**American Bar Association**

**Administrative Law and Regulatory Practice Section\
Fall Conference**\
\
Remarks of Kathleen Q. Abernathy

November 6, 2003

Thank you very much, Randy. I am very pleased to have the opportunity to
participate in this awards luncheon and to pay tribute to outstanding
public servants. I have been fortunate to work at the FCC, first at the
staff level and now as a political appointee. And I also had extensive
contact with the FCC and other government agencies while working in the
private sector. So I know first-hand the kinds of critical contributions
public servants make to our society. I would like to share some of my
thoughts about public service and how they intersect with my views on
administrative law.

Public service is a noble calling and in my experience has drawn some of
the best and brightest to government. Many who have pursued
opportunities in the public sector share a simple desire to do right by
the American people. Public service for many professionals entails
financial sacrifice, but the rewards can be rich in other respects.
While I have enjoyed being an advocate for companies in the private
sector, that really compare with the fulfillment that comes from working
on behalf of the public interest.

Collectively, public servants possess a wealth of knowledge and
expertise that forms the backbone of the administrative state.
Especially at an independent agency like the FCC  where there is a need
for economic, legal, and engineering know-how  our staff has remarkably
broad and deep expertise. A primary function of an independent agency is
to use this knowledge base to make impartial, informed judgments that
are insulated as much as possible from political forces.

At the same time, our administrative agencies merge this apolitical
expertise with presidentially appointed leadership. My job as a
commissioner is to implement the law set forth in the Communications
Act, but, inevitably, public officials are called upon to exercise
discretion and to fall back on a guiding regulatory philosophy. Having
presidential appointees lead administrative agencies ensures a degree of
accountability to the public, although not in the direct sense, because
we can't be voted out of office. The accountability comes from the fact
that our decisions collectively influence the public's perception of how
well the Administration is doing. A president accordingly tends to fill
agency posts with officials who share his or her core ideological
preferences. This helps ensure that agencies will make decisions not
only based on their embedded knowledge base, but also in a manner that
reflects the public's choice of executive leadership.

Another benefit of combining career public servants and political
appointees is that it provides an opportunity to infuse an agency with
fresh ideas and perspectives. In between my first stint at the FCC as a
staff member and my return as a commissioner, I worked for a variety of
businesses in the communications sector. These experiences gave me a far
better appreciation of the practical exigencies of the business world
than I could gained while working at the FCC. In fact, I strongly
believe that my private sector experience provides a critical framework
for reviewing issues, because I have a heightened sense of how
regulations are likely to be implemented in the real world and the
limits of what government can hope to accomplish. And when a regulated
entity makes arguments about compliance costs, I am better equipped to
distinguish legitimate gripes from whining. I also have a keen
appreciation of how debilitating delay can be for market participants. I
have often said that, when I was in the private sector, I sometimes
preferred an adverse decision to no decision at all, since I could alter
my business plan to adapt to unfavorable rules, while delay produced
paralyzing uncertainty. But without the dedicated career staff who
provide history and context to the proceedings, my business experience
would be of little value.

In short, government agencies need a strong base of career employees
with detailed and diverse expertise, and they also need political
leadership that can provide an ideological rudder.

I also thought I would say a few words about my own ideological
approach, particularly given your focus on administrative law and
scholarship.

Based on my experiences in government and the private sector, and based
on my study of the economic and legal literature, I developed a set of
core principles to guide my decisionmaking at the FCC. I published these
principles in the Federal Communications Law Journal, and the article is
available on my website, so I'll provide only a brief overview of some
of my key points.

As I mentioned already, as a commissioner at an independent agency, my
primary responsibility is to faithfully implement the statutory mandates
set forth in the Communications Act. I take this responsibility very
seriously, and I try very hard to avoid substituting my own preferences
for Congress's judgment when the law provides clear directives. I also
believe that it is critical for an agency to be conservative and avoid
overreaching when it interprets its governing statute, because  as the
FCC's own experience demonstrates  courts of appeals will not hesitate
to strike down our decisions. Court reversals can have devastating
consequences for the companies that built business plans around rules
later vacated. For example, after Congress enacted the
Telecommunications Act of 1996, the FCC's local competition rules were
reversed by the Supreme Court, and the rules adopted on remand were then
vacated by the D.C. Circuit Court of Appeals. Our third effort, to which
I dissented in part, is back before the D.C. Circuit once again. So we
still do not have judicially sustained rules on which carriers can rely.
That is not good government.

Another key principle reflects the fact that, many times, Congress does
not provide a specific blueprint, but instead commits important policy
matters to an agency's discretion. In such cases, my strong preference
is to rely on market forces in lieu of prescriptive regulation. It may
seem strange for a regulator to want less regulation. But I believe that
experience makes crystal clear that regulators, no matter how smart or
dedicated, cannot possibly allocate resources as efficiently or promote
consumer welfare as effectively as fully functioning markets. This is
particularly true in a rapidly changing technological environment, such
as we have today. Congress had the wisdom to codify this principle when
it enacted the 1996 Telecom Act: The preamble of the Act, backed by a
number of new substantive and procedural provisions, requires the FCC to
construct a procompetitive, deregulatory framework to the greatest
extent possible. Thus, whether one is a career public servant or a
political appointee, it is important to bear in mind that a good
regulator does not always promote additional regulation. To the
contrary, where competition can supplant prescriptive mandates,
regulators should look for ways to minimize regulatory oversight. As
Fred Kahn has put it, we must find ways to "let go," and the public will
reap the benefits.

In spite of my general preference for deregulation, I recognize that
there are a number of situations where regulatory intervention in the
marketplace is necessary. *First*, where structural impediments prevent
competition from emerging in the first place, regulators must intervene
to enable its development. Thus, the FCC continues to mandate the
unbundling of local telephone companies' infrastructure, although it is
fair to debate precisely *how much* unbundling is required to facilitate
meaningful competition. *Second*, regulators must continue to enforce
public policy choices that have nothing to do with competition, such as
the congressional mandate to promote the universal availability of
affordable telephone service. *Third*, regulators must ensure that
competitors do not impose externalities on one another or on consumers.
For example, while the FCC has wisely refrained from imposing common
carrier regulators on wireless carriers, we must stringently enforce
rules to prevent harmful interference.

In conclusion, I want to reiterate my respect and admiration for public
servants, to whom our country owes an enormous debt of gratitude. Our
agencies have exemplary career officials and able political leadership
and are better off for having both. In my own experiences in both
capacities, it has been my pleasure and privilege to serve, and I offer
my hearty congratulations to today's award recipients. Thank you very
much.