Probably telecom dualopolists AT&T and Verizon now hate NYS AG Eric Schneiderman as much as the banksters do -- and the more corrupt state AGs

Iowa AG Tom Miller: He's shocked, shocked, that anyone could question his toughness with the banks after he raised hundreds of thousands of simoleons from the financial sector upon announcing his intent to "investigate" the banks, which he has done so, so hard. I bet the joke'll be on the banksters when Tom hurls all that filthy lucre back at their stinking feet! (Anytime now, Tom.)



by Ken



Before we descend to the hilarity of sleazebag of the week Tom Miller, let's make sure to get the news out -- and this is big news, regarding what was looking like an unstoppable takeover of T-Mobile by AT&T. From Bloomberg:

U.S. Files to Block AT&T, T-Mobile Merger



By Tom Schoenberg, Sara Forden and Jeff Bliss - Aug 31, 2011



The U.S. Justice Department sued to block AT&T Inc.’s proposed $39 billion takeover of T-Mobile USA Inc., saying the deal would “substantially lessen competition” in the wireless market.



The government is seeking a declaration that AT&T’s takeover of T-Mobile, a unit of Deutsche Telekom AG (DTE), would violate U.S. antitrust law, according to a complaint filed today in federal court in Washington. The U.S. also asked for a court order blocking implementation of the deal, the largest announced acquisition of the year, according to data compiled by Bloomberg.



“I don’t see any room to settle the case,” said Bert Foer, head of the American Antitrust Institute in Washington, in an interview. “They have clearly drawn a line in the sand.”



AT&T Chief Executive Officer Randall Stephenson’s proposed purchase of Bellevue, Washington-based T-Mobile, announced in March, would combine the second- and fourth-largest carriers to create a new market leader ahead of No. 1 Verizon Wireless. The new company would dwarf current No. 3 carrier Sprint Nextel Corp. (S), which argued against the deal.



“AT&T’s elimination of T-Mobile as an independent, low- priced rival would remove a significant competitive force from the market,” the government said in court papers. Dallas-based AT&T fell as much as 5.5 percent in New York trading after Bloomberg News broke the news of the lawsuit. . . .

Now I don't suppose the DoJ is likely to discuss how it reached the decision to intervene, but there's good reason to think that some role, and possibly a major one, was played by the office of New York State Attorney General Eric Schneiderman. Antitrust Bureau Chief Richard Schwartz issued a statement today saying that his boss "looks forward to reviewing the Department of Justice’s complaint to determine the best course forward on behalf of New York consumers and businesses."

Since March, Attorney General Schneiderman has played a major role in the review of the proposed AT&T, T-Mobile merger. Working in close partnership with the Department of Justice, this office has played a leadership role in a group of 26 states conducting interviews and gathering evidence central to this investigation. We have conducted numerous interviews of business enterprise customers throughout New York State and throughout the country to assess whether the merger would result in harm to competition to the business enterprise market, and closely analyzed the parties' claims that the merger would lower costs and improve service to consumers.



Attorney General Schneiderman remains particularly concerned that the proposed merger would stifle competition in markets that are crucial to New York's consumers and businesses. This includes concerns about vulnerable upstate communities, where concentration in some markets is already very high, and the impacts on New York City’s information-intensive economy, which is particularly dependent on mobile wireless services. Simply put, the impacts of this proposed merger on wireless competition, economic growth, and technological innovation could be enormous.

(The release notes that Schneiderman announced in March "that this office would conduct a comprehensive review of the proposed merger.")



It comes as something of a surprise to think that there are people with decision-making authority in the DoJ who might actually be listening to AG Schneiderman. The last we heard, he was being kicked off of the the coalition of state AGs' executive committee that's been exploring some sort of settlement with the big banks over their conduct in the collapsed mortgage industry, presumably out of pique over Schneiderman's outspoken opposition to the proposed "settlement," whereby the banksters would kick in some cash in exchange for being relieved of pretty much any further liability -- allowing them, in other words, to "move on" rather than being forced forever to "look back."



Which is apparently how we address all major problems in the 21st century. We just move on



To be sure, Schneiderman isn't alone among the state AGs. There's a small but hardy band (necessarily hardy, considering how they're regarded by most of their fellows) who also take their oath of office seriously. That number emphatically doesn't include the Big Cheese of the state AGs, Iowa's Tom Miller, the man who masterminded the "settlement" and the man who apparently gave Schneiderman the boot.



Miller meanwhile is feeling aggrieved. His longtime sidekick, Assistant AG Patrick Madigan, whined:

We’ve been accused of being in bed with the banks. To say that to a group of people who have spent the last seven to 10 years fighting mortgage abuses day in and day out is an insult of the highest order. It's just unreal.

Yeah, Pat, an insult of the highest order. Just unreal. I expect you and Tom were really insulted by the unreal Taibblog post Matt Taibbi wrote back in April, titled "Best Way to Raise Campaign Money? Investigate Banks," which began:

A hilarious report has come out courtesy of the National Institute of Money in State Politics, showing that Iowa Attorney General Tom Miller – who is coordinating the investigation into the banks’ improper mortgage dealings – increased his campaign contributions from the finance sector this year by a factor of 88! He has raised $261,445 from finance, insurance and real estate contributors since he announced that he was going to be coordinating the investigation into improper foreclosure practices. That is 88 times as much as they gave him not over last year, but over the previous decade.



This is about as perfect an example of how American politics works as you’ll ever see. This foreclosure issue is a monstrous story that is somehow escaping national headlines; essentially, all of the largest banks in the country have been engaged in an ongoing fraud and tax evasion scheme that among other things has resulted in many hundreds of billions in investor losses, and hundreds of thousands of improper foreclosures. Last week, the 14 largest mortgage lenders a group that includes bailout all-stars like Citigroup, Bank of America and Wells Fargo, managed to negotiate a settlement with the federal government that will mandate some financial relief to homeowners who have been victims of improper foreclosure practices. It’s unclear yet exactly what damages and fines will be involved in the federal settlement, or how many homeowners will be affected. But certainly there are some who believe the federal settlement was a political end-run around the states’ efforts to extract their own deal from the banks.

"If the banks had to pay what they actually owed" from their mortgage-related malfeasances, Taibbi wrote, "they would probably all go out of business."



In a dandy post on Tom 'n' Pat's Iowhining, Marcy Wheeler takes a closer look at this "fighting mortgage abuses" that, according to Pat, he and Tom have been doing day in and day out these past seven to ten years. (Doesn't that three-year spread leave a lot of days-to-days unaccounted for?) Notes Marcy:

As in the settlement they signed onto with Countrywide in 2008? The one that–according to NV Attorney General Catherine Cortez Masto, Bank of America has basically blown off?

In her filing, Ms. Masto contends that Bank of America raised interest rates on troubled borrowers when modifying their loans even though the bank had promised in the settlement to lower them. The bank also failed to provide loan modifications to qualified homeowners as required under the deal, improperly proceeded with foreclosures even as borrowers’ modification requests were pending and failed to meet the settlement’s 60-day requirement on granting new loan terms, instead allowing months and in some cases more than a year to go by with no resolution, the filing says.



The complaint says such practices violated an agreement Bank of America reached in the fall of 2008 with several states and later, in 2009, with Nevada, to settle lawsuits that accused its Countrywide unit of predatory lending. As the credit crisis grew, the settlement was heralded as a victory by state offices eager to help keep troubled borrowers in their homes and reduce their costs. Bank of America set aside $8.4 billion in the deal and agreed to help 400,000 troubled borrowers with loan modifications and other financial relief, such as lowering interest rates on mortgages.

(See DDay for more on Masto’s complaint.)



Perhaps Madigan doesn’t understand this. But pointing to a settlement that, in retrospect, appears to have largely been a PR stunt as proof that you’re not in bed with the banks sort of proves the point that you are.

Back in April, Matt Taibbi ventured that the flow of cash from people in and around the mortgage industry to Tom Miller was "just something to keep an eye on," adding, "It would be interesting to see a similar analysis on the money these same characters have thrown at the Obama administration in the last year."



Interesting indeed -- I wonder if anyone ever did such an analysis. As he wrote of the bonanza Tom Miller created for himself by making noises about investigating the banks: "This is about as perfect an example of how American politics works as you’ll ever see."



At least for today, however, on the matter of the AT&T takeover of T-Mobile, the Justice Department has taken a different path. It's something.

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Are the Congressmembers still boosting AT&T's T-Mobile takeover just oblivious, or are they in on the fix?

The media-reform advocacy group Free Press has written a letter urging congressmembers who signed a letter to the FCC urging approval of AT&T's takeover of T-Mobile to reconsider based on the known facts.





"Every AT&T argument for the public benefits of this merger has now been proven wrong.



"But that doesn't seem to matter in a town where AT&T writes more checks to federal candidates than any other company (it has spent $200 million on lobbyists and campaign contributions over the years) and gives more than $60 million a year to charity groups and not-for-profits, many of whom have lent their name to letters in support of the merger.



"Should the DoJ and FCC approve this deal, we'll have no clearer example of industry capture in Washington -- where well-financed fictions trump the facts."

-- from a post by Timothy Karr, campaign director

of the media-reform advocacy group Free Press

by Ken



Like a lot of people I suspect, even people at our end of the political spectrum, I didn't originally have strong feelings about AT&T's acquisition of its wireless rival T-Mobile. I accepted the argument that the question wasn't whether it was a good idea to combine the two companies. Rather the question, since apparently T-Mobile was determined to be acquired (or, rather, its parent company, Deutsche Telekom was determined to rid itself of its U.S. operation), was whether there was a better alternative. And since there didn't seem to be anyone negotiating besides AT&T, with its $39 billion offer, the answer seemed to be that there really wasn't any alternative, and at least AT&T had some advantages -- like its status as a union shop and its record of giving generously to a range worthwhile causes.



Now, however, I'm afraid even those of us who pay little attention to such matters know way too much about this deal to feel other than distressed about the prospects of the deal going through.



When I wrote Monday about the embarrassing-for-AT&T revelations contained in the mysteriously leaked letter written by someone on its legal team, what intrigued me most was the suggestion from our friend (and go-to guy on telecom matters) Tim Karr that in Washington the facts-of-the-matter can matter less than what it's convenient for public people to pretend to believe.



As I wrote Monday, drawing heavily on Karl Bode's Broadband post "Leaked AT&T Letter Demolishes Case for T-Mobile Merger," even before the leaked lawyer letter, there was no longer any factual basis for accepting any of the claims AT&T has made that made it sound like its acquisition of T-Mobile was a patriotic act.



"Job creation"? Not a chance. The current projection is that by the time AT&T finishes "consolidating" the two companies, 20,000 jobs will have been lost. Some progressives, along with the Communications Workers of America (CWA), have been hornswoggled by the fact that AT&T has unions while T-Mobile doesn't, which in theory suggests a plus for union representation. However, even assuming that the ex-T-Mobile employees who survive the consolidation bloodbath are unionized, the 20,000 workers who lose their jobs sure won't be.



"Increased investment in communications infrastructure"? Hahaha!. Doesn't seem likely when AT&T is bragging to investors about how much less it's going to have to spend once another pesky competitor is eliminated. As Karl Bode wrote:

While AT&T and the CWA are busy telling regulators the deal will increase network investment by $8 billion, out of the other side of their mouth AT&T has been telling investors the deal will reduce investment by $10 billion over 6 years. Based on historical averages T-Mobile would have invested $18 billion during that time frame, which means an overall reduction in investment.

Verizon plus a combined AT&T and T-Mobile would together control 80 percent of the wireless market. Have you noticed how right-wingers always favor "competition" in theory as the theoretical backbone of their religion, capitalism, but in practice, well, not so much?



"The buildup of its LTE network coverage from 80 to 97 percent"? No way, no how, though this discredited claim is slightly trickier to debunk, because it takes multiple steps. First, there's the consideration that from a strictly competitive standpoint AT&T was going to have to do something about its inadequate-for-the future coverage anyway. Second, there's the awkward fact that T-Mobile's network adds almost nothing to AT&T's. And third, the leaked letter demonstrated what the actual cost would be of that 80-to-97-percent buildup: $3 billion. And yet here was AT&T paying $39 billion for T-Mobile, which would add hardly anything to its coverage.



To quote Karl Bode again (emphasis added):

Again, the reality appears to be that AT&T is giving Deutsche Telekom $39 billion primarily to reduce market competition. That price tag eliminates T-Mobile entirely -- and makes Sprint (and by proxy new LTE partner LightSquared and current partner Clearwire) more susceptible to failure in the face of 80% AT&T/Verizon market domination. How much do you think wireless broadband market dominance is worth to AT&T over the next decade? After all, AT&T will be first to tell you there's a wireless data "tsunami" coming, with AT&T and Verizon on the shore eagerly billing users up to $10 per gigabyte.

Now Free Press has sent a letter to 76 members of Congress who signed a June 24 letter to the FCC supporting the merger because of that famous coverage buildout, which AT&T has been claiming would bring broadband to rural areas starved for it. (T-Mobile's network is considered to be weaker in this regard than AT&T's.) The congressmembers are encouraged to reconsider their argument.



You can find the full text of the letter here. It begins:

On June 24, 2011, you were one of several representatives who signed a letter (the “June 24th Letter”) calling for increased deployment of advanced wireless broadband. That is a laudable goal, and worthy of strong support. Unfortunately, several signers were misled at the time by AT&T’s false claim that it needed to acquire T-Mobile to provide wireless broadband coverage for 97 percent of the country’s population.



Since you signed this letter, new facts that contradict AT&T’s claims about this acquisition’s benefits have surfaced. Last week the unintentional public posting of documents AT&T had filed with the Federal Communications Commission and subsequent press reports revealed that the company could meet its rural-deployment promise for just $3.8 billion -- one-tenth of the cost of the T-Mobile acquisition. The public now has the truth: AT&T can deliver 97 percent mobile broadband coverage without sacrificing an estimated 20,000 American jobs and without reducing investment in the U.S. wireless market by more than $10 billion.

And the letter concludes:

For these reasons, we ask that you review the new data that emerged last week. We hope you will revise your recommendation to the Department of Justice and the FCC, and encourage those agencies to use the available data to weigh the impact this merger will have on jobs, innovation and investment.



We hope you will scrutinize all of the facts closely —--including the dramatically lower cost for AT&T to build its own advanced network rather than pursue this harmful, horizontal merger -- in considering whether this merger will truly serve the interests of the American people.

Let me quote again the end of the post of Tim's from which I've (re)quoted above:



"The only question that remains is whether regulators feel politically safe to sign off on a bogus deal, which sacrifices so many American jobs, just so AT&T can pad its profits and tighten its grip on the wireless marketplace."



The first test is the congressmembers' response to Free Press's letter. I'm not holding my breath.

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AT&T + T-Mobile = "Industry capture in Washington -- where well-financed fictions trump the facts" (Timothy Karr)

All the major players in Washington know that AT&T is fabricating its case for the T-Mobile takeover. But it seems that if you spread enough cash around, people are willing to pretend they buy your fairy tales.



by Ken



It's a favorite plot device on TV legal shows, where a smoking-gun-type incriminating document turns up buried -- maybe accidentally, maybe not -- in mountains of discovery materials from the evil opposition. So it's always fun when it happens in real life, though maybe not so much fun just now for AT&T, still engaged in its campaign to secure approval for its acquisition of mobile-phone rival T-Mobile.



If you haven't heard about the mysteriously appeared and disappeared letter: From somewhere inside the AT&T legal team a letter was posted -- briefly -- on the FCC website that confirms, and then some, what most everyone had worked out: that AT&T's planned acquisition of T-Mobile had nothing to do with job creation (the current estimate is that the combination will cost a minimum of 20,000 jobs; David Saldana goes over the jobs math in an Other Words post today, "AT&T Takeover of T-Mobile Won't Create New Jobs") and also nothing to do with the claim the company has fallen back on that it needs T-Mobile to increase its wireless capacity, thereby making it sound like a "building America" infrastructure upgrade.



However as Karl Bode pointed out in his Friday Broadband post "Leaked AT&T Letter Demolishes Case for T-Mobile Merger"), while AT&T indeed has serious network coverage deficiencies that will have to be addressed for its future competitiveness, T-Mobile brings almost nothing to the table on this front, since its network largely duplicates AT&T except in weaker form. And contrary to AT&T's claim of increased investment resulting from the combination, industry watchers have already demonstrated from its own networks that by its own claims there will be a substantial reduction in investment over what the two separate companies would have invested together.



The letter, says Bode,

proves AT&T's claim they need T-Mobile to improve LTE coverage from 80-97% simply isn't true. That's a huge problem for AT&T, since nearly every politician and non-profit that has voiced support for the merger did so based largely on this buildout promise.

Bode tells us that the letter, contrary to AT&T's damage-control team's claims, actually contains new information, and it's really bad for the company: "The letter pegs the cost of bringing AT&T's LTE coverage from 80% to 97% at $3.8 billion -- quite a cost difference from the $39 billion price tag on the T-Mobile deal."



So what is the AT&T/T-Mobile deal about? Says Bode:

[T]he reality appears to be that AT&T is giving Deutsche Telekom $39 billion primarily to reduce market competition. That price tag eliminates T-Mobile entirely -- and makes Sprint (and by proxy new LTE partner LightSquared and current partner Clearwire) more susceptible to failure in the face of 80% AT&T/Verizon market domination. How much do you think wireless broadband market dominance is worth to AT&T over the next decade? After all, AT&T will be first to tell you there's a wireless data "tsunami" coming, with AT&T and Verizon on the shore eagerly billing users up to $10 per gigabyte.

Our friend Tim Karr of Free Press, our go-to guy on telecom matters, has neatly distilled the essence of the deal:

Guess what?



AT&T's plan to take over T-Mobile is really about gouging customers and destroying a competitor. My colleagues and I at Free Press have been saying this from the beginning, but it's good to have one of AT&T's own lawyers confirm it via a leaked letter.



Still, the merger is about more than higher prices and fewer choices: An estimated 20,000 American workers will lose their jobs as the "synergies" of the deal take effect.



Every AT&T argument for the public benefits of this merger has now been proven wrong.



But that doesn't seem to matter in a town where AT&T writes more checks to federal candidates than any other company (it has spent $200 million on lobbyists and campaign contributions over the years) and gives more than $60 million a year to charity groups and not-for-profits, many of whom have lent their name to letters in support of the merger.



Should the DoJ and FCC approve this deal, we'll have no clearer example of industry capture in Washington -- where well-financed fictions trump the facts.



The only question that remains is whether regulators feel politically safe to sign off on a bogus deal, which sacrifices so many American jobs, just so AT&T can pad its profits and tighten its grip on the wireless marketplace.

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What a mess! GLAAD, EqualityCalifornia, AT&T, and the threat to Net Neutrality

by Ken

I don't know if you've been following the fracas, so far focused mainly on GLAAD (the Gay & Lesbian Alliance Against Defamation) -- leading to the resignation of executive director, Jarrett Barrios earlier this week -- surrounding the disclosure that a number of organizations that over time had accepted substantial contributions from AT&T and even had a man with close ties to the company on their boards had filed statements of support for AT&T's plan to dismantle Net Neutrality which were in fact written by AT&T. (GLAAD does oustanding work on public, notably media, misperception on LGBT issues. The universsally admired work of its highly energetic and highly effective staff can't have been made easier by the hubbub of these last couple of weeks.)

Yesterday FDL's Teddy Partridge reported this latest development (links onsite):

Troup Coronado, AT&T Handmaiden, Leaves Equality California Institute Board

By: Teddy Partridge, Friday June 24, 2011 10:56 am

Having slithered off the GLAAD board of directors amidst other departures announced in that organization’s long-awaited statement, Troup Coronado, Esq., — the AT&T handmaiden who’s the source of all this travail in LBGT organizations that took “stands” on the T-Mobile merger and net neutrality — has left the Equality California Institute Board of Directors as well.

It’s a good thing, too, since Troup Coronado’s anti-gay efforts in the Heritage Foundation and the GWBush Administration are coming to light, as well as his smarmy history of breaking “ethics” rules in place during the Wild West Denny Hastert/Tom Delay era as a House lobbyist.

Earlier this week, Equality California withdrew a letter to the Federal Communications Commission from its then-Executive Director, Geoff Kors, about net neutrality. Here is I-ED Carroll’s recent e-mail and his letter to the FCC withdrawing that letter:

On behalf of Equality California I have sent the letter copied below to the FCC withdrawing our previous letter. As it says in the letter it was never our intention to oppose Net Neutrality.

And on behalf of myself I made an error in an interview yesterday with Chris Geidner in which I said that Equality California doesn’t have a policy with regard to our policy positions. In fact, there is a policy that allows the Executive Director to make decisions on policies that are core to the mission of Equality California. On issues that are outside of our core mission, such as support for our friends in labor or in the reproductive rights community, there is a policy that requires the board to weigh in if a board meeting is timely, or directs the matter to the Executive Committee. In the event of an urgent policy choice the ED can seek counsel from the Board President. I apologize for any confusion this might have created. I’ve only been Interim ED for 7 weeks!

Jim Carroll

June 22, 2011

The Honorable Julius Genachowski
Chairman, Federal Communications Commission
445 12th Street SW, Room 8-B201
Washington, DC 20554
RE: Withdrawal of letter dated October 12, 2009 – Broadband Industry Practices (WC Docket No. 07-52)

Dear Chairman Genachowski and Commissioners:

On October 12, 2009, Equality California submitted a letter to the Commission urging the preservation of an “open and accessible Internet” and requesting an effort to reach out to the LGBT community. It has come to our attention that the phrase “open and accessible Internet” can be taken to indicate opposition to net neutrality, which was neither our intention nor our organization’s position. We fully support the principles of net neutrality.

Accordingly, we request that you withdraw our letter of October 12, 2009.

Very truly yours,

Jim Carroll
Interim Executive Director
Equality California

Equality California promises a statement shortly; when I receive it I will append it as an update to this post.

Teddy, you'll note, is pretty tough on the orgs who've taken Troup Coronado into their bosom. Actually, it's not entirely clear that he has been engaged in unremitting evil masterminding.

For that matter, there's been a lot of anguish in the LGBT community over the vilification of AT&T. It's pointed out that the company has an unusually good record on its treatment of LGBT employees as well as its financial support of LGBT organizations and causes -- money that's admittedly a drop in the bucket for a company of its size but that may spell life or death for the recipients of its largesse, always hard-pressed for cash, and obviously much more so in the desperate climate following the economic meltdown. Was it wrong for orgs to accept, even welcome support from a source that has long seemed on board with their causes?

It seems kind of far-fetched that AT&T planted Troup Coronado on those boards as the linchpin of a scheme to infiltrate LGBT orgs to engineer the support that will put their anti-Net Neutrality crusade over the top. At the same time, it's a little scary to discover that some LGBT activists don't understand how damaging the AT&T-engineered breach of Net Neutrality will be, not just for LGBT causes, but for everyone who isn't a top-dollar supporter of the corporatist state.

Net Neutrality sounds like such an abstract, minor technical issue, sort of the way "media concentration" did all those years when annoying Cassandras were warning of its danger to free and open expression. Well, nothing ever was done to slow the onrush of media conglomeration, and here we are in a world where an alarmingly paltry number of media moguls control an alarmingly large portion of what passes for mass-consumed news.

If the result hasn't been quite as dire as the Cassandras warned (at least not yet), it's in good part because of the unforeseen rise of the Internet, making possible the widespread dissemination of non-corporate-blessed content. Thank goodness the corporatists won't be able to get their grubby mitts on that!

Oh, wait.

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