15 U.S. Reps Sign Letter Demanding Obama Support ATandT, T-Mobile Deal

By Wayne Rash  |  Posted 2011-09-19

15 U.S. Reps Sign Letter Demanding Obama Support ATandT, T-Mobile Deal

WASHINGTON - U.S. Rep. Heath Shuler (D-N.C.) sent a letter with 14 Congressional co-signers to President Barack Obama Sept. 15 demanding that he order regulators to settle the antitrust lawsuit that seeks to prevent the merger of AT&T and T-Mobile. 

The letter, drawn completely from AT&T's playbook, parrots the claims that the merger would create jobs and expand high-speed wireless Internet access. Notably, AT&T was one of Shuler's top five contributors during the last two election cycles, donating at least $27,000 to Shuler's private political action committee (PAC), "3rd and Long," according to contribution reporting service, OpenSecrets.org. 

Shuler, a one-time quarterback for the Washington Redskins, has been trying to make a name for himself as the new leader of what is referred to by some journalists and Washington insiders as the "Bluedog" Democrats. Shuler has been courting labor unions and large corporate sponsors to make this happen. One of the primary supporters of the merger is the Communications Workers of America (CWA). While the CWA is not one of Shuler's largest contributors, the union has officially endorsed his re-election and has sponsored "get out the vote" campaigns on his behalf. 

In response to repeated requests for additional comments on Shuler's letter about the AT&T-T-Mobile merger, eWEEK was told that the congressman and his press staff were "unavailable." 

But what's perhaps more interesting is that AT&T was also one of the top contributors to 12 of the 14 co-signers of Shuler's letter. Also notable is that the Blue Dog PAC, of which Shuler's former Chief of Staff Andrew Whalen is the group's political operations head, backed all 15 of the signers. In other words, Shuler controls the PAC that's one of the largest donors to each of the 15 members of Congress linked to the letter. Furthermore, AT&T is a donor to Shuler and 12 of the others, either directly or through their respective private PACs. 

If all of this sounds complicated, welcome to the world of political campaign contributions. Here in Washington, money can flow through many channels, not all of them obvious and many of which are well hidden. In addition, the ways candidates receive money are varied. For example, nearly every politician in Washington has a private PAC that serves only to funnel money that they otherwise couldn't take into their re-election-and sometimes to other purposes. AT&T has donated millions of dollars into these PACs over the last election cycle and the current (2012) cycle. AT&T is not alone in its lobbying efforts and the current push to urge federal agencies to approve the merger is but one example of corporations attempting to influence political outcomes. 

Shuler Letter Ignores Antitrust Review Process


In the early days of the merger between AT&T and T-Mobile, much was made over the amount of lobbying money that AT&T had to invest, but at the time, it wasn't clear where this money might turn up. The way it normally works in Washington is that members of Congress suddenly turn up taking action in some area where they normally have little or no interest. Shuler, for example, hasn't been very involved in communications policy, except for a letter pushing telecom immunity (which would prohibit suits by people being spied on to find out who was doing the spying). But suddenly he takes a public position opposing actions by his own party, but in the interests of a major contributor. 

But AT&T's influence is clear. The company has been spreading money around to your elected leaders. Interestingly, so has one of AT&T's unions, the International Brotherhood of Electrical Workers, although not to the same extent as AT&T. IBEW has also announced support for the AT&T-T-Mobile merger. 

So how much has AT&T, through its contributions to Shuler and his PAC influenced the Congressman's behavior? It's notable that during the Congressional hearings about the merger, AT&T executives were asked why they hadn't used their existing spectrum to improve service in western North Carolina-Shuler's district-and they responded that they weren't planning to expand service because there wasn't enough revenue potential. I'll be closely following this spectrum stance to see if AT&T changes its stance in view of Shuler's support.

Does Shuler think that perhaps a T-Mobile acquisition will expand coverage in his part of North Carolina? Is that the real price for his support? If so, he's mistaken, as a comparison of T-Mobile's coverage map and AT&T's coverage map of the same area demonstrate. As you'll see if you look at Shuler's district, the two maps are virtually identical. Perhaps this is because T-Mobile has historically had a roaming agreement with AT&T in North Carolina, meaning that their respective coverage would be identical. In other words, if Shuler actually believes this will help his constituents, he's sadly mistaken. 

Likewise, Shuler's stated belief that the AT&T merger with T-Mobile will generate thousands of jobs is suspect, at least. In the past, such mergers have ultimately resulted in the loss of thousands of jobs as redundant positions-and the people who occupy them-are eliminated. While AT&T has promised that it would bring 5,000 call center jobs back to the U.S. if the merger goes through, Sprint and other opponents dispute that promise. The promise also raises the question of why AT&T sent those jobs out of the U.S. in the first place. Incidentally, AT&T is not bound by its promise at this point; it's just a promise with nothing to back it up.

What's unfortunate is that Shuler apparently didn't bother to check the law before making his demands. The Department of Justice can't settle by itself. The federal court that eventually hears the case has to agree to any settlement under Chapter 5 of the Clayton Act, and the chances of that happening are slim. In addition, there's still Sprint's antitrust suit. Sprint has already said that it's not going to settle, ever. So one must wonder, did AT&T get its money's worth with Shuler? Maybe they should have checked how Shuler worked out with the Redskins before throwing good money after bad.


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