Back in May of 2009, I started a series called Follow the Money to illustrate the large amounts of money the telecommunications companies spend on legislators to push their agendas for them. You can always tell how most legislators will vote if you simply follow the money.
Through the wonders of public records searches at the North Carolina State Board of Elections, I am able to see the PAC contributions that legislators have received. I can also cross reference this information with the dates the legislators are in session and the Secretary of State’s online lobbyist database. In North Carolina you can take PAC money from a PAC who has a registered lobbyist so long as the General Assembly is not in session. If you take the contribution while in session, the state’s General Statute says it must be forfeited to the state’s General Forfeiture fund.
In this Moratorium Watch 2010 edition I want to focus on two North Carolina legislators leading the charge to ban or restrict municipal broadband projects — Sen. Daniel Clodfelter (D-Mecklenburg) and Sen. David Hoyle (D-Gaston).
Clodfelter is the co-chair of the Revenue Laws Study Committee. In just 24 months, he took in a total of $16,000 in PAC contributions from big telecom companies and their friends:
$1500 from North Carolina Cable PAC
$1000 from Sprint/Nextel
$1500 from Embarq
$500 from the NC Association of Broadcasters
$5500 from Time Warner Cable
$5000 from AT&T
$1000 from North Carolina Broadcast PAC
Senator “Obsolete Fiber” Hoyle dwarfed Clodfelter over the past 24 months:
$3500 from Sprint/Nextel
$4500 from Embarq
$8250 from Time Warner Cable
$4000 from AT&T
$2000 from Electricities (Drew Saunders is a lobbyist with Electricities and was a primary sponsor on the Level Playing Field bill for big telco a few years back)
$1500 from North Carolina Broadcast PAC
$1500 from North Carolina Cable PAC
That’s $25,250 for Hoyle from companies with an active interest in the telecommunications debate in this state.
When you consider more than $40,000 was spent to boost the campaign coffers of just two state legislators, it’s not hard to see big money is involved statewide. It doesn’t even have to arrive in the form of a PAC contribution. Clodfelter just had a $29 million Time Warner Cable headquarters building placed in Mecklenburg County. Hoyle helped procure the Apple Data Center, located 22.5 miles north of his district in Maiden, NC.
When cross-referencing Hoyle’s PAC contributions with the state lobbyist database, I found several possible conflicts that warrant investigation, and I will bring my concerns to the North Carolina State Board of Elections. If my complaint is upheld, perhaps Hoyle’s concerns about the need for additional state revenue could be eased knowing some potentially improper contributions made to his campaign were turned over to the General Forfeiture fund. Hoyle has already announced he is not running for re-election so he doesn’t need the money anyway.
Once you count that money, it’s easy to discover why some of our state legislators are actively working against our own best interests here in North Carolina. The corporate campaign contribution, which can be likened to legalized bribery, makes it difficult to convince legislators to always vote with their constituents’ best interests at heart. Whenever legislators are willing to cash corporate contributions and vote against consumer interests, we’ll be here to call them on it. Until this country gets corporate money out of government, it’s all we’ve got.
Stop the Cap! readers Terry and Scott write to let us know it was an Astroturf weekend in the pages of the New York Times‘ ‘Letters to the Editor’ section as two traditional allies in big telecom’s fight against Net Neutrality and broadband regulation blasted the newspaper’s recent pro-FCC regulatory authority editorial.
Mike Wendy, vice president of the Progress and Freedom Foundation, a disingenuously-named telephone and cable-backed front group, was first up, proclaiming the bipartisanship of the glorious Telecommunications Act of 1996 which made unregulated broadband’s growth possible:
Over the last five years alone, American companies — incentivized by the absence of Internet regulation — have invested more than half a trillion dollars to build broadband infrastructure. Consequently, this has exploded broadband choice and access, boosting jobs, productivity and commerce, as well as other important societal-civic benefits, for more than 90 percent of America. This growth will continue, fostered by vibrant competition among cable, wireless, wire line and other evolving means.
It is understandable that you ignore the second fact: it reveals an inconvenient truth. The Telecommunications Act of 1996, which put Internet services outside of 75-year-old telephone regulations, was passed by a Republican Congress and signed into law by a Democratic president, in an overwhelmingly bipartisan manner. The Bush-era regulatory changes, which ensure that Internet services get treated in accord with the law, only followed through on the pro-deregulatory, pro-marketplace intent of the law.
Speaking of inconvenient truths, it took the newspaper’s editors to fully disclose that “the writer is vice president of […] a think tank that takes support from the information technology, telecom, wireless, media, cable and content industries.” Kudos to the Times for disclosing that — too often such hackery goes unchallenged, without informing readers who is paying for it.
Of course, those big dollar amounts representing industry investments ignores the even bigger profits reaped from those investments, particularly in barely-competitive broadband. Nobody in the broadband industry is lining up for a bailout, that’s for certain.
As to the group’s assertion that bipartisan bliss made telecom deregulation all worthwhile, the only thing they managed to prove is that both political parties are ready and willing to be suckered into believing the broken promises of lower pricing and better service for their constituents (helped along with a generous campaign contribution to ease any disappointment later on.)
President Clinton, who signed the Act, considers it one of his mistakes after he saw the results.
Just days after the governor of Arizona signed a highly controversial border enforcement measure into law, LULAC labels Net Neutrality opposition its "top news story." Is this a group that represents the real interests of America's Latino community, or that of its backers AT&T and Verizon?
Next up is a letter from Brent A. Wilkes, Executive Director, League of United Latin American Citizens (LULAC). He doesn’t like Net Neutrality either, and regurgitates familiar industry talking points our readers can recite in their sleep:
We’ve seen more than $200 billion invested in broadband networks — more private investment than anywhere in the world — and the Internet in the United States has been an unquestioned success.
Second, network neutrality regulations are largely a solution in search of a problem. The F.C.C. adopted “Open Internet” principles in 2005. Since then, there have been only a few alleged breaches that were quickly resolved under this framework.
On the other hand, net neutrality regulations could shield the companies that make billions in profits from the Internet — search engines and other providers — from contributing toward the $350 billion in investment broadband upgrades needed to handle bandwidth demands, which double every two years. That would shift these bandwidth costs exclusively — 100 percent — onto consumers and could thereby deter broadband adoption in Latino and other communities.
Net neutrality could also bar broadband providers from managing, in a nondiscriminatory manner, the few bandwidth-hogging applications and services that can consume nearly all of a neighborhood’s bandwidth. If and when critics identify a real problem, Congress should quickly grant the F.C.C. the express authority to fix it.
Now why would a Latino interest group be so ready and willing to carry the industry’s water in the pages of the New York Times? Whenever AT&T and Verizon have a public policy concern, LULAC is sure to follow. For years, this group has been a part of more than a few industry-backed astroturf campaigns designed to trick consumers into buying their corporate agenda. For disadvantaged Latino communities already hard hit with an ever-expanding price tag for telecommunications services, it’s shameful to see a group openly advocating an agenda that extracts more money from consumers’ wallets.
LULAC has received millions in support from General Motors, AT&T and Verizon
LULAC was there as a card-carrying member of both TV4Us and Consumers for Cable Choice, front groups promising consumers in states served by AT&T that statewide video franchises would lower their cable bills. LULAC was front and center in the cheerleading section. Only Latino Wisconsins, along with everyone else, got rate increases instead. Thanks, LULAC!
Telecom analyst Bruce Kushnick tears the lid off:
This “deception … is about playing on America’s caring about the public interest and about minorities getting a fair shake,” Kushnick says . Worse, “these organizations have very deep-pocketed funders with lobbying groups, PR firms and others to get them the loudest ‘volume’ in the media or access to regulators and legislators. They often overwhelm the message of independent consumer groups.”
LULAC was there in states like New Jersey when Verizon was looking for its own statewide franchises. To not offer them, LULAC suggested, would harm Latino communities across the region. Actually, for many of them, the fact their cable and phone bills continue to march relentlessly higher actually hurts more.
The group is an equal opportunity sellout. During discussions about XM Radio and Sirius merging, LULAC was ready with a letter of support for the merger. Because when you think about pressing concerns for today’s Latino community, dwelling on the merger of two satellite radio services is a real front burner issue.
When Verizon wanted to acquire Alltel, guess what group was there to cheer the deal on:
LULAC supports this merger because the networks of the two companies are largely complementary. That means that when the merger is complete, even more consumers will enjoy the innovations Verizon Wireless plans to bring to market in years to come.
It’s getting hard to find a cause célèbre for AT&T or Verizon where LULAC doesn’t have their back.
But why?
Money, of course.
AT&T and Verizon have both donated millions of dollars over the years to LULAC. General Motors, which had a direct interest in the outcome of the XM/Sirius merger is a donor as well.
Don’t fall for hackery. Net Neutrality protects consumer interests and guarantees online freedom, something especially important as the forthcoming immigration reform debate begins anew. That’s an issue Latinos are concerned with. Too bad those issues don’t generate multi-million dollar contributions, which might get groups like LULAC to stop advocating against the interests of their own members.
As I have been reporting here, the moratorium on municipal broadband is alive and well in the legislative halls of Raleigh. Senator David Hoyle (D-Gaston), sponsor of last year’s consumer atrocity HB1252, is back again asking Senator Daniel Clodfelter (D-Mecklenburg County) for a vote May 5th on a proposed moratorium for municipal broadband projects. Hoyle is not running for re-election.
While no new legislation has surfaced yet, several legislators continue to hint that a new bill is forthcoming. Be assured any such legislation will be designed to protect today’s monopoly/duopoly marketplace for broadband service in North Carolina.
Senator David Hoyle calls on the legislative committee to introduce and vote for a moratorium on municipal broadband projects in North Carolina. (April 21, 2010) (1 minute, 30 seconds)
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Meeting Highlights:
Senator Daniel Clodfelter (D-NC)
• Senator Clodfelter opened the meeting stating that he “wants to focus on revenue issues/financing, not whether or not high speed Internet is a good thing.”
• Heather Fennell, from the research division at the General Assembly gave a presentation citing laws that govern cities, the original lawsuit that established precedent for cities to construct municipal fiber networks, what cities have them, and who pays the taxes on different systems.
• Vance Holloman, Deputy Treasurer-State and Local Finance Division spoke next. He assured the committee and attending audience that North Carolina’s existing municipal systems are in good standing and he expected they would be able to pay down debts incurred from initial construction and deployment costs. Holloman added the Local Government Commission, which has to approve the financing of these systems, believed these projects represent “solid economic development investments.” Holloman’s strong presentation should have encouraged legislators to favor economic development from fiber optic broadband, but we had a strong sense several members had already made up their minds made up to oppose these projects. You will have to convince them to reconsider.
• The next part of this session divided 50 minutes between private commercial providers and municipalities to share their views.
The commercial providers went first, beginning with attorney Marcus Trathen from the law firm Brooks/Pierce. Today, he was representing the North Carolina Cable Communications Association (NCCCA). Trathen has also appeared at prior meetings representing the interests of Time Warner Cable.
Trathen’s presentation was about as expected – talking points loaded with misrepresentations and misinformation. Trathen told the committee the industry does not object if cities build private networks for internal communications (how generous), but doesn’t want those networks competing with NCCCA members.
Kelli Kukura, NC League of Municipalities
Suddenlink Communications’ Bill Paramore and AT&T lobbyist Herb Crenshaw also spoke, speaking in glowing terms about investments already made to improve service in the state. Crenshaw claimed AT&T is providing U-verse service in North Carolina after spending $1.2 billion dollars on system upgrades, an amount some have questioned (a 2007 press release pegged it at $350 million.) Of course, North Carolina’s cable and broadband customers who were promised savings from all this “robust competition” have instead been stuck paying annual rate increases that more often than not exceed the rate of inflation.
Next up were the municipalities.
Kelli Kukura from the North Carolina League of Municipalities started by challenging industry propaganda designed to downplay the benefits of municipal broadband. Kukura noted at least 30 North Carolina communities enthusiastically applied for Google’s proposed 1 gigabit fiber to the home network, illustrating intense interest in fiber networks. Google has also been an active proponent of municipal broadband, Kukura noted, reminding legislators the search engine giant defended the rights of municipalities seeking to deploy next generation broadband networks.
Among the communities that have their own municipal systems, job growth grew by an average of 6.4 percent. Kukura cited broadband success stories in Bristol, Virginia and Wilson, North Carolina.
Salisbury small businessman Brad Walser, owner of Walser Technology Group testified that North Carolina community’s new municipal broadband network Fibrant would meet his company’s needs for broadband capacity not available from commercial providers. Walser noted Salisbury is suffering from an unemployment rate exceeding 14 percent. Advanced broadband, he believes, could help the city attract new businesses that will help create new, high paying jobs. Fibrant is expected to launch later this year.
EPB provides broadband service for residents in Chattanooga, Tenn.
Some of the strongest testimony came from Colman Keane, senior strategic planner for municipally-owned EPB Telecom. Keane traveled all the way from EPB’s home in Chattanooga, Tennessee to share his experiences confronting a telecommunications industry hostile to the prospect of facing a new competitor. Keane has seen and heard the industry arguments all before, noting Chattanooga heard the exact same scare stories legislators in Raleigh were hearing today. Chattanooga also faced a proposed one year moratorium and a blizzard of industry-backed lawsuits, all which were won by the city.
The benefits of fiber optic broadband in Chattanooga include dramatically-improved broadband speeds as well as a more efficient power grid made possible from smart meters that help Chattanoogans reduce their peak power usage, saving money. I want to thank Colman for making the long journey on behalf of consumers in North Carolina.
• Finally, Raleigh community activist and former city council candidate Octavia Rainey spoke out against municipal broadband, which concerned me. Rainey spent her time seated with the telecom lobbyists, and her presentation illustrated the impact of astroturf efforts to co-opt good-hearted consumers into the industry cause. I hope to establish a dialogue with Ms. Rainey to share our information with her and learn more about how she reached her views on this subject. More to come.
The complete hearing of the Revenue & Laws Committee of the North Carolina Legislature on the issue of the financial implications of municipal broadband, chaired by Senator Daniel Clodfelter (D-Mecklenburg County) (April 21, 2010) (2 hours, 8 minutes)
You must remain on this page to hear the clip, or you can download the clip and listen later.
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[Octavia has a long history of community involvement in Raleigh, trying hard to improve her neighborhoods and life in general for area residents, something she is to be applauded for doing. I suspect Ms. Rainey has formed her views on municipal broadband in part from her close working relationship with AT&T, who has a long history trying to make friends with various community groups in part to win favor for their corporate agenda. In this case, Octavia admits AT&T’s Cynthia Mitchell and her have become “great partners.” AT&T provided support in building an area playground and also paid for lunch for volunteers working on the project, adding the company wanted to be a part of the Raleigh community. There is nothing wrong with that, of course, but one wonders if the conversation also drifted into AT&T’s talking points along the way.
Ms. Rainey also praised AT&T for delivering free Internet service to 290 Raleigh-area families last fall, which would make it ironic if she didn’t support municipal broadband, which has a proven track record of erasing the digital divide and lowering prices for hard-pressed consumers. These are the people that need some fact-based information about the true benefits of municipal broadband. — Phillip Dampier]
Today was expected, but disappointing nonetheless. Hoyle actually suggested that fiber networks may be obsolete in five years and we may be moving to wireless. If that were true, why is he hellbent on a moratorium and the banning of such networks at the industry’s behest? Why would the telecommunications industry be concerned about “obsolete fiber networks?” The only thing obsolete here are the broadband networks owned by big cable and phone companies Hoyle wants to preserve and protect.
Rep. Pryor Gibson (D-NC)
Rep. Pryor Gibson, who we noted is a manager for Time Warner Cable Construction agreed to recuse himself from this issue after it became a point of contention and sat in the back corner of the room.
All of your e-mails and calls have been getting through to the legislators. This kind of attention makes them nervous and I ask you to continue. I can assure you that we here at Stop the Cap!, along with Communities United for Broadband, Broadband for Everyone NC, and Save North Carolina Broadband are going to ratchet up attention on this issue.
WHAT YOU CAN DO TO HELP
Continue writing and calling the legislators below and asking them to oppose a moratorium on municipal broadband. Make plans on May 5th to come to Raleigh and be part of the crowd that opposes the moratorium. I will post meeting details as they develop.
Please thank the legislators we have identified on this committee as friends of our cause:
Sen. Daniel T. Blue, Jr. Wake [email protected] (919) 733-5752 Democrat (919) 833-1931 Attorney
Sen. Fletcher Lee Hartsell, Jr. Cabarrus, Iredell [email protected] (919) 733-7223 Republican (704) 786-5161 Attorney
Sen. Josh Stein Wake [email protected] (919)715-6400 Democrat (919)715-6400 Lawyer
Rep. Paul Luebke (Co-Chair) Durham [email protected] 919-733-7663 Democrat 919-286-0269 College Teacher
Rep. Jennifer Weiss Wake [email protected] 919-715-3010 Democrat 919-715-3010 Lawyer-Mom
The rest of the lot either doesn’t support North Carolina consumers or have not yet made their views known on this issue. We must pin them down and identify those elected legislators that represent the people versus those representing big cable and phone interests. Be sure to tell them you will interpret any support for a moratorium on municipal broadband to mean they are opposed to competition, opposed to lower prices for consumers, opposed to job creation and economic growth, and obviously for the cable and phone interests that will stop at nothing to keep these systems from being built.
Ask them how they could possibly support keeping North Carolina 41st in the country in broadband rankings, why they are against reducing the 11.2 percent unemployment rate (10th worst in the country) in North Carolina, and how they can justify a vote that guarantees exactly more of the same. If you are from a city that applied for Google Fiber, remind your legislator passing this kind of hostile moratorium delivers a strong message this state is not serious about the next generation of broadband, and Google should look elsewhere.
Above all, note now that they understand the true implications this moratorium will have on constituents, you are confident there is no way they could ever support such a bad idea. Their delivery of a strong “no” vote reminds you why you supported them in the last election and will consider doing so again in the next.
Always be polite, professional, and persuasive in your correspondence, but deliver a clear and firm message that supporting a moratorium is completely unacceptable. Finally, be sure to ask them to get back in touch with you regarding their position on this issue as soon as possible. Then let us know!
Sen. Daniel Gray Clodfelter (Co-Chair) Mecklenberg [email protected] (919) 715-8331 Democrat (704) 331-1041 Attorney
Sen. Peter Samuel Brunstetter Forsyth [email protected] (919) 733-7850 Republican (336) 747-6604 Attorney
Sen. David W. Hoyle Gaston [email protected] (919) 733-5734 Democrat (704) 867-0822 Real Estate Developer/Investor
Sen. Samuel Clark Jenkins Edgecomb, Martin, Pitt [email protected] (919) 715-3040 Democrat (252) 823-7029 W.S. Clark Farms
Sen. Jerry W. Tillman Montgomery, Randolph [email protected] (919) 733-5870 Republican (336) 431-5325 Ret’d school teacher
Rep. Harold J. Brubaker Randolph [email protected] 919-715-4946 Republican 336-629-5128 Real Estate Appraiser
Endangered Species: The AT&T Printed White Pages Directory
A plan approved this week by the Kentucky Public Service Commission will allow AT&T Kentucky to cease universal distribution of White Pages telephone directories in the Louisville area saving the company hundreds of thousands of dollars in printing and distribution costs it does not plan to pass along to customers.
Customers in Jefferson and Oldham counties will receive directories only if they request them from AT&T Kentucky. Customers in the other 75 counties served by AT&T Kentucky will, for now, continue to receive printed directories that combine White Pages with Yellow Pages.
“They will be publicizing that and how to do that to all the customers. It’s not just people who receive their phone service from AT&T Kentucky, but those who get it for example from the local cable company, because they’ve been getting the AT&T Kentucky White Pages as well,” PSC spokesperson Andrew Melnykovich told WFPL Public Radio in Louisville.
AT&T Kentucky will make the contents of the directory available on the Internet (at RealPagesLive), while existing and new customers who request a printed directory will receive one at no charge. Yellow Pages, which contain business listings, will continue to be dropped on the doorstep of every Louisville customer.
AT&T Kentucky is the second phone company in Kentucky to move away from printed White Pages. Last April, Cincinnati Bell, which serves northern Kentucky, dropped universal distribution of its White Pages.
AT&T says the printed directories are less valuable to customers who often turn to the web to look up telephone listings. They also believe the move away from printed directories will protect the environment and provide significant savings to the company. AT&T has been getting permission to stop printing White Pages in several states where it provides service.
Unfortunately for customers, none of that savings will appear on your AT&T bill. The company does not plan any rate decrease to share the savings with ratepayers.
The PSC has told AT&T to collect and report customer complaints about the discontinued printed directories, as well as how many residents request them from AT&T, and forward the details to the agency for review.
How would you like to open your AT&T bill and discover you were overcharged more than $1,000?
An AT&T-admitted “computer glitch” is routinely overbilling customers in Tennessee several hundred dollars a month for charges that are supposed to be included in their service plan at no additional cost.
One Clarksville woman has been getting bills nearing $1,000 a month every month since January, and AT&T is well aware of its mistake, crediting her bill each times she calls.
But Belinda Horton wonders what happens to other customers, especially the poor and elderly, who may not be up to scrutinizing their phone bills every month and aggressively pursuing credits from the phone company.
“This is crazy. This keeps happening over and over,” Horton told WSMV-TV in Nashville. “When I got the next bill, it was $921.”
Now she’s fed up.
“At this point, they can correct my bill, and then they can just keep AT&T,” said Horton. “Everyone needs to check their bills.”
[flv width=”480″ height=”380″]http://www.phillipdampier.com/video/WSMV Nashville Customer’s Phone Bill Severely Overcharged 4-12-10.flv[/flv]
WSMV-TV in Nashville tells the story of Belinda Horton, a resident of Clarksville who is routinely overbilled by AT&T up to $1,000 every month since January. She isn’t alone. (3 minutes)
Be Sure to Read Part One: Astroturf Overload — Broadband for America = One Giant Industry Front Group for an important introduction to what this super-sized industry front group is all about. Members of Broadband for America Red: A company or group actively engaging in anti-consumer lobbying, opposes Net Neutrality, supports Internet Overcharging, belongs to […]
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Back in May of 2009, I started a series called Follow the Money to illustrate the large amounts of money the telecommunications companies spend on legislators to push their agendas for them. You can always tell how most legislators will vote if you simply follow the money.
