- The Washington Times - Friday, July 13, 2001

The leadership of the U.S. House faces a dilemma that has divided Washington across party lines, split regions of the country, and overwhelmed the airwaves.
Just about every interest group and lobbying firm in town has taken a side on the "Internet Freedom and Broadband Deployment Act," also known as Tauzin-Dingell. It would alter provisions in the 1996 Telecommunications Act to allow local phone companies — a k a regional Bell operating companies (RBOCs) — to offer broadband Internet access over long-distance telephone lines without proving they have opened local lines to competition.
Under the 1996 Act, long-distance carriers are permitted to provide local service, while RBOCs may provide long-distance service only if they open local markets to competition. Tauzin-Dingell addresses the purported lack of access to broadband Internet access, and gives the RBOCs greater opportunity to compete in that market.
Opponents argue the RBOCs should be providing more Internet access now, have driven competitors for local phone service out of business, and should not be rewarded for failing to open up local markets in compliance with the Telecom Act.
The dilemma for House Speaker Dennis Hastert, Illinois Republican, and his team is, should they bring Tauzin-Dingell to a floor vote given its contentiousness? There are several reasons not to.
First and foremost, the House Judiciary Committee reported out the bill with a negative recommendation. While the committee clearly recognized the legislation as poor public policy, it is worth noting that it recorded voice votes only. Members were reluctant to go on record, and that sentiment is spreading around the House.
Second, should Tauzin-Dingell pass the House and go to the Senate it would be referred to the Senate Commerce Committee. The leadership change in the Senate will not alter its fate both the new chairman, Fritz Hollings, South Carolina Democrat, and former chairman, now ranking member, John McCain, Arizona Republican, have expressed strong opposition to the bill. Since it is doomed in the Senate, there is little reason to force House members to decide who is right on the bill now.
Third, Tauzin-Dingell pits powerful interests against each other — none of whose members wish to offend if they can avoid it. The RBOCs, which are the original eight local phone companies combined now into four, have a market value almost 3 times larger than the three leading long-distance companies. They strongly favor the bill.
On the other side are the long-distance companies, including AT&T;, MCI and Sprint; state utility commissions; competitive local exchange carriers (CLECs); Internet service providers, and consumer and taxpayer groups. For example, the Florida State Public Service Commission has said: "Local competition is the fastest and most effective way for consumers to obtain broadband services at competitive prices. [Tauzin-Dingell] could undermine development of local competition." CLECs were supposed to be offering services in competition with the RBOCs, but instead the industry has been hit with bankruptcies, closures, layoffs and stock losses as a result of the RBOCs' failure to open their local markets.
Fourth, many House members are truly concerned that Tauzin-Dingell will cause the telecom industry to re-monopolize. They do not want the finger of blame pointed at them several years down the road if government has to step in to re-regulate local phone companies. That's exactly what the 1996 Act was devised to avoid.
Fifth, some on the Hill simply regard Tauzin-Dingell as premature, and want to ensure that local markets are open before the RBOCs are given a new capacity to expand their service. This faction is fully aware that the Telecommunications Act of 1996 created certain ground rules by which firms would compete in the telecom market, and that it takes time to unravel a decades-old monopoly system created by the federal government.
Finally, some House members express concern that the Telecom Act was supposed to reduce wasteful regulations and excess bureaucracy, and they fear new intervention by Congress will produce the opposite result. Recent complaints and fines against the RBOCs buttress this argument. Consumer complaints against Ameritech in February 2001 exceeded the total number of complaints in 1999, and New York assessed $13 million against Verizon for improper billing, lost orders, and other misdeeds.
By keeping Tauzin-Dingell off the floor, Speaker Hastert would save his colleagues on both sides of the aisle from casting a vote that will make almost no one happy.

Tom Schatz is president of Citizens Against Government Waste.

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