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Ideologies and champions: Universal Service from Congress to your telephone bill

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Ideologies and champions: Universal Service from Congress to your telephone bill

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Content IDEOLOGIES AND CHAMPIONS: UNIVERAL SERVICE FROM CONGRESS TO
YOUR TELEPHONE BILL
by
Mary Pepper J. English
A Dissertation Presented to the
FACULTY OF THE SCHOOL OF POLICY, PLANNING,
and DEVELOPMENT
UNIVERSITY OF SOUTHERN CALIFORNIA
In Partial Fulfillment of the
Requirements for the Degree
DOCTOR OF PUBLIC ADMINISTRATION
MAY 2004
Copyright 2004 Mary Pepper J. English
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UMI Number: 3140467
Copyright 2004 by
English, Mary Pepper J.
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1 1
ACKNOWLEDGEMENTS
The original deadline for completing my dissertation passed several years ago and
yet, in many aspects, I have been writing, researching, documenting and living it every
day over the past twelve years. My sincere gratitude goes to Dean Dan Mazmanian and
the University of Southern California for allowing me the formal extensions to complete
my work. Fortuitously, I feel my research is more comprehensive and, potentially, more
useful because of the time elapsed. I was able to follow and observe Universal Service
and the Schools and Libraries amendment, the participants that were involved, and the
outcome of issues over a much more extensive period resulting in a more viable
instrument of information.
A very special thank you goes to Dr. Robert Biller, whose patience I stretched to
the limit. He introduced me to Dr. Greg Rise, my Committee Chairman, whose guidance
has been tremendously valuable. Also, thanks to my other committee members Dr.
Michael Noll, a reputed telecommunications scholar whose work I greatly admire, and
Dr. Martin Krieger. Dr. Krieger and Dr. John McLaughlin’s encouragement from the
early days in the Washington Center provided a safety net that kept me connected.
Special thanks to the USC Washington Center and my classmates for expanding my
thinking beyond the scope of corporate life and for the feedback they provided through
the years.
To remember where I came from and to realize the opportunities I have had is so
very humbling to me. The relationships, the knowledge, and the first hand experience of
observing government in action is priceless, in many ways an exceptional education not
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Ill
available from textbooks. In one of my Public Administration classes we discussed the
perception of power rule, I must admit I got close enough to lose my awe of those in
power yet retained a healthy respect for those who choose work in government. The
following people will understand just how much the experience and completion of this
dissertation means to me; they will always have a special place in my heart for helping
make this happen.
My parents, Edward and Katherine Johnstone, my brothers and sisters for their
confidence and support, my sons, John Edward and William, for sharing me while I
pursued personal goals during their teenage years, the interviewees who shared their
experiences openly and followed up by providing additional documentation, my neighbor
Abe Ashcanese, a professional editor, for his time, patience and guidance. Dr. Martin
Allen, Dr. Molly Donovan, and Dr. Ruth Schimel for their support and confidence, Stan
Dickson and Mickey McGuire for believing in me and for providing the opportunity to
move to Washington. A special thanks to Marilyn Jordan, Harley Bledsoe, Ken
Robinson, Steve Long, Althea Kennedy and BellSouth Corporation for their technical
help and resources. Last but not least to my friend and teacher, Chris McLean. Chris is a
true “servant leader,” we should be so lucky as to have more like him in government.
The interpretations and conclusions drawn from this research are solely my own.
If people familiar with the history discover mistakes or misinterpretations, they are not
intentional. Understandably, the narrative had to be simplified in order to make it
manageable and readable to a more general audience.
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IV
TABLE OF CONTENTS
ACKNOWLEDGEMENTS.................................................................................................. ii
LIST OF FIGURES...............................................................................................................vi
ABBREVIATIONS...............................................................................................................vii
ABSTRACT..............................................................................................................................x
Chapter One: INTRODUCTION........................................................................................ 1
C o n t e x t f o r t h e S t u d y ........................................................................................................................................................................6
M a jo r D e v e l o p m e n t s in t h e S c h o o l s a n d L ib r a r ie s P r o c e s s ...............................................................................9
M e t h o d o l o g y .......................................................................................................................................................................................... 10
L it e r a t u r e R e v i e w ............................................................................................................................................................................... 13
K in g d o n ’s T h e o r y .................................................................................................................................................................................13
D e f in in g t h e P o l ic y P r o c e s s ........................................................................................................................................................19
Chapter Two: FROM TELEPHONE TO SUPER INFORMATION HIGHWAY. 30
O r ig in s o f U n iv e r s a l S e r v ic e ......................................................................................................................................................35
O n e P o l ic y , O n e S y s t e m , O n e U n iv e r s a l S e r v ic e .........................................................................................................39
T h e F C C is F o r m e d ................................................................................................................................................................................43
H o w t o D e f in e U n iv e r s a l S e r v i c e ...........................................................................................................................................4 7
P u b l ic In t e r e s t .......................................................................................................................................................................................4 9
A D e v e l o p in g V i s i o n ...........................................................................................................................................................................55
Chapter Three: THE SEEDS OF EXPANSION............................................................ 67
AND INTEREST GROUPS................................................................................................ 67
T h e In t e r n e t E m e r g e s ...................................................................................................................................................................... 70
T h e N a t io n a l R e s e a r c h a n d E d u c a t io n N e t w o r k (N R E N ) D e b a t e ................................................................74
C o m m u n it y N e t w o r k i n g .................................................................................................................................................................77
E d u c a t io n a n d L i b r a r i e s ................................................................................................................................................................85
In d u s t r y ......................................................................................................................................................................................................9 6
Chapter Four: GOVERNANCE: POLITICS OF THE HILL................................. 110
T h e A d m in is t r a t io n ..........................................................................................................................................................................110
T h e F C C .......................................................................................................................................................................................................116
T h e C o n g r e s s .........................................................................................................................................................................................130
THE h o u s e ................................................................................................................................................................................................. 131
T h e S e n a t e ................................................................................................................................................................................................135
T h e S e n a t e F a r m T e a m ...................................................................................................................................................................139
H o u s e a n d S e n a t e C o m m it t e e M a r k u p ..............................................................................................................................146
H o u s e a n d S e n a t e F l o o r D e b a t e s .........................................................................................................................................148
T h e C o n f e r e n c e ................................................................................................................................................................................... 149
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Chapter Five: AGENDA TO ACTION...........................................................................155
W in d o w o f O p p o r t u n i t y ................................................................................................................................................................ 155
A g e n d a A c c o m p l is h e d .................................................................................................................................................................... 158
A n a l y s is a n d F in d i n g s .................................................................................................................................................................... 160
Chapter Six: EPILOGUE: THE FUTURE OF UNIVERSAL SERVICE 167
BIBLIOGRAPHY................................................................................................................176
Appendix A: TIMELINE..................................................................................................186
Appendix B: THE 1966 TELECOMMUNICATIONS ACT......................................189
Appendix C: INTERVIEWEES...................................................................................... 190
Appendix D: MAJOR PARTICIPANTS IN THE TELECOMMUNICATIONS
ACT OF 1966...................................................................................................................... 196
Appendix E: WHITE HOUSE CONFERENCE ON LIBRARIES AND
INFORMATION SERVICES REPORT 1991...............................................................198
Appendix F: COMPUTER SYSTEMS POLICY PROJECT MEMBERSHIP AS
OF JANUARY 1993........................................................................................................... 199
Appendix G: COMPUTER SYSTEMS POLICY PROJECT REPORT DATED
JANUARY 12, 1993............................................................................................................200
Appendix H: PRESIDENT WILLIAM J. CLINTON AND VICE PRESIDENT
ALBERT GORE, JR. TECHNOLOGY FOR AMERICA’S ECONOMIC
GROWTH, A NEW DIRECTION TO BUILD ECONOMIC STRENGTH,
FEBRUARY 22, 1993.........................................................................................................202
Appendix I: EXCERPT FROM A 1994 SPEECH BEFORE THE HARVARD
GRADUATE SCHOOL OF EDUCATION BY REED HUNDT...............................204
Appendix J: WALL STREET JOURNAL EDITORIAL DATED DECEMBER 9,
1997.........................................................................................................................................206
Appendix K: EXAMPLE OF UNIVERSAL SERVICE BILLING......................... 207
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VI
LIST OF FIGURES
A: Organized Anarchy M odel......................................................................................... 15
B: BellSouth Model of Input/Output Points Used During the 1996 Act...................32
C: Outland Cartoon, San Francisco Chronicle, January 30, 1994..............................56
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Vll
ABBREVIATIONS
AARP Association of American Retired People
AFDC Aid to Families with Dependent Children
AFT American Federation of Teaehers
ALA American Libraries Association
AT&T American Telephone and Telegraph
ATPS American Public Television Stations
BBS Bulletin Board Service
CBO Congressional Budget Office
CFA Consumer Federation Association
CLEC Competitive Local Exchange Company
CPB Corporation for Public Broadcasting
CSNET Computer Science Network
CSPP Computer Systems Policy Project
FCC Federal Communications Commission
FRC Federal Radio Commission
HPCA High Performance Computing Act
HPCC High Performance Computing Communications
ICC Interstate Commerce Commission
IXCs Inter-exchange Companies
LECS Local Exchange Companies
MFJ Modified Final Judgment
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Vlll
NAB National Alliance of Businesses
NASB National Association of School Boards
NAIS National Association of Independent Schools
NBA National Education Association
NASA National Aeronautics and Science Administration
N il National Information Infrastructure
NPTN National Public Telecomputing Network
NREN National Research and Education Network
NRN National Research Network
NSF National Science Foundation
NSFNET National Science Foundation Network
NTIA National Telecommunications and Information Agency
NTN National Telecommuting Network
OIG Office of Inspector General
0M B Office of Management and Budget
POTS Plain Old Telephone Service
RBOCS Regional Bell Operating Companies
RUS Rural Utilities Services
SREK Snowe-Rockefeller-Exon-Kerrey
SEC Schools and Libraries Corporation
USDLA United States Distance Learning Association
VOIP Voice Over Internet Protocol
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IX
WEFA Wharton Econometric Forecasting Associates
WWW World Wide Web
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ABSTRACT
This is an investigation of how certain policy issues become the subject of
governmental action. Based on extensive interviews and document research, this
study specifically addresses how and why Section 254(h) of the Telecommunications
Act of 1996 codified and expanded the concept of Universal Service.
The purpose of my research is to add knowledge to agenda setting theory from a
practitioner's perspective. As an insider, I bring valuable insight to the behind-the-scenes
relationships, negotiations, rationales, and political positioning that occur when groups
compete to get policy makers' attention to legislate. My results show that a combination
of ideologies and champions were responsible for the amendment becoming law. Each
branch of government had a unique perspective on technology policy determined by its
constitutional or statutory role and constituency. Jurisdictional boundaries were often
crossed during the formation stage. There was no assessment of costs and benefits of the
program against any known standard or past program which made for easier passage. The
fate of the program depended heavily on economic climate and personal interest politics.
Policy occurred when everyone was paying attention or no one was paying attention.
The amendment was a concrete deliverable that elected officials could understand and
talk about with their constituency.
Agenda setting theory was useful to create structure to the study but emphasized
the fact that policymaking is not a precise science. Even the narrow portion known as the
"formation stage" or "agenda setting" does not fit exactly in one precise model or theory.
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XI
Expanding universal service to include schools and libraries exacerbated the issue
of funding in a competitive market. My research shows that had all participants
understood the history o f Universal Service, the origins of the Schools and Libraries
amendment, and the evolution of technology, a better, more honest and comprehensive
policy could have resulted.
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‘ •^The Heights Enchant Us and Not the Steps”
Goethe
Chapter One: INTRODUCTION
On February 8, 1996 people from across the nation were able to observe leaders
of government, CEOs of industry and public advocates gather in the United States
Library of Congress reading room for the official signing ceremony of the new 1996
Telecommunications Act. Televised nationally, President Clinton signed the law via
overhead projector with the swipe of an electronic pen. Vice President A1 Gore signed
the bill with the same pen his father, Senator A1 Gore, Sr. had used to sign interstate
highway legislation bill some fifty years earlier. The symbolism of comedienne,
“Ernestine,” Lily Tomlin calling the classroom and the little girl doing her homework
connected to the Library of Congress were part of the manifestation of a vision Vice
President Gore had articulated frequently over the previous decade. Even those
participants who had been adverse to the particular section of the bill being highlighted
were clapping ceremoniously as history was made.
I sat wondering how and why this two line Schools and Libraries amendment had
risen to such level of prominence. The President of the United States referred to it as the
best part of the 1996 Law. Ironically, the goal of the legislation had been to introduce
unfettered competition into a market that was rapidly and continually changing with new
entrants, new technologies and convergence. After thirty years of experience in the
telecommunications industry, I was knowledgeable of the business; with 16 years of
experience as a lobbyist, I was knowledgeable of government and had numerous
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relationships with those who legislate; and as a student of public administration I had
studied about how business, public interest and government intersect. However, 1 had
just observed this “textbook style” intersection first hand and could not explain exactly
how and why this phenomenon happened. Thus, as several of the interviewees
suggested, I was in a unique position to uncover the real story, answer my own questions
and share the information with those who may be interested.
After completing our interview, I asked Chris McLean what he thought about the
relevancy of my topic. I was still intrigued about how the Schools and Libraries
amendment had been so successful and was often referred to as the highlight of 280
pages of technical legislation. McLean was a major player on the staff of Senator Jim
Exon (D-Nebraska) during the rewrite of the 1934 Telecommunications Law. He knew
most all of the players, “where the skeletons were hidden,” and the intricacies of the
process. Almost spontaneously he remarked, “Who am I and why am I here?”' 1 laughed
just as many Americans did on the night that Admiral James Stockdale, the Reform Party
candidate, opened the 1992 vice presidential debate with those same words. Suddenly, 1
realized that McLean was serious. He considered this a profound question for me to
consider as I approached my research.
From a somewhat privileged position in Washington, I had been able to observe
the entire process of legislation over more than a decade giving me access to those who
had been involved. The topic 1 had selected, Universal Service and the schools and
libraries amendment, was still at the center of national debate. Even McLean admitted he
only knew how certain parts of the process occurred and he, for one, wanted to see how
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the whole story unfolded. McLean proclaimed, “Success has a million fathers.” This
statement, too, proved very fateful as my research developed and the story of how and
why an issue progressed to the federal agenda and became law.
Thus, the primary question my study addresses is how and why the Schools and
Libraries amendment became part of the national agenda. Before this question could be
answered, a set of secondary questions needed to be addressed. How were the problems
identified and the issues framed? How did the program evolve to meet the common
good? Who were the influential individual players at the begirming, middle and end of
the process? What organized groups had a stake in this legislation? How did they
interact? What was the window of opportunity these interactions created that made the
legislation pass?
Many variables relate to the various phases of agenda setting and the steps
involved in the process help explain the outcome. Among these variables are: first, the
problem definition; second, the generation of policy alternatives; and finally, the political
developments that arise as issues move through the process. Negotiation, symbolism,
and interorganizational networks play significant roles throughout the process. My study
adds to the knowledge base about how issues and ideas achieve agenda status or fail to do
so. Agenda setting, in the sense defined by John W. Kingdon, [in his book. Agendas,
Alternatives, and Public Policies], matters significantly as to what gets considered and
what does not, thus affecting the results of the policy process. By providing an in depth,
descriptive picture o f the agenda setting process of the Schools and Libraries program, I
hope to point the way toward more thoughtful and well designed policies. Governmental
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policy is made and implemented through complex processes. Some problems or policy
issues rise to the level of policymakers' attention while others remain in the background.
I chose a single case study approach for my research. A case is “a phenomenon
of some sort oecurring in a bounded context.”^ According to D.R Krathwohl, case
studies are often used “to evaluate an event, an institution, a process or a program.”^ The
data collection used includes thorough document research and extensive unstructured
interviews. The data shows how and why this amendment actually became law. Data
were collected through archival research, government documents, party platforms, the
media, various proposals, letters, memoranda, draft legislation and hearing transcripts.
Over 100 book sourees were consulted regarding different aspeets of the research. The
interview process was extensive and in-depth, including most major players who were
intimately involved in the development of the Schools and Libraries amendment. A
complete listing of each interviewee and their significance to this case can be found in
Appendix C. Interviews ranged from one to two hours and most were conducted face-to-
face, by telephone and by email. The transcripts of these interviews are accessible
through the author at Suite 900, 1133 2L* Street, N.W., Washington, D.C. 20036.
My research covers telecommunieations policy during the decade prior to passage
of the 1996 Telecommunieations Act Section 254(h) of the Telecommunications Act of
1996, also called “the E-rate program,” the “Snowe, Rockefeller, Kerrey, Exon
Amendment,” “the Gore tax,” henceforth referred to as "the Schools and Libraries
Amendment.” (See Appendix B) My purpose is to explain why one particular
amendment beeame federal law and to provide future researehers and policy makers with
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insight on how the intricate “inside Washington” political process works. The
phenomena involved in agenda setting are critical to understanding both governmental
processes and public policy outcomes. It is not merely final votes or presidential
initiatives and vetoes that determine the laws of our nation but also the fact that some
issues and proposals never make it to the agenda in the first place. As E. E.
Schattschneider writes, “The definition of the alternatives is the supreme instrument of
power.
A better understanding of agenda setting can help bring significant public
problems to the attention of official decision-makers. This understanding may also help
increase the likelihood that a thoughtful, well-designed policy proposal will have a
greater chance of making it through the complex agenda setting process. Agendas do
shape outcomes, but the battle over outcomes is often decided in the preliminary stages of
issue emergence.^ According to Senator Tom Daschle (D-South Dakota), currently
Minority Leader of the U.S. Senate, “The amount of regular mail, emails, telephone calls,
fax, campaign concerns, security and external duties continue to vie for attention of all of
us. Thousands of bills are introduced in each Congress and only a fraction of them
become law and those that do make it through are sometimes hard to recognize from the
way they began. Often agenda items are media driven and other times are driven from
my constituents back home through town-hall meetings and face to face contacts.”^
It is important to understand why a given agenda is originally composed as it is
and also why it changes as it develops over time. Political developments account for
many such revisions. Changes in leadership, political parties, world events, state of the
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economy, and major budgetary decisions have enormous influence on the outcome of the
agenda making process. Rapidly changing political and economic circumstances as well
as the complexity and controversial nature of many of today’s problems make it essential
that we understand how an issue becomes part of the federal agenda. In my research, you
will see how an idea became law, how symbolism propelled change, how significant
change occurred “under the radar screen,” how different examples of coalition building
worked, and how success had a thousand fathers.
Context for the Studv
Complex legislative policy flows in ebbs and tides. After approximately ten years
of debate over how the 1934 Communications Act should be revised. President Bill
Clinton signed the 1996 Telecommunications Act on February 8, 1996, with its all-
important Schools and Libraries amendment. (Telecommunications Act of 1996, Pub. L.
No. 104-104, D 254h, 110 Stat. 56, 73-75 (1997). This amendment fundamentally
changed the U. S. telecommunications policy environment by updating the law for the
first time since the 1934 Communications Act (Communications Act of 1934, ch. 652, 48
Stat. 1064 (current version at 47 U.S.C. D 151 (2001)). (See Appendix B)
One of the most important provisions in the new Communications Act codified
and expanded the ad hoc concept of a national "universal service policy" developed and
administered by the Federal Communications Commission (FCC). This expansion meant
that schools, libraries, and rural health care institutions were all guaranteed discounted
rates and access to modern telecommunications and information services including the
Internet. Historically, funding for universal service has been achieved by complex
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formulas of cross-subsidies that helped keep rates reasonable in rural and low-income
areas. This involves policies on rates, intercarrier compensation, jurisdictional cost
allocation, court cases and other distributions of funds. Subsidies are taken from more
highly populated areas where the cost to serve would be lower and spread to the more
rural and higher cost areas, from business lines to residential lines and from vertical
services to basic lines. There are additional subsidies provided by long-distance telephone
companies which pay access charges to the local telephone companies for the use of their
lines. As A. Michael Noll suggests, the costs are very difficult to determine and the
subsidy system distorts market forces which is not beneficial for real competition, the
stated purpose of the Act.^
The explicit legislative mandate for universal service grew out of the 1934
Telecommunications Act that established the FCC and charged it with “regulating
interstate and foreign commerce in communication by wire and radio so as to make
available, so far as possible, to all people of the United States, a rapid, efficient,
nationwide and worldwide wire and radio communication service with adequate facilities
at reasonable charges.”*
Although the language in the 1934 law is vague, universal service advocates have
relied on it for seventy years to support their causes. It is important to understand,
however, that universal service was actually created in the early nineteenth century as a
marketing scheme for the American Telephone and Telegraph (AT&T). In 1907,
Theodore Vail, then President of AT&T, invented it to eliminate competitors by offering
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8
consumers a “single nationwide service.” The government, which accepted AT&T as a
“natural monopoly” passed the Communications Act of 1934, in part, to regulate it.
In the decade leading up to the passage of the 1996 Act, public interest and
edueational groups, industry segments, certain Congressional leaders, as well as the
Clinton-Gore Administration, developed and advocated ideas to expand the universal
service concept to offer more services to a greater range of recipients by extending
subsidies. Essential to this expansion was the idea that schools and libraries achieve
access to services beyond “plain old telephone service” (POTS). Vice President A1 Gore
was assigned responsibility for technology policy during the eight years of the Clinton-
Gore Administration and played a key role in ensuring the goal of wiring schools and
libraries. The result was the 1996 Act required not only that schools and libraries and
healthcare funding be included in the universal service funding mechanism to receive
POTS, but also that the FCC make other services available. This researeh addresses only
the schools and libraries portion of the amendment and the process that created it as part
of the new law.
A general timeline is provided in the appendices of this document that provides
key dates leading up to the passage of the 1996 Telecommunications Law. The story of
the schools and libraries amendment developed through different streams or groups aside
from many of those dates and is presented as such in this paper. Therefore, it may be
helpful to also provide a summary list of major developments, dates and pages references
on the specific schools and libraries amendment.
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Mai or Developments in the Schools and Libraries Process
Page 34 Schools and libraries idea rooted in history of public interest
Page 42 Education, basic medical care viewed as a basic right
Page 43 Communications compared to post office as diffusion of knowledge
Page 45 Fragmentation of administration of schools and libraries gives way
to information rich and information poor argument
Page 48 New definition of universal service develops to include public interest
Page 49 Some states offer subsidies to school
Page 58 California Intelligent Network Task Force (early 1990’s)
Page 76 Community Networking groups begin talking about schools being
connected
Page 81 FarNet started
Page 84 Triennial Review, disabled community gets mentioned as precursor to
Schools and Libraries (1987)
Page 85 Bush Speech (1991)
Page 88 Council on Competitiveness Paper mentions schools and libraries
Page 95 Apple Classroom of Tomorrow (1986)
Page 99 Fortune Magazine article on schools
Page 103 NetDay Tech Corp
Page 110 Cable in the Classroom (1992)
Page 114 Gore staff focuses on classroom and libraries
Page 116 State of the Union Address schools and libraries mentioned (1996)
Page 119 Bell Atlantic commits to wiring classrooms
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Page 120
Page 121
Page 123
Page 125
Page 126
Page 128
Page 141
Page 144
10
Hundt ideology
White House Campaign on technology in the classroom (1994)
Gingrich clash of ideology and politics
Rockefeller enters the fray
Earliest version of schools and libraries amendment passes in S. 1822
House and Senate conference included Schools and Libraries
Senator Kerrey gets involved, Farm team includes schools and libraries in
Universal Service
Page 144 Senator Snowe champions amendment
Methodologv
While most telecommunications industry representatives were focused on
intricate technical pieces of the 280 page Act, the movement to expand universal service
grew quietly through other means and gained strength catching many industry
representatives off guard. In Washington “speaks,” it was “under the radar” for many of
those internally involved in the telecommunications industry. The telecommunication
lobbyists were totally absorbed in more business specific technical issues concerning
definition of the rules for a new competitive telecommunications market. Significantly,
among these were the terms and conditions of opening the local Bell Company monopoly
networks to competitors and setting the rules for allowing the Bell Companies into the
long distance market. According to theorists Baumgartner and Jones, “Agenda setting
has important policy consequences.” My study illuminates understanding of agenda
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11
setting in telecommunications policy and shows how agenda setting contributes to the
policies that shape the quality of our lives, the economy, and the nation.
It is important to recognize that this ease study of agenda setting deals only with a
single industry and a single law. The findings from the case study delineate the
theoretical and political contexts according to the qualitative methods suggested by D. F
Lancy.'' Past research and testing of the conceptual framework of similar studies
indicate the political environment, though always changing, includes attributes that are
common issue to issue, industry to industry and law to law. States M. M. Kennedy,
“Generalizability is ultimately related to what the reader is trying to learn from the
study.This study’s applicability to future cases will rest in other’s observations and
knowledge. The face validity of the study mirrors elements of others’ observations
regarding the policy process. The strengths include data with local groundedness and
richness collected over a period of several years as recommended by theorists Miles and
Huberman. A descriptive analysis of the iterative agenda setting process should thus
speak to other industries, policies, and legislation.
As a 30-year employee of BellSouth Corporation, I admit my bias up front. It is
well documented that Bell employees feel that they are part of a large family and,
historically, employees are tremendously loyal to the corporation’s values. Serving the
customer and the public are two of the most significant of our values. With that
acknowledgement, it is also important to know that I have spent the last sixteen years of
my life in Washington, D.C. deeply involved in the rewrite and implementation of the
Telecommunications Law. BellSouth, along with others in the industry, had concern for
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12
the schools and libraries amendment from the outset because of the implications for
increasing universal service funding. It is not my intent to weigh the merits of the
program, rather to analyze how and why it got on the federal agenda.
Throughout all of the years of preliminary hearings and debate, the Schools and
Libraries program was rarely, if ever, mentioned in all the meetings, hearings, debates
either in Congress or within the industry. It is even fair to say, at least some observers in
the telecommunications industry thought of “schools and libraries” as the proverbial
“gnat on an elephant’s back.” Most industry observers thought it had virtually no chance
of passing as an amendment, and it received minimal attention from the companies. The
amendment did pass, however, and has had widespread implications for all Americans.
Passing with little fanfare, it immediately became one of the most newsworthy,
controversial portions of the entire act and the debate continues even today.
In response to Section 254(h) of the Act, which legislated the Schools and
Libraries program, the FCC created an annual fund, capped at $2.25 billion per year, to
pay for the program. It was to be financed by telecommunications providers who in turn
were allowed to recoup their expenses through additional assessment (some would refer
to as a tax) to the ratepayer. The FCC also established the Schools and Libraries
Corporation (SLC), an independent not-for-profit corporation, to administer the program.
The industry was either lukewarm or actively opposed to the program during the first two
years after implementation. Ironically, most if not all, of the telecommunieations
companies now make a productive and profitable business from the Schools and Libraries
program.
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Literature Review
My literature review was directed toward learning about past policy studies and
approaches, both similar and different from the one used in this paper. I use a qualitative
inquiry that is a narrative approach to research that aims to tell the story. C. Marshall and
G. Rossman state that, “continual literature review during a study results in a creative
interplay of the processes of data collection, literature review, and introspection.”'^
Much of my literature review was done before primary data was gathered. Examining
other approaches allowed me to express a preference for Kingdon's method overall,
although the work of other theorists is dispersed throughout my paper. The authors that
are mentioned by name have published seminal works in the area of policy and provide a
general underpinning for Kingdon’s model.
Kingdon’s Theorv
Consideration of John Kingdon's views as summarized in his book. Agenda
Alternatives, and Public Policies, present a complex, helpful picture of the agenda setting
and policy-making process in health and transportation, from 1976 through 1979. His
work helped focus the questions that I asked during the sixty plus unstructured interviews
that were utilized for my study. Kingdon’s work also helped bring clarity to the other
more traditional research that was used throughout the research which I review in the
following paragraphs.
Kingdon applied his data to the "garbage can" theoretical construct of “organized
anarchies” or “collections of choices looking for problems, issues and feelings looking
for decision situations in which they might be aired, solutions looking for issues to which
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they might be the answer, and decision makers looking for work.”''* According to this
theory, decision-makers reach consensus in spite of pervasive differences of opinion
through "organized anarchies," which have three main characteristics. First, members of
the organizations do not define their preferences about policies and goals precisely.
Second, the technology used is as unclear as the organizers’ preferences. Finally,
participation in the organizational decision making processes is fluid, sometimes erratic.
Cohen, March and Olsen also theorized that the organized anarchies use decision
making processes made up of four separate streams—problems, solutions, participants,
and opportunities for choice. Only rarely, do these streams interconnect. When these
four streams do connect with each other, however, the result can be a major decision.
Choice opportunities mix in the “garbage can.” In “organized anarchies” separate
streams or processes flow throughout as organization and decision outcomes depend on
the coupling of the streams at any given point in time.'^
Building on but diverging slightly from Cohen, March, and Olsen, Kingdon
observes three rather than four “streams” flowing largely independently to constitute the
policy-making process for a particular social problem, either defining it or letting it fade.
Bringing the problem to the forefront can result from different means— the monitoring of
social data, the occurrence of “focusing events” such as California’s Proposition 13 that
brought the accelerating “tax revolt” to national attention, and feedbaek from ongoing
government programs.'^
Kingdon’s theory referred to the seeond stream as political. Here the government
agenda creates a list of issues. Several forces are paramount in this arena including the
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national mood, the power of organized interests, the turnover of government personnel,
and the jurisdictional disputes among governmental agencies and branches. Participants
in the political stream, who cluster on the public stage, include the administration, high-
level appointees. Members of Congress, media and interest groups, parties, campaigns,
funding and public opinion. The political stream can have a bandwagon effect.
Kingdon’s theory also posits a “policy stream.” In it alternative solutions are
reviewed and decisions made. The policy stream’s major focus is intellectual and
personal. Within this stream, the “policy entrepreneurs,” or the people with a deep, long
abiding commitment to a particular policy change are central. The American political
system is one that continually reshapes citizen participation. Those able to influence and
shape the public image of issues may succeed in changing its agenda status as well.
The policy stream proceeds from formulation of an agenda to a trial balloon or
softening up phase. Suggestions are made both privately and publicly about how to
resolve a particular problem. Criteria for survival of an idea includes whether it is
technically feasible; whether it is acceptable as a standard related to broad social values;
and what future constraints are anticipated by the participants in the policy stream.
Consensus is generally developed not by bargaining but through persuasion and rational
argumentation. The following illustration (see Figure A) depicts the policy streams and
how once converged either fade away, get enacted or proceed to a softening up and
consensus building phase.
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Figure A
The Organized Anarchy Model of Public Policy Making and Implementation
PROBLEM STREAM
1. Getting attention 2. Problem is defined
via: according to:
indicators values
focusing events com parisons
feedback categories o f policy
budget prioritization
POLITICAL STREAM
3. Problem
1, Formulation of
G overnm ental A genda
M ajor forces include:
national mood
organized interests
changes in government
W INDOW OPENS
TO STRUCTURE
DECISION AGENDA;
THREE STREAM S
CONVERGE
Decision Agenda
M ajor forces include:
ideas
policy entrepreneurs
hidden cluster of
participants
2. Consensus
building by
bargaining
among
participants
3. Tilt effect
-► POLICY IS
ENACTED
visible cluster of
participants
POLICY STREAM
1. Formulation of 2. Softening-up phase 4. Consensus building
(e.g., trial balloons)
3. Some ideas survive
Criteria for survival
include:
technical feasibility
value acceptability
anticipation o f future
constraints
by persuasion among
participants
5. Tilt effect
H enry, N icholas. Public A dm inistration and Public A ffairs. (Prentice-H all, Inc; Englew ood C liffs) 1995, p. 301.
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Upon meeting, these three streams—problems, policy, and politics— can produce
major public decisions. Kingdon calls these occasions “windows” which can result from
occurrences in either the problem or the political streams. Windows can open because of
changes in the Administration, in Congress, and in public opinion or the national
conditions. Windows can also open when pressing public problems emerge. They can
lead to restructuring of the governmental agenda. For a window to open resulting in a
restructuring of the decision agenda, however, all three streams must join in. In the latter
case, the legitimate, persistent policy entrepreneur is essential for success.'^
My research, both primary and secondary, is grouped around Kingdon's structure
rather than the “Garbage Can Theory” because the first includes many of the latter's
insights and structure. The unstructured interviews that I conducted touch on Kingdon’s
three streams. The first area o f questioning involved the problem. Was the problem
identified (unequal access to Internet opportunity) a more pressing one than those other
myriad inequities in American education? Was this a solution in search of a problem?
Was Internet access in America's classrooms more important than other largely missing
classroom tools such as textbooks, chalkboards, or telephones? Who should pay these
educational costs? What funding sources were considered?
The next group of questions centered on politics. What impact did the actions and
beliefs of certain citizens such as private individuals, public interest groups, politicians,
and other public figures have? What were the important human relationships and
interactions in this process? Did they involve small groups and organized special interest
groups, business and industry, federal agencies. Congress, the Executive Branch, politics
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and the media? What role did each play in getting the Schools and Libraries amendment
passed? Did any of these groups change their positions during the process? If so, how
and why? The respondents were asked to be very specific. What metaphors, symbols
and language were employed? Did the fact that telecommunications policy is fragmented
at all levels of government have an impact on the outcome?
The third and final area of interest was policy and the window of opportunity.
Why did the Schools and Libraries amendment pass Congress more easily than other bills
or amendments? Why was this educational issue attached to the telecommunications
process? Was the amendment written to be intentionally ambiguous? Was the public
really represented in the “public interest” case of the 1996 Act or were its results
serendipitous? What role did “timing” play in the passage of the amendment? What
issues affected the nature of the legislation, for instance, partisan politics, economic
changes, the budget, the environment, competing interests, assessment of needs?
This approach allowed development of a multidimensional description of how
events in this process unfolded by selecting an initial set of key informants from key
players in the process. Many of the participants were active in the legislative process,
while others had overall expertise in universal service or overall telecommunications
policy areas. Additional key informants were chosen by the “snowball method.” At the
end of each interview, each respondent was asked to recommend others with relevant
knowledge to contribute to the process.
Unstructured research questions were asked in in-depth interviews, the method
recommended by writers of other dissertations and John Kingdon, himself, in a recent
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personal interview. Such interviews abandon the asking of a predetermined set of
questions aimed to produce narrow answers. In-depth interviews, conversations with a
purpose, are often used in case studies. In unstructured interviews, a respondent
occasionally assumes the questioner’s role. Primary sources also include government
documents, congressional reports, hearing testimony and comments filed by interested
parties, legal/policy analysis, historical research, news releases, and public statements by
officials with relevant knowledge.
Defining the Policv Process
Scholars and students of public policy use many different definitions of “policy
process.” H. D. Lasswell’s model of public policy describes seven decision-making
process points— intelligence, promotion, prescription, invocation, application,
termination, and appraisal.'^ Lasswell’s theory is based on the cyclical nature of
problems: question to government, action in government, then government response to
problems, and programs' return to government. The stages may overlap in any order and
meld with other stages. An issue that has failed in one legislative session may be brought
up again in the next session for consideration as an agenda item.
Building on Lasswell’s theory, C. 0 . Jones’ model of the policy process is known
as the “stages model.” It describes the policy process traditionally by basing itself in
common experience of the types of activities as typical governmental action. First, a
problem is defined or identified and becomes part of the official agenda. Next, a solution
is proposed and governmental action is taken to alleviate the problem. These actions that
lead to new programs and services are evaluated over time, so adjustments can be made
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as the cycle repeats itself. Jones defines eleven policy-process elements and associated
questions.
1. What is the problem?
2. How many people think it is important?
3. How well organized are these people?
4. How is access to decision maker maintained?
5. How is official agenda status achieved?
6. What is the proposed solution, and who developed it and how?
7. Who supports it and how is major support maintained?
8. How much money is provided?
9. Who administers it, and how do the administrators maintain support?
10. Who judges it success and by what methods?
11. What adjustments have been made and how did they come about?
Reviewing the Jones model, it becomes clear that the first five questions deal with
Lasswell’s concept of getting the problem to government. Questions six, seven, and eight
relate to formulation, legitimacy, budgeting and action in government. The final three
questions deal with implementation, evaluation, and adjustments or programs returning to
government for review.
Current research has moved beyond the traditional policy process model and the
stages model of policy process has lost some of its following in the last twenty years.
Many scholars view the stages model as limiting and compartmentalized. They suggest
that it fails to reflect complexities of the policy process in many situations. T. A.
Birkland states that the language used in the stages model is too linear and deterministic
to serve as policy theory.^’
An extensive body of literature considers pluralist bargaining as a theory of policy
making. Pluralists, often in the field of political science, address the who and how
questions of policy making by looking at the political resources diffused throughout the
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system. Robert A. Dahl writes that dispersed authority creates a system in which
“decisions are made by endless bargaining.”^^ Pluralists studying policy-making focus
on groups, not individuals, as their primary unit of analysis.
Dahl sees pluralism as a communal, open system where “all the active and
legitimate groups in the population can make themselves heard at some crucial stage in
the process of decision.”^ ^ Just because groups can be heard, however, does not mean
that each group has equal control over the outcome. What pluralism allows are policy
decisions that result from continuous bargaining among diffused, dispersed groups
throughout the system. Dispersed inequalities allow the wide distribution of resources
among different players. According to Dahl, dispersed inequalities provide the political
system with some measure of balance and ensure that no one exercises excessive
influence in any one area of public concern.^"* Because the traditional model does not
answer the “how” or “who” questions associated with issues' ebb and flow, it serves only
as a starting point for investigations into the nature of governmental action rather than a
complete picture of how things work.^^
Pluralists see policy making as referees for interest group conflicts rather than as
an architect of policy. D. B. Truman, states that groups are inextricably linked to the
shape of the political environment in which they operate. According to Truman, “both
the forms and functions of government are a reflection of the activities and claims of such
g ro u p s.D u e to the complex nature of policy making, it is difficult for one group to
dominate a particular issue area. Many groups have overlapping memberships that act as
checks and balances. Truman says “potential” groups whose interests are widely held in
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society affect processes without an organization to carry the banner. He also notes that
groups lacking internal cohesion have limited ability to exercise power. The claims of
organized groups are balanced one against the other and against the limits of government
structure and power, thus policymaking becomes a give and take reality.^^
R. W. Cobb and C. D. Elder define various agendas and detail characteristics of
issues that make them likely to receive consideration.^^ No matter through which theory
one observes policy making, of course, agenda setting is always critical. Agenda setting
usually occurs in the early stages of the policy process when some issues become
prominent and others disappear. The process of how and why some issues become
subject to government action and others move to the “back burners” is important because
agendas shape outcomes. D. A. Rochefort and Cobb believe it is necessary to understand
agenda setting in order to understand policy making.^^
“Punctuated equilibrium” in which change occurs in dramatic or sudden fashion,
rather than in a steady evolutionary pattern can help explain the rise and fall of issues in
context, and some scholars have charged that Kingdon’s theory pays insufficient attention
to contextual details that can shape agendas. Frank Baumgartner and Bryan Jones believe
that the political system “displays considerable stability with regard to the manner in
which it processes issues, but the stability is punctuated with periods of volatile
change.”^’
They also note that when issues change in image or definition, a sense of crisis
can be the result. New institutional structures or “venues” grow around the new policy
direction, and supporting forces mobilize to maintain this new equilibrium. But with
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time, new ideas and other forces may destabilize the new structure and lead to another
round of dramatic changes. Policy monopolies are institutional structures or venues that
control issue policymaking and limit access to decision making in that area, reinforce
periods of stability.^* This kind of control helps create and support an “issue image” that
supports the monopoly. In the punctuated equilibrium model, image plays a large role.
How policymakers and the public view an issue and the values and biases they attach to it
is vital to the outcome of the policy agenda. Media coverage, organized political activity,
and access to information and research are frequently key to agenda setting, certainly in
this case study.
In Kingdon’s model, the “problem stream” emphasizes “focusing events,” which
could include crises, natural disasters, economic downturns, or other situations that call
people’s attention to a given problem and push them toward action. T. A. Birkland
elaborates, defining a “potential focusing event” as one “that is sudden, [that is] relatively
rare, [and that] can be reasonably defined as harmful or [as] revealing the possibility of
potentially greater future harm s.. .[and that becomes] known to policymakers and the
public virtually simultaneously.”" ^ ® A focusing event is fixed in a particular time and
context.
Because participants often use the event to mobilize support, change-oriented
groups or individuals have an advantage over those stuck in the status quo. Many events,
such as the terrorist attacks on 9/11 are powerful symbols. “This power is greatly
enhanced through its reduction to simple, graphic, and familiar symbolic packages,”
states Birkland.” ^’ He goes on to say, “mass publics respond more readily to these
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symbols because they are easier to interpret than are more complex stories or analyses of
public problems.” Focusing events help organized interests further their eauses. For
instance, a General Accounting Office comparative analyses report on quality of
education by countries, stimulated interest in the Schools and Libraries amendment.
Language, rituals, and symbols are all important in focusing events. L. G.
Bolman and T. E. Deal suggest an approach to organizational theory that joins symbolic
and systems usage.The symbolic approach stresses that the meaning of an event is
determined by the interpretations of those involved in it. Symbols are created to reduce
(or sometimes intentionally to increase) ambiguity in social situations and to provide
direction and clarity.
John Kirlin discusses theory building and policy-making as processes, each
leading to social constructions not to an immutable product. He recognizes that processes
of social construction theory building and policy-making share many attributes. Principal
among these is their reliance on language. Kirlin theorizes that the language used in
policy processes is neither incidental nor peripheral; but it is of central importance. One
of the most powerful words used in the policy process is “right,” which commonly refers
to individual behaviors such as voting. According to Jeffersonian tradition, "rights" are
universal, and inalienable. Many powerful public policy debates center about "rights." In
the 1960s and 1970s, the receipt of certain services came to be thought of as “rights.” The
concept of “entitlement” captured this new objective. Kirlin notes that it is almost
impossible to take away a “right,” which would be a linguistic impossibility. This applies
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to my research as the expansion of universal service to include schools and libraries could
now be seen as part of a universal “right” or entitlement.'^^
Jerry L. Salvaggio has argued that it is in the interests of the information industry
as a whole to promote a positive impression of the benefits that could come with the
arrival of the information age. And by extension, a favorable impression of possible
futures might also justify the redirection of public and private resources to insure that the
arrival of this age was swift and unproblematic.'^'^ Although Salvaggio was writing before
the information infrastructure became a term of choice, he noted the strategic use of
concepts of network and networking through advertising and public relations that
featured the terms prominently. He further described cycles o f promotion, which moved
through public relations, indirectly stimulating writing in science fiction that is frequently
coincident with the popularization of science through futurist writing. It is Salvaggio’s
theory that this activity helped to contribute to the creation of a comfortable vision of
information technology and its promise. Gareth Morgan has also contributed to this
theory by studying different stages of issues and how they can be mapped or described in
metaphorical language. One will see how the language of the information highway
developed through the years in the story of the Schools and Libraries amendment.'^^
During the early sixties, the predominant view of both economists and political
scientists was that regulation presented a case in which the benefits of government policy
were concentrated in a few well-organized interests—the firms and unions that were
protected from competition— whereas the costs were widely dispersed among consumers
whose incentives to organize to protect their interest were insufficient to induce political
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action. The accepted wisdom in political science was that in clashes between a diffuse
public interest and a tangible well-organized interest, the former could be expected to
finish a poor second."^^ Between 1967 and 1973 more than two dozen new laws for
consumer proteetion, environmental protection, occupational health and safety, and other
forms of soeial regulation were enacted, typically conferring benefits on the ill-organized
general public at the expense of a well-organized few. James Q. Wilson ascribed this
unexpected development to the rise of “entrepreneurial politics,” in which the
entrepreneur “serves as the vicarious representative of groups not directly part of the
legislative process.” This entrepreneur is someone “who can mobilize latent public
sentiment, put the opponents of the plan publicly on the defensive, and associate the
legislation with widely shared values.^^^As my case develops, the reader will see
entrepreneurial politics play a substantial role.
Michael Pertschuk elaborated on Wilson’s analysis, suggesting that this surprising
wave of legislation was produced by a five part coalition consisting of consumer
advocates in Congress, a new strain of entrepreneurial congressional staff members,
advocacy journalists, organized labor, and private not-for-profit issue entrepreneurs, of
whom the most prominent was Ralph Nader."**
As we begin the analysis of how and why the Schools and Libraries amendment
became law, you will note different theories are applicable at different stages of the
process. You will see that there are basically four groups involved in this process: The
telecom industry and their Senators and Congressmen; 2) the Gore folks who actually
wanted to do something in technology to produce a “legacy;” 3) public interest groups
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who wanted to appear as significant players in the telecom rewrite and understood they
could not play with the industry and their Members on technical terms; 4) Senators and
Congressmen who felt more comfortable grappling with education concerns rather than
the nuts and bolts of telecom where they would run up against other more
knowledgeable Members. (I would guess this represents approximately 95% of the
Congress.) In the next chapter, I provide the setting and a historical account with which
this process began.
Chapter One Notes;
Interview with Chris McLean.
^ M. B. Miles and A. M. Huberman, Qualitative Data Analysis, (Thousand Oaks, CA:
Sage Publications, 1994), p. 25.
^ D. R. Krathwohl, Methods o f Educational and Social Science Research, (White Plains:
Longman 1993), p. 347.
E. B. Schattschneider, The Semi-Sovereign People, (New York: Holt, Rinehart, and
Winston, I960) p. 68.
^ C. O. Jones, An Introduction to the Study o f Public Policy, (Monterey: Brooks and Cole
Publishing Company, 1984) p. 51.
^ Interview with Senator Tom Daschle.
’ A. Michael Noll, Introduction to Telephones and Telephone Systems, Third Edition,
(Boston-London: Artech House, 1998), pp.325-28.
^ Telecommunications Act of 1934, Pub. L. No. 104-104.
F. Baumgartner and B. Jones, Agenda and Instability in American Politics, (Chicago:
University of Chicago Press, 1993) p. 4.
” D. F. Lancy, Qualitative Research in Education (White Plains: Longman, 1993) p. 149.
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M. M. Kennedy, “Generalizing From Single Case Studies,” Evaluation Quarterly 3
(1979), p.661-679.
Catherine Marshall and Gretchen Rossmen, Designing Qualitative Research,
(Newbury Park: SAGE, 1989) pp.38-40.
M. Cohen, J. G. March and J. Olsen, “A Garbage Can Model of Organizational
Choice,” Administrative Science Quarterly 17, (1972) pp.1-16.
'^Ibid. 1972, pp.16-17.
John W.Kingdon, Agenda Alternatives, and Public Policies, (New YorkiHarper
Collins, 1995), pp. 87-110.
'^Nicolas Henry, Public Administration and Public Affairs, 6* Edition (Englewood
Cliffs:,1995),p. 56.
H. D. Lasswell, A Preview o f Policy Sciences, (New York: Elsevier, 1971) p. 28.
Charles O. Jones, (1984) pp. 27-29.
T. A. Birkland, After Disaster: Agenda Setting, Public Policy and Focusing Events,
(Washington, D.C.: Georgetown University Press, 1997) p. 8.
R. A. Dahl, A Preface to Democratic Theory, (Chicago: University of Chicago Press,
1956) p. 130.
Ibid., p. 137.
24
Dahl, 1956, p. 151.
P. Sabatier, “Political Science and Public Policy,” PS: Political Science and Politics 24
(2) 1988, pp. 145-156.
D.B. Truman, The Government Process, (New York: Alfred A. Knopf, 1951), p. 209-
506.
27
Ibid., Truman, pp. 209-506.
Roger Cobb and Charles Elder, Participation in American Politics, 2" Ed., (Boston:
Allyn & Bacon, 1983) pp. 75-88.
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D. A. Rochefort and R. W. Cobb, The Politics o f Problem Definition, (Lawrence, KS:
The University Press of Kansas, 1994) pp. 15-38.
Frank Baumgartner and Bryan Jones, Agenda and Instability in American Politics,
(Chicago: University of Chicago Press, 1993) p. 4.
Ibid., p. 6.
Birkland, 1997, p. 22.
Ibid., p. 11.
L. G. Bolman and T. E. Deal, Modern Approaches to Understanding and Managing
Organizations, (San Francisco: JosseyBass, 1984), pp. 189-212.
John Kirlin, “Where is the Value in Public Entrepreneurship?” Presented at
“Entrepreneurship and Development Conference,” University of Texas at Arlington,
December 6, 1994.
Jerry L. Salvaggio, “Protecting a Positive Image of the Information Society,” The
Ideology o f the Information Age, (Norwood, N.J, 1987), pp. 146-157.
Gareth Morgan, Images o f Organizations, (Newbury Park, CA: SAGE, 1986).
Martha Derthick and Paul J. Quirk, The Politics o f Deregulation, (Washington,
D.C.:Brookings Institution, 1985) pp. 9-11.
James Q. Wilson, The Politics o f Regulation, (Basic Books, 1980), p. 370.
Michael Perschuck, Revolt Against Regulation: The Rise and Pause o f the Consumer
Movement, (University of California Press, 1982), pp. 5-45.
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Chapter Two: FROM TELEPHONE TO SUPER INFORMATION
HIGHWAY
After years of antitrust legislation, AT&T, in January 1982, settled a suit which
was originally filed on November 20, 1974. This settlement not only resolved the 1974
issues but also freed AT&T from all restrictions from the earlier 1956 Final Judgment
initiated by the Department of Justice in 1949.’ Judge Harold Greene presided over the
1982 settlement between AT&T and the Department of Justice. Greene approved a
Modified Final Judgment (MFJ) that decreed the breakup of the parent company, AT&T.
This resulted in the split up of AT&T into seven regional companies commonly referred
to as the Baby Bells or the Regional Bell Operating Companies (RBOCS). The actual
physical divestiture (division of resources and assets) took place in 1984. Local
telephone service was to be provided by the regional Bell companies, separate and apart
from the parent company, AT&T. AT&T was to handle all interstate and intrastate long
distance business. AT&T retained Western Electric which was, after several years, sold
and became known as Lucent. Judge Greene later changed the terms of the consent
decree by imposing three line-of-business restrictions on the Bells. The RBOCs were
prohibited from manufacturing in the United States, from offering long distance
telephone service, and from entering the information services market. As a result of
negotiations between AT&T and the Department of Justice, it was later determined that
the cellular and directory business would go to the RBOCs.
The historic consent decree was administered by the Department of Justice
through much of the Reagan Administration, the Bush Administration, and into the
Clinton Administration. By the mid-eighties, it was becoming obvious to Wall Street,
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industry leaders, and many in Congress that telecommunications policy did not belong in
the courts. The “Baby Bells” had not had a role in their creation and found themselves
negotiating with both the Courts and the Congress for relief from some of the business
restrictions that had been placed on them. Converging technologies, cable and spectrum
legislation, and new technologies made the removal of these restrictions essential for the
future growth of the operating companies. Our assignment in the BellSouth Washington
office was to encourage legislation that would remove these three line-of-business
restrictions.
Through various means and strategies, two of the line-of-business restrictions
were removed in the late eighties and early nineties. The remaining long distance
restriction, which represented an approximate ninety billion revenue stream, became (at
least among industry players) the focus of the 1996 Telecommunications Act. Battle
lines were drawn and the line up was the RBOCs versus their former powerful AT&T
parent along with other long distance companies including MCI, Sprint, and WorldCom.
Millions of dollars were spent and an entire industry of lobbyists, advertisers, consultants,
journalists, and experts was created to deal with this massive legislative campaign during
the decade prior to the passage of the 1996 Act. Each of the industries and technologies
involved in the “telecommunications” legislative debate were huge including
entertainment, newspapers, electric utilities, computers, software providers, television,
cable, telephone, radio, and wireless communications companies. A June 8, 1995 quote
from a Wall Street Journal article captures the significance in terms of industry interest,
“a recent committee markup was packed with lobbyists, many of whom paid $ 1,000 for
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their seats by hiring a student to wait in line for three days to reserve a spot.” The
conglomeration of players had large numbers of employees and distribution networks
worth almost $1 trillion in annual revenues. Those interests included but were not
limited to every major communications company in the world. (See Appendix D)
The process of legislation was extremely complicated and involved each branch
of government in a continuum of time and effort. Five of the world’s largest industries
were beginning to converge: computing, communications, consumer electronics,
entertainment and publishing resulting in a rewrite of the 1934 Act. A depiction of a
model used internally by our company during the late eighties demonstrates the complex
nature of the process. (See Figure B)
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Figure B: Model of Input/Output Points Used by BellSouth during the 1996 Act
AT&T
FEDER
COMMUNICATIONS
COMMISSION
MATT REESE
a CO,
USER
COALITIONS
INDIVIDUAL
USER
COMPANIES
CUSTOMERS
a PUBLIC
O.M.B
U .S. C. OF C,
N.A.M
HOUSE
REPUBLICANS WHITE HOUSE
MED A RURAL
TEL. COs
I SENATE
HOUSE
DEMOCRATS
OUTSIDE
CONSULTANTS
CONSUMER
GROUPS
LABOR
UNIONS
STATE
REGULATORS
& NARUC
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As shown in the illustration, the user coalitions, that included the new schools and
libraries coalition along with many special interest groups was but a small fraction of the
overall picture. As Congress rewrote the rules for the industries that generated
approximately 1/6 of the nation’s gross domestic product, the lives of almost every
person in the United States were affected. The model gives you a visual idea of the
complexity involved with the process; it was a massive effort. As mentioned earlier, the
bill signing ceremony included a cross section of 250 private and public sector leaders,
including Vice President A1 Gore, House Speaker Newt Gingrich, Bob Allen, President
of AT&T, Ray Smith, President of Bell Atlantic, and other dignitaries at the United
States Library of Congress building. For the previous sixty-two years, the basis of
communication law in the United States had been legislation that was written at a time
when the telegraph, telephone, and radio were the only means of electronic
communication. In 1996, the telephone had turned 120 years old and the computer
turned fifty. President Clinton, in remarks made at the ceremony, equated the act of
creating the “information superhighway” with that of the Interstate Highway Act of 1957,
“that the same spirit of connection and communication is the driving force behind the
Telecommunications Act of 1996.” Although the 280-page bill is predominantly
technical in nature regarding markets and regulation, the highlight of the signing
ceremony was an item buried deep in Section 254 of Senate bill 652. S.652 is the
Senate’s version of the Telecommunications Bill that expanded the concept of universal
service to provide, among other principles, that all elementary school classrooms and
libraries should have access to telecommunications services for educational purposes at
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discounted rates. One must understand the origins of Universal Service to fully
appreciate the story of how and why the Schools and Libraries amendment came to past.
While story of the telephone instrument started in 1870, the underpinning of the concept
of universal serviee goes even further back.
“The telephone began as a novelty, became a necessity and is now
regarded as an absolute right”
Marshall McLuhan
Origins of Universal Service
Alexander Graham Bell and Thomas Watson are credited with the inventing the
“telephone” in 1870. In 1876, within a few hours of each other both Bell and Elisha
Gray, a prominent American electrician, filed for a caveat patent on the invention. This
resulted in one of the greatest patent litigations in history. As it turned out, history
generally credits Bell with the invention of the telephone. The name of the instrument
itself is derived from the two Greek words for far (tele) and voice (phone). “ Mr. Watson,
come here, I want yo u !” Alexander Graham Bell was in the bedroom of his home (his
laboratory) trying to experiment with sending sound over wire with the use of batteries.
According to myth, he had just spilled sulfuric acid all over his clothes. With what was
described as amazing clarity, an astonished Watson noted, “the tone of his voice
indicated he needed help!”^ So the story of the first telephone communication begins
with a simple plea from a human being in trouble. This incident brought about the
telephone’s entrance as a social force in our society. It is appropriate and symbolic that
that such an event would be involved in tapping the latent demand of human beings to
hind themselves in a concept of “community.” Bell’s instinctive use of the primitive
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telephone to summon aid in an emergency call for help began what is now commonly
referred to as telecommunication and at the time an entirely new form of “social glue.”^
The central characteristic of telephone communication is a direct person- to-
person conversation in private, with no record of words and thoughts available to others.
This foundation for “utter freedom of expression” caused Stalin to veto Trotsky’s plans
for development of a modern telephone soon after the Russian Revolution, “ft will
unmake our work, no greater instrument for counter revolution and conspiracy can be
imagined.”'* The telephone is representative of democratic societies, where individuals
can safely share ideas, opinions and reactions with one another privately without fear of
retaliation.
In this country, the use of wiretaps requires a court order and has been, at least
until recent times, used sparingly. In other countries where wiretapping and surveillance
were common, the use of telephones did not flourish as quickly. According to
Boettinger, “one of the first acts of a president of France, eager to establish a new
relationship between his government and its citizens, was to abolish the official
wiretapping headquarters.” ^ It is also noted in John Pierce and Michael Noll’s book.
Signals, that Adolf Hitler stopped telephone development in Germany by imposing large
taxes, thus limiting the freedom of expression.^
“Community” and “communications” share the same etymological Latin root,
communis—to have in common. The fundamental component of society is the
community. Community devolves out of communion of interests and experience.
Communion develops from a give and take communication process that is free, constant.
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and universal. When we are isolated by a communication breakdown, we are truly
isolated from the security, involvement and mutual dependence of community.^ Robert
Putnam, in his widely read essays, {Bowling Alone: Am erica’ s Declining Social Capital
and The Strange Disappearance o f Civic America), painted an alarming picture of just
how isolation can threaten participatory democracy.*
Because the network is a social system, its dynamics go far back in history. The
origins of the centralized network system preceded electronic and telecommunications by
centuries and lie in the emergence of postal monopolies. A key date is 1505, when the
Hapsburg emperor Maximilian 1 granted exclusive mail carrying rights to what one
would today call a multinational company, the Italian family firm. Taxis. This
concession proved to be a very rich source of revenue to the Hapsburgs, who shared in
the profits, but it also required vigilant protection from the incursion of other mail
systems. Neighboring Prussia went one step further and in 1614 established a state-run
postal monopoly.^ Before electrical communications, economic books used
“communications” synonymously with modes of transportation; that is railroads, canals,
roads, ships and bridges. Messages were generally oral reports carried by weary travelers
or written documents or letters carried from place to place. The telephone was the first
device to allow the imagery of a person, expressed by his own voice, to carry the message
directly without physical movement. This was a quiet revolution but arguably one of the
most liberating forces in the history of our country.
The concept of universal service has become one of the most debated and least
understood concepts in telecommunications policy. Its origination began with the history
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of the telephone system. Theodore Vail, who at the time was superintendent of the Post
Office’s Railway Mail Service, was offered the job as the first general manager of the
newly formed Bell Company in July 1878. There were 10,755 telephones in service at
the time. Later that year, the New England Telephone Company was formed to sell
licenses to operators of phone lines in New England. In 1879, Vail wrote to one of his
staff, “Tell our agents that we have a proposition on foot to connect the different cities for
the purpose of personal communication, and in other ways to organize a grand telephone
system.’’" National Bell Telephone Company was formed in 1879 to speed the licensing
process across the country. Meanwhile, the “Bell Telephone Companies” of various
regions were established for local service as they received their licenses. Western Union
sold its telephones to Bell in 1889 and their combined operations were chartered as the
American Bell System that remained the parent company of the Bell system until 1899.
In 1899, all of the existing Bell operations were absorbed into a parent company that was
chartered in New York City, as the American Telephone and Telegraph Company
(AT&T). Theodore Vail resigned from AT&T in 1887 after his views became
submerged by corporate financiers. The hankers viewed dividends more important than
expansion, simply as a financial endeavor as opposed to Vail’s idea of expanding the
system in order to meet demands of the public. The moneymen prevailed and Vail quit."
Meanwhile, Alexander Graham Bell was in England evangelizing his invention
with visions of its potential progressing throughout social institutions of the world.
While in London, he produced an ambitious and remarkably prophetic report on the
future of the telephone. It included many aspects of our modern day Bell system
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including the universal goal of a phone available to all in their homes and places of work
justified on the basis of the public good.
In 1901, a Boston corporate lawyer, Frederick Fish took over as President of
AT&T. His interests and skills were in protecting and defending the company against
independent telephone companies as opposed to gearing the business to customer content
and expectation.'^ Nevertheless, he grew the company and even more so the company’s
debt. By 1907, debt had grown from $60 million to over $200 million and eamings were
no longer sufficient to finance expansion. Led by J. P. Morgan, the bankers began to take
control of AT&T and Fish subsequently announced his retirement. The environment for
AT&T was one of crisis in the capital markets and a lack of investor interest. The
bankers, by that time, recognized the genius of Theodore Vail and sought him out to offer
him the position of president of AT&T and he accepted. Based on Bell’s theorized
concept, Theodore Vail implemented universal service in 1907 as a business strategy to
promote connection to and confidence in AT&T’s network.''*
One Policv, One Svstem. One Universal Service
Newspapers of the day called Theodore Vail the “Cincinnatus of
Communications,” because he reluctantly left his farm in Vermont and rushed heroically
to New York to save the Bell System. Vail knew the telephone business well from his
previous experience and immediately went to work to restore faith in the company. The
title of the first section of Vail’s first AT&T annual report to shareholders that was
published in 1908 for the year 1907, is “Public Relations.” Vail wrote “during the first
years (after the telephone was invented) such of the many imaginations...as were
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demonstrably practical were assimilated and the business was established on the lines
now followed which makes our company with its associated companies a national
system. Each year has seen some progress in annihilating distance and bringing people
closer to each other. Thirty years more may hring about results which will be almost as
astonishing. To the public, this ‘Bell System’ (the first known use of the phrase)
furnishes facilities, in its ‘universality’ of infinite value, a service which could not be
furnished by disassociated companies. The strength of the Bell System lies in this
‘universality.’” This last word became key in Vail’s favorite phrase: “One policv. one
svstem, one universal service.”'^ In 1908, Vail’s vision was expressed in a widespread
advertising campaign. His idea was that every person should have access to a telephone
and all telephones should have quick access to each other.
It was during this period that the Wireless Ship Act of 1910 (P. L. 262, 6E‘
Congress) reflected congressional intent to institute modest regulatory requirements on
the nascent wireless communications industry. Ocean going ships traveling to or from
the United States were required to have transmitting equipment if more than 60
passengers were on board the ship. This move proceeded the dramatic sinking of the
Titanic in the North Atlantic on the morning of April 15, 1912. This tragic event, with
the loss of hundreds of lives, prompted the Radio Act of 1912 in an attempt to apply
comprehensive legislative oversight to the radio industry because of airway interference
and confusion. The 1912 Act did not foresee or mention radio broadcasting. The
advancement of broadcasting technology later led to the Radio Act of 1927. This Act
asserted a public interest (a precursor to telephone universal service) in broadcasting and
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public ownership of airwaves and gave considerable discretion to a temporary
commission to decide questions of law and policy.
In 1913, the federal government believed that the consolidated Bell companies
violated the antitrust laws and forced divestiture of Western Union. Vail’s response to
the political currents was novel for the times: equating to accommodation. Unlike John
D. Rockefeller, whose struggles against the tide ended with the dissolution of his oil
empire, Vail chose to ride the tide. Not only did he accommodate, he also formed a
partnership with the public. Vail articulated a corporate and social goal that appealed to
regulators, telephone executives, and customers alike: the universal availability of
reliable, affordable telephone service, dubbed “universal service.” Soon thereafter.
President Wilson was reelected just as World War I heated up. Vail and AT&T were
ready. They demonstrated with a three-day test of wartime readiness in 1916 that the
system in existence could handle all communications required for defense throughout the
country. Twenty five thousand employees entered the ranks and volunteer battalions
from Bell personnel formed the nucleus for the Army Signal Corps.
On July 24, 1918 President Wilson proclaimed that all telephone and telegraph
operations would be under possession and control of the government, specifically the
Post Office Department. Albert S. Burleson, an ardent champion of government
ownership, was Postmaster General at the time. Vail prevailed in a visit to convince
Burleson that private ownership was in the “public interest” and a year later the company
was returned to its owners. In June of 1919, Theodore Vail became Chairman of AT&T.
He died less than a year later in April of 1920.'^
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In 1925, Walter Gifford, a Harvard graduate, who had risen through the ranks
from a payroll clerk, became President of AT&T. It was during his term as President of
AT&T in 1929 that Herbert Hoover became the first U.S. President to have a telephone
on his desk. When Roosevelt was elected President in the 1930s during the great
depression, one of the first New Deal agencies he established was the Federal
Communications Commission (FCC). Congress had first specifically regulated
broadcasting with its 1927 Radio Act that created the Federal Radio Commission
designed to regulate in “the public interest, convenience, or necessity.” The Department
of Commerce and the Interstate Commerce Commission shared federal regulation of
communications. By 1934 pressure to consolidate all telecommunications regulation for
both wired and wireless services prompted new legislation with a broader purpose.
President Franklin Roosevelt’s message requesting the new legislation and
establishment of the FCC was published in January 1934 and the Act was passed on June
19th of the same year. The Act was forty-five pages in the standard government printed
version as originally passed. The FCC came into being on July 11, 1934 as a result of
combining the powers of two former regulatory commissions. One was a major part of
The Interstate Commerce Commission (ICC) that had been regulating communications
common carriers since before World War 1 and the other was the Federal Radio
Commission. The newly created FCC has since regulated the introduction of new
technologies as they developed including: television (1935), Telex (1945), satellites
(1963), data (1978), and broadband services (1983).’*
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The FCC is Formed
One of the early acts of the newly created FCC was to initiate a comprehensive
public investigation of the Bell System. The Commissioner responsible for this
undertaking noted that for ten years there had been many demands in Congress for
government ownership of the telecommunications industry and a full-scale investigation
was necessary to satisfy the public interest. The work of this investigation consumed
four years and the findings were part of an 800-page report.'^
In a culture where competition and rivalry were considered economic progress of
the day, a “natural monopoly” which was the nature of a unified system had to meet the
awesome burden of proof put forth by the FCC. The 1938 government report was not as
detrimental as some critics desired and this allowed AT&T to continue having a
favorable approval from the general public for its service. Again national defense and
World War II diverted national attention; this time from the published Commission
report. The Justice Department postponed its proposed antitrust suit based on allegations
from the Commission report emphasizing that a strong national communications system
was deemed vital for the looming war ahead. The Bell System was charged with making
maximum contributions to the country’s defense capability and once again, it succeeded.
In today’s society, the ability to make and receive calls on the public switched
telephone network is viewed— if not as a basic human right—then at least as a necessity
for full participation in modern society.^'^ “The entitlement argument asserts that in a
modern society, telephonic communication like education, basic medical care, and postal
service, is an inherent attribute of citizenship.”^' It is somewhat akin to a social contract
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that government strikes with citizens to include open access, democratic equality, public
safety and economic security.
Early history of universal service was limited either to a passing technology or to
a government’s imposition on the use of that technology. The founding fathers
understood the importance of communications and information for commerce and
community building among the scattered settlements of the original colonies and
addressed this in several ways. For example, Benjamin Franklin proposed and the
Constitution gave Congress the power “to establish Post Offices and Post Roads.” In
1820, the Post Office was promoted out of the Treasury Department to a government
department with the aim of reaching all part of the nation as a common carrier. It was
understood that a social goal of the postal service was the diffusion of knowledge:
newspapers, books, and magazines were given large subsidies in mail rates.^^ In the late
1800’s, universal service was rooted in a “common carriage” model, where the envelope
and the message were independent, and delivery concerned only the envelope and not the
content. Access was the post office box no matter what the address, symbolized in the
television series The Andy Griffith Show, “Mayberry RFD” rural free delivery. In today’s
environment, however, the address may be the person, wherever he or she chooses to
be.^^ The First Amendment from the Bill of Rights made it elear that speech was to be
unregulated by the federal government, and the fourteenth Amendment extended the
concept to the states. Citizens were to be unrestricted in their communications. This
established a fundamental belief in the importance of communications and of access to
information for all citizens.^'*
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In Signals, a book by John R. Pierce and A. Michael Noll, the authors point out
that, “To be useful to the whole population, a service such as the mails or telephony must
be available to all, or to almost all. The post office cannot afford to bypass remote
citizens whom it is costly to serve. Neither can telephone companies. Telephone has
become so essential a part of our lives that we feel that we are entitled to have telephone
service.” They go on to say that, “Telephone service has a good deal in common with
postal service but it differs from the mails not only in the greater intensity of its
technology but in other ways. The nationwide and world wide transmission facilities of
telephone were built primarily for telephone traffic, though they serve subsidiary
purposes. In contrast, the physical transportation of letters uses a miniscule fraction of
the total system of transportation of physical objects. Telephony provides and dominates
all electronic message transmission.”^ ^ In many countries the postal service and phone
system are both government monopolies avoiding the issue of how to provide for
universal service in a competitive market.
A review of the literature on the subject of universal service reveals that what
first appears to be a simple idea can actually be a slippery and ideological concept. It can
and has been used and manipulated by various special interests throughout the
communications industry to support their case for special treatment.^^ Universal service
has meant different things at different times depending on a host of varying factors.
Consequently in every jurisdiction across the United States, from the Federal
Communications Commission (FCC) to the various state regulatory commissions, there
may be numerous definitions operating concurrently, resulting in uncertainty and
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confusion for all participants in the process.The fragmented nature of the American
sociopolitical landscape is demonstrated over 90,000 governmental jurisdictions
including fifty states, more than 3,000 counties, and many cities, villages, and townships.
This has presented a challenge in administering water supply, sewage disposal, pollution
control, highways, harbors, schools, libraries, airports, police planning, zoning, parks,
charities and many other services.^* Telecommunications policy is no exception.
Much of the research on universal service has been focused on the historical
development of this concept.^^ Other research is focused on the impact of universal
service on society, the “haves and h a v e - n o ts .A democratic political system tends
toward redistribution. In telecommunications, this has been the underpinning of policies
such as universal service and rate averaging. “As a larger percentage of household
income is used for telecommunications, not having full connectivity to the new and
powerful means of communication becomes a major disadvantage. As the marketplace
changes, the definition of universal service will expand.”^'
A paper presented to a 1979 conference in the Netherlands warned: “If
information bases are centralized and distribution facilities are limited, as they will
inevitably be, then the concept of freedom as we know it is seriously threatened. If
policy resolutions are neglected then the information revolution may effectively enslave
rather than serve people...We must not end up with two classes, an information rich and
an information poor; a small technological elite attempting to cope with a large, semi
skilled unemployed majority.Disraeli said that, ‘As a general rule the most successful
man in life is he who has the best information.’^ ^ The ancient Greeks told us that
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‘knowledge itself is power,’ and that theme was used in warning that the rise of an
information society would promote widening gaps between those individuals and
societies that are information rich and those that are information poor.^'*
How to Define Universal Service
More recently and, perhaps, more relevant to this paper, is the shift in focus
toward creating a new definition of universal service.The disjointed evolution and the
lack of a single definition of universal service made this analysis of the concept
challenging. Despite its murky development, it is clear that universal service has become
and continues to be a cornerstone of telecommunications policy in the United States. As
early as 1919, state regulatory commissions recognized that “the use of the telephone is a
business and social necessity, and .. .the efforts of a great telephone company.. .ought to
be directed to some extent toward the idea of encouraging the use of the telephone rather
than discouraging that use.” Inherent in the concept is a vague presumption that it is in
“the public interest” to seek maximum availability of an ever-increasing array of
advanced communications services. The combination of technological innovation and
the changing nature of demand for telecommunications will destroy the old natural-
monopoly character of the telephone industry.In the decade prior to the 1996
Telecommunications Act, regulators across the nation began to confront the issues
associated with universal service in an age of local competition and converging
technologies. The convergence of computing and communications technologies placed a
sense of urgency into the debate on the future of universal service. Law, economics.
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corporate strategy, social and political sciences have all contributed to the evolution of
the concept and as the debate grew, each stakeholder became more involved.
An examination of the definition of universal service starts with what many
believe is its origin in the Communications Act of 1934. Section 1, Title 1, of the
Communications Act of 1934 states: “To make available, so far as possible, to all people
of the United States, a rapid, efficient, nationwide, and world wide wire and radio
communication service with adequate facilities at reasonable charges...”
It is obvious that the above language reveals that the words universal service are
not specifically defined in the statute. A review of the legislative history surrounding the
enactment of the Act reveals that its sole purpose was actually to consolidate certain
functions of the Interstate Commerce Commission (ICC) and the Federal Radio
Commission (FRC), into the newly formed Federal Communications Commission. In
fact, the legislation changed no existing laws and had nothing specifically to do with the
modern concept of universal service. Contrary to modern perceptions regarding the
origins of universal service, research suggests that the concept was only vaguely linked to
the Act of 1934. Instead the concept [as mentioned earlier] evolved as a business strategy
shrewdly packaged in the guise of public interest rhetoric.According to Edwin Parker,
“Universal Service has never implied an entitlement program under which U.S. residents
would have a right to telephone service at government expense. Rather, the goal.. .is to
ensure that the structure of the industry makes telephone service universally accessible
and affordable.This points us to a fundamental question of who pays for universal
service in a competitive marketplace.
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Many of the common carrier sections of the 1934 Telecommunications Act came
from the old Interstate Commerce Act, but the government apparatus it set up was
considerably different. One significant difference was that a special agency was set up to
regulate the communications companies, to replace the transportation-oriented ICC in
that field. Another difference was the administrative powers granted to the FCC were
more specifically delineated and spelled out. Most important was the genius in the
drafting of the 1934 law that at the beginning of the Act, gave the FCC broad and
generally stated goals of advancing the “public interest” in available, efficient
communications services at reasonable charges. “If the FCC was careful to follow due
process, it pretty much could control or decontrol as it sees fit.”'”
As the past is often prologue, understanding the beginning of the process can offer
insight into the outcome. Students of public administration, telecommunications law, and
political science can be better served if they leam how the system works and what affects
its outputs. Politicians, researchers, education advocates, and many others framed the
schools and libraries debate in terms of the “public interest.” The term meant different
things to different participants involved in the debate, as did the definition of universal
service.
Public Interest
The concept of “public interest” is found neither in the Declaration of
Independence, the Constitution, nor any other founding document, but was first
articulated in the late 1600s by Lord Hale to reflect limitations in absolute property rights
where public usage was important. The concept of public interest was incorporated in the
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statutes establishing regulatory commissions in the early twentieth century, particularly in
the area of common carriage. What it means is far from clear; neither the FCC nor the
courts have ever defined it precisely. It often appears with the phase “public convenience
and necessity.”" * ^ In this research, it is commonly used interchangeably with the phase
“for the common good.” Just as with the definition of universal service, the term “public
interest” is often expanded to mean everything for everybody.
Government policy currently administers universal service as a system of direct
and indirect subsidies that essentially maintains basic residential service at rates deemed
affordable by regulatory authorities. An unspoken goal of Universal Service is to
accomplish it without the customer being aware that the program exists. Historically, the
support mechanisms that kept many residential rates below their cost were like a shell
game: You know they’re there somewhere; identifying exactly where can be a guessing
game."*^ Subsidized access prior to the 1996 Act was limited to basic telephony and
emergency services for individual consumers. Some states offered subsidies to schools
and other public institutions. The primary justification for this subsidization was that
“most Americans regard telephone service as a necessity.”'^ '* Many economists also
believed that it might be “socially efficient to subsidize access to the telephone network”
because of the various social and economic benefits that would accrue as a result."^^ This
is known as the “externality” argument, which attributes economic value to having more
people hooked up the network."*^
Justifications for the way universal service has been administered appeared so
self-evident that proponents of a vigorous universal service program assumed and
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sometimes affirmatively asserted that the policy, as they understood it, dated back to
early in the century thus giving the policy an exalted historical status akin to the founding
principles of the republic. According to Thomas Duesterberg, “such an origin myth,
appealing as it may be to egalitarian instincts, lacks historical credibility.
In 1907, when Vail first used the term “universal service” it was to emphasize the
need for a monolithic system that would allow a subscriber to talk to any other
subscriber. His frequently quoted words, “one policy, one system, and universal
service,” served the country well for over a half of century. The vision of “universal
service” was presented as an alternative to the existing fragmented telephone networks
that lacked interconnection. He championed “universal service” as an ideal because it
furthered his “drive to achieve political support for the elimination of competition and the
establishment of regulated monopoly.”" ^ * It was Theodore Vail, President of American
Telephone & Telegraph Company, who also said in 1910, “Competition— effective,
aggressive competition— means strife, industrial warfare; it means contention; it
oftentimes means taking advantage of or resorting to any means that the conscience of the
contestants or the degree of the enforcement of the laws will permit.”^^ Although the
words in the preamble to the 1934 Act sound grand, nothing really happened to validate
the concept of “universality” until around 1945. By then, penetration of telephones in
U.S. homes was approximately forty to fifty percent. Universal service as it is known
today came into full bloom sometime between 1945 and the early 1960’s. The FCC and
state regulators often invoked the goal of universal service to justify pricing schemes that
restricted competition and promoted maximum penetration of phone service. The
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universal service concept took on an egalitarian color during the 1960s when competition
and antitrust lawsuits threatened to unravel the Bell System. The potential danger to
universal service now became a convenient defense for the preservation of the Bell
System.^”
The problem of formulating an appropriate universal service definition was
relatively simple when the telephone networks provided only voice communication. The
challenge was to extend the network in a way that the entire population would be served.
The most challenging problem was one of cost or paying for the connections. The
solution consisted of an elaborate set of internal subsidies, long distance services, and
local services that enabled the extension of telephone service to approximately 96% of all
homes in today’s modern society. Regulatory agencies imposed universal service
obligations on service providers as a condition of obtaining a franchise to supply local
telephone service. Carriers have been required by their state regulators to construct their
networks in all areas of their service territory and to offer basic services at standard
tariffed rates to all consumers regardless of location within the serving territory. In areas
where costs of satisfying this obligation exceeds the revenues that the carrier can expect
from the consumer, carriers are allowed to make up the difference by setting rates above
the incremental cost of providing access in other areas.
Prior to WWII, U.S. telecommunications policy permitted and fostered a de facto
telephone monopoly that was in full accord with the existing technology based upon a
paired copper wire. Competition made little sense when the costs of duplicating the
existing system to provide either local or long distance services were prohibitive.^'
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During the 1950s to advance the universal goals, regulators adopted cost recovery
strategies that allowed the monopoly phone company to subsidize the provision of local
service by charging above cost rates for long distance service and more for business than
for residence lines. This system of monopoly cross-subsidization provided the funding
mechanism to increase the penetration of telephone service in rural America. After
WWII, technology began changing drastically, first with microwave followed by coaxial
cable, then satellites and fiber optics. The computer also became an integral part of
telecommunications. It brought enormous speed and efficiency to switching; the process
that routes both voice and data messages within and between communications networks.
Technology quickly moved from an analog form of representing information to
broadband, which was able to handle data, voice, and video. As the data processing,
telecommunications, and video field came together, telecommunications policy of the
past became insufficient. In response to changing technology, the government broke up
the existing telephone monopoly by forcing AT&T to divest itself of the Bell Operating
Companies in 1984. The same year the telecommunications equipment business was
fully deregulated allowing competition in that aspect of telephone service.
With the breakup of AT&T into separate local and long distance entities, the
internal cross subsidies were no longer tenable. As a result, the FCC instituted a system
of access charges, fees paid by long distance carriers (Inter-Exchange Carriers or IXCs)
to local telephone companies (Local Exchange Carriers or TECS), to originate and
terminate calls over the local network. These access charges not only covered the cost of
originating and terminating long distance calls, but also subsidized local telephone
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service in high-cost areas. This is an elaborate method of charging access usage for long
distance calls and included the continuation of charging more for business services in
order to keep basic residential rates low (although a line is a line is a line). One of the
striking implications of competition is that it is incompatible with the concept of
maintaining universal service by cross-subsidies. The 1996 Telecommunications Act’s
overriding objective was to introduce competition into all telecommunications markets.
However, with some irony, my topic concerns increased subsidization of an expanded
universal service program.
One of the most important public policy questions throughout the debate on the
1996 Act was how to preserve universal service when growing competition threatened its
traditional funding. Eli Noam of the Columbia Institute for Tele-Information identified
three reasons for the funding crunch. First, monopolies formerly bore the cost of internal
cross-subsidies and invested to establish a critical mass of capital equipment and
technology. Now, other service providers can tap into that critical mass at little cost to
themselves, making it more difficult to maintain the system o f internal cross-subsidies
and to encourage those new providers to make long-term investments in the customers’
interest. Solutions include higher interconnection charges and government subsidies.
Second, competition reduces the likelihood of some customers subsidizing others
because subsidy-paying customers who pay above-cost rates to cover subsidies are easy
targets for competitive service providers that charge lower rates.
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Third, if there is competition among carriers, the common carrier is vulnerable to
the private carrier, which can reject or accept customers and use discriminatory pricing to
under price the common carrier.^^
The proliferation of telecommunications services such as voice mail, call waiting,
call forwarding, and other vertical services made the issue of universal service much
more complicated. In other words, with a wider range of services, it was more difficult to
develop a consensus of what should constitute “essential” services. Though there was
little disagreement on the necessity of providing 911 emergency services on a universal
basis (even though it is still not universally available), the discord became more severe
when considering other services, such as home banking, distance learning, remote
medical diagnostics, surveillance, and energy management, special services for the
hearing-impaired, automatic language translation, computer conferencing, and access to
databases.
A Developing Vision
The use of hyperbole has always had a place in the political discourse of this country and
it certainly held true during the telecommunications debate. According to M. Edelman in
his book. The Symbolic Uses o f Politics, “if politics is concerned with who gets what, or
with the authoritative allocation of values, one may be pardoned for wondering why it
need involve so much talk.” The reality is that “talk” greases the wheels of the resource
allocation process and ensures acquiescence on the part of the general population.
Verbose rhetoric is a necessary feature of political life, and “the employment of language
to sanetify aetion is exactly what makes politics different from other methods of
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allocating values.Therefore, the public policy formation process (agenda setting) can
be described as a “historically determined discursive practice, as a way of doing think
with talk.”^ * Furthermore, politics is a peculiar process that “begins in conflict and
eventuates in a solution. But the solution is not the ‘rationally best’ solution, but the
emotionally satisfying one. The rational and dialectical phases of politics are subsidiary
to the process of redefining an emotional consensus.In the case of expanding the
universal service definition, idealistic “talk” and what was perceived as gain by private
interests made the emergence of an emotional consensus possible.
According to Thomas J. Duesterberg, in his article entitled, “Slow Down
Managed Competition on the Information Superhighway,” the term “managed
competition” stepped to center stage as a working metaphor to encapsulate a new
economic policy. Spurred by the apparent discontent of the electorate with the status quo
and by an inchoate fear of the future, the new economic team that came to power brought
with it the idea that they could manage the pace of change and protect the “economic
security” of working Americans. In 1993, the metaphor began to assume real dimensions
as a new Administration worked on programs to manage international trade, health care,
and industrial innovation. The term “Information Highway” began to appear in
newspapers and articles commonly as shown in the comic strip from a Sunday edition of
the San Francisco Chronicle.(See Figure C) In 1994, the drafters of America’s
economic future set their sight on the “Holy Grail” of a high tech future, the information
superhighway.^'
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Figure C: OUTLAND Cartoon Example of Media Attention to the Issue
OUTLANP Berkeley Breathed
Z S S m
taut
m m i .
mkw. ^
m to L .
r#‘ ” “
ft-
Duesterberg pointed out that use of the term information superhighway mislead
the debate and suggested the phrase “digital revolution” would have been more accurate.
In effect, modern technology now makes it possible to translate all kinds of information,
voice, data, images, music, and text in to a common medium that can be transmitted,
processed, and used with all kinds of remote devices. Personal computers, telephones,
pagers, television sets, personal communicators, fax machines, and eash registers are all
capable of communicating, processing and displaying large amounts of information. The
telecommunications infrastructure is the medium by which the data are transmitted. This
medium works best if it is “broadband,” capable of transmitting large amounts of data
quickly. In addition to broadband fiber optic cable and coaxial cable, however, phone
lines and new types of wireless systems are capable of fulfilling this funetion to a greater
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or lesser extent. The “superhighway,” in fact, may very well involve the airwaves as
much or more than some physical wire or cable that more easily fits the metaphor.^^
In the early nineties there was general agreement by many telecommunications
scholars that the definition of universal service needed to be extended beyond basic voice
communication.^^ Both scholars and policy-makers began to focus their attention on the
redefinition of universal service. The National Telecommunications and Information
Administration (NTIA) suggested that expanded basic service should include touch-tone,
emergency communication services, services for the hearing impaired and equal access to
competitive long distance carriers. Several others sought to have voice, video and data
included in the redefined universal service concept.^'' Some scholars even suggested that
redefined universal service should include access not only to communications networks
but also to information services.One of the most comprehensive attempts to redefine
universal service was made by California’s Intelligent Network Task Force.This Task
Force redefined universal service as affordable access for virtually all citizens to: the
intelligent network; and a package of essential services that included touch-tone service,
access to emergency services, access to public information services, access to edueational
services, services for customers not fluent in English, and services for persons with
disabilities.
An array of arguments centered on the need to expand universal service
depending on which group was making the argument. As mentioned earlier, the “rights”
or entitlement argument asserts that in a modern society, telephonic communication like
education, basic medical care, and postal service, is an inherent attribute of citizenship.”^ ^
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The moral basis of this claim was that telecommunications services had now become so
important that an individual without access to them is not equipped for everyday life.
The telephone was no longer a luxury; rather a necessity. Therefore, no one, including
even the poorest individuals, “should be denied the opportunity to phone for help in an
emergency or be denied the participation in the life of the community that the telephone
provides.”^ * The concern for potential isolation led to policies that include telephone
subscription as a part of welfare assistance. This argument gained legal force through the
Montana Supreme Court ruling in 1987 providing that the lack of a telephone is a
significant “barrier to employment.”^ ^
There have been similar appeals for the provision of education, electricity, and
medical coverage on a universal basis. In the mid-1800s the masthead of the Working
M an’ s Advocate, read, “all children are entitled to equal education; all adults to equal
privileges.”^ ® The argument was that universal education was a necessary requirement
for modern life. In 1925 this sentiment reappeared in a speech by L. J. Taber, master of
National Grange, who saw access to electricity as a basic right and then implored the
electric utilities “to render conspicuous service to humanity and to bring Electrical
Sunshine to all American homes, and with it the rights of the humblest citizens are being
protected.”^' The weak link in the “rights’ argument is that they are all based on moral
judgments and are not enshrined in the constitution. This line of reasoning often works
because it does not entail a complex cost benefits test. Once a service is accepted as a
right in society, the costs become a secondary consideration. California Assemblywoman
Gwen Moore adopted this strategy for her universal service campaign in that state. She
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proposed legislation that asserted that access to a telephone was a basic right. Her
argument was grounded in a broad interpretation of the state constitution’s “free speech”
clause by the California Supreme Court.^^ The rationale for this strategy was that “if the
freedom to communicate is a fundamental right, then access to the means of
communication must also be a fundamental right. Without access, one cannot be a part
of the telecommunicating community.”
Another major argument that has been used for rationalizing universal service is
the systems benefit argument. The basic argument is that provisioning of service on a
universal basis makes it better for the social system as a whole to perform more
efficiently. In the telecommunications arena, this argument says that each additional
subscriber increases the value of the entire network so that millions of other subscribers
can now have access to the newest subscriber. The system benefit argument was used in
the debate over universal education. A quote taken from the American Monthly
Magazine says that “viewed in a political light, education is imparted, not for the sake of
the recipients, but for the state of which they are mem bers.M odern society is seen as
a mechanism in which all the different parts have to work together. Therefore, it is in the
interest of society that it educates all its members. “Where every individual thought and
deed affected the social mechanism of the whole, it became the interest of the whole to
provide the necessary education for its p a r t s . T h e logic is that the benefit that accrues
to the individual is good thing for him or her, but on the ground that his or her ignorance
would be “dangerous to the state.Thereby the tax for universal service is not a levy on
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the rich for the benefit of the poor. It is the cost borne by the society for its own
benefit.^^
Language has a significant role in universal service arguments. The new service
or expanded service is often seen as “a fairy wand of social reform.”’^ Universal
education was viewed as an antidote to poverty, intemperance, and social unrest. Rural
electrification, which became “a symbol to save farmers,” was expected to improve the
quality of rural life and thereby stem the depopulation of rural area.’* Likewise, the
telecommunications infrastructure was now becoming the savior for the future, moving
our society into the information age with services ranging from education to medical
benefits for all. In the next ehapter, you will see how the Universal Serviee concept
begins taking on new meaning beginning in 1962 through the mid nineties.
Chapter Two Endnotes:
‘ Noll, 1998, pp. 322-324.
’ H. M. Boettinger, The Telephone Book, (New York; Riverwood Publishers, 1977) p. 66.
^ Ibid., p. 76.
Ibid., p. 16.
^ Ibid., p. 16.
^ John R Pierce and A. Michael Noll, Signals, The Science of Telecommunications,
Scientific American Library, W. H. Freeman and Company, New York, 1990, p. 2.
’ Everett Parker, “A Modest Proposal on Behalf of Democraey, Publie Interests and
Mergers in the Field of Communications,” Vital Speeches o f the Day LXll (2): pp. 47-
49.
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Robert D. Putnam, “Bowling Alone: America’s Declining Social Capital,” Journal o f
Democracy, Vol. 16, No 1, January, 1995, “The Strange Disappearance of Civic
America,” The American Prospect, No. 24, 1996.
^ James H. Alleman and Richard D. Emmerson, Perspectives on the Telephone Industry,
(New York: Harper and Row Publishers, 1989), pp. 4-5.
Boettinger, 1977, pp 18-27.
"john R. Pierce and A. Michael Noll, Signals, The Science of Telecommunications, W.
H. Freeman and Company, New York, 1990, p. 8.
Kenneth P. Todd, Jr., A Capsule History o f the Bell System, (American Telephone and
Telegraph Company, New York, N.Y., 1977), p. 30.
Ibid., p. 34.
Ibid., p. 35.
Ibid., p. 36.
Boettinger, p. 169.
Todd, p. 48.
Todd, p. 45.
’^Boettinger, p. 174.
^^Milton Mueller, “Universal Service in Telephone History: A Reconstruction,”
Telecommunications Policy 17, July 1993, pp. 352-69.
I. S. Pool, “Competition and Universal Service: Can We Get There from Here?”
Disconnecting Bell: The Impact o f the AT&T Divestiture, by H. M. Shooshan, III, (New
York: Pergamon, 1984) pp. 112-31.
D. V. O ’Neil and C. H. Huff, “Ensuring Universal Access to Telecommunications
Technologies for All,” IEEE International Symposium on Technology and Society, South
Bend, Indiana, June 12-13, 1998.
Jorge Reina Schement, Rebecca R. Pressman and Laurance Povich, “Transcending
Access Toward a New Universal Service,” Conference on Universal Service in Context:
A Multidisplinary Perspective, New York Law School, December, 1995.
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63
McKnight and Russell Neuman, “Technology Policy and the National Information
Infrastructure, ” The New Information Infrastructure: Stratesies for U.S. Policv. edited
by William Drake (New York: The Twentieth Century Fund Press, 1995).
^^Pierce and Noll, 1990, p. 214.
C. R. Blackman, “Universal Service: Obligation or Opportunity,” Telecommunications
Policy, Vol. 19, no. 3, 1995.
Robert K. Lock, Jr., “Breaking the Bottleneck and Sharing the Wealth: A Perspective
on Universal Service Policy in an Era of Local Competition” (1995).
^*W. Zelinsky, The Cultural Geography o f the United States, (Englewood Cliffs, N.J.:
Prentice Hall, 1973).
Herbert S. Dordick, “Toward a Universal Definition of Universal Service,” Universal
Telephone Service Ready fo r the 2P ‘ Century, Annual Review of the Institute for
Information Studies, A Joint Program of Northern Telecom Inc. and The Aspen Institute,
1991.
H. E. Hudson and E. B. Parker, “Information Gaps in Rural America:
Telecommunications Policies for Rural Development,” Telecommunications Policy,
1990.
Eli Noam, Corporate and Regulatory Strategy fo r the New Network Century, (New
York: Columbia University, 2001).
T. R. Ide, ‘The Information Revolution,’ in J. Bertrig, S. C. Mills and H.
Winter sberger, eds. The Socio-Economic Impact o f Microelectronics, Pergamon Press,
Oxford, 1980, p. 40.
Benjamin Disraeli (Earl of Beaconsfield), Endymion, (London: Longman, Green and
Company, 1881), p. 155.
Benjamin M. Compaine, Information Gaps: Myth or Reality? Incidental Paper from the
Program on Information Resources Policy, (Cambridge, Massachusetts: Harvard
University, January 1992), p. 5.
NTIA Report, 20/20 Vision, U.S. Department of Commerce, March 1994.
D. Horwitz, “The Irony of Regulatory Reform,” (New York: Oxford University Press,
1989), p. 122.
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Harvey E. Hunter, “Pricing Telephone Service in the 1980s,” Danielsen and
Kaneescher, Current Issues in Public Utility Economics, (Lexington, Mass.: Lexington
Books, D.C. Heath and Company, 1983).
Horwitz, 1989, pp. 120-22.
Mueller, 1993.
Parker, et ah, 1989, p. 59.
Fred W. Henck and Bernard Strassburg, A Slippery Slope (New York: Greenwood
Press, 1988), p. 3.
Harold Furchtgott-Roth, from remarks before the Federalist Society, Federalist Society
National Convention, November 12, 1998.
Carol L. Weinhaus and Anthony G. Gettinger, Behind the Telephone Debates,
(Norwood, N.J.: Ablex Publishing Company, 1988) pp. 64-66. For a more complete
overview of Universal Service, see Carol Weinhaus, Bob Lock, et. ah, presentation at the
Communications Media Center, New York Law School, Telecommunications Industry
Analysis Project, December 6, 1995.
Peter K. Pitsch and David P. Teolis, “Updating Universal Telephone Service,” Hudson
Briefing Paper, no. 167, Indianapolis, Aug. 1994, pp. 4-5.
Federal Communications Commission, “The Effects of Higher Telephone Prices on
Universal Service,” staff report prepared by Kenneth Gordon and John Haring,
Washington, D.C., March 1984, p 7.
Thomas J. Duesterberg and Kenneth Gordon, Competition and Deregulation in
Telecommunications, (Indianapolis: Hudson Institute, 1997), p. 48.
Ibid., p. 48.
Mueller, 1993.
Steve Coll, The Deal o f the Century (New York: Atheneum, 1986), p. 1.
Harmeet Sawhney, “Universal Service: Prosaic Motives and Great Ideals,” Journal o f
Broadcasting and Electronic Mail Media, Fall 1994, 38 (4), pp. 375-95.
Sawhney, pp. 375-95.
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Henry Geller, “Telecommunications Policy Today: Against Technology,” Issues in
Science and Technology, Winter 1986, p. 32.
^^Eli Noam, Corporate and Regulatory Strategy fo r the New Network Century, (New
York: Columbia University, 1993).
Ibid.
Ibid.
Sawhney, 1994, pp. 375-95.
Murray Edelman, The Symbolic Uses o f Politics, (Urbana and Chicago: University of
Illinois Press, 1967) p. 114.
T. Streeter, "The Cable Fable Revisited: Discourse, Policy, and the Making of Cable
Television," Critical Studies in Mass Communications, 4. 1986, pp. 174-200.
Laswell, 1962.
60
Berkeley Breathed. Outland, San Francisco Chronicle, Sunday, January 30, 1994, p 3.
Thomas J. Duesterberg, “Slow Down Managed Competition on the Information
Superhighway,” Commonsense, A Republican Journal o f Thought and Opinion, Vol. 1,
Summer 1994, No. 3. National Policy Forum, Washington, D.C., pp. 109-10.
Ibid., Duesterberg, 1994, pp. 109-12.
Gilliam, 1986. et al. (Gillan 1986; Hadden 1991; Information Infrastructure Task Force
1993; NTIA 1988; O ’Connor 1991; Office of Technology Assessment (OTA) 1990;
Parker, Hudson, Dillman, and Roscoe 1989; Williams 1991).
Barbara O’Conner, “Universal Service and NREN,” Universal Telephone Service,
Annual Review of the Institute for Information Studies, A Joint Program of Northern
Telecom, Inc. and The Aspen Institute, pp. 93-107.
Dordick, 1991,Williams and Hadden 1991.
Pacific Bell Archives, 1988.
Pool, 1984, pp. 112-31.
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Ibid., 1984.
Susan Hadden, “Technologies of Universal Service,” Universal Telephone Service ,
Annual Review of the Institute for Information Studies, A Joint Program of Northern
Telecom Inc. and The Aspen Institute, 1991, pp. 53-92.
F. M. Binder, "The Age of the Common School, 1830-1865," (New York: John Wiley
and Sons, 1974).
D. Nye, Electrifying American: Social Meaning o f a New Technology, (Cambridge,
MAiMlT Press, 1990).
Gary Jacobson and Gregory L. Bovitz, "The Electoral Politics of Budgets and Deficits,
1980-1996," (San Diego: University of California, 1989) Prepared for delivery at the
1998 Annual Meeting of the American Political Science Association, Boston,
Massachusetts.
R. Jackson, An Open Approach to Information Policy Making: A Case Study o f the
Moore Universal Telephone Service Act, (Norwood, NJ: Ablex, 1989).
S. Ditzion, Arsenals o f a Democratic Culture, (Chicago: American Library
Association, 1947).
^^J. Strong, Our Country, (Cambridge, MA :Harvard University Press, 1963).
F. T. Carlton, Economic Influence Upon Educational Progress in the United States,
I820-I850, (New York: Columbus University Press, 1966).
Ditzion, 1947.
78 -
'Nye, 1990.
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Chapter Three: THE SEEDS OF EXPANSION
AND INTEREST GROUPS
Among the first recorded descriptions of the social interactions that could be
enabled through networking was a series of memos written by J. C. R. Licklider of MIT
in August 1962, discussing his “Galactic Network” concept.' He envisioned a globally
interconnected set of computers through which everyone could quickly access data and
programs from any site. Licklider was the first head of the computer research program at
the Advanced Research Projects Agency (ARPA), starting in October 1962.^ The
Advanced Research Projects Agency changed its name to Defense Advanced Research
Projects Agency (DARPA) in 1971, then changed it back to ARP A in 1993, and back to
DARPA in 1996.
Preliminary discussions for the design of the ARPANET (Advanced Research
Projects Agency NET) began in 1967. In 1969, the U.S. Defense Department
commissioned ARPANET to link researchers with remote computer centers, allowing
them to share hardware and software resources including databases. In the early 70s,
researchers began work for the Department of Defense, on a series of high-speed links
between educational and research institutions and major supercomputer sites. The
original ARPANET itself split into two networks in the early 1980s, the ARPANET and
Milnet (an unclassified military network), but connections made between the networks
allowed communication to continue.^ While access to the ARPANET was limited to the
military, defense contractors, and universities doing defense research, other decentralized
networks were beginning to appear. UUCP, a worldwide UNIX Communications, and
USENET (User’s Network) came into being in the late 1970’s serving the university
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community and commercial organizations. In the early 1980s, CSNET (Computer
Science Network) and BITNET began providing nationwide networking to the academic
and research communities. In 1986, the National Science Foundation Network
(NSFNET) linked researchers across the country with five major supercomputer centers.
After extending to midlevel and statewide academic networks, the NSFNET began to
replace the ARPANET for research networking.'' Infrastructure terms developed which
included in order of their evolution: the Internet, World Wide Web (WWW), National
Information Infrastructure, and Information Superhighway.^ The National Research and
Education Network (NREN), an offspring of DARPA, was first proposed in 1988 as a
federally funded telecommunications infrastructure that would expand, upgrade, and
interconnect the existing arrangement of scientific research networks, including the
National Science Foundation Network (NSFNET).
Meanwhile, during the seventies, the AT&T antitrust suit was in the news and
revolutionary improvements in telecommunications and information technologies were
occurring daily. Convergence of computers, televisions and telephones put pressure on
industry to consider consolidation and new lines of business. With the passage of a new
antitrust bill, known as Hart-Scott-Rodino Pre-merger Notification Act, the Justice
Department Antitrust Division gained broadened investigative powers. There was talk
of a “consumer revolution” and voters were very suspicious of mammoth corporations
that dominated the nation’s economic landscape. In testimony before the Senate
Judiciary Antitrust Subcommittee on July 30, 1973 William McGowan, the Chairman of
MCI, testified that:
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AT&T operates under a philosophy that not only
should they supply all communications services but
that communications services should be provided by
a universal plan. They are extremely reluctant ever to
have anything designed to deviate from that plan.
Now, part of this you can understand in that they do
not wish their plan to become obsolete, because they
have some $60 billion invested in it. Now, that
universal plan supplies satisfactory telephone service.
That’s a basic monopoly and obviously, we get what
we pay for. So, as far as telephone service— yes, they
can supply that. But once you start leaving that one
area o f monopoly service, then you start getting to the
point where we are in trouble and we are going to get
more and more in trouble. The data processing
industries, for example, have been before the FCC
and have stated that unless they get better, more
adaptable communications, their industries will be
hurt bad. And, I can see the United States falling
further and further behind. We are not making the
progress necessary.®
Competition, deregulation, and privatization were begirming to be discussed to
help spread the technical innovations of recent years.
It was in this environment in the spring of 1977 when Vice President Al Gore, Jr.
quit law school to run for the U.S. House of Representatives representing Tennessee’s
fourth district. Gore defeated Stanley Rogers in the Democratic primary, ran unopposed
and was elected to his first congressional post in 1978. He was re-elected in 1980, 1982
and 1984. Shortly after he was elected to the House, Gore met with the CEO of Coming,
who told him about the revolutionary potential use of fiber optic cable in
telecommunications. According to former FCC Chairman Reed Hundt, “The president of
Corning said that he was making a new kind of glass fiber that could carry messages at
the speed of light. ‘With something like that, said young Congressman Al Gore, Jr., you
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could build an information highway.’”^ In 1986, Congressman Gore did not run for
reelection to the House; instead he successfully ran for a seat in the U.S. Senate where he
served until 1992 when he was elected Vice President of the United States.
Congressman Gore was appointed to the Science Committee in the U.S. House
of Representatives. During the late seventies, he promoted the idea of high-speed
telecommunications as an engine for both economic growth and the improvement of our
educational system. He was one of the first, if not the first, elected official to grasp the
potential of computer eommunications to have a broader impact than just improving the
conduct of science and scholarship. Larry Smarr, founder and director for fifteen years
of the National Center for Supercomputing Applications at the University of Illinois,
called Gore an early visionary on computer networking capabilities. Smarr first heard
the term “information highway” when Gore used it during a 1983 speeeh Smarr attended
at Florida State University. Smarr said even then. Gore was emphasizing his vision of a
global information network.*
The Internet Emerges
When the Internet was still in the early stages of its deployment. Congressman
Gore provided intellectual leadership by helping create the vision of the potential
benefits of high speed computing and communication. He sponsored hearings on how
advanced technologies might be put to use in areas like eoordinating the response of
government agencies to natural disasters and other crises. He chaired the Congressional
Future Caucus in the House that featured speakers such as Robert Kahn and Vinton Cerf,
early initiators of the Internet. According to Chris McLean, these new young Members
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of Congress, including Congressman Tim Wirth, Gore and others were considered the
techies and were often referred to as the “Atari Democrats.”^
Meanwhile in 1975, at the request of Congressional Democrats, Alvin Toffler, a
well-known futurist, organized a conference on futurism and ‘anticipatory democracy’
for Senators and Members of the House. They invited a young congressman named
Newt Gingrich (R-Georgia) who had worked with Alvin and Heidi Toffler, authors of
Future Shock and The Third Way, in the early 1970s when he was an Assistant Professor
of History at West Georgia State College. According to Gingrich, “I was fascinated with
the intersection of history and the future, which is the essence of politics and government
at its best.”'* ’ He attended the conference that led to the creation of the Congressional
Clearinghouse on the Future. This group was eventually co-chaired by Senator Al Gore.
Gingrich, Gore-like, would rise within the Third Wave/Third Way movement, and
become a member of the executive committee of the Congressional Clearing House on
the Future, and with the praise of Toffler as possibly “the single smartest and most
successful intellectual in American politics.” '' New American Senior Editor William F.
Jasper, in a 1994 article, “New Age Newt: A Futurist Conservative for the 2H* Century,”
revealed that Gingrich’s embrace of the Third Way also included a collaborative effort
with Toffler and twenty New Left and New Age authors in a 1978 work, “Anticipatory
Democracy,” wherein Gingrich endorsed Governor Jimmy Carter’s socialist “planning”
agenda. The book throughout extolled the virtues of “participatory democracy,” a
revolutionary slogan popularized by Tom Hayden, Derek Shearer, and Bill Clinton, and
one directly from the eight plank of the “Humanist Manifesto 11.”'^ This knowledge is
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important as we move into the legislative history of the Schools and Libraries
amendment. It suggests that Gingrich submerged his own beliefs to fulfill his leadership
role in the Republican Party, denying his strong and outspoken belief that computers
were essential for schools and libraries in order to get the U.S. where we needed to be.
As an U.S. Senator in the 1980s, Al Gore, Jr. chaired the Senate Commerce
Committee’s Subcommittee on Science, Technology, and Space. He urged government
agencies to consolidate what at that time were several dozen different and unconnected
networks into an “Interagency Network.” Working in a bi-partisan manner with officials
from the Ronald Reagan and George H. W. Bush administrations. Gore secured the
passage of the High Performance Computing and Communications Act in 1991. This
“Gore Act” supported the NREN initiative that became one of the major vehicles for the
spread of the Internet beyond the field of computer science.'^
In 1988 Mike Nelson, currently Director of Internet Technology and Strategy,
IBM Corporation, worked for Senator Ernest HoIIings, Chairman of the Senate
Commerce Committee, as staff to the Science, Technology, and Space Subcommittee.
During our interview, he recalled the experience as being a very exciting time to be a
participant in discussions on breaking edge technologies. “There was a lot of talk about
supercomputing, commercializing the Net and developing tools and software to benefit
society.” He worked with Senator Gore and Congressman Newt Gingrich on the
Congressional Clearing House for the Future, a semi-study group that brought in experts
on biotech, global warming, and other cutting edge technology.
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Another Senate staffer, Mark Rotenberg, expressed his experience, “Gore’s
reputation as the leading supporter of computer networking was widely known, so much
so that Republican lawmakers shied away from the issue fearful the young Democratic
hopeful (Gore ran for President in 1988) would get further recognition. To Gore’s credit,
he often played down his involvement to enable passage of important legislation.'^
Al Gore’s former Chief of Staff, Roy Neel, discussed Gore’s early vision of a
schoolchild in Gore’s hometown of Carthage, Tennessee. As early as the mid eighties he
began talking about how a school child could come home, turn on their computer and
plug into the U.S. Library of Congress. Carthage is a small town of with a population of
about 2000 in rural Tennessee. "He often emphasized the point that no geographic region
of the United States, rural or urban, would be left without access to broadband,
interactive service," said Neel.'® Gore’s father, U.S. Senator Albert Gore, Sr., had lost
his hid for re-election in 1970. Senator Al Gore, Sr. wrote the legislation that established
the Interstate Highway System. Gore, Jr. pursued this theme, applying the metaphor to
the digital age that allowed an obtuse concept to enter the mainstream of politics. Al
Gore, Jr. is credited with first coining the terms “information highway” or “Information
Superhighway.” As pointed out by John Kirlin language is a powerful tool in our
democracy and certainly one can witness it throughout the development of the
information age terminology.
In 1988, a National Research Council committee, produced a report
commissioned by NSF titled, “Towards a National Research Network.” This report was
influential on then Senator Al Gore, and ushered in high-speed networks that laid the
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networking foundation for the future information highway. Another National Research
Council report dated 1994, “Realizing the Information Future: The Internet and Beyond,”
was the document in which the blueprint for the evolution of the information
superhighway was articulated and which has had a lasting affect on the way to think
about its evolution. It anticipated the critical issues of intellectual property rights, ethics,
pricing, education, and regulation of the Internet. On October 24, 1995, the Federal
Networking Council unanimously passed a resolution defining the term “Internet.” The
national discourse over the future of the Internet had begun, and the seeds of the Schools
and Libraries amendment began sprouting with the introduction of the NREN debate.
The National Research and Education Network INREN') Debate
One of the earliest technical debates regarding the initial days of the Internet took
place in the late eighties and early nineties. According to Barbara O ’Coimor, “the
outcome of the debate, which was largely ignored by the popular media because of its
technical nature, will shape the fabric of American life in the twenty first century. While
on the surface it was about gigabits and interconnection, the real debate was about a
fundamental of our society, a citizen’s freedom. The direction this issue took would
determine who had access and who did not and whether our children would have access
to a quality education.”^ ’ Futurist Alvin Toffler likened the networks being discussed in
Congress to the railroads and highways of an earlier era.'*
The debate was over NREN which was an information superhighway proposed by
Senator Al Gore, Jr. designed to meet education’s research, communications, and
instructional needs. This proposal was included in the High Performance Computing Act
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(HPCA) of 1991 (S.272) authored by Senator Gore. Gore’s original bill authorized $650
million for the National Science Foundation and another $338 million for NASA to
research and construct the NREN. S. 272, in its final version, included authorization for
five fiscal years at an average of $200 million a year. It was originally introduced as
National Research Network (NRN), however, the nation’s educators and librarians
quickly began seeing other possible applications and the proposal was changed to include
the word “education” or the NREN. Smaller amounts of federal money had been
proposed for NREN in previous years, and for the 1990 budget. President Bush
recommended to Congress, an allocation of $149 million to NREN.
Many of the proponents of the HPCA argued that the United States was facing a
serious challenge to its leadership and economic status world wide because of its lack of
a coherent policy on deployment of a universally available broadband network. The very
core of the Communication Act of 1934 that had allowed Vail’s vision of “One Policy,
One System, Universal Service” to exist for almost sixty years had already begun to
fracture and fall. One section of the HPCA, Title 1 1 1 charges the NSF with ensuring that
federally funded data base and network services could be accessed via NREN. The
services would include directories of users, digital libraries of electronic books and
journals, software libraries and research facilities. This section was touted as a “universal
service” for access to a vast knowledge base available through aeademic networks.
In 1987, MCI and IBM were awarded contracts to expand the backbone of the
NSFNET and INTERNET. The Regional Bell Operating Companies (RBOCs) were
prohibited from participating. The RBOC industry leaders and other seholars argued to
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be included as the backbone of the public switched network allowing a universal access
point, therefore, lessening the need for federal funding to extend the network. On July 25
of that year, Judge Harold Greene lifted his information services restriction and the
companies began to upgrade their voice grade network. This eventually changed the
NREN debate to a broader discussion of private expansion into the home and schools.'^
The political environment was one with economic concerns brought on by the
Persian Gulf War and recession woes. In a Senate hearing on the matter John Rollwagen,
Chairman and CEO of Cray Research, stated: “It is clear that the super computer
highway will quickly catapult U.S. based researchers into new levels of productivity and
creativity by providing not only more accessibility but also more timely results. This will
provide for greater rates of innovation, the only true offensive weapon in our economic
race for global industrial leadership and continued national security.”^ * ’ Rollwagen and
other witnesses pointed to other countries that had networks either built or planned such
as France, Germany and Japan.
As these developments were taking place within the framework of government,
the next section will look at the evolving schools and libraries issue through the eyes of
interest groups. These include: community networks, education and library, and industry.
Each segment is approached separately and chronologically based on feedback from the
interviews and for organizational purposes. Although there is some overlap, it is
representative of how the agenda developed in different streams as referred to in
Kingdon’s theory.
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Many of the activities previously mentioned led private interest groups and
individuals to began claiming ownership to the developing public network. Meanwhile,
industry reaction was focused on what was in it for their bottom line.
Communitv Networking
If information is, in the words of Thomas Jefferson, “the currency of democracy,”
dissemination of information across all sectors of American society— regardless of race,
socioeconomic status, or physical ability— is vital to each citizen’s political
empowerment.^*
As early as the 1970s, a movement of community networking known as
“Community Memory” had begun in Berkeley, California. The goal of community
networking was to provide resources and information to an entire community. At the
beginning, technically skilled citizens, students and hackers often volunteered their time
to set up primitive networks that featured job vacancies, health care information, news,
and election material to thousands. Community networking predated the Internet and
subsequently became one of its more influential promoters once connections to the
Internet were affordable and available.
In 1978, the first bulletin board service (BBS) was created in Chicago and in 1986
the first Free-Net was established in Cleveland in eonjunction with Case Western Reserve
University. In 1988, Big Sky Telegraph in Montana began an effort to link the state’s
one and two room sehoolhouses and the National Public Telecomputing Network
(NPTN) started in 1989. In 1993, the Corporation for Public Broadcasting (CPB) made
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$1.4 million available to twelve communities for public education and information on
line services.
According to Andy Oram, a correspondent for American Reporter, “It was the
community networkers who first thought of wiring the schools and libraries.Dave
Hughes, a Colorado telecommunications pioneer, put forth the idea of connecting the
schools in a more cost effective way with wireless technology that had begun to explode
with the use of cellular communications in the early 1980s. The community networkers
placed terminals wherever they thought they could find interested people, including city
halls, laundromats and community centers. Their intent was to bring modern information
technology to the masses. This included offices in lower-class neighborhoods that
offered free or cheap access and training. One of the founding organizations that
promoted Free-Nets, the National Telecomputing Network, had to close its door.
However, new ones such as the Center for Civic Networking and Association for
Community Networking and Neighborhood Online continued their efforts. This
foundation of participatory democracy continued to grow with little fanfare or publicity.
Hughes, an ex-Army colonel and former aide to Defense Secretary Robert
McNamara, believed the plans for NREN that did not even mention local schools, could
result in educational elitism. The already wealthy research universities would get
additional taxpayer paid subsidized service and the poor local school systems would get
passed over. He argued, “that implicit assumptions behind the NREN proposal are that it
will only link large research (which also may be ‘educational’ in the sense of higher
education) institutions.” The NREN under consideration would not foster the vision of a
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nation of people learning all their lives by mixing institutional education and training
with learning, formally and informally, from home, libraries, and other places such as
business or study areas. Hughes suggests, “The metaphor of the need for ‘highways of
the mind’ across this land is very deceptive. It really could turn out to mean only the
telephone and the computer. ‘Today we require multiple means for sending and
receiving messages ‘super toll roads between castles.’”^ " * In a 1990 report for the Hudson
Institute, George A. Keyworth and Bruce Abell wrote about the convergence of
technologies including receiving information into our homes and offices— copper
telephone wires for telephone traffic, coaxial cables for television signals, terrestrial and
satellite transmission for broadcast signals, mail delivery for handwritten messages,
newspaper delivery for timely printed information, photos processed at the drug store for
unique visual information, and even the homework that children carry in from school.
But when all those things can be digitized— and computer hardware and software is
rapidly becoming available to do that efficiently— we no longer need all of those separate
delivery systems. In the digital world, we can use the same pieces of equipment to move
information around and display it, sending it from place to place over a common route.
But—which route will that be? Who will have access to it? Who will be in charge? How
long will it take?^^
According to many experts, these would be central policy questions for the United
States as it made the transition from the Industrial to the Information Age. “These
questions have become increasingly difficult to evade, because the common language of
digital information is going to integrate, amplify, and restructure the industrial world over
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the next several decades. On the answers hang the fate of a vast portion of the American
technology business and our economic security.This report also suggested that the
environment was the beginning of an information-age “power to the people.” They
discussed whether there would continued subsidization of one class of user by others and
how important would it be to ensure universal access to the advanced network? Does this
become a rich/poor issue?
In the same timeframe, Rand produced a report on Universal Access to E-Mail,
Feasibility and Societal Implications. In a section on Civic Networks, Sally Ann Law
and Brent Keltner reported results from five in-depth studies on civic networks including
the Public Electronic Network (PEN), Santa Monica, CA 1988, the Blacksburg Electronic
Village (BEY), Blacksburg, VA 1993, the Seattle Community Network (SCN), Seattle,
WA 1994, the Playing to Win Network (PTW), Boston, MA 1993, and LatinoNet, San
Francisco, CA, 1994. One of the main issues of interest in this report was the major
implication of providing access to and encouraging use of electronic networks. The
results showed that there were important national benefits associated with access to e-
mail and other network serviees and that these benefits could help level the playing field
for traditionally disadvantaged populations. It was pointed out that these efforts rely on
an ongoing commitment and resources to ensure that access is available and outreach is
supported.^^
The Rand research showed that for the majority of individuals, electronic mail
was the critical first entry point to participation in electronic communities. Two issues
were particularly noted: ensuring access to computers as well as providing adequate
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training and ongoing technical support. “In addition to home access, options for network
access in public places (libraries, schools, public buildings, hotel lobbies, business
centers) should be established.” It continued, “If a U.S. goal is to exploit the potential of
electronic networks to equalize opportunities between haves and have-nots, making
computers and training available will be essential. Several studies addressed the need to
extend network access to currently underserved populations often referred to as the
“have-nots” in the ensuing debate.^*
The Benton Foundation issued a paper in 1993, “Communications Policy Briefing
I,” calling for public interest groups to join the debate on the future of Universal Service.
According to the authors, nonprofits play a big role in health, education, and civic
participation and they have a long-standing commitment to social values that run deeper
than the fiscal bottom line— such values as equity, diversity, opportunity and
participation. “We need to develop recommendations useful to policymakers and give
options to people working public advocacy, and we need to do this fast. These issues
have emerged at center stage and many of policies may be set in the next year or two,”
said Andrew Blau, Coordinator for the Benton and McArthur Foundations’
Communications Policy Project. “We need to get the message out to public interest
groups that universal telecommunications service is in their strategic interest and that
they should jump into the debate over what it is and who is going to pay for it. Why?
Because this is not just an issue for the telephone industry, it’s an issue for social
policy.”^ '^
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A number of high profile public interest groups including the Electronic Frontier
Foundation, Computer Professionals for Social Responsibility and the
Telecommunications Policy Roundtable lobbied intensely for elements of a
communication strategy that would serve the public interest. Despite vigorous and
visible lobbying to advance their agendas, there was no public interest for community
networking policies reflected in the 1996 bill.
Laura Breeden, who later joined NTIA, was an educator by background who
became interested in technology in the classroom. She began working with technology in
the early 1980s. Breeden was a grantee of a National Science Foundation research
funding to help establish the Internet in higher education. She recalls that the personal
computer was so new that people generally thought of it in terms of spreadsheets or word
processing. According to Breeden, “There was really no notion of the Internet at that
time. A major breakthrough came in the late 1980’s and early 1990’s when the issue of
Internet protocols was settled. This basically allowed users on the Internet to go from a
‘clunky’ network to a more user friendly one utilizing simpler address systems.”^ ®
In 1991, Breeden was recruited to become Executive Director of a Boston based
nonprofit organization called FarNet. This organization was made up mostly of higher
education and cooperatives. Some business interests were also represented including
Sprint and AT&T. Their mission was to promote community networking. Breeden
began working with the NREN effort and encouraging further investment in K-12
classrooms and libraries. “There was beginning to be commercial competition from the
publishers, libraries and city governments for the community networking business.
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although less true in the rural areas, and the focus seemed to move to applications for
schools and libraries.”^’
In 1993, Leslie Harris, a former civil rights lawyer, was Public Policy Director for
People for the American Way. The organization was involved in lots of conversations
about early technology adoption and public interest. They were eoneemed that the non
profit sector did not understand the necessity to participate in the debate on the future of
the world wide net. These discussions involved Andrew Schwartzman, President of the
Media Access Project and Marilyn Mohrman-Gillis, Association for Public Television,
both whom had been involved in public television and educational television projects.
This group arranged a meeting with Secretary of Commerce Ron Brown and others
representing education, libraries, and civil rights groups and began discussions about
inclusion in the information age. As Harris recalled, the issues were more about access,
“it was very amorphous at the time, and we did not understand exactly what we wanted
except to be involved because the important issues were very much about equity and
empowerment.”^ ^
Marilyn Mohrman-Gillis used her experience with the 1990 Public TV Act and
the 1992 Cable Act “Must Carry Clause” as part of a coalition for Public Right of Way.
At that point the notion was to get some kind of set-aside for public TV, schools and
libraries. The concept was that whatever new telecommunications came to Americans,
there should be some set aside for community based organizations. She recalled that
“how this little miracle happened” (a reference to the Schools and Libraries amendment)
started with draft language presented to Congressman Ed Markey (D-Massachusetts).
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Gillis referred to a eopy of a “draft bill” entitled “Public Right of Way Draft” which she
forwarded to Congressman Markey.
Jill Lesser was a lawyer in private practice in New York working on First
Amendment issues when Harris hired Lesser as Deputy Director of Public Policy. Harris
assigned her a mission to organize the diverse public interests organizations. Lesser, took
the ball and ran, starting with a ten page proposal to the McArthur Foundation for
funding, on behalf of People for the American Way and The Media Access Project. She
recalls that both Andy Schwartzman and Norman Lear were very interested in civic
media, civic participation, the digital divide and especially education. “There was a sense
of limited capacity and commercial interests versus private interests in the new space
created by this converging technology; it was about platforms and interaction, not a wide
web notion.” The organizations received the funding and according to Lesser, “the goal
was literally to get a coalition of public interest organizations including education,
libraries and civil rights groups galvanized.”^ '*
The result of this activity was a coalition called the “Open Space Coalition.”
They worked on defining: What do we need? What do we want? And how do we
articulate it? The coalition provided a way to organize the libraries, arts agencies,
schools, 0M B Watch, and other not-for-profits around issues of accessibility and
affordability. Simultaneously, the Benton Foundation had convened a group to discuss
these issues. Because the Benton Foundation was not a lobbying organization and the
groups were not competitive. Lesser worked closely with them on educating the
interested parties on the issues. Andrew Blau, representing Benton, Jill Lesser, and
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Leslie Harris from People for the American Way began to speak at different forums
across the country to groups including the National Governors Association, National
Conference of State Legislators, and the Cities and Counties Association. According to
Lesser, “they logged a lot of miles going across the country ‘prophesizing’ the issue until
it became a rallying point overtime and really caught on.”^ ^ Meanwhile, talk of the
Internet was beginning to grow and discussions with the Federal Communications
Commission had begun. Representatives from the education community believed that
they had the "best politically viable" issue and began to take it on as their own.
Sam Simon, President of Issues Dynamics, suggested that the disabilities
community had a lot to do with the seeds of the e-rate. In an interview, he mentioned that
in the 1987 Triennial Review of the ATT breakup, a review set up by Judge Harold
Greene, the theme was whether there should be “dumb appliances and smart networks” or
“smart appliances and dumb networks.” The disabled community was vocal with their
need for both and education jumped on the bandwagon. “This is really where the kernel
for special rates for education began,” said Simon.^^
Education and Libraries
The country was in a severe recession during 1980s and the nation’s education
system and libraries felt the downswing. There was deep concern about our economic
future. Many Americans were persuaded that our economic prospects were dim as long
as the quality of education continued to decline. Numerous private and public studies
and reports documented the decline of education and offered a vast array of solutions.
There were frequent debates but only scattered successes in restructuring and improving
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America’s schools. Many leaders began to recognize that the decline of the educational
system was only one of the many areas of growing concern in the economic
infrastructure. The nation’s highways and railroads, water and waste systems,
communication networks, education, and corporate structures were all areas requiring
attention to meet the challenges and global positioning for the twenty-first century. A
new national vision was beginning to recognize the interdependence of education,
information access and economic development.^^
A survey conducted between December 1982 and January 1983 by the Center for
Social Organization of Schools, published findings showing that two-thirds of the schools
in the wealthiest school districts in the USA had microcomputers, compared to 41% in
the least wealthy districts. This survey was done only five years after the introduction of
the basic Apple II microcomputer.^* Thus, the idea of computers in schools was
beginning to take hold. President H. W. Bush proposed a solution to the country’s
education crisis in this America 2000 Education Strategy in April of 1991 which pushed
for information technology to be part of the solution for education problems:
Operation Desert Strom was a triumph of American
character, ability and technology— a victory for America
and all it stands for. It helped show that our nation can do
whatever it decides to do— and our people can leam
anything they need to leam. Still, eight years after the
National Commission on Excellence in Education declared
us a “Nation at Risk,” we haven’t turned things around in
education. Almost all our education trend lines are flat.
Nor is the rest of the world sitting idly by, waiting for
America to catch up. Serious efforts at education
improvement are under way by most of our international
competitors and trading partners. Yet while we spend as
much per student as almost any country in the world,
American students are at or near the back of the pack in
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international comparisons. If we don’t make radical
changes, that is where they are going to stay. While the age
of information and communication technology rewards
those nations whose people learn skills to stay ahead, we
are still a country that groans at the prospect of going back
to school.
Many proponents of a technological solution to solve the nation’s education
problems took President Bush’s challenge to heart and argued that an electronic highway
that was equitably spread to all educational institutions in this country was the way to go.
Although there were articles and some debate in educational circles, by the time interest
groups got involved with the 96 telecommunications Act, it was almost a foregone
conclusion that moving computers into the classroom was a good idea. During the years
of debate on the telecommunications rewrite, it was not a question of why or if computers
were necessary in classrooms, but more a question about how soon classrooms would get
them.
According to A. Michael Noll in his book. Highway o f Dreams, “Technology has
not solved the problems of education, yet the search for the electronic classroom
continues.” He elaborates by suggesting that the history of educational technology has
seen a lot of failure but that education is much like apple-pie and motherhood; it is very
difficult to oppose or even question.'*'^ Along the same line of thinking, Donald J.
Stedman and Louis A. Bransford, in their paper, “Educational Telecommunications
Infrastructure: Ferment, Flux, and Fragmentation” state the following:
The crusade to develop and establish an educational
telecommunications infrastructure bears some resemblance
to the 12‘'^-century search for the Holy Grail.
“Infrastructure” has come to be viewed as the god-sent
solution to educational problems. Periodically, at
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conferences and seminars and delivered via “sound bites”
from the White House or some other political venue, we are
told that there is technological light at the end of the
rhetorical tunnel. We need to climb aboard this
infrastructure express and it will carry us at 9600 baud to
the promised land where teachers teach and students
learn.^'
As it turned out, the train had left the track and the issue of whether computers were
necessary for schools had moved out of the education arena into the world of
communications and technology.
In July, 1991 the United States Distance Learning Association (USDLA)
convened a National Policy Forum to help explore policy issues and establish guidelines
for new policy and legislation in the U.S. and in the separate states. The USDLA
represents universities, K-12 schools, and corporate training interests in an association of
thousands of members. The findings from this conference suggested that the critical
natural resources of the information age were education and access to information. “High
wage level societies will be those based on the use of highly skilled workers backed by
advanced technologies and with ready access to a deep array of knowledge bases.
Economic advances will be dependent upon improvement in intellectual rather than
manufacturing productivity. In order to compete, we must rebuild our economy to match
the needs of the information age.”" ^ ^
The report goes on to say, “This restructuring is clearly linked to economic
success and it depends on a strong education system. Redefining our national resources
is not only necessary to prepare Americans for work but, even more importantly, to
prepare them as citizens in a self-governing society. We must provide access to shared
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issues and events that will characterize the twenty first century. The cost of not doing so
may be more than a decline in our standard of living; it may also cause erosion of our
democratic tradition at an unprecedented time in history when the world is moving closer
toward the democratic model. We cannot fail in our leadership now.”" * ^
The President’s Council on Competitiveness issued a Staff Report in December
1992 that called for removing barriers to growth for the communications revolution. It
stated, “The communications revolution has the potential to revolutionize education.
Under a pilot program now underway in Mississippi, for example. Professors at
Mississippi State University can interact with student in the rural Mississippi Delta and
elsewhere, using a two-way, full motion video communications system. This system
links four high schools with two universities, a math and science magnet school, and an
education network studio. Though still a pilot project, it could be a sign of things to
come.” The report continued, “For advanced education and research, the keystone of any
great university today is a large, well-managed library. Yet, in the not-so-distant future,
it could be well within the range of our technological capabilities to provide every school
and college in America on-line access to the complete text of every book in the Library of
Congress. Indeed, the likelihood is that we can build a telecommunications system that
far exceeds such capabilities.”'^ '^
Dena Stoner was the CEO for Education Development and Research that
represented the Educational Research Laboratories across the country. She began
working on the development of Federal Education Communications and Distance
Learning in 1988. Distance Learning was one of the first technological projects used in
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the school systems. Funds had been appropriated early on through the Department of
Agriculture to the Regional Labs to learn what worked and did not work about distance
learning. Politically, the issue was of importance for the rural Members of Congress who
related education to economic development. The reality was that the problems of schools
were as critical in the inner cities as they were in the rural areas.
According to Stoner, the regional lab in Illinois had been testing the Internet in
education and found the results to be quiet successful. By this time, Stoner had begun
quiet conversations with Carolyn Breedlove, from the National Education Association
(NBA) about the need to wire the schools for access. She realized that her labs had the
expertise and other groups knew them and trusted them, NBA had the muscle but they
needed more help and reached out to the libraries and the American Federation of
Teachers (AFT), school superintendents, and schools boards. “Nobody was big enough
to do anything by themselves,” said Stoner."*^ Laurie Westly, who represented the
nation’s superintendents, had also begun to get involved. According to Westly, "Higher
education had already gotten their piece with the NRBN and now they felt it was timely
to make a push for K through 12 classrooms."'^® Senator Jeff Bingaman (D-New Mexico)
had expressed interest in working with the group and floated a trial balloon in legislation
to generate interest. Talk of the telecom bill was beginning to move around and Stoner
and Breedlove felt it was important to “take the temperature of the House” on trying to
get something in the telecommunications bill for education. Prior to this point, they had
experienced success with funding requests in the Elementary and Secondary Education
Acts but there was no language for internet technology in the schools.
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None of the people from the education community had ever worked with the
Commerce Committee since most education funding and related interests came under the
jurisdiction of the Health, Education and Welfare Committees. The group intentionally
tried to keep some eontrol over the effort and had very little communication with the
Administration or the rest of the education community including the Department of
Education. They felt that getting the schools and libraries wired for the Internet needed
to be owned by someone other than the Administration or Education Committee,
therefore, keeping the issue from becoming politicized.
With little success or help on the House side, the staff from Senator Carol
Mosely-Braun’s (D-Illinois) office called a meeting. According to Stoner, Mosely-Braun
understood something very basic, “that there was a need for something as fundamental as
the Rural Electrification Act that would set up an infrastructure and subsidy system for
the schools. With the test bed in Illinois, it made political sense that Mosely-Braun
would get involved by connecting policy with research.”'* ^ By now, their coalition had
expanded to include the libraries, school boards. National Education Association, and
Deaner’s group.
In the same timeframe, then Governor Jim Hunt (D-North Carolina) was also
lobbying Senator Mosely-Braun on behalf of the North Carolina Information Highway; a
state attempt to further connect the state-funded high-speed data link to schools in North
Carolina. The state needed additional funding help because the expense had become
prohibitive for any single state's budget. According to Stoner, "Mosely-Braun had many,
many doubts but committed to check in with other interested parties such as Senators
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Snowe, Kerrey, Exon, Burns, Bingaman, Domenici, Rockefeller, and Jeffords." The
outcome of these contacts was that they wanted “huge” amounts of information but they
were interested. The interest shown provided Stoner and group the incentive to continue
building the coalition and create language for legislation that included the Schools and
Libraries piece.
Carolyn Breedlove is a nineteen-year veteran with the National Education
Association. She remembers getting involved in 1990 while she was on pregnancy leave.
In her absence, NEA made her a lobbyist and “since all of the good topics had gone to
technology,” she asked to be assigned to the technology area."^^ Breedlove credits Carol
Elenderson, from the American Library Association (ALA) with helping her to
understand how instrumental technology was for the classroom. She had never worked
with the Commerce Committee and Henderson was quite helpful in guiding her there.
She recalls a midnight call with Dena Stoner, from the Council for Education
Development and Research, and Carol Henderson, ALA, to discuss possible language to
put into telecommunications legislation. She stated, “we (NEA) played but ALA got it
first.” According to Breedlove, “the first real heart of the 1996 bill happened because we
needed to have some comments written in response to a Markey House bill.” Michelle
Richards, National Association of School Boards, was assigned the task of working on a
letter to the Hill and suggested that all of the groups sign on to the letter making it a more
powerful document. From that point forward, a “big coalition” grew.^°
Michelle Richards learned from her experience at People for the American Way
where she had worked "public space issues" concerning use of spectrum. She recalled
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that when she went to work for the National School Board Association, “it was a time of
announced cuts in education funding of magnitudes never before heard of and it was
causing a level of panic. They were looking for alternative resources for schools and
knew it was not going to happen through the appropriation process. This led to a new
open mindedness about looking for means of funding education. The association was
beginning to understand technology and how ubiquitous it was in the workforce and
worried about having students prepared for the workforce."^'
Richards stated, “The education community realized how important technology
was in the classroom, textbooks were out of date within a year of publication, keeping
global maps updated presented a huge challenge. I was hearing from school board
members from across the country about how could we bring technology into the
classroom. Prior to the Snowe-Rockefeller-Exon-Kerrey legislation in Congress, her
group had worked with Bell Atlantic Corporation in an attempt to get discounts as a quid
pro quo for their support in a price cap proceeding at the FCC. She, therefore, knew
some of the players and had begun to learn the language of telecom.
Once a decision was made to try for getting language in the telecommunications
legislation, Richards recalls that the education community had to learn to play in the
telecom arena. They hired legal representation and “walked the halls using a lot of shoe
leather.” Her organization alone represented 16,000 school board members even before
you count the teachers, administrators, parents and local officials. Richards confirmed
that their coalition spent less than $40,000 on the entire lobbying effort and even $500
meant a “big deal” to them at that time. “It was shocking how little education had been a
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part of the telecom legislation, but the Snowe-Rockefeller amendment was a ‘huge
victory.’”
Another coalition was working on the Hill with another Member of Congress.
David Byer, formerly President of the National Association of School Boards, was
working with the legislative group at the Software Industry Association. This group had
been involved with Senator Bob Kerrey’s (D-Nebraska) office discussing the need for
more technology in the classrooms. Although Kerrey was neither on the Commerce
Committee nor the Education Committee, he had served as Governor of Nebraska and
had a keen interest in both areas. In fact, during his tenure as Governor, he negotiated a
settlement with then U.S. West, for deregulating telecommunications. Part of the criteria
was that U. S. West would discount rates for schools and libraries in his state.
Breedlove recalls that the strategy first began as a “funding strategy” with Senator
Carol Mosely-Braun (D-Illinois) and Senator Conrad Burns (R-Montana). They sought
to get language in a different part of the bill for something akin to grants. (It should be
noted that Burns later voted against the Schools and Libraries funding amendment
language.) “They (NEA) never in their lifetimes thought we could get what we got,” said
Breedlove. Tangentially, the Internet had started taking off and their ability to exchange
names, phone numbers and communicate was greatly enhanced. This was really the first
time these groups had worked together which was very unusual. There were, in fact,
certain issues that were “off the table,” for instance, school vouchers. According to
Breedlove, it was “one of the best working groups ever. We knew that this was our big
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chance. The reason it happened is because we were very passionate and tenacious,
reaching our goal was essential.”^''
There were varying opinions ahout the need for technology in the schools but the
voices most heard were the pro technology in schools voices. In an article by Alan
November entitled, “Beyond Technology: The End of the Job and the Beginning of
Digital,” November discussed how to prepare students to be flexible, adaptive, and
interdependent by re-engineering the organizational design of learning. November
pointed out, “educators may be the most physically and intellectually isolated profession
in America. We are probably the only profession that is getting computers before we get
telephones. Think about how ridiculous this would be for any other business. We must
provide the communications infrastructure to connect educators and students to the
world.”
An early reference to schools and libraries was found in a 1991 document entitled,
“White House Conference on Libraries and Information Services.” Delegates voted and
accepted ninety-five recommendations and petitions with priority recommendations
determined by a conference vote. The preamble to the document states:
Of the 95 recommendations and petitions adopted by the
Conference, 22 concern the availability and access to information
by all segments of the population. The common thread of
recommendations in this section is the strong belief of Conference
delegates that all public information must he freely and easily
accessible to all Americans.^®
The recommendations address collection development, physical and language barriers,
fees, and confidentiality aspects that pose potential obstacles to the free and ready flow of
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information. Specifically, delegates approved three recommendations from this report
that deal with the subject of my research. The first one calls for equal opportunity
through equal access to information, specifically in the nation’s rural areas. The idea of a
federal subsidy for funding technology is stated. The second recommendation highlights
the need to network all of the nation’s school libraries. Finally, the third recommendation
incorporates the concept of a national superhighway for libraries and schools. (See
Appendix E)
Industry
The Apple Classroom of Tomorrow (ACOT) project was launched in 1986 as a
means of studying the influence computers have on the learning process in K-12
classrooms. David Dwyer, Project Manager and Distinguished Scientist for ACOT,
“observed profound changes in the nature of instruction, learning, assessment and the
school culture itself.”^ ^ In his report, he suggests the ACOT project dispelled many
myths about technology through discovering that teachers adapted to computers easily;
children tended to be more involved with cooperative learning rather than learning in
isolation; student interest in computer use did not decline over time; children, even the
very young, did not find the keyboard a barrier to the use of the computer; and, software
was not a limiting factor in the learning process.^*
In 1992, the National Alliance of Business (NAB) released the findings of a study
investigating how difficult it was for the twenty five hundred small business firms to find
job applicants with basic skills.Global competition, new technologies, scientific
discoveries, changes in production techniques, and the re-engineering of work were all
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part of the “knowledge society” terminology used when referring to the new economy.
Belief that educational technology was important to the learning process was gathering
support from leaders of business. Fortune Magazine featured a story in 1992 about what
some eighty-five leading U.S. corporations were doing around the country in terms of
establishing partnerships with schools and school systems to remedy the shortfalls in
terms of corporate/industrial needs.
During the late 1980s and early 1990s much of the telecommunications industry
was engaged in battles over pricing, manufacturing restrictions, cross subsidies,
information services and other issues. A USA Today article (June 24, 1991) reports that
A1 Sikes, then Chairman of the FCC, had turned the agency into one of the most powerful
agencies of the government. “This decade, the FCC will determine if your car radio can
sound like a CD player or if you can talk to your television set. If you’re on a raft in the
middle of the Amazon River and get tracked down by phone, chances are you’ll have A1
Sikes to thank.
Aceording to a 1991 Barron’ s article, “Rattling Their Playpens: The Baby Bells
Are Pushing for More Freedom,” Judge Harold Greene would decide how and where Ma
Bell and the seven Baby Bells operate. “Individual congressmen second-guess him all
the time, but Congress as an institution cannot muster a majority to overrule him. The
lawmakers have been trying to make laws for the communications industry since the mid
seventies and have never passed a th i n g . T h e Baby Bells were fighting to determine
the future of regulation on their business. The long distance companies were fighting to
keep the Bells out of their market. AT&T and thirty-seven other members of a ‘no name’
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coalition, including manufacturers and toll service competitors, were pursuing a long-
running campaign against Consent Decree relief for the regional Bell companies.
For the Regional Bell Operating Companies, the issues at stake were framed in
various ways depending on the audience. The RBOCs organized their lobbying efforts
through the MFJ Task Force, which was made up of one vice president from each of the
seven companies. R.L. (Mickey) McGuire, Executive Vice President of Government
Affairs for BellSouth, served as Chairman of the group. The long distance companies
were led by A1 McGann, former AT&T executive, and director of the Competitive Long
Distance Coalition. In general, the RBOC position papers would start with words like:
“What Would the Impaet of Lifting the Restrictions be on the Economy?” The word
economy was substituted with: the disabled, job creation, telemedicine, education, long
distance rates, universal service, research and development, patents, infrastructure
investment, competitiveness, national security, small business, states rights and other
issues of the day.®^
On November 10, 1992, a group known as the Citizens for a Sound Economy
Foundation released a briefing document entitled, “Outlook for Communications Policy
in the Clinton/Gore Administration.” It stated that the Clinton/Gore campaign claimed
victory based on a platform of economic growth, job creation and global competitiveness.
It also stated that the Clinton/Gore campaign had supported development of a broadband
information network and increased competition in communications markets.
With this in mind, the Bell Companies were quick to frame their issues in
the context of job creation, economic development and competitiveness. In April of
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1993, a group of seven Regional Bell Operating Chief Executive Officers along
with Communications Workers of America President, Morton Bahr, visited with
Vice President A1 Gore. They presented him with a document entitled, “An
Infrastructure for All Americans: Creating Economic Growth in the 2 E ‘ Century.”
The document quoted from the President and Vice President’s recent book, Putting
People First, restating their vision for the nation’s telecommunications
infrastructure in the years ahead. In the book, their stated goal reads: To create a
door to door (high performance) information network to link every home, business,
lab, classroom and library by the year 2015 and to put public records, databases,
libraries and educational material on-line for public use to expand access to
information.
The Bell companies’ document complimented the Administration’s vision and
proceeded to underscore how freeing their companies from the restrictions could help
make the Administration's vision a reality. With supporting documentation from the
Wharton Econometric Forecasting Associates (WEFA), the report pointed out the
significant role that Bell Companies could play. The WEFA study determined that lifting
the restrictions from the companies would create 1.68 million new jobs, add $165 billion
to the U.S. Gross Domestic Product, a 1.7 percent increase over their baseline forecast;
and generate an extra $82 billion in consumer spending. As a quid pro quo, the industry
would commit to Universal Access, upgrade the public network with a $125 billion
investment to deploy high performance networks, and provide network access and
interoperability that customers needed to choose their information providers.
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A second document the Bell Companies used to frame their issues was a report on
healthcare. In July 1992, the Arthur D. Little Company completed a study entitled,
“Telecommunications: Can it Help Solve America’s Health Care Problem?” That study
quantified over $36 billion in annual cost reductions based on four telecommunication
applications.^^ This report was delivered to the First Lady’s (Mrs. Clinton's) task force
on healthcare. Secretary Donna Shalala’s Department of Health and Welfare office, and
to other policy makers in the area of healthcare. President Bill Clinton mentioned
telemedicine in a major healthcare speech to the nation in early 1992. On September 15,
1992, the administration released its “Agenda for Action-Administration Vision
Statement on Information Inforstructure” document quoting the A.D. Little study.
On August 18, 1993, the lead story in the New York Times called for “Rethinking
Phone Policy.This article finally said what the Regional Bells had been trying to get
policy makers to understand for several years. The message was clear: Washington
officials must deal with telecommunications policy.
Another article published earlier that year was right on the mark on the issue of
Universal Service. However, the author’s remarks concerning universal service seemed
to get little attention among industry lobbyists and decision makers. In hindsight, had
they heeded the message from a respected business publication, we may have improved
the Universal Services outcome in the 96 Act. In the April 19, 1993 issue of Fortune
Magazine, Andrew Kupfer fortuitously pointed out the following:
The most difficult issue government will face is how— and even
whether—to make sure there is basic, low cost service for every
American who wants a phone and other essential services that the
highway will provide. On the telephone network, that principle.
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known as universal service, has been the law of the land for 60
years. It reflects the belief that phones, like mail, electricity, and
highways, unite the nation’s people and make America strong.
The government achieves universal service through regulation.
The phone companies are obliged to hook up everyone in their
service area and charge each customer the same basic rate— even
though this can mean stretching miles of wire to a customer whose
payments won’t cover the whole cost. High profits from some
customers such as those who pay for added services like call
waiting compensate for the money losers and enable the phone
company to hit the rate of return the regulators allow.
But as competition and new technology galvanize local markets,
universal service become harder to deliver in the traditional way.
Cable companies aren’t bound by universal service rules.
Numerous businesses were involved in the early stages of the National
Information Infrastructure but the issue surrounding their involvement (at least for the
Bell companies) was about future profitability and potential markets, not universal
service. In December 1990, the CEO’s of Computer Systems Policy Project (CSPP)
member firms met with Administration officials to discuss their public policy position on
technology issues. At that meeting, CSPP was asked to assess the High Performance
Computing and Communications (HPCC) Program and provide recommendations to
increase industry’s involvement and interest. On December 3, 1991 after almost a year of
review and analysis, CSPP issued its report and video, “Expanding the Vision of High
Performance Computing and Communications: Linking America for the Future.” It
concluded that the HPCC Program was a significant and critical undertaking that would
advance research in high performance computing and networking technologies as well as
increase the use of high performance computers to solve important science and
engineering problems. In addition, CSPP commended Senator A1 Gore, Jr. and
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Representative George Brown for introducing the Information Infrastructure Technology
Act in the summer of 1992 to move the HPCC effort to a new level.
In October 1992, the CSPP made its recommendations for the 103‘ ^ ‘ * Congress,
which were to provide the foundation for an information and communications
infrastructure of the future; bring the benefits of HPCC technology to individual
Americans in areas such as health care, education and manufacturing; and develop
technology demonstration projects. A follow up report dated January 12, 1993 from the
Computer Systems Policy Project whose membership included the nation’s top
technology CEOs. (See Appendix F)
The report, entitled “Perspectives on the National Information Infrastructure”
CSPP’s Vision and Recommendations for Action. (See Appendix G) Specific to this
research, on page ten of the report, the CSPP recommended extending America’s edge in
computing and communications technologies to education services in schools,
communities, work places, and homes. The report suggested that an "information
inforstructure for lifelong learning would offer unprecedented potential for improving
lives by making knowledge readily available and usable by all Americans." Such an
inforstructure would provide a tool for addressing many of the learning needs the country
faced. The report also recommended electronic libraries for students to use on-line in the
classroom and at home.^^
In response to a solicitation from the National Science Foundation, BellSouth
issued a report on its recommendations dated March 6, 1993. Although classified
proprietary, it included BellSouth’s vision of how NSF and NREN should evolve.
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BellSouth concurred with the finding of the CSPP and suggested that the HPCC be
expanded to foster the creation of services and application to serve society’s needs such
as: K-16 education, health care delivery, manufacturing productivity and job creation,
telecommuting and access to libraries and other important databases. The report went on
to stipulate the recommended protocols and technology.^^
Thomas R. Spacek, Executive Director of National Information Infrastructure
Initiatives at BellCore, produced a document dated April 7,1993, referred to as
“Internet/NREN Update.” At the time BellCore still was the research arm for the
regional Bell operating companies. This “proprietary” document discusses the RBOC’s
commitment to the N il vision and applications and expressed the desire for increased
RBOC participation in the commercialization of the Intemet/NREN.^^
Another effort involving the telecommunications industry (RBOCs, AT&T, IBM,
etc.) in the early days of the Information Highway was known as NetDay. NetDay was
started in central California by Michael Kaufman of KQED, a public broadcast
organization, and John Gage of Sun Microsystems. It was conceived as a grassroots
drive to help bring California’s elementary and secondary schools onto the Internet, using
a combination of public volunteers and private contributions that culminated in a single,
focused day of activity called NetDay. The goal of NetDay was to install high-speed
wiring infrastructure in local schools and to enable schools to connect to the Internet.
The wiring standard was Category Five, a level of performance that allowed sophisticated
digital video and data transmission within the school.^' Also involving an effort from
private industry. Tech Corps (formed in October 1995) was a grassroots, volunteer
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organization designed to help schools prepare students and teachers for the twenty first
century by bringing the technical expertise of thousands of men and women into
America’s schools. President Bill Clinton had recently challenged Americans to help
bring the power o f computer technology into the classroom by stating, “This goal cannot
be achieved by government fiat. It can only be met by communities, businesses,
governments, teachers, parents and students joining together.. .A high tech ham-
raising.”^ ^
The Tech Corps concept built upon a program started in Massachusetts that had
successfully completed pilot projects in twelve communities and expanded to forty-seven
school districts during 1995. Five additional states launched Tech Corps in 1995
including New Mexico, Colorado, Iowa, Illinois, and Tennessee. The founding national
sponsors of Tech Corp were CEOs Thomas Wheeler (Cellular Telecommunications and
Internet Association), Robert Palmer (Digital Equipment Corporation), Bert Roberts
(MCI Communications Corporation), and Gary Beach (Computerworld, Inc.) Other
corporate partners included Cellular, Inc., Sony Electronics, Inc., Anderson & Lembke
and Dell Computer Corporation. By the end of 1996, there were thirty-six state Tech
Corps chapters. The significance of this project was that it was closely allied with, if not
an informal arm of the Administration whose goal was to challenge Americans to help
bring the power of computer technology into the classroom. It should be noted that in my
interviews with administration officials Tech Corp was, at a minimum, initiated and
utilized as a public relations tool to further the Administration's cause. This national
effort was significant to the Administration’s desire effort to gain recognition for its
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initiative to wire all the sehools and libraries across the country. In some aspects, it
appeared the Administration was leaning on private industry to do their bidding; as
understood in Washington, there is generally an assumption of a quid pro quo for the so
called “do gooders” or those who cooperate. At that point, the industry had not
anticipated legal requirement that the nation’s schools and libraries be wired.
In the Chapter Four, the role of the Executive Branch and Congress becomes
apparent. Starting with the 1988 election and circumstances surrounding the needs of
U.S. libraries, the discussions for what became known as the Schools and Libraries
amendment became more focused. The next section. Politics of the Hill, includes a look
at the Administration, the FCC and the Congress.
Chapter Three Endnotes:
' Vinton Cerf, David Clark, Robert Hahn, Barry Leiner, Daniel C. Lynch, Leonard
Kleinrock, Jon Postel, Larry G. Roberts, and Stephen Wolf, “A Brief History of the
Internet,” Version 3.31, Intemet Society, www.isoc.org/internet/history.
^ Ibid.
^ Tracy LaQuey and Jeanne C. Ryer, Internet Companion, (Reading, Mass: Addison
Wesley Publishing, 1993), p. 6.
Ibid, LaQuey and Ryer, p. 10.
^ R. H. Zackon, Hobbes’ Internet Timeline v.l. Internet Society, 2000.
http://info.isoe.org/guest/zakon/Intemet/History/HIT.html. Updated October 1, 2000.
^Coll, 1986, p. 33.
“Hundt Discusses Digitization of Broadcasting at Electronic Industries Association
Convention,” Federal News Service, January 9, 1995.
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Notes from an interview between Jonathan Shallet with Larry Smarr, July 12, 2000.
^ Interview with Chris McLean.
Steve Farrell, “Gingrich, Toffler and Gore: A Peculiar Trio,” from NewsMax.com, July
3,2001.
" Alvin Toffler, Power Shift: Knowledge, Wealth and Violence at the Edge o f the 2P ‘
Century, (Bantam Books, 1991/
Humanist Manifesto II, William P. Jasper, “New Age Newt: A Futurist Conservative
for the 2L ‘ Century,” The New American, 1994.
Robert Kahn and Vinton Cerf, “A1 Gore and the Intemet,” September 28, 2000,
Internet Correspondence.
14
Interview with Mike Nelson.
'^Rotenberg Email, in Folitech: Some Defenses o f Al Gore and his Tech-savviness,
October 30, 2000.
Interview with Roy Neel.
Roger Karraeker, “Highways of the Mind or Toll Roads Between Information Castles,’
The Whole Earth Review, Spring 1991, No. 70, pp. 1-11.
Alvin Toffler, Power Shift: Knowledge, Wealth and Violence at the Edge o f the 2P ‘
Century, Bantam, 1991.
19
Barbara O ’Connor, Universal Telephone Service, 1992.
Coalition for the National Research and Education Network Conference Report, The
Information Superhighway o f Tomorrow, Washington, D.C., 1989, p. 3.
State and Local Strategies fo r Connecting Communities, Center for Policy Alternatives
and the Benton Foundation, 1990.
^^Michael Strait, “Helping Make Ties That Bind: The Corporation for Public
Broadcasting’s Community-Wide Education and Information Services Initiative,” Ties
That Bind Conference, May 4-6, 1994, Apple Computer, Cupertino, CA.
Andy Oram, American Reporter, 1996, Andyo@0'Reilly.com.
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Karraeker, 1991, pp. 7-11.
George A. Keyworth and Bruce Abell, Report fo r the Hudson Institute, 1990, pp. 3-28.
Ibid.
Robert H. Anderson, Tora K. Bikson, Sally Ann Law and Bridger M. Mitchell,
Universal E-Mail, Rand Study, The Markle Foundation, 1995, pp. 130-152.
M. Schrage, “Information Age Passes Up Gold by Ignoring Silver,” Los Angeles
Times, Section D l, p. 12, 1993.
29
Community Policy Briefing I, Benton Foundation, (1993).
Interview with Laura Breeden.
31
Interview with Leslie Harris.
^^Ibid.
Interview with Marilyn Morham Gillis.
Interview with Jill Lesser.
Ibid.
Interview with Sam Simon.
“A Technical Guide to Teleconference and Distance Teaming,” 3 '^ ^ ’ Edition.
“School Uses of Computers - Reports from a National Survey,” No 1, Center for
Social Organizations of Schools, The Johns Hopkins University, April 1983, p. 3.
U. S. Department of Education, America 2000: An Education Strategy, Washington,
D.C., April 18, 1991, p. 1.
A. Michael Noll, Highway o f Dreams, Lawrence Erlbaum Associates, Publishers,
Mahwah, New Jersey, 1997, pp. 44-45.
Donald J. Stedman and Louis A. Bransford, “Educational Telecommunications
Infrastructure: Ferment, Flux, and Fragmentation,” A National Network, Institute for
Information Studies, 1992.
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42
USDLA National Policy Forum, “Educational Policy Recommendations,” 1991.
Ibid., pp. 2-6.
The Communications Revolution and Public Policy, “Removing Barriers to Growth,”
President’ s Council on Competitiveness, December 1992.
Interview with Dena Stoner.
46
Interview with Laura Westly.
Interview with Dena Stoner.
Ibid.
Interview with Carolyn Breedlove.
Ibid.
Interview with Michelle Richards.
Ibid.
Behrens, Steve, “Echo of the ‘public lane’ proposal: Senate backs telecom discount for
school, libraries, rural hospitals,” http://www.current.org/in/in513.html.
54
Interview with Breedlove.
Alan November, “Beyond Technology: The End of the Job and the Beginning of
Digital Work,” Educational Renaissance Planners.
White House Conference on Libraries and Information Services, Recommendations,
1991.
David Dwyer, “Apple Classrooms of Tomorrow: What We’ve Learned,” Educational
Leadership, April 1994, p. 4.
Ibid., pp. 4-5.
John G. Watson, “Edueational Technology: A Necessity for the 2E ‘ Century -W hy
The Delay?,” Thomas B. Fordham Foundation, 1994.
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Susan E. Kuhn, “How Business Helps Schools,” Fortune Magazine, Spring 1992, NY:
Time, Inc.
John Schneidawind, “FCC Chairman Turns Up Power at Agency,” USA Today,
Monday, June 24, 1991.
Thomas G. Donlan, “Rattling Their Playpens: The Baby Bells Are Pushing for More
Operating Freedom,” Barron’ s, May 20, 1991.
Documents available from the BellSouth’s Governmental Affairs Office, 1133 2 U'
Street, Washington, D.C.
Dr. Robert Blau, “An Infostructure for All Americans,” Modified Final Judgement
Task Force, April, 1993.
Arthur Schiller, “Health Care Cost Reductions,” Arthur D. Little Company,
Cambridge, MA, July 1992.
Edmund L. Andrews, “Rethinking Phone Policy, ” New York Times, August 8, 1993, p.
1 .
Andrew Kupfer, “The Race to Rewire America,” Fortune, April 19, 1993.
Perspectives on the National Information Infrastructure: CSPP’s Vision and
Recommendations for Action, Washington, D.C. 1993. Internet:
CSPP@MCIMAIL.COM.
BellSouth Internal Document, National Science Foundation Reply, March 6, 1993
(Proprietary).
Internet/Nren Update, Government Affairs Policy Council, Thomas R. Spacek,
BellCore, April 7, 1993.
NetDay: A Partnership to Bring Students, Teachers, and Schools Onto the Information
Superhighway, Technos Quarterly, Summer 1996, Vol. 5 No. 2.
Karen Smith, Tech Corp Press Release, October 10, 1995.
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“What is the first part ofpolitics? Education. The second? Education.
A nd the third? Education. ”
Jules Michelet
1798-1874
Chapter Four; GOVERNANCE: POLITICS OF THE HILL
The Administration
Vice President George H. W. Bush won the presidential election of 1988 by a
comfortable margin in part because of the economy and the popularity of President
Ronald Reagan. Bush’s famous response to all proposals for raising taxes to offset the
rising budget deficit was, “read my lips: no new taxes.” Vice President Bush recovered
from an early third place showing in the Iowa’s Caucuses, behind Senator Dole and
Reverend Pat Robertson, to force ail his opponents to withdraw from the race. Governor
Michael Dukakis of Massachusetts was the Democratic opponent. Senator Al Gore, Jr.
announced his candidacy but withdrew in the early months of the campaign.
Issues concerning the most decisive American military victory since World War
1 1 , the Gulf War, dominated much of Bush’s four-year term. With Democrats still in
control of the House and Senate, there was a great deal of posturing and haggling over
efforts to reduce the deficit. Newt Gingrich, Minority Whip of the House of
Representatives, led a majority of House Republicans to vote against a deal between
Bush and Democratic leaders in 1990 to reduce the deficit by $500 billion over the next
five years. However, Democrats demanded and eventually won a deficit reduction
package that treated Democrat constituents far better than the first version, with smaller
social spending cuts and more progressive taxes.'
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A significant event relating to the Schools and Libraries amendment happened
during this period. The Cable Re-regulation bill sponsored by Senator Al Gore passed
through both Houses of Congress. The cable industry banked on President Bush vetoing
the bill. The veto was overridden and the industry ended up with a bill they had little
input into. The rest of the telecommunications industry came out wiser for the defeat and
cable was left to rehabilitate their image. One of the ways they did this was through
public services, primarily “Cable in the Classroom.” The Cable Act also had strong
public interest provisions such as public education station set asides. The telephone
industry had gotten least some of the message and tried to frame their arguments in terms
of public interest.
Because of Bush’s popularity, most of the leading Democratic candidates
declined to run for President in 1992. After a long primary season. Bill Clinton, then
Governor of Arkansas, was nominated by Democratic Party as their candidate for
President. Clinton subsequently selected Senator Al Gore, Jr. as his running mate,
forming a southern based Democratic Presidential ticket. It should be noted that southern
states have traditionally ranked among the lowest in the U.S. in terms of education, this
“no doubt” contributed to the prioritization education received during the following
years. Here we see how timing and window o f opportunity set the stage for agendas.
The 1992 election was dominated by issues concerning the budget deficit. The
public was increasingly unhappy over the deficit and the perception that steps to reduce it
had been unsuccessful. Ross Perot made a surprisingly strong showing during the
presidential campaign with a theme of deficit reduction now. Bush ran again on “no new
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taxes,” and Clinton came in with a campaign theme of “putting people first.” Al Gore,
Jr., Clinton's Vice Presidential nominee, with support and encouragement from Bill
Clinton, had proposed that the U.S. government fund construction of an “Information
Superhighway” capable of carrying two-way switched video signals to every home and
business in America by 2015; the same year the Japanese had targeted for completing a
similarly ubiquitous broadband system in their country. This became a major campaign
theme during the election.
Clinton-Gore won the election and the Democrats took over control of both
Houses of Congress for the first time since 1980. For twenty of the last twenty four years
the White House had been under Republican control. “Their Inauguration marked a fresh
start and it felt as if something “different” had swept the town.”^ The ceremony was
referred to as “The People’s Inaugural” with free events along the Washington Mall, a
theme that paralleled the “people’s internet.”
The budget rather than “people first” became the number one priority and in 1993,
Clinton proposed a five year deficit reduction that passed Congress without a single
Republican vote in either House. This action in addition to other missteps of the Clinton
administration cost Democrats votes in the 1994 election and the result was that both
Houses of Congress, the House and the Senate, returned to Republican control for the
first time in forty years. This set up the dynamics for the House Republican Party’s
Contract with America. The contract promised, among other things, action within one
hundred days on a balanced budget amendment, tax relief for individuals and businesses,
and cuts in Aid to Families and Dependent Children (AFDC) and other welfare programs.
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The House Republicans proposed in the summer of 1995 to slash or terminate
numerous government programs and agencies, including the Department of Education.
Their professed goal was to balance the budget by 2002 while reducing taxes by some
$240 billion. The Clinton administration’s response was to agree in principle to the
popular goal of a balanced budget and smaller government while attacking the
Republicans on the grounds of how they chose to pursue their cuts: reductions in
Medicare spending for the elderly and disabled, Medicaid payments for the poor, school
lunches, student loans and environmental protection. The public sided with Clinton,
helping to revive his Presidency and paving the way for the 1996 reelection.
Not long after the 1992 election. President Clinton assigned responsibility for
technology and communications policy to Vice President Al Gore. According to Jim
Kohllenherger (who was at the time Domestic Policy Assistant reporting to Greg Simon,
Senior Domestic Policy Advisor) the new vice president’s administration learned a good
lesson from Walter Mondale’s Chief of Staff. The message was, “fight for five things:”
get included in all meetings; he a part of all decision making; have complete access to the
President; arrange weekly meetings between the VP and the President; and finally; hold
large interagency meetings. The lessons were acted upon and in early 1993 a series of
interagency meetings had hegun.^ Greg Simon called the meetings that included hut were
not always limited to Larry Irving, NTIA, Anne Bingaman, Department of Justice, Mike
Nelson, Office of Technology Assessment, Joe Stiglitz, National Economic Council,
Chris Edly, Advisor, and on occasion Reed Hundt, Chairman of the FCC.
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By February, the Vice President’s organization had begun working on their own
set of legislative principles for the telecommunications law rewrite. They recognized that
technology was the engine of growth and worked with the N il and Silicon Valley. A
National Information Infrastructure Advisory Committee was established in 1993. The
group was made up of public officials and technology executives that made
recommendations regarding information technology, particularly in the realm of
education.
On February 22, 1993, a report called, “Technology for America’s Economic
Growth, A New Direction to Build Economic Strength,” was released and signed over the
official signatures of President William J. Clinton and Vice President Albert Gore, Jr.
Highlights of the policy paper (See Appendix H) included the fact that the Government
would take a new and more active role in the development of technology. It was
announced in this document that Vice President Gore and the Office of Science and
Technology Policy would take the lead in developing new technology and science
policies and programs. Perhaps most significant from this report was the point that the
Government would invest in a national information infrastructure to be built by the
private sector but encouraged by federal policy. While telecommunications policy wonks
were working toward a solution for the telecommunications industry. Vice President A 1
Gore, Jr. was nurturing a different kind of vision. For the past decade, he had been
advocating construction of a switched broadband network capable of providing high
speed communications to every home. His vision of the school child in Carthage
connecting with the Library of Congress became the focus for many of his staff.
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Although the prospect was ambitious, the idea was in tune with a tradition
of nation-building that began long before the Interstate Highway System. When
American’s commerce consisted primarily of tangible goods, Thomas Jefferson
dispatched Meriwether Lewis to find a river route to the West Coast. Later,
govemment land grants played a major role in the construction of coast to coast
railways. The U.S. Postal Service began with a similar theme when in 1775, the
Continental Congress created the US Postal Office. This service helped a weak
confederation of colonies and created a strong country by supporting our unique
State/Federal economic model of commerce. It also supported our democratic
system by providing the free flow o f ideas and information."*
With trade and information services becoming a larger share of the
nation’s economy, the communications infrastructure was more important than
ever before and the Vice President wanted a system that would be capable of
transmitting more than words and numbers, he wanted images as well. “Our
challenge is to provide Americans with the educational opportunities we’ll all
need for the twenty first century. In our schools, every classroom in America
must be connected to the information highway with computers and good software
and well-trained teachers. We are working with the telecommunications industry,
educators, and parents to connect every classroom and every library in the entire
United States by the year 2000.” President Clinton articulated this policy in his
State of the Union Address, January 23, 1996, just weeks prior to the signing of
the Telecommunications Act of 1996 into law. President Clinton and the United
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States Congress sought to reinvent universal service, expanding it beyond
telephones, to provide universal Internet access to the nation’s schools and
libraries.^
As the Congress worked through the different versions of the
telecommunications bill, the Administration was very involved. According to
Greg Simon, “They held more hands than there were to hold.”^ Former Vice
President A1 Gore remembers these times as “some of the most exciting and
challenging of our administration. The result of the 96 Act, specifically the
accomplishment of hooking up Schools and Libraries, is something we will
always be proud of.”’
The FCC
The FCC is an independent regulatory commission with five
commissioners appointed by the President and confirmed by the U. S. Senate.
The President selects one of the commissioners to be the Chairman. No more
than three of the five Commissioners can be in the same political party as the
President, and the President may not remove the commissioners at will. The
Commission’s authority is granted by Congress to write detailed rules and
specific orders that come from laws passed by Congress. They also receive their
funding and oversight from Congress.
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In Humphrey's Executor vs. United States (1935), the Supreme
Court held that President Franklin Roosevelt lacked the authority to remove a Federal
Trade Commission member without specific cause. In a classic description of the nature
of independent regulatory agencies, the Court wrote:
Such a body cannot in any proper sense be characterized as an
arm or an eye of the executive. Its duties are performed without
executive leave and, in the contemplation of the stature, must be
free from executive control...To the extent that it exercises any
executive functions—-as distinguished from executive power in
the constitutional sense— it does so in the discharge and
effectuation of its quasi-legislative or quasi-judicial powers, or as
an agency of the legislative or judicial department of the
government.*
The same point was made directly with regard to the FCC in a ruling on discovery
matters in the AT&T divestiture case in which documents were sought from the FCC on
the same basis as executive branch agencies. Judge Harold Greene stated that “both as a
conceptual and practical matter, the Federal Communications Commission is free from
executive control and not answerable to instructions from the President.” ^
The theory of the New Deal independent agencies was that commission members
would work together in a nonpartisan manner, bringing their expertise and varied
experiences to the decision-making process. In the case of the FCC, Congress delegated
broad authority to the agency to regulate in “the public interest” which is not synonymous
with “the political interest.”'^
Reed Hundt had been A1 Gore’s friend since high school and an adviser to him in
his 1984 Senate campaign, 1988 Presidential campaign, 1990 Senate campaign and 1992
run with Bill Clinton for the White House. According to Hundt, he was the only person
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in American history to have gone to high school with the Vice President and to law
school with the President.' * Hundt realized after the 1992 election that for the purpose of
carrying out Gore’s vision for the information highway (a campaign theme), the most
important presidential appointment would be chairman of the Federal Communications
Commission. Hundt pursued this position and in early 1992 was appointed to Chairman
of the Federal Communications Commission. His duty, as he saw it, was to “fulfill Al’s
vision for the information highway.”'^ According to Roy Neel, Gore’s Chief of Staff at
that time, Hundt had met with him early on after the election where the two of them
discussed various other appointments, but Hundt was most interested in the FCC. Hundt
promised he could effectively implement Gore’s agenda.'^
Gore’s telecommunication’s policy team included Greg Simon, Commerce
Secretary Ron Brown, Gene Sperling from the Economic Advisory team, Joe Stiglitz
from the Council of Economic Advisors, Sally Katzen from the Office of Management
and Budget, Anne Bingaman, head of the Department of Justice’s Antitrust Division, Roy
Neel, Chief of Staff, and Reed Hundt (then Chairman-Designate). According to Hundt,
this group began meeting at least once every two weeks in Vice President A1 Gore’s West
Wing office to begin addressing a complete revision of the 1934 Telecommunications
Act. At the end of one of those meetings. Gore said, “Now we have to do something to
connect the schoolgirl in Carthage, Tennessee, to the information highway.”'^ Gore had
included this image in dozens of speeches since his days in the House of Representatives.
There was some limited discussion about the need for education and networks into the
school but not much more about the reason to connect all the classrooms to the
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information highway. According to Hundt, only later did this group develop a detailed
explanation of the importance of that national mission.
In 1993, less than one percent of all spending in education was dedicated to
technology. This was the same year that universal addressing called the World Wide
Weh (www) became accessible through the use of hypertext language. Hundt recalls a
meeting in the Vice President’s office to discuss the new communications law reform
being drafted in Congress. The Administration had begun to put government information
on the Web and he believed that government should also bring change to the education
world as Gore had promised in his campaign speeches. “We did not know what specific
technology would bring change to the education world. We only believed that
government should guarantee that all necessary beneficial technologies were available
equally to all students and all teachers.”'^ This is a prime example of ideology propelling
the schools and libraries program to the forefront of the national agenda.
In January 1994, Vice President Gore and Chairman Reed Hundt were in Royce
Hall on the University of California Los Angeles campus. The UCLA conference had
been organized by a Disney executive as an indirect lobbying effort on the government’s
initiative to rewrite the communications law. The purpose of the conference was to
discuss convergence of technology and the information highway. During this meeting,
Hundt met with Bell Atlantic’s Chairman, Ray Smith, and John Malone, Chairman of
TCI. They had armounced a planned merger and plans to build the information highway.
Blair Levin, Hundf s Chief of Staff, asked the merger partners about wiring classrooms,
“Would this information highway built by TCI and Bell Atlantic run all the way into
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classrooms?” Smith answered, “Sure. Schools. We already connect to schools.”
Telephone companies had for years promised officials they would give preferential rates
to schools as a quid pro quo in agreements to increase or "at least not decrease" the price
of basic dial tone service to residential consumers. Teachers in classrooms, however,
were left unconnected. When pushed further. Smith said, “Sure, if that is what they want.
We will do every classroom.”
The difference was the billions of dollars necessary to put wire or wireless
networks into the two million classrooms of 100,000 schools, as opposed to the few
million dollars it would cost to give discounted rates for the telephone in the principal’s
office. According to Hundt, he initiated and requested through Congress a McKinsey and
Company study that estimated the total cost of networking every classroom in the United
States to be about $10 billion. That sum represented less than one percent of annual
national spending on education and even a smaller percentage of the annual revenue from
the communications market. Hundt knew that if he could pull it off, that it would be the
largest single national program to aid elementary and secondary schools in the history of
the country. However, in February of 1994, after the FCC issued a major cable rate
decision that negatively impacted TCI, the Bell-Atlantic/TCI merger was subsequently
called off. So in Smith’s mind, there was likely no quid pro quo due.
In a 1994 speech before the Harvard Graduate School of Education, Reed Hundt
demonstrated his tenacity to wiring the nation's schools and libraries. Specifically, he
announced publicly that TCI and Bell Atlantic had committed to connect all classrooms
in their region to broadband networks. (See Appendix I)
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At a July 1994 dinner with Andy Grove (Chief Executive Officer of Intel) and
other Silicon Valley business leaders, Hundt listened to the discussion centered around
the desire that government was not needed to shape the convergence of the new computer
world and the old communications world. Hundt assured the Valley executives that the
“FCC would never stand for Federal Computing Commission.” Hundt then turned the
conversation to the social goal for the current Administration: to connect all children to
the new data networks through Personal Computers in every classroom.
Within a week after the Silicon Valley dinner, the Democratic House passed a
telecommunications reform bill that comported with the White House agenda crafted in
Gore’s office. It called for the FCC to order reduced rates for telecommunications use in
schools. According to Hundt, “a disappointment was that it would not necessarily let the
FCC fund the connection of every classroom to the information highway, but its language
was ‘fuzzy enough’ to pave the way for an amendment of this effect in the conference
committee negotiations that would reconcile the House and Senate versions of the bill.”'^
In an interview Reed Hundt expressed his deep passion for wiring schools and
libraries and explained the roots of his passion. Hundt briefly taught seventh grade social
studies in Philadelphia after college. As it turned out, only half of his seventh grade
would graduate from junior high school and only half of them from high school. Hundt
wanted in his govemment job to make sure that schoolchildren would have a “way to
escape poverty in the future.” He felt that the message of technology and competition did
not sell well with the America public but the message of kids and how he felt about
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education got across to people and it just happened to coincide with the Vice President’s
agenda. The Administration and the FCC began to reprogram their message.'*
With the help of Michael Sheehan, a consultant specializing in airwave
communication, Flundt narrowed his message to promote his most ambitious goal: “We
want to put communications technology in every classroom.” The campaign was
centered on four concise points; 1) A hand up, not a hand out, 2) Put the future in the
present, 3) Connect parent, teachers, and kids: We are family, 4) Equal chances for all.
Throughout the summer of 1994, according to Blair Levin, Hundt’s Chief of Staff, every
speech, news release, interview and meeting included some form of these four points.*^
Senator Ernest F. Hollings withdrew his Senate bill after failed negotiations in the
Fall of 1994. This blocked Hundt’s immediate plan for connecting the classrooms to the
information highway.
Another alternative was considered for funding the project through airwave
spectrum auctions or providing a relaxation of cable rate regulation in return for
commitments to connect the classrooms. Brian Roberts, of Comcast Cable, had publicly
announced that he favored using spectrum auction revenue to pay for putting
communications in classrooms. Another significant player in the communications
business, George Lucas, owner of Lucasfilm, met with Reed Hundt during the Fall and
expressed his vision for the future of electronic communications. Lucas explained that
the world would soon be wrapped in continuous high-speed transmissions of voices,
texts, pictures, and moving images. He felt that teachers could impart education through
stories that would inspire the unique imaginations of every individual child. Lucas
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conveyed his point that every classroom should he connected to the communications
network. LucasArts, part of the Lucas conglomeration, is a leading international
developer and publisher of entertainment of interactive software and it would appear a
beneficiary from such a mandatory connection.
In late October 1994, a communications staff person from Senator Bob Dole’s
staff advised the press that the FCC should not take any new actions until the 1994
election outcome based on their belief that Dole would he elected President. Hundt,
along with many inside Washington observers, felt that the Democrats would return to
the House and Senate in the 1995 term, however, as often happens in politics, the worm
turned. For the first time in fifty years the Republicans took control of both the House
and the Senate. The new Speaker of the House, Newt Gingrich (R-Georgia) introduced
his "Contract with America" and his intent was to liquidate the FCC along with the
Department of Commerce and the Department of Education. Gingrich’s philosophy was
that an ungoverned and ungovernable communications economy was good for business.
Gingrich agreed with Gore that technology could create prosperity, hut he differed on the
means of getting technology into the hands of the public at least after becoming the
Republican Speaker. Earlier in this paper, it was suggested that Gingrich appeared to
contradict some of his personal values once elected to lead the Republican House. In a
1995 paper presented by the Benton Foundation, The Learning Connection, Gingrich is
quoted as saying earlier that year, “There has to be a missionary spirit that says to the
poorest child in America, ‘The Internet is for you; the Information Age is for you.’”
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However, the Republican mantra was taxpayers should not be responsible for altruism
that supported their doctrine of personal responsibility.
Meanwhile, Vice President Gore met with the new Senate Commerce Committee
Chairman Larry Pressler (R-South Dakota) and Representative Jack Fields (R-Texas), the
new Telecommunications Subcommittee Chair of the House Commerce Committee.
Gore presented them with requirements for any telecommunications legislation that
would be proposed and approved by the Administration. Cormecting all schools to the
Internet was a must have. According to Hundt, the meeting was controversial and ended
with an exchange of confrontational remarks.^^
Readily acknowledging that Republicans were in charge, Hundt relayed a story
of how he invited Speaker Gingrich to visit a local Washington elementary school with
him. The children were working on computers and the message from teaehers was for
computers in the classroom. According to Hundt, Gingrich committed to him during the
visit that he would not oppose the schools and libraries effort but would not bring it up
for a vote on the House side. Obviously, no one wanted to be on record with a vote
viewed as “against edueation.” Gingrich’s interest in technology and education was
documented earlier in this research. Many observers viewed the Schools and Libraries
program as an unfunded mandate, the message of government intervention with wiring
the schools and libraries again contradictory to the Republican’s Contract with
America.^'
The FCC staff had determined during the later months of 1994 that the
“Spectrum Auction theory” for producing revenues for the schools and libraries effort
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was the best means to accomplish the goal. Spectrum can be more easily understood as
“radio frequencies” that are finite in nature and valued for new and evolving
technologies. The first auction was held on December 5, 1994, and lasted two months.
The auction, as noted in the Guinness Book o f World Records as the largest auction in
history, raised $7.7 billion for the Treasury. However, with this kind of return, it made it
increasingly difficult for the Republicans to do away with the FCC.
Meanwhile, in early 1995, both chambers of Congress had begun drafting a new
telecommunications bill. One of the issues concerned the future of digital television.
The broadcasters were asking for high-defmition television channels to be given away
while the Hundt FCC felt the FCC should be promoting a national over-the-air Internet
access network that like broadcast television would be free. The winners in this battle
would sell products that merged the feature of personal computers and televisions.
Recognizing the battle lines, Hundt arranged a meeting with Bill Gates, founder of
Microsoft in Seattle, Washington, in March 1995. Hundf s goal was to persuade Gates to
align his corporate interest and the public good and for Gates to take a lead in the
political as well as the business leadership. Hundt’s wish was for Gates to go after the
spectrum so Congress could not force the FCC to give the broadcasters spectrum for
high-defmition signals for big screen television. One can easily recognize Reed Hundt as
an entrepreneur according to Kingdon’s theory or a champion of the schools and libraries.
Concurrently, Karen Kornbluh, head of the Office of Legislative and
Intergovernmental Affairs for the FCC, reported to Hundt that the Senate Commerce
Committee was ready to debate the new Pressler telecommunications bill (S. 652) and
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that it did not have the classroom connection language in the draft. Kornbluh,
meanwhile, had discovered a group of educators that had formed a coalition to insert
language that requested a small appropriation for technology programs through the
Department of Education. Kornbluh explained the concept of universal service to them
and suggested that they push to have it expanded to include teachers and students.
Several Senators and the White House staff agreed, although the ranking Minority Leader
Ernest F. Hollings was more focused on making sure the Bell Companies were not
allowed to roll over the long distance companies. He was not focused on funding schools
and libraries. It is common knowledge around Washington that Senator Hollings did not
like the RBOCs and therefore, was focused on their barriers of entry into long distance.
Senator Jay Rockefeller (D-West Virginia) had become interested in distance
learning in order to provide quality education to rural West Virginia. He was concerned
about the prices Bell companies charged for sending live video over short distances and
was willing to give the FCC authority to order the phone companies to charge lower rates
for educational purposes. At this point, he had in mind something akin to discounted
rates. Kornbluh and group met with and convinced Rockefeller to go further and
champion the goal of the President and the Vice President to connect every classroom to
the information highway. Senator Olympia Snowe (R-Maine) also believed in the need
for distance learning. She viewed the role of government was to help poorer states. She
noticed that the provision for schools had been dropped from the Republican draft and
successfully proposed to amend Pressler’s draft to address the issue.
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On March 23, 1995 the full Senate Commerce Committee passed the entire
Senate version of the telecommunications bill. The Schools and Libraries amendment at
that point did not have language that called for installing connections in every classroom
nor did it specify that every classroom be connected but a version of the Schools and
Libraries language passed. On June 8, the full Senate began floor debate on the
telecommunications bill. Senator John McCain (R-Arizona) tried unsuccessfully to
amend the bill to delete the Snowe-Rockefeller Schools and Libraries language. The
notion failed and the amendment stayed in the bill. On June 15, S. 652 passed the full
U.S. Senate 81-18.
Although the same education coalition worked with the House side, the House
Republicans refused to insert Congressman Ed Markey’s (D-Massachusetts) language
into the House version of the telecommunications bill. On August 4, 1995, the House
passed its version devoid of any Sehools and Libraries language or universal service
language. According to Hundt, he held the Bell companies and the Speaker responsible
for killing the classroom connection proposal on the House side. “But if our side could
insert the Snowe-Rockefeller classroom connection language into the legislation
negotiated by the Senate-House conference committee charged with reconciling the two
chamber’s bills, then in the resulting FCC rulemaking, I could try to bring Gore’s dream
to reality.
From August through the end of 1995, Hundt strategized with the Administration
on aligning their message for the passage of the telecommunications bill. He met with
Anne Lewis, Director of Communications for the Clinton Administration, in October of
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1995. They discussed what the FCC was doing that people seemed to care about. Hundt
said that getting the classrooms connected to the Internet was the most important thing,
and that opening telephone markets to competition was not really a voter issue. Lewis
promised to poll the classroom connections issue and suggested that no one understood
the Internet. Hundt suggested just calling it “technology in the classroom.
In his book, Hundt says, “As a matter of law, the White House could not tell the
FCC Chairman or the commissioners how to vote. But I, as the agency head, preferred
the White House to approve of my agenda. Few are successful in any endeavor without
learning the value of partnership. Moreover, the power of the White House to drive or
block any agenda was, especially in the midst of the Gingrich Revolution, a primary
source of support.” Hundt often questioned why the FCC’s chairman should not be able
to consult directly with the White House. He suggested that the law did not prohibit
discussions, only unwritten direct advocacy on a particular issue.
On November 13, 1995, failed budget negotiations shut down the government for
a period of six days. Eight thousand government employees were furloughed and the
polls registered a huge lift for the Democrats. Again on December 15, the Congress shut
down the Executive branch of government, this time for more than twenty days. It was
during this period that final negotiations were being worked out on the conference
language for the telecommunications bill. Senator Hollings and Congressman Markey
held the conference committee hostage to the threat of a veto from the White House if the
bill did not include their demands. Hollings and Markey insisted on a compromise that
gave the FCC tremendous power to open the local telephone markets and that let the FCC
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connect every classroom to the communications networks. The Republicans had already
begun being characterized as mean-spirited because of the budget negotiations. This
window of opportunity helped allow the Snowe-Rockefeller-Exon-Kerrey provision to
remain in the conference language.
On December 20, 1995, the conference committee (a joint group of House and
Senate conferees) passed a bill that the Democrats and the White House could accept.
The Snowe-Rockefeller-Exon-Kerrey provision was included and Vice President Gore
announced that the President would not veto the bill. Gore was proud of the bill that
would connect every classroom to the Net and even announced, some would suggest
prematurely, that an agreement had been reached to the press. The Republicans were
infuriated that he was taking credit for the result of the conference committee. Senator
Dole and Congressman Fields made it clear that the Republican Congress was far from
allowing the Congress to vote on the bill. In addition. Senator Dole wanted to allow for
more consolidation of the broadcast industry.
Congress returned to work in January 1996 and both chambers voted on January 5
to reopen the government. Polling revealed that the Republicans were being blamed for
shutting down the government and interfering with family holiday vacations. Several
Republican leaders felt that the “regulatory” nature of the telecommunications conference
report was against what they stood for and there was discussion of delay. But by that
time, again a matter of opportunity, the mega industries involved in the deal were ready
to move on to the rulemaking process to in order to stabilize the telecommunications
market. This helped create pressure for a final floor vote on the bill. Public sentiment
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also called for something that showed positive action from the Govemment in
Washington. On February 1, the Senate and House passed the conference eommittee
version of the 1996 Teleeommunications Act and President Clinton agreed to sign it.
An interesting twist in the events of the Schools and Libraries program is what
happened with the spectrum auction idea. Senator Bob Dole had supported digital
television license auetions instead of the proposed give away language in the existing
versions of the two chamber’s telecommunications bill. According to David Wilson,
telecommunications staff for Senator Dole, Dole was reluctant to even vote for the bill
heeause it ordered giveaway of the spectrum to the broadcasters. To win his support for
the bill, Hundt negotiated with Dole’s staff the terms of a letter to be sent to the FCC
demanding that it hold off granting the broadcasters their digital TV licenses until spring
1997. This would have allowed Dole, if elected President in 1996, to reverse the
Telecommunication Act’s giveaway. As the literature on agenda setting suggests, there
were alternatives eonsidered.
When asked to view the Schools and Libraries program in hindsight, considering
the current pressure on the Universal Serviee Fund, Hundt stated, “We may have to
revisit it in a more intelligibly honest way at some point.”^ *
The Congress
It is a generally accepted fact around Washington that being assigned to the
Commerce Committee in Congress is a strategic and positive move for fundraising
purposes. The Chairman’s role is often coveted for its ability to raise money for
campaigns from business interests. Without trying to be cynical, “gridlock” is good for
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politicians. They are then able to raise money from one or both sides of interests on
pending legislation. The telecom legislation was no exception with major players on
each side of the debate all able to block each other’s progress.
By July, 1983, seven months after the breakup of AT«feT, thirteen bills had been
introduced in Congress to protect the concept of a universal telephone service.
Representative Edward Markey (D-Massachusetts) stated at one hearing that if telephone
service becomes a luxury, the USA could witness the creation of ‘an information
aristocraey and underelass.’^^ Senator Frank Lautenberg (D-New Jersey) made his
maiden speech to the U. S. Senate in June of 1983. In it, he warned that computers
threatened to create a new class of poor people, those without access to computers for
learning. Lautenberg described the ‘potential for new and distressing divisions in our
society’ based on a gap between children in wealthy school districts, where there is
money to provide computers, and ehildren in poor distriets.^'^
In 1984, the Cable Communieations Policy Act was amended to the 1934
Communications Act to proscribe national policy regarding the cable television industry.
The Cable Act of 1984 was changed with the passage of the Cable Television Consumer
Protection and Competition Act in 1992. The momentum of that effort carried over
through the next several years as Congress made attempts to rewrite the Communications
Act of 1934. It also paved the way for additional public interest issues.
The House
H.R. 3515 was introduced on October 8, 1991 by Congressman Jim Cooper (D-
Tennessee) along with several other original cosponsors. The purpose of the bill was to
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amend the Communications Act of 1934 to encourage competition in the provision of
electronic information services, to foster the continued diversity of information sources
and services, and to preserve the universal availability of basic telecommunications
services. The bill was known as the newspaper publisher’s bill because the publishers
were concerned about losing their classified ad revenues to future online ads offered by
the Bells. This bill was important in the preliminary phases of the 1996 act because it
talked about both competition and preservation of universal service.^’
Congressman Ed Markey (D-Massaehusetts) was the Telecommunications
Subcommittee Chairman during much of the telecommunications law debate. An
interesting story concerning how the Schools and Libraries program got its nickname
came from his staff, Colin Crowell. Crowell said that it all started in 1989 when the Bells
were trying to get out from under the line of business restrictions that had been placed on
them from Judge Greene. “The Bells knew they had to paint a picture of what the future
would look like in public terms. Their message was, ‘Unleash us so we can make the
world better.’ They started talking about the French Minitel system and the best medical
practices being shared through the information services. I even recall that during a series
of six or so hearings, we had Appalachia State University hooked up remotely into the
hearing room to showcase technology.”
Crowell continues, “Congressman Markey had been interested in education
throughout his career and wanted schools to get some type of diseount. In August of
1993, we had lunch at the Willard [Hotel in Washington, D.C.] with George Lucas,
producer of Star Wars. Lucas had the George Lucas Foundation in San Francisco and
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was interested in High Definition TV. Ed was explaining the proposed house legislation
to him and mentioned the Bells might get into the cable business and other new
information services. Lucas commented, Tt would be great for education.’ Markey said,
‘yes, and I want to find a way to cover the cost for education.’ Lucas responded, ‘1 think
the phone companies should do it for free.’ Markey said, ‘You are right, this is in the
public interest.’ After that meeting, Congressman Markey wrote to all the Bell CEOs and
asked if they would be willing to fund services to K-12 free. There were varying
resp o n ses.It should be noted this is the second time in this story that George Lucas
shows up to suggest that the phone companies wire the schools for free; the other
communication was with Chairman Hundt.
In our interview, Crowell elaborated by pointing out that; “the Markey-Fields
version of the House bill had school discount language in it. It was set up as “a public
interest obligation” not part of universal service. The difference is phone companies
would not receive a subsidy to do it; it would simply he an obligation in return for their
use of right of ways, etc. Thus, the name “E rate” and /or “Ed-rate,” for Ed (Markey)
came into being.” According to Crowell, Markey put the provision in the bill without
anyone from the education or the library community coming to him.
In November o f 1993, Energy and Commerce Chairman John Dingell (D-
Michigan) introduced a bill, H.R. 3626, which was favorable to the RBOCs. Later that
same day Representative Ed Markey (D-Massachusetts) and Congressman Jack Field (R-
Texas) introduced H.R. 3636. Both bills passed the overwhelmingly on June 28, 1994
and became known as H.R. 3636. This bill would have allowed the RBOCS to petition
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the FCC in order to provide long distance service. It was generally thought to be more
favorable to the RBOCs than the Senate version and had the discounted school language
in it.
In the 1994 election, as stated earlier, there was a GOP sweep of the Congress. On the
House side. Speaker Newt Gingrich (R-Georgia) heralded the “Contract with America.”
There was no mention of telecommunications in the contract nor was it on the Speaker’s
agenda, however, there was major talk of less regulation and less government. By 1995,
Chairman Harold Bliley (R-Virginia) had introduced H. R. 1555. This was the House
Version of the Telecommunications Bill of 1995. Democrats were not successful with a
provision for providing services at affordable rates to schools and libraries in this House
version. An amendment requesting such language was sponsored by Congresswoman
Connie Morelia (R-Maryland), Congressman Orton (D-Utah), Congressman Bob Ney (R-
Ohio), and Congresswoman Zoe Lofgren (D-California). According to Mike Regan, it
was defeated because a “satisfactory funding mechanism did not exist.” On August 3,
1995, House Commerce Chairman Thomas Bliley, Jr. (R-Virginia) promised that he
would “work with sponsors of the House amendment on affordable telecommunications
access for schools, public libraries and telemedicine activities in rural hospitals.
In our interview Mike Regan, Counsel for the Republican House Commerce
Committee, recalled that most of the activity on Schools and Libraries in the final year
before passage of the 1996 Law came out of the Senate. Speaking for the House
conferees, he said their attitude was “let’s get as much for this as we can.”^ " ^
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The Senate
Senator Ernest F. Flollings (D-South Carolina) introduced S. 1822 on February 3,
1994, which was the Democratic precursor to the 1996 Act. His Chief Counsel, John
Windhausen only vaguely remembers any interest in the Schools and Libraries language
of that bill. He did recall that Chairman Hundt had requested that the language be
extended to include classrooms, but this was not done in S. 1822.^^
During discussions on S. 1822, some Senators felt left out of the negotiations
particularly a group of those from rural states. This brought about the creation of the
“Farm Team” described later in more detail. The package of Farm Team amendments
first introduced the E-rate language on the Senate side. It included preferential rates for
libraries, museums (including zoos and aquariums). The rationale was that schools were
paying the highest business rates with the least amount of service and that the typical
school only had a phone in the principal’s office. According to Chris McLean, “there
was very little attention paid to the provision at that time.”^^ There was a showdown
between the Farm Team and the Committee Leadership and virtually all of the Farm
Team agenda was adopted by Senator Hollings. Hollings even commented at some point,
that his bill had become a Universal Serviee Bill instead of a competition bill.
According to a Bureau of National Affairs article, representatives from the
RBOCs and AT&T (in different meeting) had spent hundreds of hours meeting with staff
to discuss language in the bill. It was generally more favorable to the long distance
companies. On May 12, 1994, Senator John Breaux (D-Louisiana) along with Senator
Bob Packwood (R-Washington) introduced a nine page bill that would have simply
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allowed the RBOCS to provide long distance on a date certain which would be one year
after enactment of the legislation?’
In June of 1994, Senator Daniel Inouye (D-Hawaii) introduced a narrower piece
of legislation that would open the market for both cable and telephone in basically a
trade. It reserved twenty percent of the information highway for free use by nonprofits
organizations and government. It also authorized funding for their equipment. The
National Public Telecommunications infrastructure Act (S. 2195), departed from the
broader approach taken by Senator Hollings bill. “Passage of this legislation will ensure
that the new information superhighway will be a vehicle for education and civic
discourse— not only a commercial kiosk for entertainment, home shopping and video
games,” said David Brugger, President of America’s Public Television Stations
(APTS).^^ APTS had been working for such a bill, bringing the coneept of reserved
educational frequencies to the 1990s and applying it to all future telecom technologies.
According to their General Counsel at the time, Marilyn Mohrman-Gillis, the bill was
based on a new version of the "Public Right of Way Proposal" which had been drafted by
APTS along with colleagues from the Media Access Project and People for the American
Way Action Fund.^^
The proposal was sent to Inouye's staff with dozen of signatories, including the
National Education Association, La Raza, Consumer Federation of America and the U.S.
Catholic Conference. The Inouye bill directed the FCC to write rules requiring operators
of “telecommunications networks” to reserve capacity for free use by state, local and
tribal governments, accredited educational institutions open to enrollment by the public.
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libraries and nonprofits that were created to provide “nondiscriminatory public access to
noncommercial, educational, informational, cultural, civic or charitable services.
The bill called for twenty percent as an “appropriate” portion of capacity to be
reserved, but allowed the FCC leeway to require less. The bill claimed the reserved
capacity as public property— network owners would neither control the capacity nor have
liability for it. The justification was that telecom companies use government-owned
rights of way and spectrum. Gigi Sohn, Media Access Project Director said proponents
expected to argue that the pending legislation would give the telecom companies new
authority in exchange for the free space, for example, permission to enter the cable
business and vice versa.'*' According to Jill Lesser, Media Access Project, “Legislators
were nervous about setting aside anything in perpetuity, and one of the things we ran up
against was the notion that the infrastructure would have infinite capacity. If it did, the
reservation would not be needed and will go away, if it does not, the law would be
there.”'* ^
The Inouye bill authorized the FCC to allocate an unspecified amount of money
to a new “Public Telecommunications Infrastructure Fund” to give nonprofit and
govemment users economic support in using the reserved capacity. The
money would have to come from a “universal serviee fund” supported by fees from
telecom companies and other sources. The bill spoke repeatedly about Congress’s
“compelling interest” in improving democratic self-govemance and insuring all citizens’
access to diverse educational and other services, including the voices “most likely to be
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excluded” by marketplace forces. This bill never made it to markup but one can again
see how the issues flowed in different policy and political streams.
The Hollings bill S. 1822 was passed in committee markup with a vote of 18-2 on
August 11, 1994. The two opposing votes were from Senator John McCain and Senator
Bob Packwood both whom objected to a domestic content provision in the bill. The
version of the bill that came out of markup had the school, libraries, museums and zoos
language in it. Meanwhile, time was running out in the session to get both the House and
the Senate bills to the floor. It was becoming more apparent that the Republicans were
going to gain seats in the Fall election. Rumors that the Minority Leader, Senator Bob
Dole (R-Kansas) was going to run against President Clinton were strong. On September
22, David Wilson, staff to Senator Dole presented the Hollings staff a non-negotiable
package of amendments for S. 1822 and told them that was the price for Senator Dole to
go along. On the morning of September 23, Senator Hollings pulled the bill fully
intending to reintroduce it the following session.
However, again the worm turned and everything changed with the election of
1994. In an interview with Donald McClellan, senior staff to Senator Pressler (R-South
Dakota) McClellan shared his recollections about the Schools and Libraries amendment.
He recalled, “Early on, two Members and their staff. Senator Snowe and Senator
Rockefeller had “dogged determination” to pass the amendment. In the aftermath of the
1994 election. Senator Pressler became Chairman of the Commerce Committee and we
started having a series of regular meeting first with the Members of the committee and
then with their staff. Pressler even cloistered the GOP staff to develop the bill and we
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were not allowed to talk to lobbyists for several weeks. In mid to late January of 1995,
the Republicans issued their first draft after a series of ‘Republican only’ meetings. The
Hollings bill had crashed and burned in the waning day of the 103'^‘ ' Congress and many
groups felt like they had been slighted in the process up to that point, including the
bipartisan Senate Farm Team. We wanted to do things differently and were overly
inclusive.”
McClellan continued, “Very quickly after we issued our draft the Democrats put
theirs out which was basically the same one they had worked on from the 1 0 3 '^'* From
that point on we were determined to get it (the Communications Bill) done. The
bipartisan staff started meeting together to reconcile the two drafts. The E-Rate language
was in the Democrat version but not in the Republican version. We were kind of
engaged in conference before the bill was even voted out of committee. We were
meeting every day, ‘we rocked’ and ended up having a committee mark-up in March
1995.” ^^
Negotiations went on up to moments before the mark-up. No one knew exactly
where the amendments were or where the votes were. Some of the agreements that had
been worked out were not honored and some of the language was changed by the GOP
staff.''^
The Senate Farm Team
The Commerce Committee in 1994 was made up almost entirely of Senators from
rural states. On the Democratic side, only Senator John Kerry (D-Massachusetts)
represented an urban state and on the Republican side all Senators represented rural
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states. Schools are the hub of the rural communities and are generally a significant part
of economic development plans. Therefore, one of the most fascinating stories that came
out of the 1996 Act was that of the bipartisan Senate Farm Team.
While Senator Hollings and his staff were involved with the nuts and bolts of how
to open the monopoly network to competition, many of the other committee Members felt
closed out of the Hollings/Danforth style of Committee management. Ironically, one of
their Members (Senator Larry Pressler) was soon to become Chairman of the committee.
This group was interested in making sure that their states received some benefit from the
1996 Act. They felt their responsibility was to ensure rates and services in rural America
were comparable to other parts of the nation. They wanted to make sure that their
constituencies were not relegated to second class citizenry status because of high rates or
lack of access to the new services that were coming from advanced technologies.'*^
Again, according to Kingdon’s theory, these individuals could be seen as policy
entrepreneurs.
The players known as the Farm Team were Chris McLean, Senator Jim Exon’s
office (D-Nebraska), Greg Rohde, Senator Byron Dorgan’s office (D-North Dakota),
Carol Ann Bischoff, Senator Bob Kerrey’s office (D-Nebraska), Cheryl Bruner, Senator
Jay Rockefeller’s office (D-West Virginia), Earl Comstock, Senator Ted Stevens’ office
(R-Alaska), Katie King, Senator Larry Pressler’s office (R-South Dakota) and on
occasion. Chip Pickering, Senator Trent Lott’s staff (R-Mississippi).
This group represented a strong voting block that gave them tremendous negotiating
power on the Senate Commerce Committee because of the shared rural nature of their
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constituency. This team had seen the effects of “deregulation” on rural services in
airlines, trucking, and railroads and not want to repeat that in telecom. Their mission was
to ensure rural communities had affordable access to the national information
infrastructure and most of what they sought got included in the bill. They saw this as
critical for economic development for their states."*^
This Farm Team developed as the Danforth-Inoyue Bill gave way to S. 1822 (the
Hollings Bill). They operated as a small face to face group characterized by openness,
trust and intensive interpersonal relations. According to Cheryl Bruner, “even though bi
partisan they had a mutual respect for each other.”'^ * Several o f the members referred to
their special Farm Team Creed, chants and Prayers to the Santa Farma Teama. “It was a
special team and the only group whose Sponsor’s amendment was singled out by name in
official conference report,” pointed out McLean."^^ Fragments o f the team still work
together today although only one remains on the Hill in the capacity of Congressman,
Chip Pickering (R-Mississippi).
Prior to the markup Members of the Farm Team met in Senator Dorgan’s office
and piece by piece provisions were incorporated into the Chairman’s Mark. According to
McLean, “There was a lot of shuttle diplomacy between the Farm Team, the Democratic
staff and the Republican staff. The tension grew as the markup approached.
Carol Ann Bischoff is often referred to as the “Godmother” of the Schools and
Libraries amendment. Educated as an attorney, she went to work for Senator Kerrey (D-
Nebraska) in 1993. Although Senator Kerrey was not on the Commerce Committee, he
had always been a player in telecommunications issues. As Governor of Nebraska, he
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was responsible for deregulating telecommunications in his state. In an interview with
Bischoff, she revealed that Senator Kerrey gave her specific instructions to bring money
into Nebraska, to make him a player in the 1996 Act, and to hook up kids in Nebraska to
the Internet. Kerrey had ambitions to run for President and served as Chairman of the
Democratic Senatorial Campaign Committee during the mid nineties. He was very well
liked and respected by Senator Ernest Hollings, Chairman of the Commerce Committee
during the early drafting stages of the 1996 Act. According to Bischoff, she felt it was her
number one priority to deliver this amendment for Senator Kerrey. She said she shed a
lot of tears during the process and was very “kind” to Earl Comstock, whose help she
knew she needed.^'
Earl Comstock recalls the group spending hours together negotiating off in a side
room, while the “rest of the core staff was too busy to deal with the smaller group.”
Comstock was described by one of the interviewees as the “master o f figuring out how to
fund programs, bring home the bacon and keep issues under the proper jurisdiction.”^ ^
His powerful boss. Senator Ted Stevens, also happened to be Chairman of the Senate
Appropriations Committee. The remark about Comstock was made in an extremely
complimentary manner and was seconded by several of those interviewed. Comstock
was known for his legislative drafting ability and is credited with writing the language
that allowed the schools and libraries to become part of Universal Service. Comstock
commented that “as long as industry wasn’t screaming” he was willing to do this. The
language was “deliberately ambiguous” because proponents (particularly the
Administration) were looking for the broadest possible language. The Farm Team staff
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met with Greg Simon from the Administration at least three times during the process.
Comstock commented that they “used whatever vehicle were available to them.” He also
said, “The provision would not have happened without the Farm Team and that a
confluence of unrelated events allowed it to happen, they just tacked it on.”^ ^
According to Cheryl Bruner, Senator Rockefeller (D-West Virginia), her boss,
had a major interest in the health and telemedicine aspects of technology and was
committed to offering an amendment concerning funding in the markup of the
telecommunications bill. “Community health care locations were being closed due to
lack of funding. He had also taken an interest in distance learning but at that point we
were only thinking about an amendment concerning telemedicine. Senator Kerrey was
not on the committee and had a notion about education so we were familiar with the idea
from Carol Anne Bischoff. We realized that the education amendment was not in the
Chairman’s mark and wanted to help. In the final hours before the scheduled markup at
about 3:00 a.m., 1 heard from Carol Anne that Senator Olympia Snowe (R-Maine) was
interested in offering an amendment on schools and libraries and recommended that she
call her staffer. 1 checked with Kevin Joseph from Senator Hollings office, who was
coordinating the markup for the Democrats, and he said ‘fine, go ahead’ and the rest was
history.” She remembers around 6:00 a.m. “slapping together the schools and libraries
language.”^''
When asked if this was the normal for policymaking or offering amendments,
Bruner commented that under Chairman Hollings’ rule, “everything was scripted” and
the Chairman was never to be surprised. With Chairman Pressler, as Chairman, it was a
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whole different ballgame and the amendment just kind of popped up out of no where.
Hollings had to have at least two or three hours notice of what would occur in a markup
ahead of time so that things were thoroughly vetted, those were the unwritten rules.
Senator Snowe barely had time to tell her Chairman was she was prepared to do.”^ ^
Chris McLean, Greg Rohde, and Earl Comstock were all well known as the avid
defenders of the Universal Service Program in Congress. They saw it as the trade off for
deregulation of the industry. According to McLean, “Time and time again rural interests
got the “leftovers” and we were determined that it was not going to be that way with the
telecommunications act. Every liberalization should bring some great social benefit such
as phones for the disabled, lower rates for the elderly and educational benefits.Greg
Rohde verified that, “Kerrey had honed in on schools getting special access and wanted
to mandate discounts in a different area of the bill but the Republicans would not accept
that as a provision of their bill. In a Farm Team meeting, Comstock said ‘why don’t we
make it part of universal service?’ Comstock drafted the amendment and handed it off to
Snowe.
Kevin Joseph managed much of the floor process for Senator Hollings during the
telecommunications legislative debate. Joseph worked well with both Republicans and
Democrats and had a particularly good working relationship with Angela Campbell, staff
to Senator Olympia Snowe (R-Maine). “Angela came to me at 2:30 a.m. the morning
before mark up and said, ‘my boss wants to offer an amendment, and it is not going over
well with the Republican Commerce Committee leadership, ‘What should I do?”’ Kevin
responded with an email to both Bruner and Campbell suggesting that they team up to
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offer the amendment. He recalls, “Nobody really had a plan, but once the two of them
got together the politics of Snowe and Rockefeller almost guaranteed that it would
pass.”^ *
Angela Campbell is a true unsung heroine of the Schools and Libraries process.
Campbell, Staff to Senator Olympia Snowe, was new to the Senate and fairly new as a
Legislative Assistant. She had spent a year working for Snowe on the House side but
quickly discovered the Senate was a very different place. Campbell could be described
as low key and modest, but was frank with her responses. When asked in our interview
how they came up with the idea of an amendment for schools and libraries, Campbell
replied that, “Senator Snowe was new to the intricacies of the telecom bill, she had not
been on Commerce Committee in the House. It was the staffer’s job to bring things to
the Member’s attention that might affect the state or be of particular interest to her.
Senator Snowe had always been a strong advocate for women’s issues and education.
She definitely wanted to offer an amendment to the telecommunications bill and I
prepared a bunch of options for her, one had to do with the small cable companies who
were having some pole attachment issues in Maine. Their representatives had
specifically lobbied us.”
“Anyway, weeks before the Commerce Committee mark-up, I was comparing the
bill that had passed the Committee the previous session, and noticed that the provision to
bring schools and libraries into the telecommunications era was missing from the new
Republican proposal. Nobody had lobbied us on the schools and libraries issue. When I
saw that the provision had been dropped, it rang a bell in my head because I knew Maine,
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being a large and sparsely populated state, often needed subsidies to be on par with other
states. When 1 approached Senator Snowe with the idea of offering the amendment, she
loved it. It was exactly what she wanted. Plus, naive little me, I figured it had passed
once, it could easily pass again.”^ ^
Campbell noted that she recalled Senator Snowe’s involvement in two phases:
“Up to and during the Commerce Committee mark up, when we were pretty much flying
solo, and after the mark up when people came out of the woodwork to help up. After the
mark up, the ones who helped us push it through were ultimately the education lobbyists.
They mobilized their forces back home, and the local educators and librarians all lobbied
their Member of Congress to support the Snowe-Rockefeller-Exon-Kerrey amendment.^®
House and Senate Committee Markup
It is important to know that Chairman Larry Pressler was under a lot of pressure
to pass the telecommunications bill out of the Senate. He was up for re-election and
faced trouble in his home state for his “right leaning rhetoric.” He had publicly supported
the privatization of public television and followed other Gingrich led Contract issues. In
South Dakota, there were bumper stickers that said “Privatize Pressler, not Public
Television.” Industry wanted a bill and there was something for everybody in it: cable
reform, digital television for broadcasters, radio ownership liberalization. Universal
Service for rural areas, low income support for urban poor, and American Disability Act
provisions for the disabilities community.
The Senate committee markup was contentious but took only a couple of hours.
The Snowe-Rockefeller-Exon-Kerrey amendment was actively debated in the session.
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Senator John McCain (R-Arizona), the second highest ranking Republican on the
Commerce Committee, had not really participated in the pre markup sessions but showed
up for the Committee mark-up. He brought his own set of amendments and was
adamantly opposed to the Schools and Libraries amendment. Chairman Pressler
begrudgingly allowed Senator Snowe to offer her amendment and let the “will” of the
committee and/or the full Senate (if it passed) determine its fate. According to
McClellan, that was the “price” we had to pay for Snowe going forward with the rest of
the bill. It was not that we were opposed to funding Schools and Libraries; we just felt
this was broader than rural concerns and was more in line with “social policy.”^’
Senator John McCain (R-Arizona) articulated the argument against the
amendment. His objections were: 1) Snowe-Rockefeller is an “unfunded mandate” and,
thus, may not be considered under current rules governing the Senate; 2) the amendment
lacks “means testing.” For example, it does not discriminate between the rich libraries,
rich schools and poor libraries and poor schools, 3) Subsidization for universal service is
a “local issue” that should be considered by “local decision-making.”
The Snowe-Rockefeller-Exon-Kerrey amendment passed on a narrow 10-8
partisan vote with Snowe voting with the Democrats. Senator Bob Packwood actually
left the room prior to the vote. According to his staff person, Hance Haney (who had
formerly handled education issues). Senator Packwood did not want to vote against the
education community.
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House and Senate Floor Debates
Leading up to action on both the House and Senate floors, there was much
discussion regarding the schools and libraries on the provision in congressional offices,
hallways, committee rooms, and offices/schools throughout Washington, D.C. and to a
certain extent in schools and libraries across the nation. Some wanted much more than
“recommendations to ensure access”—perhaps at least “provisions to ensure affordable
access.” Others wanted affordable access and much broader coverage, perhaps to include
“students in continuing, higher education, and library settings.” Still others wanted to
completely eliminate the universal service provisions altogether.
House Bill, H R. 1555 did not contain the schools and libraries provision. Its only
mention of Universal Service was a provision in Section 246 (b) that contained words
describing principles upon which the Joint Board should “base policies for the
preservation of universal service.” The principles included “quality services at just and
reasonable rates,” promotion of “access to advanced telecommunications services,” and
promotion of “reasonable comparable services for the general public in urban and rural
areas.”
The Senate’s version S. 652 included the Snowe-Rockefeller-Exon-Kerrey
provision on schools and libraries and was accepted on a 58-36 vote on June 8, 1995 on
the floor of the U.S. Senate. The original language referred to “incremental cost” for the
provision of services to educational providers and libraries was modified to “reasonable
rates” in a Manager’s amendment, agreed to by principal authors of the language.
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The Conference
This is the point where different parts of the complex process began coming
together. The special interest groups representing schools and libraries began really
getting organized under the umbrella of Ed-Line and lobbied the conferees. Momentum
began building for the Schools and Libraries language. Still, business was focused on the
overall bill (basically the other 279 pages of the legislation) and still not paying much
attention to the Schools and Libraries movement.
Barbara Pryor, Education Staff to Senator Jay Rockefeller (D-West Virginia) at
this point began to lead the charge. While Bischoff was mentioned as the “Godmother,”
Pryor was given the title of “Midwife” to the Schools and Libraries program by many of
the interviewees. According to Pryor, “It was definitely my baby and to this day still is.”
She guarded and nurtured the Schools and Libraries piece from Committee mark up
through the FCC Rulemaking and beyond. Pryor discussed working with the definition
in the language so that Catholic schools could be included. The thinking was that there
would a lot of influential Republican Senators (several who were Catholic themselves)
who would have to vote on this and the way it was set up was not exactly public money.
Sister Dale McDonald and Father Bill Davis, representing the Catholic Schools, began to
get very involved. Pryor said the Catholic Church basically saved the Schools and
Libraries program.^^ Pryor is one of the most senior education staff on the Senate side
and is the one person most mentioned when interviewees were asked for other people
who were involved in the Schools and Libraries process. She describes herself as a
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guardian of the program and was appalled during the aftermath that some people wanted
to “pull the plug on children.”
The opposing voice on Schools and Libraries (actually the entire universal
service program) among staffers came predominantly from Harold Furchgott-Roth,
Senior Staff to former Chairman Thomas Bliley (R-Virginia). Several of the conferees
commented during the interviews that his philosophy could be described as libertarian, a
view that sees markets as the solution to almost everything. It should be noted that
Furchgott-Roth was later appointed to the Federal Communications Commission in 1997.
David Wilson, Telecommunications Staff for Majority Leader Robert Dole, was
very active in the Conference Committee. On November 1, 1995, he presented Senator
Dole with an alternative Republican plan for “Creating a Land Grant Education for the
Information Age.” Wilson sent Dole a memorandum dated May 25, 1995 outlining a
program in which the “Republicans Lead the Way in Modern Ages.” Dole had
announced his Presidential Campaign and Wilson had prepared the memo with
consideration of Dole’s “major” education speech in mind.
Excerpts from Wilson’s memo (November 1, 1995):
In general, we would make a portion of government spectrum
available to multiple users for a fee and then distribute those fees in
block grant form to the states. The states in turn would use these fees
to develop and implement their own plans on how to hook up schools to
the so-called “Information Super Highway.” Hospitals and libraries
could also be considered.
Instead of auctioning off spectrum to a single user like AT&T or
Sprint, we would allow several groups to use it at the same time. In
return, they would pay an annual fee and not create radio interference
with any other use.
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By using an annual fee system, versus an auction process, we
would create a revenue stream that constantly replenishes itself. Actual
proceeds, on the other hand, disappear once spent.
Besides being a responsible solution— no taxes or unfunded
mandates— this amendment also encourages innovation. Spectrum’s
scarcity and high value actually discourages innovation, as manv
cannot afford to buy exclusive spectrum to test or develop their ideas.^
But by this point in the conference, Wilson’s proposal could not get any traction
while the Snowe-Rockefeller-Exon-Kerrey amendment continued to gain steam. It
appeared from the research that Republicans who were opposed to the effort waited too
long to recognize that the Schools and Libraries initiative was to be taken seriously. This
is not unlike what occurred with the lack of attention or respect for it from industry.
We will see in the next chapter how windows of opportunity created favorable
conditions for the various players, or as Kingdon would say, the different streams, to
come together for the successful passage of the Schools and Libraries amendment.
Chapter Four Endnotes:
' Gary C. Jacobson and Gregory L. Bovitz, The Electoral Politics o f Budgets and
Deficits, 1980-1996, (San Diego: University of California, 1998) Prepared for delivery at
the 1998 Annual Meeting of the American Political Science Association, Boston,
Massachusetts.
^Interview with Chris McLean.
^ Interview with Jim Kohllenberger.
U.S. Postal Service, 1998 Annual Report.
^ President Bill Clinton, State of the Union Address, January 23, 1996.
^ Interview with Greg Simon.
^ Interview with Former Vice President A1 Gore.
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Randolph May, “An Agency for Bill and Al,” Studying the Digital Revolution and its
Implications for Public Policy, The Progress and Freedom Foundation, December 14,
2000, http://www.pff.org.
^ United States vs. AT&T (1978).
“^May, 2000, p. 3.
'' Interview with Chairman Reed Hundt.
Reed Hundt, You Say You Want a Revolution (New Haven and London: Yale
University Press, 2000).
Interview with Roy Neel.
Reed Hundt, You Said You Want A Revolution (New Haven and London: Yale
University Press, 2000),pp. 8-9.
Hundt, 2000, p 10.
Hundt, 2000, p.26.
Hundt, 2000, p.58.
Interview with Chairman Reed Hundt.
Interview with Blair Levin.
Hundt, 2000, p. 88.
21
Interview with Chairman Reed Hundt.
Interview with Karen Kornbluh.
Hundt, 2000, p. 126.
Interview with Reed Hundt.
Hundt, 2000.
Interview with Kevin Joseph.
27
Interview with David Wilson.
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28
Interview with Chairman Reed Hundt.
David Burnham, ‘In Bell System Breakup, Small is Expensive,’ The New York Times,
July 31, 1983, Sec. 4, p. 8.
Jane Perlez, “Computers Pose a Peril for Poor,” The New York Times, June 8, 1983, p.
B-1.
Interview with Colin Crowell.
Ibid.
Interview with Mike Regan.
Ibid.
35
Interview with John Windhausen.
Interview with Chris McLean.
Bureau of National Affairs, “The Aftermath of S. 1822.”
Steve Behrens, “Inouye Bill Reserves Capacity on Infohighway,” Current,
Washington, D.C.: Current Publishing Committee, June 20, 1994.
Interview with Marilyn Morham-Gillis.
'^ ‘ ^Senate Bill S. 1086, note this bill did not pass and was not reported out of committee.
Interview with Gigi Sohn.
Interview with Jill Lesser.
Interview with Donald McClellan.
Ibid.
Interview with Chris McLean.
Interview with Greg Rohde.
Interview with Chris McLean.
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48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
Interview with Cheryl Bruner.
Interview with Chris McLean,
Ibid.
Interview with Carol Ann Bischoff.
Interview with Greg Rohde.
Interview with Earl Comstock.
Interview with Cheryl Bruner.
Ibid.
Interview with Chris McLean.
Ibid.
Interview with Kevin Joseph.
Interview with Angela Campbell.
Ibid.
Interview with Donald McClellan.
Interview with Hance Haney.
Interview with Barbara Pryor.
David Wilson, Memorandum to Senator Robert Dole, November 1, 1995.
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“It is circumstance and proper timing that give an action its character
and make it either good or bad. ”
Agesilaus
444-400 B. C.
Chapter Five: AGENDA TO ACTION
Window of Opportunity
How and why did the amendment to connect the schools and libraries to the
information highway happen? As with most occurrences in life, there is usually a story
behind every story and in the case of politics, nothing should be taken at face value
because there are usually “multiple” stories. This process was no exception and as my
research shows, there were many steps in the process of the Schools and Libraries
program becoming a federal law. The Schools and Libraries amendment was a jagged
process. It took many changes in direction and had advances and setbacks. It does not fit
into one black and white model of policy making but rather emphasizes that there is
always gray area and crossing of lines and/or theories.
The issue of public network and education was initially inspired by the movement
of community based networking. Although ironically, this group did not get anything out
of the bill, their preliminary work and the Inouye bill started the momentum to expand
universal service to schools and libraries. It happened that Vice President Al Gore, Jr.
was interested in technology and his work in the late eighties and early nineties definitely
pushed the ball forward by giving people an image of the school child in Carthage,
Tennessee connecting to the Library of Congress. Once elected Vice President, Gore
began considering his path to the Presidency and needed a great track record and good
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campaign themes. Technology and education polled well. Gore selected an ambitious,
ego driven man in Chairman Reed Hundt, and appointed him to the FCC to pull the two
themes together. The telecommunications bill had been in the making for a decade. The
major industry players were positioned to get a piece of the pie. Education in this U.S.
was lagging behind other industrial countries and was in need of a shot in the arm. The
election of 1994 played a huge role in the changing dynamics of the Congress. Several of
the interviewees mentioned that the most amazing part was that a Schools and Libraries
amendment actually made it through a Republican Congress. One interviewee pointed
out that “they did not want to be tagged with taking it away once it got on the Senate
floor” (the “rights” theory). The fact is, Senator Snowe, a noted Republican, was actually
the one most responsible for and credited with making it happen. She was a champion
for schools and libraries.
The Farm Team effort was the overriding factor to the success of the Schools and
Libraries program. Senator Bob Kerrey’s (D-Nebraska) eagerness to be a part of the
negotiations of the telecommunications bill made a difference. He, too, at the time was
thinking about a Presidential run. The timing was significant in that the Republicans
were on shaky ground after the budget debacle. Congress was looking for something to
pass. It was difficult to be against schools and libraries.
The most repeated theme that came from the interviews was that industry was
getting everything they wanted and so schools and libraries became the “quid pro quo.”
One interviewee remarked that “give something back” became the mantra among staff
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and public interest advocates. Here, we once again see ideology as a backdrop for getting
schools and libraries on the agenda. Senator Rockefeller often referred to it as “the deal.”
As was stated earlier, the bill was 280 pages long and involved six of the largest
industries in the country so it was about business or commerce. It would be rare, but not
impossible, that this type of legislation could occur again. Further research could
document whether social amendments occur in most cases of massive industry legislation
or whether the Schools and Libraries in the Telecommunications Act was an aberration.
Last but not least, the Bell Companies and their former parent’s (AT&T) attention was
diverted, more focused on intra-industry fighting over market share. The education and
libraries communities had geared up to win, the staff from these groups and the staffs
from the Rockefeller, Snowe, Kerrey, Exon offices all felt a sense of urgency and passion
about getting this amendment into the bill. There was a moment of opportunity that
happened at 2:00 am the morning before the Senate Committee markup that made the
difference. Senator Olympia Snowe (R-Maine) crossed party lines and stood up for what
she believed in, the Schools and Libraries amendment. From that point on, Snowe and
Rockefeller championed it as their “baby.” As the saying goes, if the baby had been
thrown out, the bath water was going with it. In essence, the Schools and Libraries
amendment was able to hold the entire telecommunications act hostage to its passage.
It is difficult to see that another window of opportunity would ever have occurred
in a different time or setting. This question was asked of each interviewee. Most
commented that we were in good and bullish times, they suggested the thinking was that
the golden goose (high tech industry) was just going to keep laying eggs, the economy
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was growing and technology promised great things that probably could not be duplicated
today’s environment. Many noted the dramatic shifts in Congress and the national mood
during that period are unlikely to be duplicated. As one interviewee said, “the stars just
aligned.”
“Nothing we do, however virtuous, can be accomplished alone”
Reinhold Niebuhr
Agenda Accomplished
On February 8, 1996 the leaders of government, CEOs of industry and public
advocates gathered in the United States Library of Congress Reading Room for the
signing of the telecommunications law. Greg Simon, Vice President Gore’s Domestic
Policy Advisor, selected the venue to recall Vice President Al Gore’s twenty-year-old
promise to connect the schoolgirl from Carthage, Tennessee, to the Library of Congress.
President Clinton announced from the podium that "the best feature" of the bill was the
authority it granted to connect all classrooms to the Internet. According to many of those
present, even the lawmakers and CLOs who had initially opposed the Schools and
Libraries language, applauded loudly in the spirit of the moment and the glare of the
television cameras. It was difficult, politics notwithstanding, to be against school
children, educators and libraries. Senator John McCain, one of the amendment’s most
ardent opponents even subsequently used it positively as a campaign theme as he held
media events in classrooms during his run for President in 2000. However, the language
of the law pertaining to schools and libraries became the topic of a long ensuing debate
that continues to this day.
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The law represents the first comprehensive revision of the United States’
telecommunications law in more than sixty years. The universal service section of the
law, Section 254, for the first time legislated the goal of universal service. The law
expanded both the base of companies that contribute to offset communications service
rates and the category of customers who should benefit from discounts. Schools,
libraries, and health care providers, as well as residential and rural customers, became the
primary universal beneficiaries.
As mentioned in my introduction, Chris McLean made the statement in his
interview, “Success has a thousand fathers.” This seems to hold true in the case of the
Schools and Libraries amendment. As each interviewee recalled their role during the
years of formation, many took credit for its success. Although, there was likely some
revisionist history, it was easy to observe how one could think their part was most
responsible for the success. As the part of a complex process that occurred over a matter
of several years, the stories were amazingly complimentarily and consistent. Each
interviewee knew different parts of the process had occurred but no one knew the
complete story that is covered in this research. In Kingdon’s theory, streams run
independently and to the point that McLean makes, as different independent streams
came together, it felt to the participants in each stream that their particular role had made
the significant difference in the success of the Schools and Libraries amendment.
The new law required that the FCC and the states base the universal service
system on seven principles, including the principle that elementary and secondary
schools, libraries, and health care providers should have access to advanced
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telecommunications services. The FCC was instructed to adopt final rules in the
universal service proceeding on or before May 8, 1997.
“Draw from others the lesson that may profit you rself ’
Terence
c.190-159 B.C.
Analvsis and Findings
What is agenda setting? What relevance does agenda setting theory have to
public policy? Why is it important to the work of Public Administrators? These are
questions that my research has attempted to answer by using data and viewpoints of most
of the major players that were involved in the Schools and Libraries amendment process.
As a translator at heart, I was interested in designing this study to examine the
intersection of business, government and nonprofits organizations coming together, often
without speaking the same language or working in the same environments, to accomplish
a goal.
The two most critical and politically charged policy issues that surfaced when
considering how to upgrade the current U. S. telecommunications infrastructure were:
(1) How much would it cost? And, (2) Who would pay for it and how? As the Kingdon
theory posits, participation in the organizational decision making processes can be fluid
and erratic and this process was certainly no exception. In the case of the Schools and
Libraries program, there were many secondary questions that had to be addressed. Who
was allowed to participate in determining the definitions of universal service? How did
private and publie sectors work together? Who would administer the program? Who is
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allowed to participate in the program? Who pays into the fund and who takes out? Who
are the recipients? What type of evaluation is in place? When will the program be
reviewed? As technology evolves and systems change, the decision making and agenda
setting processes will only get more complicated and the results of my study may serve as
a guide to what future policies will get considered.
The scope of this research was limited to how and why the Schools and Libraries
amendment beeame part of the 1996 Telecommunications Act. The nature of the
amendment was sweeping in scope yet vague in language as is evident in this very short
paragraph that affected the lives of almost every person in the United States. (See
example on telephone bill Appendix K) Asked why subsidies for schools should not be
provided through general taxation, the former FCC Chairman Reed Hundt gave an
illuminating answer. He aeknowledged that telephone companies would pass on
universal serviee charges to the customers, however, Hundt said, “it’ll be passed on to
everyone in Ameriea in insignificant ways down to, you know, pennies per day. It will
be a collective action by all America.. .Probably the most equitable way that you could
raise money for a national purpose would be through contributions by communications
companies, because they cover the whole country.”'
The researeh covered the stories of individuals that were involved and developed
the historieal account of how and why the amendment happened. The major findings
derived from this study are as follows:
1. Each braneh of government has a unique vantage point on
technoloev poliev based on its eonstitutional or statutorv role
and constituenev.. In manv ineidenees. iurisdietional
boundaries are crossed during the formation stage. For
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instance, the education felt it was easier to get something
through the Commerce committee rather than through
traditional funding methods.
2. Costs and benefits of the program were never truly assessed
against any known standard or past program. Besides the
McKinsey report, there was not even an estimate of what the
program would cost.
3. The fate of this particular technological project and program
depended heavily on economic climate and personal interest
politics. Rural economic development issues were an
essential piece of the success as demonstrated by the
tremendous influence of the Farm Team. They considered it
a fair deal.
4. Agenda setting theory was helpful to give structure to the
process during the research, yet amplified that policy making
is not a precise science. Even the narrow portion known as
the “formation stage” or “agenda setting” does not fit exactly
in one precise model or theory.
5. Issues may lay dormant for a long time before fully
developing and moving to the Federal Agenda. The seeds of
this issue went back to the notion of common carriage.
6. Issues got addressed when either everyone was paying
attention or no one was paying attention. The Farm Team
had been excluded from industry and committee staff
negotiations and, therefore, started their own side group, to
which initially no one was paying attention. The rest of the
Act involved most everyone paying attention.
7. When there is major complex legislation (a big pot of stewT
it is easy to slip something in without a full public debate.
8. Elected officials like to have concrete “deliverables” in
legislation that they support. This means something that they
can talk about in speeches and newsletter that even
“grandmothers and children” can understand.
9. Industry was so foeused on their own needs and profitability
that they missed obvious cues of what was coming.
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10. Agenda setting policy can help one anticipate the unexpected
in legislation. It is important to know the history and pay
attention as probable issues arise.
John Kingdon’s research served as a basis for this research study. Kingdon’s
premise that agendas are set following a convergence of streams from problems, politics
and policies held true to a certain extent in this study. The policy entrepreneurs, those
with deep, long abiding commitment to this change, and window of opportunity were
identifiable. It was not clear at times, which stream issues were floating in, some weeks
it was political, some weeks it was policy oriented and the data showed that issues often
crossed jurisdictional boundaries and more importantly, classification or labeling
boundaries.
While Kingdon did not emphasize studying the root o f the problem, where an
issue originates or how it arose, it appears from my study that this is an area that future
researchers should pay significant attention to. For example, in the case of the Schools
and Libraries amendment, the origin of the issue goes back further than our U.S.
Constitution. It would have been useful and perhaps, resulted in better, more efficient
and comprehensive policy, had all the players known the history o f universal service and
the original thinking for its purpose. The analogy that came to mind often during the
research was that of a tree. The roots of the U.S. Constitution are deep in history and
grew from seeds borrowed from the English. From that, eame a large and strong tree
with branches that are very diverse and extend in different directions. When all the
forces were right, fertilizer, climate, production from the branches, someone noticed it
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was ripe for more and thus, universal service expanded without consideration or research
on its roots or its needs.
To carry the analogy further, there may be times when a program or a branch
needs to be pruned or cut. The tree may be a candidate for cross-pollination. While
universal service was made a guiding principle of American telecom regulation in 1934,
and the spirit of universal service is noble, the substance has grown woefully dated. In
1934, legislators assumed that telecommunications was a monopoly; today it is a
competitive market. In 1934, only one kind of service was delivered, through one kind of
telephone (the plain, rotary dial, black kind); today voice, video, and data are carried over
wires, fiber optics, satellites and airwaves. In 1934, technology required that all of the
intelligence needed to run the networks was in the switches at the network’s core; today
that intelligence has migrated to computers on the network’s periphery and many of those
computers are owned by customers rather than service providers.
In hindsight, the universal service fund was unstable even before the 1996 Act
and continues to grow more so each day. The goal of the 1996 Act was to increase
competition. One of the results of the Act, the expansion of universal service, is
diametrically opposed to the stated goal. There appears to be no political will to correct
the problem for the public good. Technology is outpacing the legislators’ ability to
legislate it, leaving many inequalities in the system that should be addressed. There is a
lingering question about internet telephony, currently known as voice over internet
protocol (VOIP), in which long distance calls are carried over the internet, should it be
regulated or not? What happens as current communications traffic leaves the existing
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network for newer, less expensive and faster technology? Who then will pay into the
universal fund? Who will have the political will to tax the Internet or expand universal
service obligations to cable providers and others who provide communication services?
Are State Public Service Commissions still relevant? Should we even have a Federal
Communications Commission?
I have described in my work, how an issue progressed to become part of the
public agenda and to a limited extent why. Technology in school and libraries was, at
best, an ancillary issue to the majority of players in industry during the ten years of
debate. As a result of my research 1 found that ideology and champions of the cause
really made the difference. Wiring schools and libraries was an issue that deserved more
attention from industry and lawmakers in order to educate and perhaps elicit a better,
more efficient and lasting result for a comprehensive national universal service policy. It
is likely that businesses viewed the program as a distraction to their bottom line and/or
regarded it as a social problem that belonged in some other arena such as the Department
of Education. The industry players were more engaged in issues to improve their
operations and the debate over universal serviee did not receive the respect or attention it
should have during the formation of the 1996 Aet.
Donald A. Schon’s book. The Reflective Practitioner, provided grounding during
my research. Schon suggests that professionally designed solutions to public problems
can have unanticipated consequences, sometimes worse than the problems they were
designed to solve.^ Although, not entirely the case with the schools and libraries, it could
be said that overzealous practitioners promoting their own interests in several cases got in
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the way of good and lasting public policy. As a practitioner, I realize that it is difficult to
capture what occurs on Capitol Hill in a textbook but believe I have provided additional
insight through my research. As a leader, a manager, a student and a lobbyist, my
organization has been both the stage for my activity as well as part of the object of my
inquiry. Reflecting in action has provided a forum for the integration of both research
and practice. From this, I have gained a greater appreciation and respect for public
administration, policy formation and the complexity of getting issues on the national
agenda.
Chapter Five Endnotes:
‘ Hundt, 2000.
^ Donald A. Schon, The Reflective Practitioner, Basic Books, HarperCollins Publisher,
Cambridge, MA, 1983.
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‘ •^Fixing the universal service fu n d is an issue that needs to be addressed right
Commerce Communications Subcommittee Chairman
Senator Conrad Burns (R-Montana), (April 2003 Senate
Hearing)
“We love this dance around the fire o f being concerned, being concerned, being
concerned and doing nothing”
Senator Ernest F. Hollings (D-South Carolina),
Commerce Committee Ranking Member
(April 2003 Senate Hearing)
Chapter Six: EPILOGUE: THE FUTURE OF UNIVERSAL
SERVICE
The implementation phase of the Schools and Libraries amendment has been even
more complicated and controversial than the policy formation phase. The language in the
legislation was so vague that there have since been law suits, fraudulent behavior, time
delays, shortage of funds, and a continuing debate on the future of universal service.
A 1998 Washington Post editorial stated that residential phone customers could
face an increase of four to five percent on their monthly phone bill to pay for the new
Universal Service Fund. Opponents of the plan labeled it “the Gore Tax” and there were
numerous editorials and articles chastising the Administration for the hidden tax as seen
in a 1997 Wall Street Journal editorial. (See Appendix J). It was even suggested in one
of the interviews that after the Gore debacle on “inventing the Internet,” and the “Gore
Tax” fiasco, the current administration adopted a “hands o ff’ approach to complex
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telecommunications issues. From all indications, the Bush administration has punted
responsibility for the country’s telecommunications policy to the Federal
Communications Commission. This is not necessarily a good thing since the
communications industry represents approximately twenty percent of the U.S. economy
and has been severely weakened over the past several years.
In a December 1997 Federal Communications Law Journal article, Charles Oliver
wrote: “In fairness to the Vice President Gore, one must acknowledge that 2.65 billion
per year that the FCC is bestowing on schools, libraries and health providers is a fraction
of the ten billion dollars plus that the system awards every year to all rural residents—
upper, middle, and lower class alike. In fairness to the Senators who represent low-
density states, one should acknowledge that they, too, had a vision. One Senator told a
charming story about the first felony committed in his hometown, after which it was
discovered that hardly anybody there bothered to lock their doors— even when leaving
for extended vacations. The mere knowledge that such places exist is a salve to the spirit
of all Americans, including those who live in large cities; yet, it gives one pause when the
Senator provided the postscript to this idyll: providing telephone service to that town
requires a monthly subsidy of approximately $200 per home per month. After hearing
the story, the author asked the Senator how he could justify funding those subsidies by
applying a surcharge to telephone services used by urban residents who sleep in bathtubs
to avoid being hit by bullets. Would it not make more sense to support such subsidies
from general tax revenues? The Senator answered truthfully and candidly: “it might
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make sense, but if people knew what they were being asked to pay, they would not pay
it.”*
That, unfortunately, points to the real problem. Rural Senators and the Vice
President, having discovered the FCC’s ability to redirect billions of dollars with arcane
regulatory formulas have discovered a magic elixir. Drink the potion and their respective
dreams and visions are brought to fruition, without having to go through the House Ways
and Means Committee, Appropriations or the Congress as a whole. “The bureaucrats
who taught the Vice President how to pursue his visions without dipping into tax
revenues, by jury-rigging the regulatory system instead, have enlarged the appetite of a
monster that has been dormant for a long time but is beginning to grow again. It could
grow again when somebody else has a vision that costs money. In time, the process
could begin to drag the whole system down.”^
Competition and subsidized, regulated network services are profoundly
incompatible, and today universal service stands at the heart of the contradictions. To
introduce competition without a complete overhaul of the universal service funding
mechanism could lead to bankrupting those left providing it. The important question now
is what could have been done better at the beginning. A good place to start would have
been with the question of what is universal serviee? What services, products, applications
or technology does it cover? When will its goal be accomplished or will it continue to
evolve? Once defined, if a determination is made that the American public should fund
a universal service program, the second question would be how much will it take and
where will the money come from? At that point, start with a budget for the whole
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170
package deciding how to divide the targeted beneficiaries in an open, public and
accountable process. The price of this program was never discussed making it easier for
the Congress to pass it.
The FCC was instructed in the Act to make all subsidies explicit on the
customer’s bill as part of the universal service implementation process, but to date, this
has not happened. Instead, Chairman Hundt and the Joint Committee chose the
politically expedient route by expanding universal service to implement the Schools and
Libraries portion first. There were likely numerous reasons for this. First and foremost,
was that the political implication of raising prices to reflect the real costs in the rural
areas of this country may have been politically impossible. The 1996 Act established
explicit congressional principles in section 254 (b) that guided the Joint Board and the
FCC in adopting policies to preserve and advance the universal service system. The
principles are as follows: 1. Quality services should be available “at just, reasonable, and
affordable rates; 2. Advanced telecommunications and information services should be
accessible in “in all regions of the Nation”; 3. Individuals in “rural, insular, and high cost
area” should have access to basic and advanced services at rates that are “reasonably
comparable to rates charged for similar services in urban areas; 4. Contributions from all
telecommunications service providers should be “equitable and nondiscriminatory"; 5.
Federal and State universal mechanisms should be “specific, predictable and sufficient";
6. Schools, libraries, and health care providers should have access to advanced
telecommunications services; 7. Other principles judged by the Commission to be
necessary to protect the public interest, convenience, and necessity.
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171
Pursuant to the last principle, the Joint Board and FCC in 1997 added the
principle that universal service support mechanisms and rules should be competitively
neutral. The FCC established funding caps for disbursements to both schools and
libraries for the “E rate” program ($2.25 B) and for the rural health care program
($400B).
Over the first five funding years (1998 to 2002), the Commission committed
approximately $10 billion and disbursed $6.2 billion to eligible schools and libraries.
During the 2002-filing window, which closed in January 2002, over 36,000 applications
were filed seeking $5.7 billion. Currently, the FCC has committed $1.87 billion to over
28,000 applicants for funding year 2002. The addition of the E Rate program has
resulted in a substantial increase in the overall size of the fund since collections began in
1998.
Because demand for E-rate funds exceeded available funding and due to
Congressional pressure, the FCC established funding priorities ensuring that funds are
directed to the most economically disadvantaged schools and libraries and that every
eligible school and library filing would receive some assistance. Internet access is given
priority funding and internal connections are considered priority two.
With its inception, the Schools and Libraries program generated significant
support and controversy. Proponents credit it with accelerating the deployment of
Internet connections for thousands of schools and libraries nationwide— particularly in
low-income and rural communities. Since it creation, over eighty six percent of the
nation’s public schools and sixty five percent of libraries have received discounted
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172
services. Critics, however, continue to raise concerns over the scope and funding level of
the program and the potential for fraud, waste and abuse.
On October 31, 2002, the FCC’s Office of Inspector General (OIG) released a
report documenting instances of fraud uncovered in the administration of the E-rate
program and cautioning that the FCC lacks the necessary resources to provide adequate
oversight. In February Federal prosecutors filed the first criminal case involving the E-
rate, charging the owner and three employees of a New York Internet services company,
with conspiring to defraud the program of millions of dollars. The FCC held a public
forum on May 8, 2003, focusing on proposals to improve the administration of the E-rate
program and ensuring proper FCC oversight of the program. One of the major policy
challenges has been to achieve consensus on the fundamental values surrounding
universal access among the different stakeholders of national and international
infrastructures. Most would agree the access to networks and services should be
equitable, affordable and ubiquitous but that access depends on other physical, technical
and economic factors.
Lawrence Gasman, Director of Telecommunications and Technology Studies at
the Cato Institute stated, “It has been said that social security is the third rail of U.S.
social policy—^touch it, and die! By the same token one might argue that the universal
service doctrine is the third rail of U.S. communications policy.”^ During the debates
that preceded the passage of the ‘96 Act, there was little discussion of the merits of
universal service. Politically, the Democrats and liberals genuinely believe the universal
service doctrine helps the poor and worthy organizations like schools and libraries. For
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173
them, the universal service doctrine was especially attractive because it represented an
opportunity to pass social welfare legislation as part of a broadly supported law at a time
when the era of big government was supposedly over and other large scale social welfare
programs, such as socialized medicine, were difficult to pass. Meanwhile, Republicans
and conservatives who might have been expected to oppose the program both in its social
and economic forms did not do so because universal service provides subsidies for
telephone service in rural areas—traditionally a strong political base for the conservative
right and home base for most every Senator on the Commerce Committee. Again,
ideology played a strong role in this agenda item moving to law.
In his book, A Perspective on Telecommunications, A. Michael Noll, says, “The
entire mentality o f subsidies and universal service is outdated and is inconsistent with a
free marketplace and competition. The real problem was created decades ago with the
subsidization of local service by long-distanee service. Today’s version of this inequity
is aecess charges, which have been extended to create explicit subsidies for various social
purposes. Social welfare indeed has its place, but should not be funded by charges on
specific industries. It would not make sense to charge fast-food establishments some
extra tax that would then subsidize the hungry. So too, telecommunication service
providers should not be taxed explicitly to subsidize phone service to the need or to
schools and libraries or to rural areas.” He goes on to say, “Subsidies once initiated are
difficult to halt. Those benefiting become a strong political voice continuing to beg to be
fed. Even in those cases where help has not been requested, who will not refuse a
handout from the government when it if offered?”'' Ken Robinson seconded that opinion
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in our interview, “Once you start it, you will never be able to satisfy the appetite of the
schools and libraries.”^
So many questions and issues remain. How does one determine universal access
when the technology required to keep up to date with current trends is constantly
changing? Will the Internet be taxed? How is the whole structure to be governed? Should
the governing institution be publicly accountable? How will the program be funded? At
what level will technical literacy be fully achieved? Who will be provided technical
support? Who will provide access? Will a government institution be necessary to provide
access to the network or will telecommunications providers receive subsidies from the
government? Is the role of a regulatory agency to regulate or administer education
programs? What will the role of community networks be?
O f course, there is always the three-percent federal excise tax on your telephone
bill that was originally assessed to pay for the Spanish American War in 1898 when the
telephone was still considered a luxury. Yes, look on your bill. It is still there and
amounts to approximately $6.5 billion annually, just about the right amount to fund the
entire Universal Service Program. Congress even voted, almost unanimously, to rescind
the tax in the late nineties (vetoed by President Clinton as part of a larger bill). Would it
not make sense to use those funds more appropriately for the industry where the tax
appears? That is a question for another day and another chapter in the continuing saga of
universal service.
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Chapter Six Endnotes:
' Charles M. Oliver, “The Information Superhighway: Trolls at the Tollgate,” Federal
Communications Law Journal, Volume 50, December 1997, No. 1, Published by Indiana
University School of Law-Bloomington.
^ Ibid.
^ Lawrence Gasman, “The Telecommunications Act of 1996,” Regulation, The Cato
Review of Business & Government, Fall 1996, Cato Institute.
A. Michael Noll, Introduction to Telephones and Telephone Systems, Third Edition,
Artech House, Boston, London, 1998, pp. 328-329.
^ Interview with Ken Robinson.
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Appendix A: TIMELINE
1934 Telecommunications Act of 1934
1967 Amendment to the 1934 Act to provision for operation and funding of Corporation
for Public Broadcasting
1969 Arpanet commissioned by Department of Defense for Research into Networking
1981 Bitnet, “Because It’s Time to Network” begins
French Minitel deployed across France by French Minitel
1982 AT&T Antitrust Suit Settlement Announced
1984 Bell Company Break Up
Cable Communications Policy Act
1986 NSFNet created, 5 Supercomputing centers across America
1991 World Wide Web (WWW) created
1992 Clinton/Gore Elected to the White House
Cable Television Consumer Protection and Competition Act
Reed Hundt nominated to the FCC
November 20: Dole approves Hundt’s confirmation as FCC Chairman
Internet Society (ISOC) is chartered
1993 January: Sculley testifies before Senate Commerce, perspective on
National Information Infrastructure
White House goes on line
September: The National Information Infrastructure (Nil): Agenda for Action
Report is issued
November: House Judiciary Committee Brooks and Dingell introduce H.R. 3626,
House Commeree Committee, Markey Fields introduce H. R. 3636
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December 21: Gore makes major speech on the topic of our National
Communications Policy at the National Press Club
1994 January: Gore, Hundt speak at UCLA
February 3: Hollings introduces S. 1822
June 28: House Bills merge and pass as H.R. 3626
August 11: S. 1822, Hollings bill markup in Senate Commerce Committee
Dole “draft bill” introduced in the Senate
September 21: Hollings met with Dole
September 22: Hollings staff met with Dole Staff
September 23: Hollings pulls down Senate bill
December 5: Hundt, Gore, Pressler attend kickoff for first Spectrum auction
1995 January 9: Gore speaks at Conference on Federal, State and local
Telecommunications Policy
January 9: Senate Hearing, before Chairman Larry Pressler
March 23: Senate Commerce Committee passes S. 652 out of committee
June 8: Full Senate begins debate on S. 652
June 15: S. 652 passes Senate. Vote was 81-18
November: Congress shut down for six days
December 15: Congress closes Executive Branch
December 20: Gore announces Conference Committee work is okay with the
White House
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1996 January 26: President Clinton speaks about connecting classrooms in his State of
the Union Address
February 1: Senate and House pass Conference Report for S. 652
February 8: S. 652 Signing Ceremony, Library of Congress
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Appendix B: THE 1966 TELECOMMUNICATIONS ACT
^Telecommunications Act of 1996, Pub. L. No. 104-104, D 254h, 110 Stat.
56, 73-75 (1997).
Subsection 254(h) (1) (B) states:
(h) Telecommunications Services for Certain Providers.
(1) In general.(B) Educational providers and libraries.— All telecommunications
carriers serving a geographic area shall, upon a bona fide request for any of its
services that are within the definition of universal service under subsection
(c)(3), provide such services to elementary schools, secondary schools, and
libraries for educational purposes at rates less than the amounts charged for
similar services to other parties. The discount shall be an amount that the
Commission, with respect to interstate services, and the States with respect to
intrastate services, determines what is appropriate and necessary to ensure
affordable access to and use of such services by such entities. A
telecommunications carrier providing service under this paragraph shall__
(i) notwithstanding the provisions of subsection (e) of this section,
have an amount equal to the amount of the discount treated as an
offset to its obligation to contribute to the meehanisms to preserve
and advance universal service, or
(ii) receive reimbursement utilizing the support mechanisms to
preserve and advance universal service.
(2) Advanced services.—The Commission shall establish competitively neutral
rules-
A) to enhance, to the extent technically feasible and economically reasonable,
access to advanced telecommunications and information services for all public
and nonprofit elementary and secondary school classrooms, healthcare
providers, and libraries; and
B) to define the circumstances under which a telecommunications carrier may be required
to connect its network to such public institutional telecommunications users.
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190
Appendix C: INTERVIEWEES
Transcripts may be accessed through the author at Suite 900, 1133 21^‘ Street, NW,
Washington, D.C. 20036
Government Representatives
Vice President A l Gore:
Vice President o f the United States, 1992-2000, former U.S. Senator, U.S. House o f
Representatives, (D-Tennessee)
Roy Neel:
Roy Neel and Associates, former President o f United States Telecommunications
Association, form er C hief o f Staff to President Bill Clinton, former Chief o f Staff to Vice
President Al Gore, form er C hief o f Staff to Senator Al Gore
Reed Hundt:
Senior Advisor, McKinsey & Company and former Federal Communications Commission
Chairman
Majority Leader U. S. Senate Tom Daschle:
(D-South Dakota)
Donald McClellan:
Vice President-Gateway Corporation, former Chief o f Stafffor the Senate Commerce
Committee, Chairman Larry Pressler (R-South Dakota)
Congressman Chip Pickering:
(R-Mississippi), former Senior Telecommunications Staff for Senator Trent Lott (R-
Mississippi)
Mike Nelson:
Director o f Internet Technology and Strategy, IBM Corporation, former Senior
Telecommunications Advisor to Vice President Al Gore, former Senior Staff to Senator Al
Gore, former staff to Senator Ernest F. Hollings (D-South Carolina), Chairman o f the
Senate Commerce Committee, Science, Space and Technology
Cheryl Bruner:
IBM, former counsel to Ron Brown, Secretary o f Commerce, and telecommunications staff
advisor to Senator Jay Rockefeller (D-West Virginia), Member o f the Senate Commerce
Committee
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191
Mike Regan:
Vice President, Cox Communications, former Chief Counsel fo r the House Commerce
Committee, Chairman Tom Bliley (R-Virginia)
Kathy Brown:
Vice President-Verizon Corporation, former Senior Staff Federal Communications
Commission Common Carrier Bureau, former Senior Staff, NTIA
Carol Ann Bischoff:
Vice President-Competitive Local Exchange Carriers, former Telecommunication Staff to
Senator Bob Kerrey (D-Nebraska)
Barbara Pryor:
Senior Education Staff to Senator Jay Rockefeller (D-West Virginia), Member o f the
Senate Commerce Committee
Greg Rohde:
President, E-Corpernicus, former Assistant Deputy Secretary during the Clinton
Administration, form er Senior Telecommunications Staff Advisor to Senator Byron
Dorgan (D-North Dakota), Member o f the Senate Commerce Committee
Chris McLean:
Partner, National Strategies, former Assistant Deputy Secretary o f Rural Utilities
Services, (RUS) during the Clinton Administration, former Senior S ta ff to Senator James
Exon (D-Nebraska), Member o f the Senate Commerce Committee
Senator Olympia Snowe:
(R-Maine), Member o f the Senate Commerce Committee
Colin Crowell:
Legislative Assistant to Congressman Ed Markey (D-Massachusetts), Chairman,
Telecommunications Subcommittee for the U S. House o f Representatives Commerce
Committee
Earl Comstock:
Attorney at Law, Sher and Blackwell Attorneys, Washington, D. C., former Chief o f Staff
to Senator Ted Stevens (R-Alaska), Member o f the Senate Commerce Committee
Angela Campbell:
Former Telecommunications Stafffor Senator Olympia Snowe (R-Maine), Member o f the
Commerce Committee, U. S. Senate
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192
Blair Levin:
Analyst, Legg Mason, former Federal Communications Commission C hief o f Stafffor
Reed Hundt, Chairman o f the Federal Communications Commission
Tom Kalil:
Special Assistant to the Chancellor, University o f California Berkley, former White House
Economic Council, Special Assistant for Economic Policy fo r President Bill Clinton,
Deputy Assistant to Vice President Al Gore
John Windhausen:
President o f Alternative Long Distance Providers, former C hief o f Staff, Senate
Commerce Committee fo r Senator Ernest F Hollings (D-South Carolina), Chairman o f
the U . S. Senate Commerce Committee
Karen Kornbluh:
Chief o f Technology Policy, Mass Media Bureau, former Director o f the Federal
Communications Commission, Office o f Legislative and Intergovernmental Affairs,
former Staff Advisor to Senator John Kerry (D-Massachusetts), Member o f the Senate
Commerce Committee
Greg Simon:
President, Simon Strategies, former C hief Domestic Policy Counsel to President Bill
Clinton
Larry Irving:
President, Irving Information Group, former Assistant Deputy Secretary fo r National
Telecommunications and Information Administration-Clinton Administration, former
Senior Counsel fo r Congressman Ed Markey (D-Massachusetts), Subcommittee
Chairman fo r Telecommunications, Commerce Committee, U S. House o f
Representatives
Jim Kohllenberger:
Consultant, form er Senior Domestic Policy Advisor to Vice President Al Gore
Laura Breeden:
Director, American Connects Consortium, former Department o f Commerce, Chief o f
Inforstructure Division, Director o f Telecommunication and Information Inforstructure
Assistance Program, former Executive Director, Far.Net Association, Newton,
Massachusetts, form er Grantee o f National Science Foundation Project on the Internet
David Wilson:
President, David Wilson & Associates, former Legislative Assistant to Senator Robert
Dole (R-Kansas), Majority Leader o f the U.S. Senate 1994-95
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193
Hance Haney:
Vice President-Regulatory, Qwest Communications, former Legislative Assistant to
Senator Bob Packwood (R-Oregon), Ranking Member o f the Senate Commerce
Committee, form er Field Representative fo r Education fo r Senator Bob Packwood
Kevin Joseph:
Vice President, Allegiance Corporation, former Chief Senior Counsel fo r the
Telecommunications Subcommittee Chairman Ernest F. Hollings (D-South
Carolina), Chairman o f the Commerce Committee, U.S. Senate
Sheryl Wilkerson:
Vice President, Arraycomm Corporation, former FCC Legislative Liaison, former
Telecommunications Staff Advisor for Senator Ernest F. Hollings (D-South Carolina),
Chairman o f the Commerce Committee, U. S. Senate
FCC Representative:
Anonymity Requested
Public Interest Representatives
Norris Dickard:
Vice President, Benton Foundation, former Administrator, Harvard Kennedy School o f
Government, form er Senior Policy Advisor, Workplace Development Issues, Clinton
Administration
Michelle Richards:
Director-Federal Programs Advocate, National Schools Boards Association, former staff
member, People fo r the American Way
Jill Lesser:
Vice President ofAOL, former Director o f Civic Media Project, People fo r the American
Way, Attorney at Law
Lynn Bradley:
Director, Government Relations, American Library Association (ALA)
Jeff Burnett:
Vice President, Government Relations, National Association o f
Independent Schools (NAIS)
Carolyn Breedlove:
Exhibit Manager and Lobbyist, National Education Association (NEA)
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194
A rt Brodsky:
Editor, Industry and Commerce, Consressional Quarterly, former Press Director, Qwest
Communications, form er Press Vice President, (NTIA)
Leslie Harris:
President, Leslie Harris and Associates, former Manager o f the Media Access Project
Dena Stoner:
Vice President and Director, Government Relations, National Rural Electric Cooperative
Association, form er Staff to the Regional Education Labs
Sam Simon:
President and CEO, Issues Dynamics, a public interest organization in
Washington, D.C.
Sarah Fitzgerald:
Vice President fo r Communications, Funds for Learning, former Assistant Editor,
Washington Post, staff member fo r Interactive Services Association
Ira Fishman:
Attorney, Patton and Boggs Law Firm, Washington, D. C., former head o f the Schools and
Libraries Corporation
A rt Sheekey:
Project Director fo r the Regional Technology Consortium, Council o f Chief State School
Offices, U.S. Department o f Education, former Science Fellow during the first Bush
Administration
Marilyn Mohrman-Gillis:
Vice President, Am erica’ s Public Television Stations
Laura Westley:
Director, Girl Scouts o f America, former Assistant Executive Director o f Government
Relations, National School Board Association
Business Interests
M el Blackwell:
Vice President, Universal Service Administrative Company, form er Vice President-AT&T
Congressional Relations
Frank Gumper:
President o f Board, Universal Service Administrative Company, form er Vice President
fo r Regulatory Affairs, Bell Atlantic Corporation
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195
Dr. Barbara Cherry:
Attorney fo r the Federal Communications Commission Policy and Plans Bureau, former
Ameritech lawyer, form er ATT Legal Department
Dr. Robert Blau:
Executive Vice President-Federal Regulation, BellSouth Corporation, former FCC staff
economist. Common Carrier Bureau Division, Federal Communications Commission
Dr. Kathleen Levitz:
Vice President-Regulatory, BellSouth Corporation, former Head o f the Common Carrier
Division, Federal Communications Commission
Frank Dillow:
Vice President-Legislative Relations, Verizon Corporation, former Vice President for
General Telephone Company
Aubrey Sarvis:
Partner, Trammel and Sarvis, former Executive Vice President o f Bell Atlantic
Corporation, form er General Counsel fo r Senator Ernest F. Hollings (D-South Carolina),
Chairman Senate Commerce Committee, U. S. Senate
Bernard Wunder:
Partner, Wunder & Lily Law Firm, former Assistant Secretary National
Telecommunications and Information Administration (NTIA), Reagan Administration,
former Chief Counsel to Congressman VanDeerlin (D-California), Chairman o f the
House Telecommunications Subcommittee
Kenneth Robinson:
Consultant, Editor, Telecommunications Policv Report, former Senior Legal Advisor to
Chairman Al Sikes, Federal Communications Commission
Linda Roberts:
Consultant, form er Head o f Office o f Technology, Department o f Education, during the
Clinton Administration
Dr. Bob Pepper:
Director o f Office o f Plans and Policy Department, Federal Communications
Commission
Kathy Reid:
Senior Telecommunications Staff to House Commerce Committee fo r Representative Tom
Bliley (R-Virginia), Chairman o f the House o f Representatives Commerce Committee
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196
Appendix D: MAJOR PARTICIPANTS IN THE
TELECOMMUNICATIONS ACT OF 1966
Bell Atlantic
BellSouth
US West
Pacific Telesis
Southwestern BellSouth
AT&T
Cellular Telecommunications Industry Association
MCI
LDDS
Information Industry Association
National Newspaper Association
Alarm Industry Association
Small Telco Association
National Association of Regulatory Utility Commissioners
National Association of Broadcasters
AARP
CFA
Disability Community
Education Community
Veterans
Healthcare Providers
Independent Film and Video Producers
Computer Industry
Small Business Administration
State and Local Governments
Communications Workers of America
AFL-CIO
State Attorney Generals
Comcast
Cox Enterprises
Tele-Communications, Inc.
Time Warner
McCaw
IBM
National cable Television Association
Sprint
Teleport
Metropolitan Fiber Systems
Hughes Communications
DirecTV
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197
Primestar
Viacom
Paramount Communications
Silicon Graphics, Inc.
Robert Murdoch News Corporation
Turner Broadcasting
Intel
Motorola
Hewlett Packard
Microsoft
Sony
Phillips
Toshiba
General Instrument
Samoff
Thompson
Zenith
Buisness Software Alliance
MIT
Information Technology Association of America
Douglas Communications
General Communication Incorporated
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198
Appendix E: WHITE HOUSE CONFERENCE ON LIBRARIES AND
INFORMATION SERVICES REPORT 1991
Upgrading Rural Services
Develop Networking Equity for Low-Density Areas (Priority Recommendation)
That networks connecting small, rural, urban, and tribal libraries be developed and
supported at the federal, state, and local levels to ensure basic library services to all end
users. Equal opportunity to participate in our country’s economic, political and social life
depends upon equal access to information. The federal government should provide
additional funding, based on low-density populations, under the Library Services and
Construction Act to address the networking needs of small and rural libraries. All rural
and low-density population libraries should be provided with federal funds for a
minimum of one access terminal on the National Research and Education Network.
Networking School Libraries
Ensure Statutory Support fo r role in America 2000
That to assure all students have equal access to the Nation’s library and information
resources, federal and state statues should be enacted and/or revised, as well as adequately
funded, to ensure that all school libraries participate in regional, state and national
networks, and in support of American 2000. Every America 2000 New American School
should be networked to share information, resources, and ideas using a technologically
advanced library media center as its information technology hub.
Building Education Information Network
Share Via a National 'Superhighway ’ (Priority Recommendation)
That the Congress enact legislation creating and funding the National Research and
Education Network (NREN) to serve as an information “superhighway,” allowing
educational institutions, including libraries, to capitalize on the advantages of technology
for resource sharing and the creation and exchange of information. The network should be
available in all libraries and other information repositories at every level. The governance
structure for NREN should include representation from all interested constituencies,
including technical, user, and information provider components, as well as government,
education at all levels, and libraries.
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199
Appendix F: COMPUTER SYSTEMS POLICY PROJECT
MEMBERSHIP AS OF JANUARY 1993
John Scully, Apple Computer
Robert E. Allen, AT&T
Eckhard Pfeiffer, Compaq
Janies E. Ousley, Control Data
John A. Rollwagen, Cray Research
Ronald L. Skates, Data General
Robert B. Palmer, Digital Equipment
Lewis E. Platt, Hewlett-Packard
John F. Akers, IBM
Edward R. McCracken, Silicon Graphics
Scott G. McNealy, Sun Microsystems
James G. Treyhig, Tandem
James A. Unruh, Unisys
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200
Appendix G: COMPUTER SYSTEMS POLICY PROJECT
REPORT DATED JANUARY 12,1993
“Perspectives on the National Information Infrastructure”
We are currently the world leader in computing and communications
technologies, yet we have not taken steps that will allow us to make the most of our
potential. This report calls for concerted efforts by the U.S. public and private seetors to
develop and deploy an advanced information infrastructure that will put our information
technology advantage to work for all Americans.
Throughout history, the United States has been successful, in part, because we
have taken bold steps to make our national resources available to individual Americans
by creating a variety of underlying foundations or infrastructures. Our transportation,
telephone, electric power, and water systems are all solid examples of this tradition. By
developing the infrastructures to make these resources readily accessible to individual
Americans and easy to use, we have experienced an economie prosperity, quality of life,
and global competitiveness virtually unmatched by any nation. We need to build on this
tradition to carry us into the 2U‘ century.
A national information infrastructure, which will be as accessible and easy to use
as our existing national infrastructures, will revolutionize our ability to communicate and
collaborate by erasing geographic boundaries. It will enable us to tap into our existing
resources of creativity and knowledge. It will lead to the development of products and
services today unimagined. It will create new jobs and economic strength for individual
Americans. It will accelerate the development of critical technologies. And finally, it
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201
will enable us to address more effectively many societal problems, including challenges
in the areas of health care, education, and manufacturing.
A summary of recommendations was as follows:
Administration Agenda
1. Make the N il a National Technology Challenge
2. Establish a National Information Inforstructure Council
3. Establish an N il Implementation Entity
4. Invest in Research for a Nil
5. Fund Pilot Projects to Demonstrate Technologies
6. Develop a Public Education Program
7. Make Government Information Easily Accessible
Legislative Agenda
1. Authorize a National Information Infrastructure Council and Appropriate Funds
for its Operation
2. Authorize and Appropriate Funds for Research and Technology Demonstrations
Industry Agenda
1. Continue Investments to Develop and Deploy a N il
2. Continue to Invest in Research and Development of Applications
3. Reach Out to Other Industries
4. Promote N il Efforts
5. Develop N il Goals and Milestones
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202
Appendix H: PRESIDENT WILLIAM J. CLINTON AND VICE
PRESIDENT ALBERT GORE, JR. TECHNOLOGY FOR
AMERICA’S ECONOMIC GROWTH, A NEW DIRECTION TO
BUILD ECONOMIC STRENGTH, FEBRUARY 22,1993
To ensure that the future o f America is a future o f economic growth
and high quality o f life and environment, the Government will take a new,
and more active, role in the development o f technology. Instead o f limiting
support to basic research and defense-oriented projects, the government
will focus on investments designed to strengthen industrial competitiveness
and create jobs. Technology policies will be adopted which encourage
innovation by creating a market that rewards invention and enterprise.
Vice President Gore and the Office o f Science and Technology
Policy will take the lead in developing new technology and science
policies and programs. The National Economic Council (NEC) will
provide a forum fo r ensuring that tax, trade, regulatory and other broad
economic policies reinforce, not frustrate technology initiatives. The
Administration will also work with Congress to prevent 'earmarking’ o f
funds fo r technology projects and regularly and systematically review
every federal technology program to determine their continued relevance.
In addition to these ongoing processes, the following initiatives will lay the
foundation fo r the new era:
-make the research and experimentation tax credit permanent so
that businesses have a dependable incentive to invest
-accelerate investment in advanced manufacturing technologies to
promote competitiveness and advance worker skills;
-develop a major program to help the U.S. automobile industry
develop new technologies to eliminate environmental hazards and
reestablish competitiveness o f the industry;
-invest in improving energy efficiency o f federal building;
-support development and introduction o f computer and
communications equipment and software to improve education and
training; and
-invest in a national information infrastructure and design
communications policies that ensure rapid introduction o f new
communications technology.
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203
The Administration strongly believes that efficient access to high
speed communications networks and computer system would have a
dramatic, positive, impact on America’ s businesses and citizens. To tap
this potential, it proposes to implement five policies designed to promote
technological innovation and increased infrastructure investment.
1. Implement the high-performance computing and
communications program introduced by then-Senator Gore which will
provide scientists and engineers with the tools to tackle the most
challenging research projects. The networks will be constructed by the
private sector but encouraged by federal policy and technology
developments.
2. Create a high-level inter-agency Task Force with the NEC to
ensure that government policies do not inhibit, but rather accelerate, the
development o f communication technology and investment in
communications infrastructure. The Task Force will work with Congress
and the private sector to fin d consensus and implement the necessary
policy changes.
3. Create an information infrastructure technology program to
assist industry in developing the hardware and software necessary to
utilize computer/communication technologies in manufacturing, health
care, life long learning and libraries.
4. Provide funding for NTIA to assist non-profit entities
(states, school districts, libraries) in purchasing computers and
networking facilities fo r pilot projects in areas such as distance learning.
5. Utilize computer/communication technology to improve
dissemination o f Federal information while promoting growth o f industry.
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204
Appendix I: EXCERPT FROM A 1994 SPEECH BEFORE THE
HARVARD GRADUATE SCHOOL OF EDUCATION BY REED
HUNDT
“My third, a time urgent, children’s topic, concerns the country’s
classrooms. In Los Angeles, on January 11 of this year, the Vice President challenged
every telecommunications company, school board, teacher, librarian, and citizen of
this country to "connect and provide access to the National Information Infrastructure
for every classroom, every library, and every hospital and clinic" in the country by
the year 2000.
In his State of the Union speech two weeks later, the President said: "The Vice
President is right-we must also work with the private sector to connect every
classroom, every clinic, every library, every hospital in America into a national
information superhighway by the year 2000." He went on: "Think of it-instant access
to information will increase productivity, will help to educate our children."
That was the first time telecommunications was mentioned in a State of the
Union Speech. It was mentioned as the path to a new kind of education. This national
information infrastructure of which the President and the Vice President have spoken
will rely heavily upon our telephone and cable networks, as they exist and as they
will become. Already telephone lines easily have sufficient capacity for some video
applications and many voice, data, and computer linkup.
The President, the Vice President, and I hope all of you believe that these
networks should reach all of the classrooms of all of our schools as soon as possible.
Already Bell Atlantic, PacBell and Ameritech have said, with some modest
reservations that I think can be overcome, that they will connect all the schools in
their regions to the developing broadband networks. A major cable company, TCI,
made the same commitment. These commitments will extend the networks to more
than 1/3 of American schools. If-or dare I say when?-the Administration's challenge
is met by everyone, education in this country will be reinvented, forever and for
better.
Congressman Markey has already surveyed the 20 largest telephone and cable
companies to determine their views on linking America's classrooms to the
information superhighway. A majority do not oppose linking the classrooms
essentially for free, but they are concerned with details.
There are many questions. Should cable companies and telephone
companies race each other into the classrooms?
Who does the internal wiring? Would asbestos be disturbed in some
schools, electric conduits disrupted in others?
Should we set the standards for carrying capacity and interoperability?
Who will pay for transmission costs after the networks are installed? If a
student calls long distance, who pays?
These are questions relating to how this will work in the classroom: What
applications will be created? Who will control the content? How will students and
teachers be trained? What will change in the relationship between student and
teachers?
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205
These are good questions, but when I hear them, I inwardly smile. For these
are not questions about the grand unified theory of physics or the balancing of the
budget. These questions are the kind that can be readily solved and reasonably
quickly. They are, in fact, questions that can be solved by you in this audience.
There is already a vehicle for you to help address these questions. It is
S 1822, a bill entitled the Communications Act of 1994, introduced by
Senator Hollings, along with more than a dozen other Senators. When 1 testified
about this bill last week, 1 told the Senators the most important part of the bill might
be the language that directs the FCC to promulgate rules that will "enhance the
availability of advance telecommunications services to all public elementary and
secondary school classrooms and libraries."
Congressman Markey is the author of another telecommunications reform bill,
HR 3636. This noble bill should be amended also to grant the FCC the authority to
monitor and, where necessary, to complete the construction of the information
highway into every classroom. 1 believe Congressman Markey agrees that is in the
public interest to make this change.
We have a glorious opportunity in this Congress to do a very right thing, but 1
have not heard from a single educator or academic in support of the goal that the
President outlined, that Senator Hollings aims to achieve and that Congressman
Markey may well support. Certain telephone companies and cable companies have
been helpful, but isn't the vision of the interactive education enterprise compelling to
Harvard? Harvard itself is going to be wired for interactivity within a few years,
according to an announcement a couple of weeks ago. But all the school and
classrooms in the country should be included.
We in government can help write the rules but we need the wisdom of you
here, a combination of not just of educators, broadcasters, and cable operators-but
of utilities companies, regulators, software providers and most importantly parents
to make it work right. This is my challenge to you-to form such a coalition and
make it an effective voice for the children of America."
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206
Appendix J: WALL STREET JOURNAL EDITORIAL DATED
DECEMBER 9,1997
(Editorial)
New Phone Tax
9 December 1997
The Wall Street Journal
A22
(Copyright (c) 1997, Dow Jones & Company, Inc.)
The President is muttering about tax cuts these days, but he hasn't said much about the tax hike his administration is
dropping on households come January. Yes, a tax hike. You'll feel the new annual tax, set to run at something like
$25 a household, when you pay your long distance telephone bill.
The phone tax isn't called a phone tax, o f course. It is called a "universal service contribution." The Federal
Communications Commission is requiring that phone companies make that "contribution" for the social good o f
wiring the nations' schools and libraries to the internet. This coming year, the companies will have to hand over
$2.25 billion in extra charges for the wiring cause. Ultimately it is not the phone companies who will carry this cost.
They will pass it along to the American consumer in the form o f higher rates. That is why it is a tax.
The new phone-tax story got started when Vice President Gore, Senate Democrats and Olympia Snowe o f Maine --
more or less a Republican - wedged into the 1996 telecom bill some vague language about giving the nation's
schools and libraries access to the information revolution. That language said nothing about Washington forcing the
public or private sector to spend billions to connect the nation's schools and libraries to the internet.
Nonetheless, that was what Reed Hundt, then the FCC chairman, decided the bill meant. Soon he and Mr. Gore were
going around the country speaking about the federal mandate to wire every school and library. Next thing you know
a faceless set o f FCC appointees had come up with the $2.25 billion price tag, money that was to be extracted from
the phone companies and then buried in phone bills. When he retired from his job, Mr. Hundt told the staff the FCC
had "done more for K-12 education than the federal government has ever done before, with the sole exception o f the
school lunch program."
We can see how wiring every American classroom on the theory that Web surfing will keep kids current in the
information age is the sort o f dream achievement you would want to be able to claim credit for in a Presidential
campaign. In the event, it seems that some half o f American classrooms are wired already, thanks to energetic local
school boards and marvelous private-sector efforts by companies like Sun Microsystems. Even as politicians seek to
earmark funds and support in the name o f solving some supposedly serious social problem, market forces or smaller
government units are already at work solving that problem. N o wonder Grandiose Government types like Mr. Gore
are sounding so much in earnest. They were simply bom into the wrong era.
The market may also kill this phone tax. Back in the days o f monopolies, phone companies and their customers
tolerated hidden costs. What choice did they have? Now though they live in such a competitive environment that
they have to defy big regulators. So this week we're seeing the first signs o f resistance: Many carriers are talking
about going against the FCC's wishes and itemizing the phone tax. That way consumers can see what they're paying
for, which is never a bad idea.
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207
Appendix K; EXAMPLE OF UNIVERSAL SERVICE BILLING
verizsiP
M9k9 p r o g n u tiw y a$y
Blino Dan; 09^7/03 Papa e of
Talaphona Numbar:
Aocount Numbar:
How to Raach Uf: S at pagt 2
Verizon Service Record Informetion
Inventory oi Product* *nd Servirai on Account 000013916364
TTiff documtnt la a llatlnff of aarvicaa on your account tor which you pay a Monthly Charge (tftla k pot a bitlj.
Variton provldaa thia Information on your account yaarty for your conyanlanca. If you would Ilka thk Information
more frartuantty call Ota numbar on tha top of thIa fraga.
*U ne N um ber;
* Basic Service
1 , Dial T one Line
Interlata Carrier N am e (PIC)
intraiata C arrier N am e (LPIC)
2 . ELS -
Econom y M e ssa g e S ervice
t , Listed S ervice
4 . Local N um ber Portability
S u rch arg e
a . N on-Prim ary F ederal U niversal
S ervice F und S urch arg e
a . N on-Prim ary Line S u b sc rib er
Line C harge
7 . R esidence Dial Tone
Econom y M e ssa g e^ A C S ervice
a . Touch T one
NR
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A ettrK y Dels
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CoUst Amount
1 2/17/92 LEFE 5.00
WTL
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1 12/1/98 LEFE .11
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1 3/17/99 LEFE .23
1 6A0A)0 LEFE .63
1 1/1/99 LEFE 6.36
1 2/17/92 EEEE .00
1 1/1/9B EEEE .00
Your AT&T Statement
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University of Southern California Dissertations and Theses

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Asset Metadata

Creator English, Mary Pepper J. (author)

Core Title Ideologies and champions: Universal Service from Congress to your telephone bill

School School of Policy, Planning and Development

Degree Doctor of Public Administration

Degree Program Public Administration

Publisher University of Southern California (original), University of Southern California. Libraries (digital)

Tag OAI-PMH Harvest,Political Science, public administration

Language English

Contributor Digitized by ProQuest (provenance)

Advisor Hise, Greg (committee chair), Krieger, Martin H. (committee member), Noll. Michael (committee member)

Permanent Link (DOI) https://doi.org/10.25549/usctheses-c16-509571

Unique identifier UC11340244

Identifier 3140467.pdf (filename),usctheses-c16-509571 (legacy record id)

Legacy Identifier 3140467.pdf

Dmrecord 509571

Document Type Dissertation

Rights English, Mary Pepper J.

Type texts

Source University of Southern California (contributing entity), University of Southern California Dissertations and Theses (collection)

Access Conditions The author retains rights to his/her dissertation, thesis or other graduate work according to U.S. copyright law. Electronic access is being provided by the USC Libraries in agreement with the au...

Repository Name University of Southern California Digital Library

Repository Location USC Digital Library, University of Southern California, University Park Campus, Los Angeles, California 90089, USA