FCC head sees risks in more regulation

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ASPEN, Colo. (AP) -- Federal Communications Commission Chairman Michael K. Powell said yesterday that the threat of terrorism and the "despicable activity" of some companies has led to a shift toward more regulation that could harm innovation and the economy.

"I do see a mood swing in Washington. I see a mood swing in the country," Mr. Powell said at the Aspen Summit, a technology and telecommunications conference held by the Progress and Freedom Foundation, a Washington think tank.

Mr. Powell worries about the rising belief that regulations do a better job than free markets because "the telecommunications sector and the high-tech sector are at a point in history where they can ill afford to be lined up with that kind of thinking."

He also said industry bears much of the blame, with corporate fraud cases undermining the public's trust and generating support for more regulations.

"The despicable activity engaged in by Enron and [WorldCom] and Adelphia -- and the list is long -- violates the trust of their employees, violates the trust of the market, violates the trust of consumers, and people cry out to be protected," he said.

He said the government must respond, but should avoid going too far.

Mr. Powell reiterated that, despite recent criticism, he won't quit his job.

"I'm going to stick around. Absolutely," he said.

Rumors and reports that Mr. Powell would resign have proliferated recently after intense criticism in Congress and elsewhere about the FCC's decision to roll back media-ownership rules.

Led by Mr. Powell, the Republican-dominated FCC voted 3-2 on June 2 to ease decades-old restrictions on ownership of newspapers and television and radio stations. The changes, which go into effect Sept. 4, would allow a single company to own TV stations reaching nearly half the nation's viewers, and combinations of newspapers and broadcast outlets in the same area.

Lawmakers from both parties are pushing to roll back some or all the FCC changes, a fight expected to heat up when Congress returns from summer recess.