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market share loss in business lines to CLECs." It's a lot easier to 
think about evil C.E.O.s than to decipher that.


Even in good times, F.C.C. World pays obsessive attention to the 
commission's chairman. In bad times, the attention becomes especially 
intense; and when the chairman is a celebrity F.C.C. World devotes 
itself to full-time chairman-watching. The current chairman, Michael 
Powell, is a celebrity, at least by government-official standards, 
because he is the only son of Colin Powell, the Secretary of State. 
Unlike his father, he has a kind of mesmerizing ambiguity, which 
generates enormous, and at times apoplectically toned, speculation about 
who he really is and what he's really up to. Powell is young to be the 
head of a federal agency—he is thirty-nine—and genially charming. 
Everybody likes him. Before becoming chairman, he was for three years 
one of the F.C.C.'s five commissioners; not only is he fluent in the 
F.C.C.'s incomprehensible patois, he has a Clintonesque love of the 
arcane details of communications policy. He's always saying that he's an 
"avid moderate." And yet he has a rage-inciting quality. One of his 
predecessors as chairman, Reed Hundt, quoted in Forbes, compared Powell 
to Herbert Hoover. Mark Cooper, of the Consumer Federation of America, 
calls him "radical and extreme." Just as often as he's accused of being 
a right-wing ideologue, Powell gets accused of being paralytically 
cautious. "It ain't about singing 'Kum-Ba-Yah' around the campfire," 
another former chairman, William Kennard, says. "You have to have an 
answer." One day last spring, Powell, testifying before a Senate 
subcommittee, delivered an anodyne opening statement, and the 
subcommittee's chairman, Ernest Hollings, of South Carolina, berated 
him. "You don't care about these regulations," Hollings said. "You don't 
care about the law or what Congress sets down. . . . That's the 
fundamental. That's the misgiving I have of your administration over 
there. It just is amazing to me. You just pell-mell down the road and 
seem to not care at all. I think you'd be a wonderful executive 
vice-president of a chamber of commerce, but not a chairman of a 
regulatory commission at the government level. Are you happy in your 
job?"

"Extremely," Powell said, with an amiable smile.


One cannot understand Powell's maddening effect, at least on Democrats 
and liberal activists, without understanding not just the stated purpose 
of the commission he chairs but also its real purpose. The F.C.C. was 
created by Congress in 1934, but it existed in prototype well before the 
New Deal, because it performs a function that is one of the classic easy 
cases for government intervention in the private economy: making sure 
that broadcasters stick to their assigned spots on the airwaves. Its 
other original function was preventing American Telephone & Telegraph, 
the national monopoly phone company, from treating its customers 
unfairly. Over the decades, as F.C.C. World grew up into a comfortable, 
well-established place, the F.C.C. segued into the role of industrial 
supervision—its real purpose. It was supposed to manage the competition 
among communications companies so that it didn't become too bloody, by 
artfully deciding who would be allowed to enter what line of business. 
In addition to looking out for the public's interest, the commission 
more specifically protected the interests of members of Congress, many 
of whom regard the media companies in their districts as the single most 
terrifying category of interest group—you can cross the local bank 
president and live to tell the tale, but not the local broadcaster. 
According to an oft-told F.C.C. World anecdote, President Clinton once 
blocked an attempt to allow television stations to buy daily newspapers 
in the same city because, he said, if the so-and-so who owned the 
anti-Clinton Little Rock Democrat-Gazette had owned the leading TV 
station in Little Rock, too, Clinton would never have become President.


F.C.C. World may have been con tentious, but it was settled, too, 
because all the reasonably powerful players had created secure economic 
niches for themselves. Then, in the nineteen-eighties, the successful 
breakup of A.T. & T.—by far the biggest and most important company the 
commission regulated—deposited a thick additional sediment of 
self-confidence onto the consciousness of F.C.C. World. A generation 
ago, for most Americans, there was one local phone company, one 
long-distance company, and one company that manufactured telephones, 
which customers were not permitted to own—and they were all the same 
company. It was illegal to plug any device into a phone line. By the 
mid-nineteen-nineties, there were a dozen economically viable local 
phone companies, a handful of national long-distance companies competing 
to offer customers the lowest price and best service, and stores 
everywhere selling telephone equipment from many manufacturers—and 
millions of Americans had a fax machine and a modem operating over the 
telephone lines. A.T. & T. had argued for years that it was a "natural 
monopoly," requiring protection from economic competition and total 
control over its lines. So much for that argument. Over the same period, 
the F.C.C. had assisted in the birth of cable television and cell phones 
and the Internet. It was the dream of federal-agency success come true: 
consumers vastly better served, and the industry much bigger and more 
prosperous, too.

The next big step was supposed to be the Telecommunications Act of 1996, 
one of those massive, endlessly lobbied-over pieces of legislation which 
most people outside F.C.C. World probably felt it was safe to ignore. 
Although the Telecom Act sailed under the rhetorical banner of 
modernization and deregulation, its essence was a grand interest-group 
bargain, in which the local phone companies, known to headline writers 
as "baby Bells" and to F.C.C. World as "arbocks" (the pronounced version 
of RBOCs, or regional Bell operating companies), would be permitted to 
offer long-distance service in exchange for letting the long-distance 
companies and smaller new phone companies use their lines to compete for 
customers. Consumers would win, because for the first time they would 
get the benefits of competition in local service while getting even more 
competition than they already had in long distance. But the politics and 
economics of the Telecom Act (which was shepherded through Congress by 
Vice-President Gore) were just as important. Democrats saw the act as 
helping to reposition them as the technology party—the party that 
brought the Internet into every home, created hundreds of thousands of 
jobs in new companies, and, not least, set off an investment boom whose 
beneficiaries might become the party's new contributor base. Clinton's 
slogans about the "information superhighway" and "building a bridge to 
the twenty-first century," which, like all Clinton slogans, artfully 
sent different messages to different constituencies, were the rhetorical 
correlates of the Telecom Act, and Gore's cruise to the Presidency was 
supposed to be powered substantially by the act's success.

The F.C.C. had a crucial role in all this. The arbocks are rich, 
aggressive, politically powerful, and generally Republican (though like 
all important interest groups they work with both parties); they 
immediately filed lawsuits, which wound up tying the hands of their new 
competitors in the local phone market for more than three years. Through 
rule-making, enforcement, and litigation, the F.C.C., then headed by 
Reed Hundt, who was Gore's classmate at St. Albans, was supposed to keep