Larry Pressler

Mr. PRESSLER

Mr. PRESSLER. Under the consent decree that broke up AT&T, DOJ is not the decisionmaker; it was the court, Judge Greene. Now we are making DOJ the decisionmaker under the Dorgan proposed amendment.

Mr. PRESSLER. They will make the final decision.

Mr. PRESSLER. But under the Clayton and Sherman Acts, as my distinguished friend pointed out, the language in the bill, they already have antitrust power. We are setting up a permanent administrative bureaucracy in the Department of Justice that is supposed to be done over at the FCC, and we have it done in the FCC in two ways. One is the public interest convenience and necessity; and two is the checklist that Senator Hollings and Senator Exon and Senator Kerrey of Nebraska had there with staff. This was all worked out. We spent night after night. Never has there been a more bipartisan effort in this Senate, preparing a bill, if I may say so. We invited everybody. I talked to all 100 Senators. There is an implication by the Senator from Nebraska that all this was sprung upon him suddenly.

Mr. PRESSLER. There is an implication that the bill is driven by corporate interests.

Mr. PRESSLER. Your staff was in the room where the bill was drafted.

Mr. PRESSLER. I want to say how hard that staff and Senators involved worked through the weekends. A lot of Members have not had a day off since Christmas. I find the suggestion that this bill is a result of corporate interests in the Senate of these United States, when we had a discussion this morning about assuming language, or whatever people are saying, and so forth, and maybe I misspoke. I do not know. I raised some points. I consider the Senator from Nebraska a good friend. We have done everything we can to do what is right for the American people. If we do not pass this bill in this Congress, it will fall over to 1997 and we will lose 2 years of jobs and creativity. This is not a perfect bill. I welcome the participation of the Senator from Nebraska.

Mr. PRESSLER. I find it unreasonable for the suggestion that this is a bill of corporate interests. I believe the Senators involved have acted in the public interest.

Mr. PRESSLER. There is a large part of corporate America for the Justice Department review which the Senator is supporting.

Mr. PRESSLER. But I am not accusing the Senator of responding to corporate America. I think we are asking, in the public interest.

Mr. PRESSLER. Some of the biggest corporations in America want a Justice Department review.

Mr. PRESSLER. If my friend will yield for a question, is there another area of the Justice Department where they have a decisionmaking role? Earlier this year, we had this process that we went through, and both Senators from Nebraska had their staffs there and could have been their personally, night after night, and they both did a good job. They wrestled with this Justice Department thing over and over and could not find another area of American life where the Justice Department has a decisionmaking role, such as this amendment wants to add.

Mr. PRESSLER. Mr. President, I would like to be able to enter into this colloquy. What is the parliamentary situation?

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Friday, June 9, 1995, at 10:30 a.m.

Mr. PRESSLER

Mr. PRESSLER. Right.

Mr. PRESSLER

Mr. PRESSLER. I suggest the absence of a quorum.

Mr. PRESSLER

Mr. PRESSLER. I suggest the absence of a quorum.

Mr. PRESSLER. I say to my friend, the Senator from Nebraska, that my mother is watching in Sioux Falls. She might appreciate it if we can just talk all afternoon, but I think other than her, there might be some boredom. I did want to praise Senator Inouye for his leadership and willingness on the GTE consent decree. I thank the Senator very much. Mr. President, I will go a bit further to describe in more detail some of the things in the Dole package this morning. I think all this was worked out in Dole-Daschle and others, including myself as a cosponsor. In that package, the current law does not recognize the uncertainty and disproportionate burdens rate regulation [[Page S8076]] imposes on small cable companies. Without relief, many small cable companies will be unable to rebuild and upgrade their systems; moreover, they may be unable to survive or compete in the telecommunications marketplace. Small cable companies must spread high fixed costs over a small subscriber base, making it difficult to rebuild and upgrade facilities, to obtain a return on investment, and to service debt. At the same time, small cable companies typically incur a higher cost of capital than the industry as a whole. The current regulatory scheme has required small cable companies to devote a substantial amount of their operating budgets to legal and accounting expenses simply to understand and comply with the complex regulations spawned by the Cable Act of 1992. Rate regulations imposed on these companies have depressed their revenues and caused uncertainty in the financial sector, exacerbating the difficulty such companies have in attracting financing. The uncertainty caused by the threat of regulation alone has discouraged the banking community from extending financing to small cable companies. Without such financing, small cable companies will be unable to position themselves to meet competition, or in many cases, to stay in the cable business. At the same time, small cable companies have been particularly hard- hit by the competitive challenges of direct broadcast satellite [DBS], which has become one of the fastest introductions ever of a new consumer electronics product since its launch in 1994. DBS services, which are expected to serve 2.2 million subscribers by the end of this year, deliver virtually every program network offered on cable, including movies, sports, and dozens of channels of pay-per-view movies. Small cable companies need immediate rate relief in order to access the capital necessary to compete and to continue to provide services to customers. Consequently, telecommunications reform legislation should exempt small cable companies from rate regulation. radio ownership The financial health and competitive viability of the Nation's radio industry is in our hands. We all agree that the telecommunications legislation we are considering today is about competition, and not picking winners and losers. And we also agree that this legislation goes a long way toward giving cable, satellite, and the phone companies the freedoms they need to compete, but we now need to agree to extend these same freedoms to the over 11,000 radio broadcasters in this country. No other audio service provider, be they cable, satellites, or telcos, has the multiple ownership restrictions that radio has. The language we are offering today eliminates these outdated radio-only rules. It is imperative that we in the Congress end this discrimination against radio sooner by adopting this language, rather than wait for the bureaucracy to come around to it later, as this legislation as currently drafted, would have it. Immediate action is critical because the FCC is on the verge of authorizing digital satellite radio service, whereby 60 new radio signals will broadcast in every market in the United States. This satellite service will be mobile and available in automobiles, homes, and businesses. Also, cable already provides 30 channels of digital radio broadcasting in markets across the United States under a single operator. Obviously, an incredible diversity of voices has been achieved, with even more competition to radio quickly making its way down the information superhighway. Yet let us not lose sight of the fact that all of these welcome new voices are also aggressive competitors for radio's listeners and advertisers. And unlike radio, these competitors are not burdened with radio's multiple ownership restrictions, nor do they have the same public service obligations are radio broadcasters. Our Nation's radio broadcasters have a strong tradition of providing the American people with universal and free information services. In a telecommunications environment increasingly dominated by subscription services and pay-per-view, it is essential that we not foreclose the future of free, over-the-air radio by restricting ownership options. For radio, serving the public interest and competing are not mutually exclusive, they are complementary. So it is left up to us to empower radio so it can grow strong well into the next century, and continue to serve our communities as it has done so well for the past 70 years. The last is perhaps the most important, relief from ownership rules works. In the early and mid-1980's, the FCC issued hundreds of new radio licenses and the market became oversaturated with radio stations without sufficient advertising revenue to support the increase. However, in 1992, the FCC granted limited relief in radio ownership restrictions. After many years of financial losses, suddenly radio became an attractive area for investment, and alarmingly, multiyear stations going off the air was arrested. The economies of scale kicked in, stations gained financial strength in consolidation, and competing for advertising improved. Allow me to cite some statistics. In 1993, a year after the new limits took effect, the dollar volume of FM-only transactions almost tripled, to $743.5 million, while group sales grew 44 percent. In 1994, sale prices of single FM stations rose 12.7 percent from 1993's $743.5 million to $838 million. From 1993 to 1994, the total volume of AM station sales shot up 84 percent, totaling $132 million. There is every reason to believe that all of these positive trends will continue and flourish if we remove radio's outmoded multiple ownership restrictions. Clearly, maintaining local and national radio ownership limits in the face of tomorrow's competitive environment is not only unfair but is a major step backward. Mr. President, I might say a word about the GTE consent decree. The GTE consent decree arose from the 1982 acquisition of Southern Pacific Communications Co., the forerunner of Sprint, and Southern Pacific Satellite Company, Spacenet. The Justice Department, as part of its statutory Hart-Scott-Rodino review of the proposed acquisition, negotiated a consent decree based on section 7 of the Clayton Act. Unrelated to the acquisition, the suit also claimed GTE's provision of information services created a substantial profitability, monopolizing the market in violation of section 2 of the Sherman Act. This portion was removed in 1991. GTE was not found to have violated any antitrust statute. They voluntarily accepted the consent decree in December 1994, allowing the company to proceed with acquisition. The primary restrictions of the decree are: Structural separation between GTE's telephone operating companies and Sprint; and GTE's telephone operating companies are prohibited from providing or joint marketing interLATA long distance companies. The GTE consent decree should be vacated through the pending telecommunications reform legislation for three reasons: First, GTE no longer owns the Sprint or Spacenet assets that gave rise to the original suit. The Sprint assets were disposed of completely in 1992. Spacenet assets were sold to General Electric in late 1994. The GTE consent decree is not related to the modified final judgment. The 1982 court order that resolved the AT&T antitrust case and broke up the Bell system restricts the regional Bell operating companies from entering the long distance and manufacturing businesses. GTE is the only non-Bell telephone company with such cumbersome proceedings. These procedures resulted in higher costs and hamper GTE's ability to compete. GTE also filed a motion with Judge Harold Greene in the U.S. district court to have the court vacate the GTE consent decree.

Mr. PRESSLER. I suggest the absence of a quorum.

Mr. PRESSLER. Mr. President, we also on this side of the aisle support this amendment, and we have no problem with it and look forward to working with the Senator from Pennsylvania.

Mr. PRESSLER

Mr. PRESSLER. If my friend will yield, I think what is going on, Senator Dole is trying to get an agreement for a vote at 10:30 and has been unable to do so. But I say respectfully to everybody, when I was a lieutenant in the Army--a mere second lieutenant--LBJ was referred to affectionately, at least by my superiors, as ``LBJ.'' Also on this floor I heard the term ``Reaganomics'' used a great deal back at the point when it was thought not to be popular. I am very respectful, as I am sure my friend is, of the President of the United States. Let me say, whether it is Ike, FDR, LBJ, Reaganomics, Bush-whack--I have heard all these terms around the Senate over the years. I just want to point that out because I am very respectful, as I am sure the Senator from Pennsylvania is. Military service was mentioned. When I was a second lieutenant, we used to affectionately and supportively refer to LBJ as LBJ. Maybe we need a new form of rules because past Presidents have been referred to in a variety of ways on the Senate floor.

Mr. PRESSLER. I did not refer to the Senator's comment as nonsense. I just said this whole debate I think----

Mr. PRESSLER. I urge the Senator from Pennsylvania to proceed.

Mr. PRESSLER. I think in American society we refer respectfully to our President. I have heard various Presidents referred to by their first name on the Senate floor. I do not want to start digging it out. We have a friendly society. We refer to our President by first name or last name. We have good, healthy debate. I think that this whole objection here is nonsense. And I urge---- Mr. KERREY addressed the Chair.

Mr. PRESSLER. If my friend will yield.

Mr. PRESSLER

Mr. PRESSLER. Mr. President, I suggest the absence of a quorum.