AT&T's Collapsed Merger Deal: A Crack in the Corporateers' Armor??
Some lobbyists may be hunting for their food stamp applications in Washington, with the collapse of AT&T's attempt to take over and kill T-Mobile. This breakdown of the lobbying steamroller is reverberating in the halls of private power, and should give some lift to consumers battling a corporatocracy that has lately seemed invincible. Here's the AT&T lobbyist info from Politico Influence:
AT&T bulked up in the arms race on lobbying the issue - spending nearly $11.7 million on lobbying during the first half of 2011 (an increase of nearly $2 million over the same time period in 2010). Thirty-five lobby shops filed reports with the House Clerk to lobby for AT&T during the first nine months of 2011. Hired guns include: Adams & Reese, Clyburn Consulting, Crossroads Strategies, Holland & Knight, Mercury Strategies, and Peck, Madigan, Jones & Stewart. Nickles Group, Patton Boggs, Denny Miller Associates and Mayer Brown also filed lobbying reports to work on behalf of the telecom giant.Now, several K Streeters confirmed to PI that with the fight over, they've been put on notice that the telecom shop won't keep everybody on into 2012. AT&T did not respond to an email request for comment.
Of course, even those lobbyists couldn't have believed that AT&T's plan to take over rival T-Mobile would benefit consumers. Aside from creating a cellphone market controlled 60% by AT&T and Verizon, the merger would have eliminated the last major provider with no limit on data use, not to mention flexible lower-priced plans. It didn't take a genius to predict what the merger would do to prices and service.
Yet the interesting twist to AT&T's surrender is that the corporate steamroller broke down at all, since the most significant opposition was from the consumer end, not from another industry. In recent years consumers have fought losing battles against the biggest industrial lobbies. A few examples from the Consumer Watchdog files:
- AT&T's nationwide drive in 2005-2006 to deregulate cable and video services, state by state, largely succeeded because the company flooded state legislatures with lobbyists and lucre. Consumer outcries about the loss of local control and protection against cable companies' abuses never pierced the lobbyist cocoon. In California, phone companies thanked the governor later with more than half a million dollars in contributions to him and his pet causes.
- National health reform ended up in 2010 far from its framers' original intent because the insurance companies doubled their lobbying and went to war. They squelched the "public option" and ensured that, when mandatory insurance kicked in, Americans' only choice would be private insurance.
- California health insurance companies keep getting away with double-digit rate increases because the state Legislature does what the insurance industry asks. Repeated attempts to regulate health insurance (in the way that auto insurance is successfully regulated) all failed, despite waves of consumer demand for rate relief and the support of insurance commissioners.
Even this year, the AT&T/T-Mobile merger seemed to have success written all over it. The AT&T-Cingular merger of 2006 had raised similar consumer objections about loss of competition, service and price (many of which came true, as shown in a devastating Consumer Watchdog comparison), but it sailed through.
So the collapse of T-Mobile merger gives reason to think there's a chink in the corporateering armor, and multimillion-dollar lobbying budgets can be beat.
Consumer advocates' plan to put health insurance regulation to California voters, an end run around bought-and-paid-for legislators, is looking like a better bet.
Other states successfully push down premiums because they have the power to approve or reject increases before they take effect, with no harm to competition or insurers' fiscal solvency. The insurance industry and its allies will certainly spend at least tens of millions of dollars to prevent California voters from enacting the same thing in the largest state insurance market.
Consumer groups don't have tens of millions of dollars for a ballot campaign. But corporations have overreached, and don't have a nickel left in the way of public trust. So thanks, AT&T, for blowing that $11.7 million on lobbying for nothing. It's cheering to those of us who are up against your corporate ilk.
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