ne wholesale discounts for leasing the Bells' lines and networks, began to set rates that made offering competitive local service more realistic. When, in early 2002, the influential New York State public service commission increased the discount from an aver- age of IO percent to more than 30 percent, other states followed suit, and AT&T expanded its local service offerings significantly. AT&T's PR skills served its political goals. Unfortunately, in retro- spect, it may have been at a high cost. Political goals tend to be narrow and transaction-oriented-discrediting an opponent or winning a vote. Public relations is supposed to be about building and nurturing long-term relationships with those who have a stake in an organiza- tion. The most insidious effect of the blurring of the distinction be- tween politics and public relations, however, is that it can lead you to believe that any fact can be "managed." Therein lay the roots of the single biggest public relations mistake of my career. CALLS In 2000, our regulatory people were working on a grand scheme that would simultaneously lower the access fees that long-distance compa- nies pay to local phone companies and allow the local companies to increase their monthly charges by an equal amount. This was a Very Big Deal. Although access charges had slowly come down over the years, they were still long-distance companies' largest single cost, amounting to 4.6 cents per minute on every long-distance call in 1999. In some cases, access charges accounted for most of the local companies' profits and subsidized the cost of providing local service. Ever since the breakup of the Bell System, AT&T had labored mightily to lower these charges, which most economists agreed were grossly inflated, but it really had only two choices: build its own links to its customers, which was impractical in most cases, or engage in annual, contentious three-way negotiation between the Bells, the long- distance companies, and the FCC, which seldom resulted in more than incremental change. In