THE RAPE OF MA BELL The Criminal Wrecking of the Best Telephone System in the World<i> by Constantine Raymond Kraus and Alfred W. Duerig (Lyle Stuart: $19.95) </i>
For most of us, the 1982 dissolution of AT&T; into seven “Baby Bells” and 1,200 independent companies has seemed both a blessing (reducing long-distance rates and speckling city streets with private phones for public use) and a curse (rates for local calls have risen and getting refunds or operator assistance on those new, brightly-colored phones can be next-to-impossible). To these authors, however, eliminating AT&T;’s monopoly has crippled our nation’s telecommunications system, making it inefficient in the present and unprepared for the future. By publishing this book, Constantine Kraus and Alfred Duerig, both long-time Bell System engineers, hope to elicit enough public sympathy to bring back a company akin to the old AT&T.;
Their chance for success is frankly limited, for while Americans might get angry enough to give the new phones a good smack when they gobble quarters without connecting calls, it’s doubtful that people will become sufficiently outraged with the present, free-market system to lobby for a restoration of the old monopoly. Their case, nevertheless, remains compelling and convincing. Competition is as wrong in telecommunications as it is in gas, electric and water distribution services, the authors argue. It has led to redundancy in telecommunications networks and has left our phone system without national coordination. The latter is the most disturbing, for the elimination of the closely-knit network on which the U.S. military depended could endanger our national security.
Ma Bell’s demise also has threatened our economic security, a danger the authors discuss only in passing. While it’s commonly assumed that free market competition is the only way to beat the Japanese, the truth is that progress in high technology benefits most from some central coordination. Recent Japanese advances, such as high-density TV displays, came about because of planned, collaborative research and development. It’s thus more than coincidental that America’s deficit in telecommunications trade has soared to $2 billion since the pace of divestitures began escalating in 1981.
Bringing back a mega-corporation like AT&T; is easier said than done, however. AT&T; officials first established a monopoly in the early 20th Century by spreading a rumor that the company was faltering, then buying up stock from panicky investors, a less-than-flattering slice of history which the authors omit from this affectionate portrait. And yet while the authors offer no viable plan for re-establishing central control of telecommunications, their book highlights the dangers in not doing so and points to a serious dilemma America has so far failed to resolve: the proper balance between our national ideology of unfettered competition and our growing need for coordinated national planning.
