Act should ``include a test specifically designed to 
ensure that the Bell companies entering into long distance markets will 
not impede competition * * *'' I hope that Mr. Klein and the Attorney 
General can set this record straight as to the administration's policy.

  Mr. Klein also wrote to Chairman Burns that ``we think that the 
openness of a local market can be best assessed by the discretionary 
authority of the FCC, relying in part on the department of Justice's 
competitive assessment, and based on the evaluation of the particular 
circumstances in an individual state.''
  Mr. President, I fought hard to include DOJ in the process of 
determining when Bell Operating Companies enter in region long distance 
markets because of the legal and economic expertise of the Antitrust 
Division. It would be tragic if the Department abdicate its role in 
this area.
  The Federal Communications Commission [FCC] is not the only agency 
equipped to make decisions about the openness of markets. A market 
cannot be competitive if it is not open. The Department's 
responsibility under the act and the Nation's antitrust laws is most 
serious and should be aggressively pursued by the Antitrust Division.
  Although the ultimate decision lies with the FCC, the Department must 
accept its important role as the expert in competition and market power 
and adopt a meaningful entry standard based on procompetitive 
principles. I am not yet convinced that the Department has done that.
  To me, what is most important is that the Attorney General put 
forward a test which Mr. Klein will implement which is unrelenting in 
its commitment to competition.
  The Kerrey test of competition would be as simple as do customers 
have a choice? If the answer is no, you do not have competition.
  The ideal open telecommunications market would allow an entrepreneur, 
new to the market to offer bundled services to the home. To do that 
there must be full access to the local exchange carrier at fair prices. 
If it takes a legion of lawyers, lobbyists, and investment bankers to 
even offer a new service to a customer of a monopolist, you do not have 
an open market.
  On a separate but equally important competition issue, I remain very 
concerned about recent mergers between large telecommunications 
providers. The decision by the Department of Justice to approve the 
Bell Atlantic/NYNEX merger without any conditions is troubling.
  Reports of AT&T's efforts to bring two BOC's back into it's fold 
should give everyone pause. A year ago, such action would have been 
laughable. I feel strongly that the Bell Atlantic merger approval, 
personally supervised by Mr. Klein sent exactly the wrong message to 
the market. I fear that this merger will lead to a new round of large 
telecommunications mergers which could greatly reduce any chance for 
the swift adoption of a vibrant, competitive telecommunications market.

  Competitive entry could be frozen while real and potential 
competitors court, woo, and marry each other. As to unions between the 
progeny of the former Bell System, I believe that it is generally not a 
good idea for family members to wed!
  One thing is certain, Congress did not intend to replace the urge to 
compete with the urge to merge.
  While the FCC and the States struggle with implementation of the new 
telecommunications law, it is important to remember that a key part of 
that legislation did not rely on regulation, it relied on the 
marketplace. The idea was to unleash pent up competitive forces among 
and between telecommunications companies. Mega mergers between 
telecommunications

[[Page S7294]]

 titans quell these market forces for increased investment, lower 
rates, and improved service.
  I can accept an honest disagreement on competitive impact of the Bell 
Atlantic/NYNEX merger. I want the head of the Antitrust Division to 
follow the law, even if it provokes my ire. It is in honest 
disagreement that we can examine the effectiveness of the law. If the 
law needs to be changed, let's change it.
  Beyond that, there are elements of the Bell Atlantic/NYNEX decision 
which are deeply troubling to me. Those concerns could be relieved if I 
were convinced that the competitive concerns received full, open, and 
deliberate consideration and that efforts were made to mitigate the 
loss of actual and potential competition. Most importantly, this merger 
should not be a precedent for a no holds barred approach to 
telecommunications combinations.
  The history of telecommunications service in America is at a critical 
point. At risk is a lifeline service important to every citizen of this 
Nation. The Department's commitment to using its full authority to 
promote competition is important to achieving an environment where 
consumers come first and entrepreneurs are encouraged to challenge the 
status quo.
  The bold vision of the Telecommunications Act is a promise yet 
unfilled. The man or woman who executes the responsibilities of this 
office will have a profound effect on every American, and not only in 
telephone service.
  Our antitrust laws form the keystone of our market economy. They 
stand between every American and the tyranny of raw, unbridled economic 
power. The person entrusted with the enforcement of those laws must 
have an unwavering commitment to a marketplace built on full, fair, and 
open competition.
  As the Senate fully considers this nomination, I am willing to be 
convinced that Joel Klein is that person.
  Mr. President, the need for competition is the overriding imperative 
of this Telecommunications Act. I am not in business as a monopoly. My 
business is such that customers come in. If they do not like what I am 
serving them, do not like the price, they go elsewhere, and as a 
consequence of that we pay very close attention to the customer. And 
those customers right now who are buying local services, especially 
residential service at the local level, they still have two choices: 
Take it or leave it.
  That is not competition. I do not come to the floor here criticizing 
the regional Bell operating companies or AT&T or any other long 
distance providers. I am just very much aware, if I am a monopoly, I do 
very much business if I have to compete, if I have to satisfy my 
customers' desires, demands for high quality and a reasonable and fair 
price.
  There is a businessman in Nebraska who owns many things, and one of 
the things he owns is newspapers. I once asked him how he managed to 
make money in the newspaper business, and he said to me, well, it's 
real simple; he takes advantage of two of America's most endearing and 
enduring institutions, monopoly and nepotism.
  Mr. President, with the Telecommunications Act need to ensure that 
the monopolies face competition, they come to us, the RBOC's and AT&T 
and the other carriers are all coming to us saying they want to 
compete. What they need to make sure happens is that there is 
competition, that you get rigorous and vigorous competition at the 
local level.
  In addition to that, though it is not the role of Antitrust at 
Justice, it is the role of the FCC to make certain that on the table we 
have before us those things that the market will not get done.
  There are some things that competition will not get done for us. 
There is a need to make certain we have real service. There is a need 
to make certain that areas that are remote are getting good service. 
There is a need to make certain people with lower incomes are going to 
get universal service. There are all sorts of things the market will 
not get done, and we have to put them on the table. I think we have an 
easier time surfacing those things and debating those things than we do 
in making certain that at the local level we have competition.
  As I said, Mr. President, it is not an easy thing to accept that 
competition if you are in business right now and you are a monopoly. It 
is easy to talk about it, but it is not easy to do it. There is a lot 
of pressure on Justice and FCC to make decisions and determinations 
that are anticompetitive under the veil and cloak of competitive 
language.
  I am very much concerned, not by his actions, but by some statements 
and a particular letter he wrote in response to a concern of a Member 
of this body about a speech that Mr. Klein had given. The letter, in my 
judgment, gives away the authority that this Senate and the House of 
Representatives, when we finally passed the Telecommunications Act of 
1996, gave the Department of Justice.
  Mr. Klein appeared to me, in this letter, to give away the authority 
that this law gives the Department of Justice. I, for one, need to hear 
from the Attorney General saying that she believes that the Department 
of Justice has this authority and she intends to make certain that 
Antitrust exercises that authority before I am going to be willing to 
vote for Mr. Klein.
  It is a difficult job being head of Antitrust. As far as I am 
concerned, the Antitrust Division of the Department of Justice creates 
a lot of jobs because they insist on competition. I believe you get 
more jobs in a competitive environment, not less. I believe competition 
determines in a much better way who is being successful in giving the 
customer what they want and, as a consequence, much more likely in the 
long term to create jobs than if we allow entities to perform 
vertically monopoly, or near monopoly, control over the marketplace, 
and, in that kind of environment, to be able to basically say, as I 
indicated earlier, to the customer, ``Take it or leave it; I don't care 
whether you like the price, whether you like the service; I am saying 
to you, you have to take it or leave it.''
  This is one of the most difficult things we have ever gone through, 
going from a monopoly to a competitive environment. It is going to be 
wrenching and difficult for rural areas and for private sector 
companies that have to adjust their hiring policies, have to adjust 
their personnel policies, have to adjust their marketing policies. I 
know that this kind of change is going to force the private sector, the 
monopoly private sector, to go through substantial change. But it is 
the intent of this legislation that they go through that change. It is 
only if we have a competitive environment, again, acknowledging there 
are some things the market will not do for rural areas, and we have to 
make sure, in order to achieve universal service, that we identify 
those things upfront or it will not happen.
  But acknowledging and setting aside those things, it is terribly 
important for the consumers to take advantage of the benefits of what 
the Telecommunications Act of 1996 allows. It is vitally important that 
both the FCC and Antitrust at Justice insist on a competitive 
environment in order for that to happen.
  I regret at this stage in the game having to say I do not support Mr. 
Klein. As I indicated, my view can be changed, depending upon what the 
Attorney General says in response to a letter I have sent to her. My 
hope is she will indicate she intends to make certain that Antitrust, 
whoever is confirmed, will carry out the intent of the law as debated 
fully on this floor and as enacted both by the Senate and the House of 
Representatives.
  It would be my hope to be able to vote for Mr. Klein. At this stage 
in the game, I will not. At this stage in the game, I hope this body 
deliberates a good deal of time upon not just Mr. Klein, but what is 
going to happen if Antitrust and Justice doesn't enforce the law, what 
is going to happen to consumers of this country if we don't get a 
competitive environment.
  The only reason we had benefit in the long distance environment with 
reduced price and increased quality was the presence of competition. In 
the absence of that, the consumers of this country are going to come 
back to us and say that that law wasn't very darn good.
  All of us who voted for that act have a lot at stake. All of us who 
voted for the Telecommunications Act of 1996 have a lot at stake, and 
the job that Mr. Klein does, or whoever it is at

[[Page S7295]]

Antitrust and all the Commissioners who are going to be nominated over 
at FCC, as well, all need to take a lot of time in deliberating over 
what those individuals are going to do before we vote to confirm them 
as a consequence of the impact that they are going to have, not just 
upon us, but especially upon the consumers, upon whom all of us, at the 
end of the day, depend.
  Mr. President, I look forward to having an opportunity later to come 
down, and I most especially look forward to not only yielding the 
floor, but listening to the majority leader. I yield the floor.
  Mr. LOTT addressed the Chair.
  The PRESIDING OFFICER (Mr. Stevens). The majority leader.

                          ____________________