Nothing like a fresh new year! State legislators return to their respective capitals to once again do the work of the people. Or, in the case of Indiana State Senator Brandt Hershman, the work of AT&T (formerly SBC). The eager Mr. Hershman has already introduced a bill, SB 245, that deregulates the phone industry, eliminates local franchising, etc., etc.
To review: when last we left the state of Indiana, SBC had tried to use a pet Representative to introduce a stand alone bill effective barring muni broadband. To their surprise, it didn’t get out of subcommittee, as lots of folks from rural areas and less desirable markets explained that if the law passed, they could not expect to see affordable broadband anytime soon. Without broadband, their economies stagnated and died. We closed with democracy triumphant. Repeat in 2005 in about a dozen other states.
But, like Jason, Chucky, or Jar-Jar Binks, the telco lobbyists and their wholly owned subsidiaries in the state legislature keep comming back for endless sequels. Once again, the forces of corporate welfare have learned from their previous mistakes and have unvieled their new tactic — trying to sneak these provisions through as part of larger telecom reform bills. SB 245 is over 100 pages long, with numerous complex provisions on hot button issues like pricing, redlining and local franchising. The few news stories about SB 245 have not even mentioned the anti-muni provisions.
But the foot soldiers of monopoly incumbents didn’t recon on Jim Baller — The Man Who Knows All Things Muni Broadband.
Unfortunately, according to this article, Indiana’s Governor Mitch Daniels shares Mr. Hersham’s hate of local governments and love of corporate subsidies. According to the Governor, it is “bad” to spend public money to provide public services, but “good” to provide public money or other valuable benefits (like publically funded low interest loans or building conduits in public roads for private companies at state expense).
Color me stupid, but I don’t get it. If this is about how the wonderfulness of capitalism and the American way should not be sullied by the foul taint of state socialism, then why provide public subsidies to billion dollar private companies with access to capital markets and other forms of financing? If this is about providing a needed service to the public, then why not let local governments determine how best to deliver it? Local governments do a good job on such complicated and messy issues as sewers, electricity, public transportation, etc. etc.
But SB 245 contains lots of juicy tax incentives to encourage telecommunications providers to upgrade and deploy new systems. (As an added insult to the apparently despised local governments, the tax breaks come out of local property taxes.) (I gotta ask, was Whitacre [head of AT&T] frightened by a school bus or something as a child? Why does he and his lobbyists have such a hate on for local governments? Did a mayor insult him once and he has sworn to wreak revenge? and why do legislators go along with this? I mean, they live in these supposedly awful, inefficient, anti-competitive local communities. Don’t they notice that their local government seems to be doing a pretty good job on their sewer and sanitation? But I digress …)
At the same time that SB 245 gives direct tax subsidies to incumbent monopolists, it eliminates local franchising of cable services (creating a state franchise), permits red-lining (build out requirements prohibited), and limits PEG access. Oh yeah, and since Indiana will soon be overflowing with competition as a result of all this deregulation, it phases out rate regulation.
I confess I grow suspicious when the only role reserved for government is to shut up and transfer public money to private companies, particularly monopolies deregulated in the name of “free enterprise” and “competition.” But I suppose I can’t blame these companies for trying. AT&T exists to maximize its revenue, and sucking down subsidies while surpressing competition certainly does that.
But I can blame the Hon. Brandt Hershman. People elect him to watch out for their interests, not transfer public money to AT&T and other incumbents. Hopefully the people will rise again, as they did last year, to remind their elected officials of this. Perhaps this time it will stick.
Stay tuned . . .