Wednesday, November 28, 2001

FALLS VILLAGE, Conn. — Here’s a weird one. SBC Communications, one of the four mega-Bell monopolies that control 92 percent of local telecom connections, has named William Daley as its president. Mr. Daley will be second in command to Ed Whitacre, chairman and CEO of the company that was created with the merger of Ameritech, Pacific Bell and Southwestern Bell.
This is like AT&T Broadband naming Newt Gingrich its new president.
Mr. Daley is best known, not for his telecom savvy, but for his political connections. He’s a former commerce secretary and was Al Gore’s presidential campaign chairman last year.
Mr. Daley’s immediate task will be to oversee SBC’s “efforts to push legislation through Congress that would make it easier for the regional Bells to roll out high-speed Internet service,” writes Steve Labaton in the New York Times. “Mr. Daley and Mr. Whitacre said that the company’s push into those markets was vital to increasing profits.”
Well, I’d put it a little differently: Mr. Daley’s job will be to get the Tauzin-Dingell bill passed and thus gut the Telecommunications Act of 1996, and wipe out the remaining competitors to the mega-Bells, leaving the field free for an end-to-end monopoly takeover of U.S. telecom service. And that,of course, will mean higher prices and deteriorating service. Why Congress would want to re-monopolize telecommunications is one of the mysteries of the age. It’s hard to see the political value already, Bell customers are mad as hell.
The House Republican leadership knows that Tauzin-Dingell is radioactive. The last thing that smart folks like Denny Hastert and Dick Armey want to do with a close election coming up in a year is to force their members to walk the plank, required to choose between constituents the Bells on one side and competitive telecom companies, from AT&T and WorldCom to CLECs like McLeod, on the other. But Commerce Chairman Billy Tauzin has made the obnoxious bill his pet project, and leaders are reluctant to deny him a vote. So far, they have sent a strong signal that they don’t want the bill to come to the floor. They’ve delayed it for about half a year, but Mr. Tauzin wants a vote next month.
We’ll see. The SBC move could easily backfire. This is not a partisan issue, but by naming Mr. Daley as president, SBC is making it one. The William Daley I know a nice guy but a fierce Democrat wants Dick Gephardt, not Dennis Hastert, as his speaker.
After the Florida vote, Mr. Daley schooled in tough-guy Chicago politics by his father and brother, both mayors charged that George W. Bush “blithely dismissed the disenfranchisement of thousands of Floridians.” On Nov. 10, 2000, almost exactly a year ago, he called voting irregularities in Florida “an injustice unparalleled in our history.”
As I said earlier, a weird choice. What’s behind it? One answer may be desperation. The Bells don’t want to compete, and they are pulling out all the stops to get the bill passed. Frequently, however, desperation leads to error.
I can’t say I don’t like Mr. Daley personally. He’s a nice guy. The last time I saw him was last summer at a ranch outside Vail, Colo. We were playing pool, neither of us very well. He was way ahead, but I won when he sank the 8-ball. Now, there’s a nice metaphor for the fate of Tauzin-Dingell.

James K. Glassman is the host of

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