corruption – Techdirt (original) (raw)

Mistrial Declared In Bribery Trial Of AT&T Executive

from the this-is-why-we-can't-have-nice-things dept

I’ve covered telecom giants like AT&T for most of an adult life. And I can tell you with absolute certainty that the company all but owns most state legislatures, who are happy to pass no limit of terrible, anti-consumer, anti-competitive legislation in exchange for a nice vacation trip or campaign contribution.

AT&T lawyers and executives are usually smart enough to avoid leaving any sort of paper trail, bribing officials within the pathetic confines of our existing, really flimsy lobbying and campaign finance laws. But in 2022, AT&T was hit with a $22 million fine for just outright bribing former state Rep. Edward Acevedo and his colleague, Former Illinois House Speaker Michael Madigan.

AT&T was trying to secure legislation that would free the company from having to maintain or repair traditional copper-based (and heavily taxpayer subsidized) phone and DSL service, often still in active use by the poor and elderly. AT&T’s been going state to state, with mixed results, trying to convince state politicians that it shouldn’t have to maintain the copper-based networks taxpayers paid handsomely for and still, in many parts of the country, help connect folks to 911 services.

AT&T used a lobbying firm as an intermediary to pay Acevedo $22,500 over nine months. That resulted in the indictment of Former AT&T Illinois President Paul La Schiazza. But the attempted prosecution of La Schiazza was declared a mistrial last week in Illinois, after prosecutors failed to convince just one of twelve jurors hearing the case that bribery had occurred. La Schiazza’s attorneys were very happy about it:

“Defense attorney Tinos Diamantatos mocked the prosecutors’ case in his closing argument Tuesday, referring to the feds’ “dark and stormy night”interpretation of evidence and at one point calling his client “Mr. Unethical Bribester.” The reality, he said, is that there is no evidence that La Schiazza exchanged Acevedo’s money for AT&T’s legislative success.”

Prosecutors say they had ample email evidence bribery occurred (you can peruse the complaint and case details here). The complaint notes that Acevedo was paid “for supposed consulting services” but clearly “did no work in return for the payments.” The bribes are clearly bribes, but in email correspondence was often couched in the kind of rhetoric that leaves things open to interpretation. If you’re an imbecile.

If you recall, AT&T also was caught in a scandal paying Trump “fixer” Michael Cohen $600k to gain inside access to the former President.

Madigan, meanwhile, is facing his own broader trial on various corruption allegations.

In just the last decade or so AT&T has been fined $18.6 million for helping rip off programs for the hearing impaired; fined $10.4 million for ripping off a program for low-income families; fined $105 million for helping “crammers” rip off their customers; and fined $60 million for lying to customers about the definition of “unlimited” data. It’s also been accused of ripping off U.S. schools for decades, something I’ve yet to see properly investigated.

Usually AT&T cleverly skirts around the limits of our fairly weak lobbying laws, and when they are caught, routinely manages to reduce or avoid fines entirely. Here we have one of the most obvious bribery cases in years showcasing how AT&T literally purchases favorable state legislation, yet it’s still somehow a steep uphill climb toward anything even vaguely resembling accountability or justice.

Filed Under: 911, accountability, bribery, carrier of last resort, corruption, dsl, edward acevedo, paul la schiazza, phone, telecom
Companies: at&t

NYPD Chief Caught Up In Corruption Probe Exits Office With Mandate Reducing Punishments For Officer Misconduct

from the hurling-one-last-'fuck-you'-to-the-public dept

It’s been a whirlwind few months for NYPD Commissioner Edward Caban, at least in terms of press coverage. None of it has been positive, though.

A few months ago, reporting from ProPublica exposed Commissioner Caban’s efforts to make the NYPD even less accountable than it always has been. Public records and other information obtained by ProPublica made it clear Caban wasn’t interested in cleaning up a police department that was costing residents millions of dollars a year in the form of lawsuit settlements.

Earlier this month, things went from par-for-the-unaccountable-course to shit hitting the fan. The FBI spent a few days raiding homes and offices of city officials and direct subordinates of Mayor Eric Adams. Adams, a former NYPD officer, claimed to be unaware of any criminal activity happening under this nose — something he buttressed by stating he had repeatedly told staff and appointees to “follow the law,” which is the sort of thing you only need to say more than once when staff and appointees seem insistent on breaking the law.

One of the targets of the FBI raids was none other than Commissioner Edward Caban. It’s unclear at this point if it has anything to do with his brother, Richard Caban, who runs a bar catering to NYPD officials that has been repeatedly cited for violations of building and fire codes. Even if not, that bit of information couldn’t have helped.

With the FBI breathing down the neck of the most powerful officials in New York City, Commissioner Caban has decided to press the eject on this phase of his career, resigning his post before the city has a chance to punish him for his (alleged) involvement in whatever it is the FBI is investigating.

But he has deployed a golden-esque parachute of sorts. Not for himself, though. The officers he’s leaving behind have been given an undeserved parting gift: reduced punishment for misconduct, courtesy of a top cop who spent his short term in office doing little more than reducing punishments for misconduct. Here’s Reven Blau with the details for The City:

The NYPD has quietly reduced the suggested punishment for cops guilty of abusing authority, using offensive language, failing to take a civilian complaint, and conducting an unlawful search, THE CITY has learned.

The changes to what’s called the disciplinary matrix are dated Sept. 9, just three days before now former Police Commissioner Edward Caban resigned in the middle of a federal corruption probe that has touched several members of Mayor Eric Adams’ administration.

The police commissioner has total control over the penalty guidelines and the mostly watered down version took effect this past Monday.

Fun stuff if you’re a misbehaving cop. And the NYPD has several of those. The matrix says less the bad stuff for bad cops, which means things that used to result in five-day suspensions are now subject to nothing more harsh than “additional training.”

The list of violations effected by the dilution of accountability ranges from the mundane to the “hey, maybe we shouldn’t let cops get away with this sort of thing.”

The categories of downgraded punishments include: violations of department rules and regulations; abuse of authority; discourtesy and offensive language; firearm-related incidents; off-duty misconduct; and prohibited conduct.

Some of these are violations best described as violations of employer policies. They should still be punished, though, and with more than some remedial training. Others are little more than “officers being assholes.” Even so, assholish-ness should be actively discouraged. Cops treating the people they serve disrespectfully can’t be handled with an extra PowerPoint presentation or two.

The worst part is Caban’s mandate also covers things are the subject of federal lawsuits:

Under the new rules, a cop guilty of an “unlawful search of premises” now can get a punishment that is nothing more than additional “training.”

This isn’t ticky-tack bullshit. This is the actual violation of constitutional rights. Treating this as a training problem is absolutely the wrong way to handle this. Certainly, re-training might be necessary but that should be on top of harsh punishments that make it extremely clear violating rights is never acceptable. And repeat offenders should be shown the door. Anything less than that is an insult to city residents, who not only have to deal with having their rights violated but are expected to cover the cost of lawsuit settlements with their taxes.

Caban’s exit and parting shot at accountability are par for the course, unfortunately. Officials who resign in the middle of outside investigations are also par for the course. Very few public officials are willing to take what’s coming to them, preferring to get out and under the radar before things get truly ugly. Caban’s exit is basically an admission of guilt. And it’s not enough for him to dodge his own personal accountability by taking the easy way out when faced with the consequences of his actions. He had to make it easier for the cops he left behind to do the same thing. These aren’t the actions of a leader. They’re the actions of a coward who loved the power but hated the responsibility.

Filed Under: corruption, edward caban, new york city, nypd, police misconduct, rights violations

NYC Mayor Eric Adams’ Ex-Cop City Hall Buddies Spent Most Of Last Week Getting Raided By The FBI

from the ex-cop-distances-himself-from-ex-cops-he-employed dept

The most powerful entity in New York City isn’t the Mayor. Or City Hall. It has always been the NYPD, which has never been overseen by anyone who could remotely be considered capable, much less willing, to hold the department accountable, at least not in my lifetime. The chain of succession at City Hall over the past 40 years runs from Ed Koch to Rudy Giuliani to Michael Bloomberg and Bill de Blasio, with a brief stop for David Dinkins, who was quickly kicked to the curb by open bigotry and powerful police unions when it became clear he might actually try to introduce stronger accountability measures.

Bill de Blasio was the only mayor to be roundly rejected by the NYPD, and even that rejection was only temporary. Everyone in this chain of commanders has done everything they can to protect the NYPD. The present mayor may be the worst so far — a company man whose years of service as an NYPD officer have made him more deferential than most.

New York City hasn’t quite reached the levels of corruption that has made Chicago (in)famous, but it’s going to keep trying! With each passing year and election of an NYPD-worshiping mayor, the level of corruption increases. Believing otherwise is pure denialism.

And now, the mayor whose buddies in the cop shop (some current, some former) led him to deploy a gun-detection system the system’s developer has admitted won’t actually work where it’s being deployed (NYC’s subway system) is now at the center of another classic NYC clusterfuck. Here’s ABC News with more details:

The FBI conducted searches at the homes of two of New York City Mayor Eric Adams‘ closest aides on Thursday, sources familiar with the investigation told ABC News.

The Hamilton Heights home of First Deputy Mayor Sheena Wright, who is engaged to Schools Chancellor David Banks, and the Hollis, Queens, home of Deputy Mayor for Public Safety Phil Banks, were searched as part of an ongoing investigation, the sources said.

That early reporting might make it seem as though these raids were tied to a couple of outliers, albeit ones working very closely with Mayor Eric Adams. Later reporting makes it clear the problem isn’t limited to Sheena Wright and Phil Banks.

On Wednesday, in coordinated early morning raids, FBI agents seized phones and/or searched the homes of more than half a dozen senior city officials, including Sheena Wright, first deputy mayor; David Banks, schools chancellor, and his brother Philip Banks III, deputy mayor for public safety; Edward Caban, NYPD commissioner; and Timothy Pearson, mayoral adviser.

That’s multiple raids in one day, all targeting City Hall employees with close ties to Eric Adams. You’ll also note that one of the raid targets was the NYPD commissioner himself, Edward Caban — someone who has his own antagonism towards notions of law enforcement accountability.

But there’s a larger law enforcement nexus here. Eric Adams is a former NYPD officer. Philip Banks is a former NYPD department chief — one who resigned suddenly a decade ago when news surfaced he was involved in the bribing of several city officials. Adams liked Banks enough to give him a job, despite his immediately obvious ethical concerns.

Mayor Adams’ adviser, Timothy Pearson has his own issues. He held down a job at Resorts World Casino while simultaneously working for the mayor’s office. Pearson only exited his casino job after this double-dipping was exposed by the press. He’s also been sued four times for sexual harassment.

As for Commissioner Caban, he’s his own bag of trouble:

Commissioner Caban came under a cloud when it turned out his brother, Richard, was operating a Bronx bar and restaurant called Con Sofrito — a place where Adams celebrated his birthday and NYPD brass liked to party — in violation of multiple building and fire-safety codes and a judge’s order to shut down an outdoor terrace.

And yet, he’s still somehow the NYPD commissioner. And all of this comes on top of preexisting scandals, including multiple convictions tied to illegal fundraising for Adams’ 2021 mayoral campaign.

Eric Adams — a.k.a. Mr. Law Enforcement — doesn’t seem to be all that concerned about enforcing laws. His staff and political appointees are allegedly engaged in an unknown amount of lawbreaking. And that only covers the recent raids, which, at minimum, imply unlawful activity. There’s also plenty of confirmed lawlessness on the record.

All of that adds up to this spectacularly terrible response from the mayor’s office in response to the raids:

“Investigators have not indicated to us the mayor or his staff are targets of any investigation,” the mayor’s chief counsel, Lisa Zornberg, said in a statement. “As a former member of law enforcement, the mayor has repeatedly made clear that all members of the team need to follow the law.”

First, the feds don’t need to “indicate” anything about the mayor’s staff. It’s already clear at least one member of his staff (adviser Timothy Pearson) is the “target” of an “investigation.” Second, what the fuck does this even mean: “the mayor has repeatedly made it clear that all members of the team need to follow the law.”

I have worked a number of jobs over the past 30 years, both as a subordinate and a supervisor. I have been told (or have told others) to “follow the law” exactly zero times over that period. This is not a normal thing for people to say. If it’s something you have to say “repeatedly,” it’s because you or the people you employ are “repeatedly” trying to violate the law or, as the case would seem to be here, actually violating the law.

Not that the NYPD is handling this any better following the raid of Commissioner Caban’s house. Its response to these events was to eject anyone asking questions or reporting on the raids.

When the Post tried to reach chief of patrol John Chell for comment about the raids and subpoenas,” the paper reports, “NYPD Deputy Commissioner for Public Information Tarik Sheppard got on the phone and called the reporter a ‘f- – – ing scumbag.’” Minutes later, the department reportedly kicked Tina Moore, the Post’s police bureau chief, out of the press room at NYPD headquarters.

Not a great look for anyone involved or anyone close to those involved. This is going to get extremely interesting extremely quickly. Friends, cohorts, and actual employees of the mayor and his office have already been on the receiving end of FBI raids. It’s only a matter of time before the bell tolls for the mayor himself. Even if Adams was smart enough to generate some plausible deniability, someone under investigation is going to roll over and offer up enough evidence to pierce this façade. Mayor Adams may ultimately survive this, but it’s going to leave permanent scars.

The overarching theme, however, is something we’ve seen several times before: the people who talk the loudest about law and order are the people who most frequently decide laws don’t apply to them. Power corrupts, and those with the most of it are almost always the first to succumb to this inevitability. As for the city itself, I guess it’s time to try again when the next election rolls around. But history suggests Adams will just be replaced by someone equally terrible and equally subservient to the whims and demands of the city’s law enforcers.

Filed Under: corruption, eric adams, fbi, new york city, nypd

from the this-is-why-we-can't-have-nice-things dept

Thu, Sep 5th 2024 05:31am - Karl Bode

Last November, Maine residents voted overwhelmingly (83 percent) to pass a new state right to repair law designed to make auto repairs easier and more affordable. More specifically, the law requires that automakers standardize on-board diagnostic systems and provide remote access to those systems and mechanical data to consumers and third-party independent repair shops.

But like so many states where such reforms are passed, lobbyists for tech companies, automakers, and other manufacturers quickly got to work either trying to weaken the rules or eliminate them completely. While Maine’s law technically took effect last week, nobody has to actually comply with it yet because lobbyists have helped bog down efforts to flesh out how the rule will work in practice.

The original law mandated the creation of a new portal car owners and independent mechanics can access to reset car security systems. Automakers were also supposed to create a “motor vehicle telematics system notice” system informing new car owners how access will work. The bill also mandated that the AG create an oversight board to ensure automakers are complying with data share requests.

But automakers quickly got to work trying to claim that this new system was a threat to consumer privacy. They also convinced some lawmakers to push for new versions of the bill literally written by the auto industry that would eliminate the standardized database and the oversight entity as part of a near-total rewrite of the bill:

“I am not comfortable with that because it leaves us with right to repair in name only where the only recourse that a repair shop has is to sue an auto manufacturer if they feel they’ve been done wrong,” [Maine Rep. Daniel] Sayre said. “I think that puts small Maine businesses and Maine consumers in a very difficult position relative to the giant corporations that make our cars.”

So far, the effort appears stuck in neutral as all interested parties attempt to make the law’s goal a reality. There remains a risk that, as in New York State, the bill could be so watered down by the time it’s finally fully implemented that it becomes largely decorative. Or, as in Massachusetts, that legal challenges by an auto industry keen to protect their repair monopoly keep it bogged down by lawsuits indefinitely.

Automakers insist they just care a lot about consumer privacy — concerns that are absent from their everyday business practices. If you recall, a recent Mozilla study showcased how most modern vehicles are a privacy nightmare, collecting no limit of data on users (and their phones, when attached via Bluetooth). Without that collection being transparent with users, or that data being properly secured and encrypted by the manufacturers, it’s resulted in a flood of recent lawsuits.

Filed Under: automakers, consumers, corruption, legislation, lobbying, privacy, right to repair, state law

84% Of Americans Want Tougher Online Privacy Laws, But Congress Is Too Corrupt To Follow Through

from the this-is-why-we-can't-have-nice-things dept

Wed, Aug 21st 2024 05:32am - Karl Bode

Americans are, apparently, tired of having every last shred of personal data over-collected, hyper monetized, then improperly secured by a rotating crop of ethics-optional corporations and lazy executives.

A new survey from U.S. News and World Report took a look at prevailing U.S. consumer privacy beliefs, and found, among other things, that 84% of the public wants Congress to pass tougher privacy laws:

“In our survey, 84% of respondents said the federal government should implement stricter data privacy laws, and just 16% said it should not. Congress has been deadlocked for years on this question, although a bipartisan effort appeared to be making some headway in 2024.”

As is the norm for U.S. journalism, the outlet frames our failure to pass an internet privacy law over the last 30 years as something that just kind of happened without meaningful cause. The “question” of whether to have even baseline public privacy protections has been left unanswered due to some sort of ambiguous externality. Just blame that pesky, ambiguous gridlock.

In reality, Congress hasn’t passed a privacy law because it’s blisteringly, grotesquely corrupt. U.S. policymakers have decided, time and time and time again, that making gobs of money is more important than consumer welfare, public safety, market health, or even national security (see: our obsession with TikTok, while ignoring the national security risks of unregulated data brokers).

The federal government is also disincentivized from passing a nationwide privacy law for the internet era because they’ve found that buying consumer data from data brokers is a wonderful way to avoid having to get a traditional warrant.

You could, on any random day, pluck any of a million mainstream news reports on consumer privacy from the newswire and not find a single one willing to make either of these causes clear to readers. Yes, getting everybody aligned on quality privacy legislation is difficult, but it’s not 30 straight years of inaction difficult. At some point, this reckless disregard for public welfare is a feature, not a bug.

All of that said, it’s evident that the public isn’t great when it comes to personal responsibility. Most of the users surveyed didn’t engage in basic protective measures like two-factor authentication or reliable, encrypted password managers:

“42% use multi-factor authentication, seen by experts as a good way to protect online accounts, and just over half (53%) use security questions to verify their identity. Only one in six (17%) said they use a password manager app or software that creates hard-to-break passwords, and 27% said they used biometric authentication such as facial recognition or fingerprint.”

In the absence of federal and state protection from reckless data monetization, consumers have to have their own backs, and it’s clear we’re not particularly good at that, either.

Filed Under: consumers, corruption, law, privacy, security, survey

FCC’s Carr Wrote A ‘Project 2025’ Chapter On Ruining The FCC And Taxing Tech Giants, Which May Have Violated The Hatch Act

from the hello-I-have-some-exceptionally-terrible-ideas dept

Tue, Jul 23rd 2024 05:27am - Karl Bode

The leading candidate to head the FCC should Trump win re-election is facing calls for an investigation into Hatch Act violations after he helped co-author the controversial Project 2025.

Sixteen House Democrats have sent a letter to government officials arguing that Carr’s involvement in the openly political Project 2025 is a clear violation of the Hatch Act and should be investigated:

“The Misuse of Position Rule clearly prohibits federal employees from using their government positions, titles, or authority to sign letters, write op-eds, speak in their personal capacity, or—as it were—draft the blueprint for archconservatives to take over their agency.”

For his part, Carr claims he was only participating in the controversial project in his capacity as a citizen, and received the green light from FCC ethics officials before his participation. Even should he be investigated and found culpable, fines for Hatch Act violations are generally rather pathetic.

Project 2025 is, if you’re unfamiliar, a extremist proposal being circulated by key MAGA Republicans that calls for the mass firing of civil servants based on their ideological beliefs, a radical and undemocratic expansion of power for the president, the dismantling of the Department of Education, numerous new corporate tax cuts, draconian new abortion restrictions, and a ban on pornography.

FCC Commissioner Brendan Carr, who, you’ll recall, spends most of his time on cable news complaining about a company he doesn’t actually regulate (TikTok) in order to get attention, wrote a chapter about what should happen at the FCC under a second Trump term.

If you’re familiar with Carr there’s nothing too surprising here. Instead of proposing the agency do its actual job and protect competition and consumers from the whims of AT&T and Comcast, Carr instead calls for a dramatic expansion of the agency’s efforts to “rein in big tech” (which in Trump parlance means harassing any company that tries to moderate racist right wing political propaganda on social media).

Carr has a few sections of his chapter where he pretends he’s interested in “empowering consumers,” but again that mostly involves vaguely whining about tech companies and a dangerous dismantling of Section 230. It has nothing to do with “antitrust reform” or “reining in corporate power” and everything to do with bullying companies that don’t toe the increasingly unhinged authoritarian line.

Should Trump win the next election and Carr is appointed FCC boss, his biggest proposal will indisputably be a giant new telecom tax on tech companies. For half a decade now, AT&T, Comcast, Verizon and friends have used Carr as the spearhead for their plan to impose major new taxes on tech giants under the pretense of funding U.S. broadband deployment (sometimes called “sender pays”).

I’ve discussed (more times than how I can count) how this unserious policy is largely just a handout to subsidy-abusing regional telecom monopolies. It involves falsely claiming that tech companies get a “free ride on the internet” and should pay telecom giants billions of dollars for no coherent reason.

It’s a plan that drives up costs for consumers (since tech companies will simply forward the costs on to you) and effectively breaks the internet (just ask the Internet Society). In South Korea it drove companies like Twitch out of the country because they couldn’t afford to do business. All so telecom giants with a long history of subsidy fraud and abuse can get billions in additional subsidies.

I’ve written extensively on why Carr and AT&T’s call for a “big tech telecom tax” isn’t serious adult policy, but I’m still not entirely sure that “big tech” execs fully understand the scope. In the EU, telecoms have pushed proposals that would charge any internet service that accounts for over 5 percent of a telco’s average peak traffic billions of dollars in additional extra-government surcharges “just because.”

To be clear, the FCC’s Universal Service Fund (USF) program (which helps fund rural and school broadband) is in a dire need of a revamp, since the contributions historically came from levies on your home phone line.

And while Democrats and Republicans have flirted with the idea of including tech companies in that contribution base, I (as somebody that has studied this sector for decades) think it makes more sense to address widespread existing subsidy program fraud and abuse by industry giants and take direct aim at monopoly power (which is directly responsible for high broadband costs and stunted deployment).

That’s not stuff Carr is interested in because it’s not something AT&T and Comcast are interested in.

What Carr and AT&T are interested in is a big fat punitive, nontransparent, and badly managed tax that will be pocketed by subsidy-abusing telecom giants in exchange for fiber networks you’ll probably never actually see. And if Carr is Trump’s pick to head the FCC (a position Carr has been positioning himself for for the better part of a decade) it’s absolutely a policy that’s getting implemented on day one.

Filed Under: big tech, big tech tax, brendan carr, corruption, fcc, hatch act, project 2025, sender party pays, sender pays, tech, telecom

from the this-is-why-we-can't-have-nice-things dept

Wed, Jul 17th 2024 05:25am - Karl Bode

We recently noted how the telecom industry, with the help of the recent Chevron ruling, was gearing up to deliver what it hopes will be the killing blow to popular net neutrality protections. Protections designed to prevent telecom monopolies from abusing their market power to screw customers and competitors.

They appear to be having some early success. Last month, the Sixth U.S. Circuit Court of Appeals won the lottery to hear the industry’s net neutrality challenge; a boon for telecoms given the highly Republican makeup of the court (the GOP historically always sides with the policy interests of big telecom).

Last Friday the industry got another win, when the appeals court temporarily put the FCC’s reinstatement of the rules on hold until August fifth as it considers legal challenges from the broadband industry. The rules were originally slated to take effect on July 22.

The Supreme Court’s recent Chevron ruling effectively strips away decades of legal precedent and eliminates the authority of regulators (who ideally have subject matter expertise Congress doesn’t have) to make any enforcement decisions or new rules not strictly outlined by Congress.

Lobbyists have enjoyed framing this as some noble rebalancing of power for the greater good of mankind and puppies, but it’s largely a way to ensure regulators become the legal and policy equivalent of decorative gourds. A company like AT&T knows they have already lobbied Congress into abject corrupt dysfunction; now they’re setting their sights on the last vestiges of regulatory independence.

The goal for a company like AT&T and Comcast is to claim not just that the FCC lacks the authority to implement and enforce net neutrality rules, but no authority to protect broadband consumers whatsoever. “If you want consumer protections,” they’ll say, “they must be very very very clearly written by Congress” (a Congress we all well know we’ve corrupted to the point of uselessness via decades of lobbying).

Post Chevron, some variation of this will be playing out across every regulatory and industry that touches your lives, the impact and scope of which the press has woefully failed to aptly communicate to the public.

In a recent filing, FCC lawyer Scott Noveck argued that Chevron wasn’t integral in the legal justifications underpinning their net neutrality rules:

“Loper Bright has no direct relevance here because the [Net Neutrality] order under review does not turn or rely on Chevron. Instead, the order consistently focuses on ascertaining the best reading of the Communications Act using the traditional tools of statutory construction – exactly as Loper Bright instructs.”

The FCC could certainly still win the fight. But this isn’t an era known for strict adherence to logic or legal precedent, so it remains very much up in the air if the FCC will come out victorious.

One very real potential outcome is that the Republican courts will declare that Title II of the ‘34 Act simply does not apply to ISPs, ensuring the FCC can’t do much of anything on consumer protection; whether it’s net neutrality or simply demanding that big telecom be transparent about sneaky fees.

The one small bright spot here: courts have repeatedly and clearly ruled that if the federal government is going to abdicate its consumer protection oversight of widely disliked telecom monopolies, states are well within their right to fill the void and pass their own net neutrality rules. Though, even here, this creates a fractured landscape of inconsistent enforcement across each state border.

Again, this microcosm impacting net neutrality is going to apply to countless other efforts to hold corporations accountable across countless different industries and regulators, clogging the courts with a parade of legal challenges that will indisputably create (quite intentionally) a gridlocked mess for regulatory enforcement. I’ve found that, generally, people don’t quite understand what’s coming.

Filed Under: broadband, chevron doctrine, consumer protection, corruption, fcc, high speed internet, monopoly, net neutrality, telecom

The Corrupt Supreme Court Makes A Reckless Mess Of Broadband Consumer Protection (And Everything Else)

from the look-kids,-we're-dismantling-the-federal-government dept

Tue, Jul 9th 2024 05:25am - Karl Bode

The Supreme Court issued a recent ruling that could take an absolute wrecking ball to everything from consumer protection and environmental reform to public safety. It was a ruling that dismantled decades of precedent and puts nearly all regulatory enforcement efforts at risk, yet it somehow barely warranted much coverage by a largely disinterested, billionaire-owned U.S. press.

It’s being sold as some sort of noble, good faith rebalancing of power by industry, but the Loper Bright v. Raimondo ruling eliminates Chevron deference and upends the major questions doctrine, which, in many instances, risks turning U.S. regulators into the legal and policy equivalent of decorative gourds.

Chevron deference delegated independent regulators (often with detailed subject matter expertise Congress doesn’t have) the authority to craft policy (and sometimes new rules) provided they were within the reasonable confines of the law. The Loper ruling strips that authority away, leaving many policy determinations in the hands of an increasingly corrupt, and increasingly extremist, court.

From Feckless Mush To Something Much, Much Worse

You can already routinely see how hard it is for a U.S. regulator like the FCC, whose domain is telecom and (some) media, to pass even fairly-feckless policy choices without them being sued into oblivion. Even in instances where they’re clearly acting within their Congressional mandate.

You saw it with net neutrality and consumer privacy. You see it with their fairly basic effort to rein in broadband discrimination. Even efforts to make ISPs clear about their pricing have seen bottomless legal challenge by a telecom industry incessantly trying to claim regulators have zero authority whatsoever to do anything to protect American consumers under the law.

All enforcement and reform is much, much harder now. Every policy and reform effort by regulators (even long established) will now be challenged anew, flooding the courts with numerous new contentious debates once believed somewhat settled. And it’s going to impact everything you deal with on a daily basis, from the quality of your local drinking water to your local labor protections.

In broadband land, efforts like net neutrality are at particular risk. In part because the Communications Act of 1934 was particularly murky in terms of the width and breadth of FCC authority. We’d settled much of that over the decades with various legal fights from Brand X to several rounds of net neutrality fights; fights that, more often than not, already routinely came down on the side of telecom giants.

But even the existing corrupt, feckless mess that passes for coherent consumer protection in telecom is about to be upended by a Republican minority. An unelected minority keen on dismantling the regulatory state on behalf of corporations looking to eliminate most, if not all, meaningful oversight.

University of Colorado Professor Blake Reid has an excellent post exploring how the Loper ruling could send broadband consumer protection into complete disarray with the dismantling of decades of precedent. His wager, which is likely the right one, is that the court (historically in lockstep with AT&T and Comcast) will simply declare the FCC lacks all consumer protection authority:

“The easy money is that the Court’s conservative majority (including then-Judge Kavanaugh, who wrote a blistering dissent against an earlier iteration of the rules in USTA v. FCC), will simply rule that Title II of the ‘34 Act does not apply to ISPs. This result would obliterate the Damoclean pendulum of rules that has more or less kept ISPs in check over the last two decades and make it clear that America’s oft-reviled ISPs have free rein to, um, dutifully serve their customers.”

As Blake notes there are some bright spots.

The legal debates over FCC authority are so extensive and tortured that a court looking to dismantle FCC authority has to trample many of their own past determinations to fit a square peg into a round hole, which could provide ample legal opportunities for those challenging the dismantling of the regulatory state. There’s also the fact that the courts have repeatedly declared that states have the right to protect broadband consumers (and net neutrality) if the feds won’t.

So we’re not doomed. And people should not give up hope. But in my opinion, informed by 25 years of studying and writing about U.S. consumer protection, it’s very, very, very bad.

The Supreme Court, in corrupt fealty to large corporations, simply decided it would be fun to throw several large grenades into the belly of what’s left of semi-coherent U.S. federal policy governance. But if you read the insights of folks like the American Enterprise Institute’s Daniel Lyons, they’ll try to tell you it’s all for the greater good:

“By overturning Chevron, the Court hopes to shift the locus of legislative decision making back to Congress, where it belongs. There are significant benefits to shifting important, politically sensitive issues from agencies to Congress. It increases political accountability by placing key decisions in the hands of directly elected officials. And the legislative process makes more room for bipartisan compromise, assuring more gradual but more lasting change supported by a broader swath of the political spectrum.”

This pretty common framing of the ruling teeters somewhere between delusion and lying. Corporations didn’t lobby the unelected Supreme Court because they were just super concerned about the balance of policy power among “unelected bureaucrats.” They did it because they know they’ve already lobbied Congress into absolute, corrupt dysfunction on nearly all meaningful reform and corporate oversight. Now they’re taking aim at the already shaky authority of U.S. regulators.

All during the net neutrality debate you saw some variation of the claim that “if we want net neutrality protections, Congress should just pass a law.” This was usually made by companies like AT&T who know full well they’ve ensured that Congress is a corrupt, feckless mess. Now they’ve ensured regulators often can’t implement reforms without the explicit instruction of a Congress too corrupt to function.

This is not a good faith effort at meaningful reform of policy power, and you don’t drop rulings like this the Friday before a major holiday because you’re proudly attempting to serve the public interest.

Once corporate America has the federal regulatory state handcuffed and neutered, they’ll shift their collective attention and resources toward undermining state rights. This is the culmination of a 50+ year Republican effort to dismantle coherent federal corporate oversight and accountability. All fights, on everything, are now local. And which state you currently live in matters more than ever.

The goal isn’t some noble defense of freedom or constitutional balance. The goal is legal gridlock for all meaningful reform. The goal is near-zero meaningful oversight of giant corporations. And there are decades upon decades of evidence as to precisely how that’s going to go for everybody without a seven figure lobbying budget.

And again, we’re not just talking about telecom or your expensive broadband bill. We’re talking about entirely new, bottomless legal fights over every last regulatory policy that impacts your everyday life. Every reform and every effort by every regulator governing every sector in the U.S. is going to be inundated with lawsuits by corporations claiming regulators lack the authority to do anything they view as detrimental to their goal of improved quarterly returns.

This intentional fracturing of coherent federal regulatory authority also comes as we collectively face unprecedented chaos caused by a destabilizing climate that’s only just getting started.

I’m not sure the impact and scope of this ruling is even calculable. And I don’t think the folks saying things like “this can’t possibly be that bad” or “the impact of dismantling Chevron is being overstated” fully understand precisely what we’re talking about just yet. Fortunately for them, the impacts over the next five to ten years won’t be subtle, so the learning opportunities should prove limitless.

Filed Under: chevron, chevron deference, corruption, general questions, loper, regulators, supreme court

Pennsylvania Once Again Shows What Broadband Corruption Looks Like: Doles Out Millions In Dodgy, Non-Transparent Grants To Comcast, Verizon In Favored Political Districts

from the do-not-pass-go,-do-not-collect-$200 dept

Mon, May 20th 2024 05:27am - Karl Bode

By now we’ve laid out the case that U.S. broadband is spotty, expensive, and slow due to regional monopolies and the corruption that protects them. Despite this, every time the U.S. decides to spend taxpayer money on broadband, said corruption usually ensures that we throw most of that money into the laps of the same giant companies responsible for our broadband woes to begin with.

America loves dumping billions of dollars into the accounts of AT&T, Comcast, Verizon, or other giants in exchange for layoffs and half-deployed networks. Companies that have lobbied for decades to crush all competition and defang regulators to ensure U.S. broadband remains as expensive and spotty as possible get billions of dollars to do very little (or nothing). It’s utterly pathological and it never changes.

Case in point: Pennsylvania Governor Josh Shapiro recently announced that the state would be doling out $204 Million to deliver broadband to 100,000 Pennsylvanians in 42 counties. Officials insist that project applications were evaluated based on “experience and ability of the applicant to successfully deploy high-speed broadband service,” and “affordability standards that include a low-cost option.”

The problem: nearly all the money was simply dropped into the laps of Comcast and Verizon, the latter of which has an extremely long history of ripping off Pennsylvania telecom subsidy programs in exchange for networks that are routinely not fully delivered. Verizon was at the heart of a major scandal on this front in the 90s, and again in the 2000s when accused of neglecting its aging DSL networks.

Another problem: smaller ISPs, cooperatives, and community broadband networks (which have a solid track record of deploying more affordable access) were ignored entirely. Penn State Telecommunications Professor Sascha Meinrath tells me that community broadband ISPs and nonprofits that promised to deploy faster broadband at much lower costs were completely snubbed:

“I’ve now talked to multiple ISPs that offered a faster, cheaper service but got turned down,” he said. “And I’m like, so wait a second…what criteria were they using to decide on these two companies? There’s just a real lack of clarity as to what’s transpired here, frankly.”

Worse, Meinrath notes that the state politicians in charge of the organization in charge of determining who won awards (the Pennsylvania Broadband Development Authority (PBDA)) conveniently wound up driving most of the awards to their own districts:

“All four of the board members — like Republican Senator Gene Yaw — have projects in their own very small districts, which statistically speaking is an incredible occurrence, because only one tenth to one twentieth of the state is covered by these grants.”

There are questions about how any of this is even legal. In several of the grant applications the state appears to have twisted itself in knots to approve funding for Comcast and Verizon — in key political districts — without bothering to offer the slightest transparency into how the state made determinations.

Pennsylvania is also one of 17 states where telecoms like Comcast lobbied for what’s effectively a state ban on community-owned broadband networks, despite the fact such networks routinely help drive affordable access — and competition — to broken broadband markets.

In PA policy conversations, Meinrath notes that the PA government likes to pretend that this law doesn’t exist, despite the section in question being literally titled “prohibition against political subdivision broadband services deployment.” The entire state policy apparatus is custom built to make it difficult to challenge monopolies — while simultaneously denying that this is happening:

“They [giant private providers] have a right at first refusal for muni networks, but also for public private partnerships, which again, this is not even acknowledged by the state,” Meinrath said. “You can imagine if there is a law that is on the books – Title 66, paragraph 3014, subpart H – but declared to not exist, officially – it makes it very awkward.”

This is all par for the course. Politicians from both parties will wax poetic endlessly about the need to “bridge the digital divide.” But even the best intentioned are too politically timid to acknowledge that monopolization and competition problems exist, much less propose solutions.

So when pressured to “fix the problem,” their solution is almost always to throw a bunch of money into the laps of politically powerful telecom monopolies responsible for much of the problem in the first place. Companies that are, as extensions of our domestic surveillance systems, now well beyond the reach of coherent reason, accountability, or the law.

There are billions more in broadband subsidies headed to the states via the $42 billion in broadband subsidies included in the infrastructure bill. But unlike Pennsylvania’s recent grant awards, the federal process will actually involve something genuinely resembling transparency, hopefully giving small businesses, cooperatives, and community owned broadband networks a better shot.

Still, telecom monopolies like Comcast and Verizon are there too, working overtime to ensure they not only hoover up the lion’s share of the funding, but don’t face any sort of “onerous” requirements, like having to actually deliver uniform, affordable broadband access to poor people.

Filed Under: broadband, corruption, fiber, grants, high speed internet, josh shapiro, pennsylvania, subsidies, telecom

Congress Told ISPs To Remove All Huawei Network Gear, Failed To Fund The Effort, Then Just Forgot About It

from the performative-outrage dept

Mon, May 13th 2024 05:25am - Karl Bode

Long before TikTok histrionics took root, you might recall that numerous members of Congress spent numerous years freaking about another Chinese company: Chinese telecom equipment maker Huawei.

The argument, made without much in the way of public evidence, was that Huawei was systematically using its network gear to spy on Americans at a massive scale. Congress then proposed a solution: it would require that U.S. telecom operators (large and small) rip out all Huawei equipment from their networks at great expense, then replace it with usually more expensive alternatives.

So in early 2020 Congress passed the Secure And Trusted Communications Act effectively banning Huawei from U.S. telecom networks. Congress doled out 1.9billiontoripoutandreplaceHuaweigear,butit’sestimatedtocostaround1.9 billion to rip out and replace Huawei gear, but it’s estimated to cost around 1.9billiontoripoutandreplaceHuaweigear,butit’sestimatedtocostaround5 billion to actually complete the effort. But instead of finishing the job, the FCC last week politely pointed out that Congress did nothing.

The costs were significant, but especially for smaller telecoms which may now be forced to withdraw from the program, or shut their networks down entirely without additional funding, the FCC wrote:

“Several recipients have recently informed the Commission that they foresee significant consequences that could result from the lack of full funding, including having to shut down their networks or withdraw from the program. Because Reimbursement Program recipients serve many rural and remote areas of the country where they may be the only mobile broadband service provider, a shutdown of all or part of their networks could eliminate the only provider in some regions.”

So basically Congress freaked out about Huawei (without much public evidence), proposed a very expensive solution to address the problem, didn’t fully fund the program, then basically fell asleep. Their apathy and dysfunction now risks putting some smaller ISPs out of business; ISPs that may be the only broadband provider available in some rural markets. Impressive work all around.

This is all fairly ironic given the hysteria Republicans like the FCC’s Brendan Carr have had about TikTok. Carr has made quite a career showing up on cable news to gnash his teeth over a social media network his agency doesn’t have the authority to regulate. Yet he’s not been anywhere near as active in pushing for a solution for a huge problem impacting a sector he actually regulates.

In part because the work of actually doing a coherent job doesn’t much interest an ad-engagement chasing press. The actually daily nitty gritty details of coherent governance isn’t sexy, and (usually) doesn’t get you on cable TV.

It all aptly demonstrates the often-performative nature of Congress’ hysteria over China. They’ll thrash and flail over some perceived Chinese threat to grab headlines and make U.S. competitors (like Facebook or Cisco) happy, throw out some barely workable solution (like say the TikTok ban), then consider their job done. Once the cable networks are no longer interested they’ll just forget about the problem entirely.

Filed Under: broadband, china, congress, corruption, fcc, network security, rip and replace
Companies: huawei