July 26, 1994 FCC CHAIRMAN CHALLENGES URBAN LEAGUE TO HELP MAKE INFORMATION SUPERHIGHWAY A BRIDGE BETWEEN HAVES AND HAVE-NOTS; ANNOUNCES 1993 EEO STATISTICS FOR CABLE AND BROADCASTING INDUSTRIES Calling it an "historic time for both the FCC and for the National Urban League and our interaction," FCC Chairman Reed Hundt addressed the 1994 National Urban League Conference at Indianapolis on July 26. Chairman Hundt spoke about the FCC's goals of promoting equal employment opportunity; having the ownership and management ranks in the telecommunications industry look more like the people they serve; and improving education opportunities for urban and disadvantaged schools. He also announced the results of the FCC's 1993 Equal Opportunity Statistics for the broadcasting and cable industries. The results were not satisfactory, he said, with African-American employment in those industries well below the percentage of African-Americans in the workforce, especially in the upper- management ranks. Chairman Hundt noted "These results reflect insufficient movement toward our goal of insuring that the broadcasting and cable workplaces look more like the American workforce as a whole. But we believe the Commission's renewed emphasis on EEO enforcement will spur improvement in the coming year." Chairman Hundt, commenting on the upcoming Personal Communications Service (PCS) auctions, noted that the FCC has "created a framework in which African-American businesses can enter this emerging industry on the ground floor -- not after the industry has been built-out." Pointing out that the FCC adopted provisions to ease the entry barriers for minority businesses for approximately 1,000 broadband PCS licenses, the Chairman pointed out, "The value of businesses run pursuant to these licenses could amount to one and a half times the total gross revenues of the top one hundred African-American businesses in the country today." Chairman Hundt said his vision of the information highway "is that it is a way for millions of Americans to bridge the gaps in education, health care and economic opportunity that divide our country." He closed by stating "We at the Commission are committed to building a communications bridge across this gulf. We do so because it is good for business, it is good for our children, it is good for our nation, and because it is right." - FCC - FCC CHAIRMAN REED E. HUNDT 1994 NATIONAL URBAN LEAGUE CONFERENCE TUESDAY, JULY 26, 1994 [ACKNOWLEDGEMENTS] Thank you, Wayne, for that kind introduction. I would also like to thank the members of the 1994 Conference Planning Committee for inviting me to speak to you today. It is a great honor to be here, and to talk to you about what the information highway means for urban America, and especially for African- Americans in our country. This is an historic time for both the FCC and the National Urban League and for our interaction. The League is beginning a new era with its recently appointed president and chief executive officer, Hugh Price. I am very proud to say that I followed in Hugh's footsteps by going to the Yale Law School five years after he graduated. And in the small world department, his daughter, in her second year at the same law school, excelled this summer as a law clerk in the General Counsel's office at the FCC. The Urban League is very lucky to have Hugh Price to lead it into the 21st century. The Urban League was founded in 1910, and as I grew up, I knew it as a beacon of hope and a powerful force for change. A former president of the Urban League, Vernon Jordan, has been invaluable to me during my tenure as Chairman of the FCC. Vernon has always been available to me and always provides sound and thoughtful counsel. He is a national treasure. I have learned much from him and he has contributed to the work of the Commission in many important ways. In so many ways he continues to advance the good works of your organization. I am here today to suggest that your job now in part is to help the communications revolution -- or information highway -- bring new hope and opportunity to all Americans, not just the few and well-to-do. I want you to help us make the information highway into a bridge. A bridge, of course, has to cross a chasm, a gap, a divide, in order to be a bridge. And the chasm I am talking about is that between what Cervantes in Don Quixote called the difference between the haves and the have-nots. In our country, to a large degree, this is the chasm between a world that is largely white and a world that isn't, between a suburban world that is largely well-off by any objective standard and an urban world that isn't. I believe the information highway provides a unique opportunity to help bridge the economic, social, racial and geographic gaps that divide this nation. This is what it has done all over the world. It brought down the Berlin Wall in Germany and it brought democracy to South Africa. Let's have the information highway work its magic here, too. All our lifetimes there have been two worlds in America joined by few, if any, bridges: the largely white world of opportunity and reward for hard work, and the largely nonwhite world of diminished chances and persistent injustice. I grew up in the first world. My parents were the first in either of their families to go to college, and thanks to the GI Bill, after the war my father got a law degree from Michigan, a short drive from here by Midwestern standards. I was born a few months before he got that degree. Poor planning, they said. He meant to get the degree first and job and son later. So with a wife and new baby, my father arrived in the Washington area looking for work just as Harry Truman was getting miraculously reelected and the Democratic Party was splitting over segregation and state's rights (not for the first or last time). My parents were solidly liberal. They voted for Norman Thomas in 1948 and later my mother was the only person in Falls Church, Virginia, who did precinct work for Adlai Stevenson. But the late 1940's was a time of segregation as I know many of you know too well. My parents, who had come to the South from Wisconsin, were shocked by it, but we lived under its regime. I went to segregated schools through the eighth grade -- first segregated by law, then later only by inveterate practice. And we lived in a segregated neighborhood. And even my favorite teams, the Washington Senators and especially the Washington Redskins included only whites. As you all know and helped cause, on this issue, the most important domestic issue of my lifetime, the country began to change profoundly when the '50s became the '60s. At last, my mother did precinct work for a presidential candidate who won. My high school was integrated. And almost outside our school doors, Martin Luther King came to Washington to give his famous "I Have a Dream" speech. Hopes for change swelled. But since then we have all learned that the history of America remains the history of race. And this is a tortured history, where hope often turns into disappointment and awful new problems call out for new solutions. Now in this decade of the 90s we have terrible problems of drugs, violence and broken families, but we must be of good cheer. We also have new solutions including particularly the opportunities given us by the communications revolution, also called the information highway. When we talk about the information highway, it's advisable that we all share what we think it is. A Harris poll showed that a majority of Americans approved of the information highway, but only one-third said they knew what it is. Here's what I think it is. First, it is the mother of all metaphors. Second, this information highway is our country's great network of communications technologies. I mean the familiar: - the telephone system that reaches 98% of all homes; - the cable system that passes more than 90% of homes; - the broadcast television and radio stations that provide free programming in every American city and town; - the cellular telephone system that covers most of the country - satellites that offer video programming via satellite dishes no larger than a salad bowl; Third, the information highway is also the largest economic development in our times. It is transforming the workplace, the work force, our products, and our companies. As our national appetite for communications technologies grows -- whether for voice, video or data services -- so grows the information highway. The challenge for us as a Nation is to make sure that as the information highway revolutionizes the way in which Americans communicate, it serves to bring us together as a Nation rather than to further divide us. I do not pretend to compare my experiences of our history of division with any of you or to lecture you on its pain or meaning, but I do ask you to let me share a little of my life so that we might more easily talk together about what can be accomplished in the job the President has been most gracious to give me. I spent a high school summer working with kids in the projects of Southwest D.C. Now I had studied the speeches and writings of Martin Luther King and written high school essays about him. This I learned was way, way short of what I needed to do to make a contribution in that grim neighborhood in the shadow of the Capitol. But I did learn there about the depth of the gulf between the two worlds. After college I got my first full-time job, teaching at an urban school. This was way before the communications revolution and we suffered a major deficit in information technology -- we had only books. And before the first class on the first day someone came by and gave me 35 textbooks which I handed out to everyone in class. After a few moments of calm, the bell rang and everybody except me raced to squeeze through the door simultaneously. After about half had escaped, I realized they had taken their books with them. However, I had four more classes arriving and that I was down to approximately eleven books. Those did not survive past lunch. The rest of the year I taught with purple stained fingers as I distributed wrinkled mimeopapers. I'm sure some of you remember mimeographs, although my children have no idea what mimeopaper is. I had to make up the lessons because I had not even kept one textbook for myself. I actually had no idea what I was supposed to teach in social studies. That very first class revealed that the first chapter of the book was about global climate change, I think it was global warming if I remember correctly, and I hope our environmental Vice-President will forgive me but we were not able to follow up on that. We moved into African history instead. Fortunately, for the curriculum committee and for the reputation of the teaching profession, after one more year in teaching I elected to go to law school. I learned much from the kids I was supposed to teach. A lot more than they learned. Most of all, I learned again about the depth of the gulf between the two worlds. It was still mighty deep and bridges were few -- as I will mention in more detail later. After graduating, as a lawyer I worked on many civil rights cases, especially including work for the NAACP Legal Defense Fund -- thanks to, of all people, my friend who was only the second Black to go to my high school. From there he went to Harvard Law School and then to the Legal Defense Fund. If I hadn't met him in 9th grade, my life would have been diminished. My colleagues and I were lucky enough to win the cases we got from LDF. On those cases alone we donated more than $2 million in free legal services over 16 years in total. But I received far more in value from those cases than we spent. Most important, I learned from each and all of them that there are many aspects to the gulf between the two worlds: in the two worlds education opportunity is not the same, business opportunity is not the same, and even the law does not work the same way. Everyone here who heard Martin Luther King's great speech in 1963 wanted the two worlds to be bridged right away. It has taken more time than we hoped. Now, however, with this communications revolution, the information highway, we have a new chance to realize his Dream. The reason is a practical one: the economy and society are both changing radically because of communications. So we have, quite plainly, a chance to change them both for the better. In order to do this, we at the FCC have three particular goals: 1) We want to promote equal employment opportunity; 2) We want to have the ownership and management ranks in this sector look more like the people they serve; 3) We want to improve education opportunities for urban and disadvantaged schools. The first goal is to promote EEO policies in new and existing communications businesses. The White House's Council of Economic Advisors predicts that the telecommunications industry will add more than 100 billion dollars to the Gross Domestic Product over the next decade. This means tremendous new job opportunities. Employment in the communications sector of our economy is projected to rise from 3.6 million workers today to more than five million workers in the year 2003. At the FCC, we are also working hard to make sure that African-Americans have fair opportunities to work in the new industries of the communications revolution. In January of this year, the Commission stepped up the level of enforcement of its EEO rules. We increased the level of fines imposed on broadcast stations and cable television systems that fail to maintain effective EEO programs. We issued the largest such fine in the Commission's history. We are sending a strong message to any broadcast and cable owners that are tempted to ignore the importance of these rules. However, in the communications industry, the employment picture is not what it should be or can be. The Commission's most recent statistics for equal employment opportunity -- which I am releasing here today -- were collected for the years 1989 through 1993. The employment of African-Americans overall and in the management ranks of the cable and broadcast industries during 1993 remained the same, or declined slightly when compared to 1992 figures. African-Americans are about 11.0% of the American workforce, but in the broadcast industry, their representation in management is only about half as high as that. Black males in this category actually decreased from 2.9% in 1989 to 2.8% in 1993. The figures for the cable industry are only a little better. These results reflect insufficient movement toward our goal of insuring that the broadcasting and cable workplaces look more like the American workforce as a whole. But we believe the Commission's renewed emphasis on EEO enforcement will spur improvement in the coming year. We are also conducting a broad-ranging inquiry to determine ways generally to improve the effectiveness of our EEO program. The key goal is to focus on the emerging industries. We need to ensure, for example, that the employment profile of the wireless cable operator receives the same attention and scrutiny by the FCC as that of wired cable operator. We need to make sure providers of cellular telephone service maintains a commitment to equal employment opportunity that is every bit as meaningful as that of the FM radio station owner. Ultimately, our goal in the EEO area is that providers of communications services look more like the communities they serve. In a dynamic sector such as communications, existing technologies merge. New technologies emerge. The rapid pace of change gives us at the FCC a great chance to encourage industry to meet its commitment to equal employment opportunity. Our second goal is to promote ownership and management opportunities by minorities and women in the communications business. I mention here first our focus on employment because the experience of employment in the communications industries, especially in the upper-management ranks, helps to qualify the employee for ownership. On-the-job training, preparing cash flow projections, managing sales accounts, tracking employee performance all help prepare people to be managers or to succeed as a budding entrepreneur. But as these communications industries grow, and as new industries are created, we want to make sure that those who have historically been discriminated against will have a chance to participate as competitors and owners. No we should note that throughout our nation's history, our government has actively encouraged entrepreneurs to link our vast country. The information highway of the nineteenth century was the railroads. More than 150 years ago, private enterprise began the busy task of joining our nation through railroads. In order to provide incentives for railroad construction, the government gave out land grants totalling well over 100 million acres. This acreage represented nearly 10 percent of the nation's public domain in the mid-nineteenth century. Twenty-nine different railroads received land grants. Many great fortunes in America came from those land grants. Would anyone here care to guess how many were owned by African- Americans? I think you know the answer. While thousands of minorities labored at building the railroads, not one had a true or fair opportunity to own and operate them. Just imagine -- if American industries had sought to include African-Americans as owners at the emergence of other industries, America would undoubtedly be a different and better place today. It might be that if African-Americans had somehow been included as owners in these industries, African-Americans would not today be so disproportionately unemployed, poor, impacted by poor health services, and affected by violence. Like land in the nineteenth century, the spectrum which we license at the FCC is a tremendous natural resource. The way in which we use spectrum has the potential to concentrate power and wealth within the hands of a few, or to benefit all Americans. In this emerging era of communications, access to, employment in and ownership of the information industries is essential to bridging the gulf between two worlds of haves and have-nots. But at this time, minorities are seriously underrepresented in the ownership of telecommunications businesses. Let's look at the record. -- There are 490 minority-owned telecommunications firms -- of approximately 98,000 firms in the industry -- one half of one percent. -- Of about 10,000 commercial broadcast radio and television stations, only 300 are minority-controlled -- about 20 of 1000 television licenses. -- Of the approximately 7,500 Cable operators, nine are minority controlled. That's just over one-tenth of one percent. -- Of nearly 1700 electronic computing equipment manufacturers only one of these companies is owned by an African-American. That's five hundredths of one percent. Now, what are we going to do about these numbers? This year, the FCC took historic action to ensure that minorities are able to compete for licenses to provide the next generation of wireless telephone service -- known as personal communications services, or "PCS." Yesterday, we initiated the first auction for radio spectrum for PCS. PCS -- personal communications services -- refers to the next generation of wireless services that will help meet our ever more mobile society's rapidly growing demands for on the go communications. The small lightweight multi-function portable phones that you can use anywhere. Portable faxes and other imaging devices. New advanced paging devices that will significantly improve the flexibility and functionality of all telecommunications networks. Analysts predict that this industry will one day replace the wireline telephone. In a decade mobile telephony is expected to serve 100 million subscribers and be a 50 billion dollar industry. In the way we are selling these licenses to run mobile telephone companies I believe we are creating the most important economic opportunities ever made "fairly" available to women and minorities in our country's history. We created a framework in which African-American businesses can enter this emerging industry on the ground floor-- not after the industry has been built-out. The FCC adopted provisions to ease the entry barriers for minority businesses for approximately 1,000 broadband PCS licenses. The value of the businesses run pursuant to these licenses could amount to one and a half times the total gross revenues of the top one hundred African- American businesses in the country today. We tried to address the root of the problem minorities have in starting new businesses- -access to capital. They say in America you can inherit money or you can make it -- but the key really is to be able to raise it. The auction rules are designed so that minority businesses can attract investors-- with bidding credits, tax certificates and extended payment terms. -- We designed the rules so that they will attract viable entities intent on providing service -- not turning a fast profit. -- We provided spectrum blocks in which small business, women and minorities will bid without competition from the big guys with easy access to big money. This industry, which is so vital to the economy, should look like the communities it serves. Our third opportunity is to use the communications revolution to revolutionize education. Today's schoolchildren remain largely shut-off from the modern information age. In that way, their classrooms are little different from those I taught in 25 years ago. There are forty-five million people who from the beginning of the day to the end of the day, are outside the scope of these networks, who do not participate in the information superhighway the way almost all adult Americans already do. I am speaking, of course, of our children and their teachers in the classrooms. Few poor and minority students have computers in their homes. Over 50% of children from high income homes have computers. Less than 5% from low income homes have them. Twenty-two percent of white primary school children have computers in their homes. Less than 7% of African-American and Hispanic children do. Does it matter? You bet. An experiment with computers in the homes and schools of inner city New York children, known as Project TELL, illustrates the point. The study showed that when "at risk" students, whose performance tends to worsen over intermediate school years, had access to computers they showed less decline in school performance as they made the transition from elementary to intermediate school. Students in that experiment showed greater learning capacity and improved self esteem. They had a far more positive attitude about their educational future than they had before participating in the project. Furthermore, the computer proved to be an unexpected resource for other family members. But above all, the time that children spent on the telecommunications networks increased the time they spent reading, writing, and learning cognitive and technical skills. And we can only guess how that extra time will empower these children as they grow and enrich their lives and communities. Access to the information highway can improve the quality of life in our communities in other important ways. This access means that through Communications we can bring the magnet school to all kids, instead of sending just a few kids off to it. The magnificent attractive power of knowledge can draw children to the path of opportunity. We have only to make that knowledge available. This isn't an option I'm presenting, it's an imperative. As access to the information highway becomes a stronger determinant of success, those without access will fall farther behind. The gulf between the two worlds can widen. That is why President Clinton and Vice President Gore have called upon the telecommunications industry to connect every classroom, every clinic, every library, and every hospital in America to the national information superhighway by the year 2000. At the FCC, we are working hard to make this happen. That access is particularly critical for children who come from homes that are disconnected from the telecommunications network. More than 15 million Americans live in homes without a phone: these are homes with children. While our telephone network reaches 94% of American households, only about 50% of women with children living at or below the poverty level have telephones in their home. Those kids can't explore the information highway at home, or call 911 in the event of an emergency. Both basic access in the home and educational access must be improved. I want to urge you to lead the country, as you are leading each of the Urban League chapters across the nation, toward that goal. Legislation passed by the U.S. House of Representatives and now pending in the Senate can make the difference in whether or not these services come to underserved communities. I appeal to each and every one of you to become involved in working for the passage of that legislation in these last few weeks before Congress adjourns. I'd like you to help me and help all of us give all the children of this country access to the power of knowledge. That's why we need your help in meeting the President's goal of connecting the classrooms, libraries and clinics by the year 2000. . CONCLUSION My vision of the information highway is that it is a way for millions of Americans to bridge the gaps in education, health care and economic opportunity that divide our country. That bridge will not be built on its own. Indeed, unless we act wisely, the information highway will belike one of those road projects that ripped apart neighborhoods and divided rich and poor. The learning and economic advantages of the information highway might after all separate our country more practically between the haves and have-nots. It may increase distrust and disadvantage, instead of fostering understanding and opportunity. Twenty-six years ago Bobby Kennedy was here in Indiana the day of the murder of Dr. Martin Luther King. He talked about the choice before us: "Among us are millions who wish to be part of this society -- to share in its abundance, its opportunity, and its purposes. We can deny this wish or work to make it come true." If we make Bobby Kennedy's wish, which was also Dr. King's wish, come true, we can as Kennedy also said, ". . . halt the dangerous drift toward isolated enmity which may soon find us looking at each other across impassable barriers of suspicion and anger," then maybe all communities in this nation will be empowered to have the fair opportunity to pursue the American dream. You understand this. Your organization has long worked to promote programs that empower citizens and communities. In conclusion, I want to talk to you about letting the communications revolution empower our communities and our children. After all, the heart of the American Dream is that we want to do for our children more than was done for us, to leave the world better for them than it was left for us. As I mentioned previously, in the year after Martin Luther King and then Bobby Kennedy were killed, I took a job as a school teacher. It was a middle school, grades 7 through 9. It was tough for teachers. It was worse for kids. Only half the kids who started the 7th grade would graduate from 9th. On average, in three years at my school, a child would fall two years behind in reading skills. And if you got through 9th grade and into the local high school, you had less than a 50 percent chance of graduating. The best way out -- the only way out -- was physically to get out. And the way to get out was to be permitted to enroll in one of the city's magnet schools. In theory, the magnet was intended to attract the best kids, so as to accelerate their learning. In reality, it was the only ticket out of an ever deepening cycle of poverty and hopelessness. I had three students out of 150 who started 7th grade reading well enough to give them a chance to be admitted to the magnet school in 8th grade. I asked them if they wanted special tutoring. We agreed to meet every Saturday at my apartment for special study sessions on how to pass the entrance exam. We did this for several months. The day of the exam came. Many of you have probably seen the movie "Lean on Me" about the New Jersey principal, Joe Clark -- or the movie "Stand and Deliver", starring Edward J. Olmos -- who plays the real life, East Los Angeles Math teacher Jaime Escalante? Both were true stories in which the efforts of dedicated teachers vastly improved the test scores of their students. Both movies had the key to all successful movies: A Happy Ending. But no movie was made about me and my three special students. No movie will be made. All my students failed the test. And I failed them. I don't know where they are now. If they have good jobs and good lives, it's because they ran into a better teacher or a miracle opportunity. I gave them far too little, too late. But I did make a promise to myself. I wouldn't settle for that ending. None of us should settle for that ending. We must make sure that the school children of today have better ways to escape poverty, despair, and hopelessness. We have to make sure that the teachers of today are better teachers than I was, have better tools than I did, and don't bring too little too late to their mission as I did. Now the information highway won't guarantee happy endings for all. It is not a cure for all society's ills. But when I think about what it could have meant to my students, in education, in job opportunities, in the chance for ownership, I know the information highway can help bridge the two worlds that have occupied the same land for five centuries yet have remained too far apart. We may not each of us share in a Hollywood happy ending. But we can all help create better endings -- and better beginnings -- for as Bobby Kennedy said, "The millions who wish to be part of this society". These are the millions now on the other side of the gulf that divides us. We at the Commission are committed to building a communications bridge across this gulf. We do so because it is good for business, it is good for our children, it is good for our nation, and because it is right. We need your help, as the country has needed you for 84 years. I know we can count of you and I thank you from the heart.