Internet S.O.S.

Saturday, September 14, 2013 by Media Citizen

by Tim Karr







Last week we learned that U.S. and British intelligence agencies have broken the back of digital encryption — the coded technology hundreds of millions of Internet users rely on to keep their communications private.

Is the Internet on life support?

Over the weekend, Der Spiegel reported that the NSA and its British counterpart are also hacking into smartphones to monitor our daily lives in ways that wouldn’t have been possible before the age of the iPhone.

This news, just the latest revelations from the files of Edward Snowden, only heighten our sense that we can no longer assume anything we say or do online is secure.

But that’s not all. In a case that was heard in a U.S. federal appeals court on Monday, telecommunications colossus Verizon is arguing that it has the First Amendment right to block and censor Internet users. (That’s right. Verizon is claiming that, as a corporation, it has the free speech right to silence the online expression of everybody else.)
It's come to this. Government and corporate forces have joined to chip away at two pillars of the open Internet: the control of our personal data and our right to connect and communicate without censorship or interference.

The Surveillance Industrial Complex

A series of reports coordinated among the Guardian, the New York Times and ProPublica revealed that the NSA and its British counterpart have secretly unlocked encryption technologies used by popular online services, including Google, Facebook and Microsoft.

Using National Security Letters and other secret court orders, intelligence agencies can wedge their way onto the large telecommunications networks that move most of the world’s Internet traffic. Getting access to the data is only half the challenge. To read and sort these communications, the NSA works with a lesser-known assortment of security vendors that filter through mountains of data, target references and patterns of interest and crack codes designed to safeguard user identity and content.

Many of the companies that ply this trade are only now being exposed through “Spyfiles,” collaboration among WikiLeaks, Corporate Watch and Privacy International designed to shed light on the multibillion-dollar industry. According to the latest documents provided by Edward Snowden, U.S. intelligence agencies alone spend $250 million each year to use these companies’ commercial security products for mass surveillance.

Without safeguards that protect users from surveillance and censorship, the Internet’s DNA will change in ways that no longer foster openness, free expression and innovation.It’s part of a sprawling complex of companies, lobbyists and government officials seeking to rewire the Internet in ways that wrest control over content away from Internet users.

While motivations may differ, the result is the same: a communications network that works against the Interests of many for the benefit of the few.

Tearing the Fabric

The Internet wasn’t meant to be like this. Bruce Schneier, an encryption fellow at Harvard's Berkman Center for Internet and Society, writes that the NSA and the companies it works with are “undermining the very fabric of the Internet.”

Telecommunications companies are doing their part by giving spy agencies access to our data. They’re also bankrolling a multimillion-dollar lobbying effort to destroy Net Neutrality — the one rule that prohibits Internet service providers from blocking or degrading our ability to connect to one another, share information and use the online services of our choosing.

If Verizon wins its case in Washington, ISPs will be able to prioritize certain online content while degrading user access to sites and services that the big companies don’t like.

It’s a business that puts at risk the most integral function of the World Wide Web. Sir Tim Berners-Lee, the Web’s pioneer, saw the network as a “blank canvas” — upon which anyone could contribute, communicate and innovate without permission.

Berners-Lee’s invention relied on an open protocol that gave everyday users power over the network. This networking principle has far-reaching political implications, favoring systems that are more decentralized and democratic.

Without safeguards that protect users from surveillance and censorship, the Internet’s DNA will change in ways that no longer foster openness, free expression and innovation.

Media Policy

If we’ve learned anything during the Summer of Snowden, it’s that corporations and governments alone can’t be trusted to be good stewards of the Internet. We need media policies that protect our privacy and promote access to open networks.

The fight for these policies is being led by a diverse and bipartisan alliance of civil liberties and communications-rights organizations, including the ACLU, EFF, Free Press and Public Knowledge.

We’re not alone. Millions joined the call for Net Neutrality in 2010; millions more stood up to defend the Internet against the PIPA and SOPA Web-censorship bills in 2012. The battle to protect users’ privacy has engaged new audiences as we've learned more about the extent of the NSA's mass surveillance.

In each of these arenas, we’re working to stop bad laws, amend others and implement new policies that put Internet users first.

A grassroots movement is fueling this fight. If you haven’t joined us yet, now’s the time to step up and save the Internet.

Freedom = Censorship?

Saturday, July 14, 2012 by MediaCitizen

by Tim Karr

 

Think you have the right to speak freely via cellphones, websites and social media? Well, the companies that provide you with access to the Internet don’t.

The framers drafted the First Amendment as a check on government authority — not corporate power. But whether we’re texting friends, sharing photos on Facebook, or posting updates on Twitter, we’re connecting with each other and the Internet via privately controlled networks.

 And the owners of these networks are now twisting the intent of the First Amendment to claim the right to control everyone's online information.

Right before the Fourth of July, Verizon filed a brief with the U.S. Court of Appeals for the D.C. Circuit that expressed this intent in no uncertain terms. The brief was part of the telecom company’s bid to overturn the Federal Communications Commission’s Net Neutrality rules, which prohibit carriers from blocking or discriminating against Internet users’ content.

In the brief, Verizon argues that the First Amendment gives the company the right to serve as the Internet’s editor-in-chief.

The First Amendment “protects those transmitting the speech of others, and those who ‘exercise editorial discretion’ in selecting which speech to transmit and how to transmit it,” the company’s attorneys wrote. “In performing these functions, broadband providers possess ‘editorial discretion.’ Just as a newspaper is entitled to decide which content to publish and where, broadband providers may feature some content over others.”

By “content” Verizon means all digital communications that cross its wires, from photographs of your cousin’s backyard barbeque to YouTube videos of human rights violations in Syria.

Verizon filed its brief quietly just before the July Fourth holiday, but it has caught the attention of the Internet freedom community like a skunk under the back porch.

This is not the first time Internet Service Providers (ISPs) have suggested that they have a First Amendment right to stifle speech online. AT&T argued in 2010 that its role is similar to that of an editor who selects content and speaks — and that it is not merely a conduit for the communications of others.

This defense of corporate censorship is no idle threat but a pretext for a full-scale takeover of the Internet — a move that first requires killing off any consumer protections that stand in the way.

We live in a time when growing numbers of people watch television programs, listen to music, create videos and share photographs via Internet connections provided by private entities.

A 2011 report from European Digital Rights states that ISPs and other technology companies are fast becoming the information cops of the world. The report paints a picture of an emerging “censorship ecosystem” fueled by private entities that often work hand in glove with governments.

This collusion serves both corporate and political interests. ISPs are seeking new authority to interfere with user traffic, including limiting access to the content of competitors like Netflix or shutting down the accounts of users they charge with sharing too much media. Governments are demanding that access providers help them filter and police the Internet — and that they do so under a veil of secrecy.

The most dangerous threats to free speech today lie at this intersection between corporate and political power. While businesses might do many things better than governments, our government is at least by definition directly accountable to the American people. So when Verizon claims the right to decide who gets free speech on the Internet, it’s making this claim as a benevolent despot, not as a representative democracy.

The framers of the U.S. Constitution could not have foreseen a time in which technology allowed more than a billion people to communicate via mobile phones connected to the World Wide Web. Nor could they have envisioned a world in which companies like Verizon, AT&T and Comcast wield more authority over our free speech than a British monarch.

And yet the First Amendment has survived to this day in defense of democracy’s most consequential right. People on both the left and right value freedom of speech. Just days after Verizon filed its brief, a diverse coalition of more than 1,000 groups and Internet dignitaries joined together behind a Declaration of Internet Freedom that establishes freedom of expression as its first principle.

But popular consensus behind free speech on the Internet is running headlong into media giants like Verizon that want to suppress open Internet culture.

Any claim that the First Amendment protects corporations — and not people — is absurd. And it shows just how far some companies are willing to go to control 21st century communications.

Corruption Is Responsible for 80% of Your Cell Phone Bill

In the case of Big Telecommunications, buying politicians pays off handsomely by killing the competition.
By Matt Stoller, Republic Report
Posted on April 11, 2012

Last year, a new company called Lightsquared promised an innovative business model that would dramatically lower cell phone costs and improve the quality of service, threatening the incumbent phone operators like AT&T and Verizon. Lightsquared used a new technology involving satellites and spectrum, and was a textbook example of how markets can benefit the public through competition. The phone industry swung into motion, not by offering better products and services, but by going to Washington to ensure that its new competitor could be killed by its political friends. And sure enough, through three Congressmen that AT&T and Verizon had funded (Fred Upton (R-MI), Greg Walden (R-OR), and Cliff Stearns (R-FL)), Congress began demanding an investigation into this new company. Pretty soon, the Federal Communications Commission got into the game, revoking a critical waiver that had allowed it to proceed with its business plan.

And so Americans continue to have a small number of expensive, poor quality cell phone providers. And how much does this cost you? Take your phone bill, and cut it by 80%. That’s how much you should be paying. You see, according to the Organization for Economic Cooperation and Development, people in Sweden, the Netherlands, and Finland pay on average less than $130 a year for cell phone service. 

Americans pay $635.85 a year. That $500 a year difference, from most consumers with a cell phone, goes straight to AT&T and Verizon (and to a much lesser extent Sprint and T-Mobile). It’s the cost of corruption. It’s also, from the perspective of these companies, the return on their campaign contributions and lobbying expenditures. Every penny they spend in DC and in state capitols ensures that you pay high bills, to them.

This isn’t obvious, because much of how they do this has to do with the structure of the industry.

 

Telecommunications isn’t like selling apples, where you have a lot of buyers and sellers. In a business like buying or selling apples, all you need is an apple tree to get into the business. Cell phones aren’t like that. It’s a business where you sell services on top of a network of cell phone towers that can transmit phone calls and data, and these networks cost tens of billions of dollars to build. But even if you have the money to build one, you still might not be able to, as the Lightsquared example shows. These networks all use public airwaves, or “spectrum”, and you need government permission to use it. Remember the electromagnetic spectrum you learned about in school? The government literally leases that out to companies, and they make radios, microphones, wifi routers, and cell phones that use it.

This has implications for your cell phone bill. Once AT&T or Verizon has paid for its network and licensed spectrum from the government, the cost of adding an additional customer is very low. That means that the biggest providers with bigger networks and more licensed spectrum make more money. It’s not only that their costs are lower, but also because they can keep other players out through control of the political system. That is, they can move towards monopoly in the industry. And monopoly means higher prices for you, and more profits for them. Here’s the data.

Verizon and AT&T’s Average Revenue Per User (ARPU) are substantially higher than any other national carrier’s. Verizon’s wireless profit margins (EBITDA) are substantially higher than all other carriers except AT&T. And Verizon and AT&T together control four-fifths of the entire wireless industry profits, the only two major carriers to control double-digit shares of the industry’s total profits. Over the past 3 years Verizon and AT&T’s share of total industry profits has steadily increased while everyone else’s declined.

This of course doesn’t mean that these companies are investing more in their networks, for better service for you and me. In case you haven’t noticed, cell phone coverage is still really bad, and calls drop routinely. The chart below can explain why. The data is from the CTIA, or the Wireless Association, and it shows the effect of industry consolidation.

Basically, what this chart shows is that in the 1990s, cell phone companies bought up other cell phone companies, and Congress and the FCC were happy to go along because of the power of industry lobbying. Once these companies had an effective cartel, their amount of investment dropped. If you didn’t like your cell phone company, you couldn’t really switch, because the other big cell phone company was just as bad. In 1997, the industry was putting 50 cents of every dollar of revenue into investing in more cell phone towers. By 2009, that number dropped 12.5 cents of every dollar. CTIA has made it much harder to find this data since 2004, but it is obscure filing comments at the FCC. Pretty soon, we should expect the public not to even be able to track why our cell phone’s usage is so bad.

To reduce prices in such a system, you need either competition in the form of more networks (with the same or different technology) or price regulation. The Federal Communications Commission has neither forced more competition, nor has it restricted price gouging. In fact, by doing things like killing Lightsquared, it has ensured high prices for all of us. Furthermore, the FCC has allowed a small number of big players like AT&T and Verizon to buy up much of the public airwaves (or “spectrum”) available for cell phone use, just to keep out competitors. It tends to allow big mega-mergers to go through (with the exception of the recent T-Mobile and AT&T merger). Meanwhile, Congress is trying to tie the hands of the FCC on making more spectrum available for anyone to use, and broadcasters are also throwing their lobbying into the ring, because they want to be able to control more spectrum to transmit television signals.

Why does the FCC and why does Congress want us to have high cell phone costs? Well, they don’t, not really. It’s more accurate to say they don’t particularly care about our problems, but are responding to an entirely different problem that is completely unrelated to cell phones. The government is responding to the need for campaign contributions for politicians.

Politicians need huge sums of money to run for office. Just a regular Congressman (and remember, there are 435 of these) needs $2 million on average to win reelection – which is about $20,000 per week he’s in office. He needs this money to buy TV ads. Unlike in other countries, where political parties get free TV time or public money to pay for elections, American politicians get this money from private interests. Some of the biggest donors, in fact the single biggest donor, is AT&T, with Verizon in the top 100. These politicians lobby regulatory agencies like the Federal Communications Commission to make sure these companies can do what they want, and politicians make sure that phone companies get to buy up other phone companies, eventually creating a near monopoly situation. And we all know that monopolies charge more and deliver less to their customers. As telecom legal expert Marvin Ammori said, “It’s proven cheaper to buy politicians than invest in high speed broadband or to provide good customer service at a fair price. ”

In other words, we are stuck with big bad cell phone companies not because those companies are good at providing cell phone service (which anyone with a dropped cell phone call knows), but because they are good at corrupting markets through political donations. AT&T has the single biggest donor group (known as a “Political Action Committee”) in Washington, DC.

Again, that’s on average $500 a year, $40 a month, or $1.50 a day, from you, straight into the pockets of Verizon and AT&T.

Verizon's Cozy Deal With Cable Would Create a Wireless Duopoly

Tuesday, 03 April 2012

By Mike Ludwig, Truthout | Report
Verizon Wireless and America's biggest cable companies want to sell you everything in one package: wireless, broadband, cable TV and a telephone landline. This might sound like an easy option, but consumer groups say that the consolidation deals behind these service bundles could crush competition in the market and raise prices for everyone.

Verizon Wireless plans to purchase $3.6 billion worth of unused wireless spectrum from a joint venture representing the big cable providers Comcast, Time Warner and Bright House Networks. Verizon is also buying $315 million worth of spectrum from the Cox cable company. In a separate deal that anti-trust watchdogs brought to the attention of regulators, Verizon and the four cable companies will also market each others' products under a controversial joint-marketing agreement. Consumers could, for instance, buy a wireless plan from Verizon when purchasing cable Internet from Comcast.

Verizon claims it's trying to boost 4G coverage, meet the growing demand created by smartphone technology and offer customers some one-stop shopping. Opponents of the deal, however, say Verizon already holds the greatest amount of prime mobile broadband spectrum. If the proposed deal goes through, Verizon and its biggest competitor, AT&T, would hold more wireless spectrum nationally than all other providers combined and essentially become a market duopoly, according to Parul Desai of the Consumer Union, which publishes Consumer Reports.

Desai said the whole deal would reduce competition among all the companies involved. Verizon is essentially giving the cable companies control of the landlines and the cable companies are giving Verizon control of the wireless spectrum. Verizon would have little incentive to compete with the cable companies with its FiOS high-speed wired Internet service, and cable companies would have little incentive to compete for wireless service. Time Warner, Cox and Comcast already operate as monopolies in some regions, Desai said, and the deal could leave consumers with little or no choice in landline and broadband providers.

Desai said the cable companies had begun to invest in wireless, which is why the companies have unused spectrum to sell, but once they realized it would be tough to compete with Verizon Wireless and AT&T, they decided to sell out their holdings in exchange for a firmer grip on landlines.

"The wireless side will be dominated by Verizon Wireless, and they'll get out of the landline game, and cable will get out of the wireless game so they can dominate the landline game," Desai said. "... So what happens when you sell the spectrum and it continues to go to the top two players? It makes it easier to squeeze out some of the smaller players."

Two smaller telecommunication firms, Level 3 Communications and MetroPCS, have filed briefs with the Federal Communications Commission (FCC) opposing the deal. Desai said the deal isn't just bad for smaller firms; it's also bad for consumers, who will be left with fewer options and could eventually pay higher prices because Verizon and the cable companies will not be competing with one another.

Rural consumers could be especially affected because the companies will have less incentive to expand infrastructure to underserved areas, and by reducing competition, rural consumers could pay higher prices and even lose services, according to Edyael Casaperalta, who works to bring high-speed Internet access to rural areas with the Center for Rural Strategies. Rural residents are often low income, Casaperalta said, and may not be able to afford bundled packages offered under the joint-marketing agreement.

"Knowing that there's a lack of interest in rural customers, there's already less competition for rural customers to be able to get better services and better prices, and this type of transaction will create even less competition, if any at all," Casaperalta said.

The Justice Department and the FCC are currently reviewing the proposed deal, and the FCC must approve the spectrum transfers. In December, just days before Verizon announced its deal with the cable companies, AT&T and T-Mobile abandoned a $39 billion merger andplaced the blame on regulators. AT&T canceled the acquisition, which critics feared would also create a wireless duopoly, after resistance in the FCC and legal challenges spooked investors.

Congress is also weighing in on the Verizon deal. On March 21, the Senate Antitrust Committee held a hearing on the deal titled "The Verizon/Cable Deals: Harmless Collaboration or a Threat to Competition and Consumers?" The hearing featured Comcast and Verizon executives butting heads with consumer advocates.

Verizon Executive Vice President Randal Milch told the committee that Verizon needs more spectrum to respond to the growing demand caused by the "explosive" use of smartphones, tablets, and other data-intensive devices.

"We are only buying spectrum not currently in commercial use in order to put it to use serving customers, and no customer will see fewer choices or increased prices as a result of this transaction," Milch said.

Joel Kelsey of the Free Press, a media policy group, told the committee that it's always dangerous to consumers when media consolidations reduces competition.

"Allowing for further consolidation in this marketplace will only drive prices higher, reduce consumer choice, and have drastic consequences on the rate of innovation as the companies involved are freed from competition and find diminishing value in investing in better infrastructure," Kelsey said.

The proposed deal also raised ire among unions, but instead of outright opposing a deal that labor groups see as a potential job killer, two unions have proposed stipulations to the FCC. The Communications Workers of America and the International Brotherhood of Electrical Workers have asked the FCC to only approve the deal if Verizon agrees to continue developing its FiOS Internet service, which they fear could go under if Verizon decides not to compete in the landline market. The unions also asked the FCC to prohibit cross-marketing services in Verizon territory and require that the companies allow customers to buy individual services at bundle prices without buying the whole service bundle.

30 Major U.S. Corporations Paid More to Lobby Congress Than Income Taxes, 2008-2010

by Ashley Portero - December 9, 2011

By employing a plethora of tax-dodging techniques, 30 multi-million dollar American corporations expended more money lobbying Congress than they paid in federal income taxes between 2008 and 2010, ultimately spending approximately $400,000 every day -- including weekends -- during that three-year period to lobby lawmakers and influence political elections, according to a new report from the non-partisan Public Campaign.

Despite a growing federal deficit and the widespread economic stability that has swept the U.S since 2008, the companies in question managed to accumulate profits of $164 billion between 2008 and 2010, while receiving combined tax rebates totaling almost $11 billion. Moreover, Public Campaign reports these companies spent about $476 million during the same period to lobby the U.S. Congress, as well as another $22 million on federal campaigns, while in some instances laying off employees and increasing executive compensation.

The Public Campaign report expanded on a newly released analysis on corporate tax dodging by the liberal-leaning Citizens for Tax Justice, a non-profit research and advocacy group, as well as lobbying expenditure data provided by the non-partisan Center for Responsive Politics.

Citizens for Tax Justice, the sister organization to the Institute on Taxation and Economic Policy, reports that 68 of the 265 most consistently profitable Fortune 500 companies did not pay a state corporate income tax during at least one year between 2008 and 2010, while 20 of them paid no taxes at all during that period.

"Our report shows these corporations raked in a combined $1.33 trillion in profits in the last three years, and far too many have managed to shelter half or more of their profits from state taxes," Matthew Gardner, Executive Director at the Institute on Taxation and Economic Policy and the report's co-author, said in a statement. "They're so busy avoiding taxes, it's no wonder they're not creating any new jobs."

According to the report, titled Corporate Tax Dodging in the Fifty States, 2008-2010, state corporate tax revenues have been declining for 20 years, due to the passage of multiple state tax subsidies, as well federal tax breaks that further reduce state corporate income tax revenues since states usually accept corporations' federal tax. Moreover, Gardner said multi-state corporations are constantly "devoting their money and legal firepower to coming up with tax avoidance schemes."

Between 2008 and 2010, the 265 companies analyzed paid state income taxes equal to only 3 percent of their U.S. profits, half of the statutory 6.2 percent state corporate tax rate. As a result, these companies avoided a total of $42.7 billion in state corporate taxes over three years.

"As recently as 1986, state corporate income taxes equaled 0.5 percent of nationwide Gross State Product (a measure of nationwide economic activity)," states the report. "But in fiscal year 2010, state and local corporate income taxes were just 0.28 percent of nationwide GSP, equaling the low-water mark set in 2002."

Companies' Laying Off Workers While Receiving Tax Rebates, Raising Executive Pay
Among the 20 companies who paid zero or less in state corporate taxes are utility provider Pepco Holdings, the pharmaceutical company Baxter International, and Intel Corporation (INTC).

Baxter International (BAX) and Intel are among the corporations that Public Campaign reports did not did not pay federal incomes during the same three-year period.
Of those companies, General Electric (GE) spent the most on lobbying, expending about $84 million on lobbying while paying a federal income tax rate of negative 45 percent on more than $10 billion in U.S. profits. PG&E Corp. followed General Electric, spending almost $79 million on lobbying, while paying a negative 21 percent tax rate on $4.8 billion of U.S profits, and Verizon Communications, which spent $52 billion on lobbying while paying a negative 3 percent tax rate on $32.5 billion of profits.

A negative effective tax rate means that a company enjoyed a tax rebate, usually obtained by carrying back excess tax deductions and credits to an earlier year, thereby allowing the company to receive a tax rebate check, according to Citizens for Tax Justice.

U.S. House Deputy Whip Kevin Brady, R-Tex., is currently making a last-ditch effort to include a corporate tax repatriation holiday on legislation to extend a payroll tax cut, an extension that Senate Majority Leader Harry Reid, D-Nev., said could put an extra $1,500 into the pockets of middle class families each year. While those in favor of the corporate tax repatriation provision -- which would give U.S. businesses a temporary tax break on as much as $1 trillion in overseas income -- insist it would boost the nation's sluggish economy and make it easier for corporations to create jobs, the Congressional Budget Office reports tax repatriation holidays ranks dead last among 13 policy options for creating jobs. The CBO estimates that over the 2012-2013 period, a repatriation holiday would, at best, create the equivalent of one-full time job for every $1 million in federal costs.

Even while dodging most of their state and federal taxes between 2008 and 2010, Verizon (VZ) laid off more than 21,000 U.S. employees, while Boeing, Wells Fargo, General Electric, American Electric Power, and FedEx also let go of thousands of workers. Because companies can be reluctant to make data changes in U.S. employment available, Public Campaign reports it was not able to find up-to-date employment statistics for many of the companies evaluated in the report.

Moreover, as it was laying off employees, General Electric gave their top executives a 27 percent pay raise between 2008 and 2010 -- executives received more than $75 million in compensation in 2010. Wells Fargo increased executive pay by a whopping 180 percent, upping executive compensation from $17.8 million in 2008 to almost $50 million in 2010, while Boeing,  FedEx and American Electric Power also instituted lavish executive pay raises while laying off thousands of lower-level workers.

In fact, 2010 year was a record year for executive compensation. The CEO's of some of the largest U.S. corporations made, on average, $11.4 million in 2010, about 343 times more than workers' median pay, according to an analysis by the American Federation of Labor, the widest gap between executive and employee pay in the world. CEO pay has skyrocketed since 1980, when chief executives were only paid about 42 times more than the average blue collar worker.

Meanwhile, the U.S. Census Bureau reports that the median household income fell $3,719 between 2000 and 2010, when measured in 2010 dollars.

Public Campaign released its report on Wednesday, just as thousands of unemployed Americans from across the nation swarmed K Street in Washington, D.C., the lobbying center for some of the world's most profitable corporations. The march was part of "Take Back the Capitol," a four-day series of events aimed at persuading Congress to pass comprehensive job creation measures that will benefit their constituents, rather than special interest groups.

29 Major Corporations Paid No Federal Taxes, 2008-2010
Of the 30 companies analyzed in the report, which include corporate giants such as General Electric, Verizon Communications, Wells Fargo (WFC), Mattel (MAT) and Boeing (BA), 29 of them managed to pay no federal taxes from 2008 to 2010. Only FedEx, which raked in about $4.2 billion in profits during that period, paid a three-year tax rate of 1 percent -- totaling $37 million -- far less than the statutory federal corporate tax rate of 35 percent.

Verizon Strike Expected to End Soon

Verizon Strike: As Delays Mount, It's Time for the Company to Bargain With Workers in Good Faith (Update: Strike May End Soon)

By Laura Clawson, Daily Kos
Posted on August 20, 2011

Update: According to the Philadelphia Inquirer, "Verizon Communications Inc. and union leaders will announce today that employees will return to work starting Tuesday morning, ending for a time, the longest and largest strike in recent labor history."

Though Verizon has claimed that its managers and replacement workers would be able to keep up with the workload of striking workers, reports of significant service delays are spreading. And with inexperienced people trying to do complex work and not knowing what they're doing, as seen below, no wonder.
 

In that video, striking workers actually step in to help prevent injury or damage. Another video shows replacement workers blowing a transformer, and that's not the end of the problems striking workers have witnessed. So no wonder that while "Verizon acknowledges 'minor' disruptions since the strike began on Aug. 7," Steven Greenhouse goes on to report some issues that sound less than minor.

Mr. Marsh, who just graduated from Buffalo State College with a degree in urban planning, wanted to order Verizon’s FiOS Internet and television services for his new apartment on West 49th Street in Manhattan. 

"They let me go through the whole signup and then at the end they said, 'There are no installation dates available. Someone will contact you,' " Mr. Marsh said. "That was probably a week ago. They were trying to make it seem like everything is O.K., like the service is there but it’s not. I thought it would be a couple of weeks, but it might end up being a couple of months. I decided to go with Time Warner instead."

Meanwhile, Verizon workers have taken the pickets to the homes of top executives, saying:

"One can't possibly go up to the mansions in Mendham and not be struck by the grossness of destroying the standard of living of working-class operators and technicians while living in the lap of luxury. It is worth marking the contrast," said Hetty Rosenstein, CWA's New Jersey director. [...]

Blackwater Mercenary Security For Verizon

by Unions.org

Wait. What? Blackwater? That private, for-profit, trigger-happy army that killed 17 civilians in Nisour Square in Baghdad in 2007? Yeah. THAT BLACKWATER.

I have just confirmed with Communications Workers of America (CWA) Local 1104 that Blackwater is indeed being contracted by Verizon for security purposes. At this moment, CWA Local 1104 was not able to say how many security contractors have been hired or where they will be working. I’m sure more information will follow.

Blackwater, now called Xe, is considered to be the world’s largest and most powerful mercenary army. In 2004, they had 2,300 men actively deployed around the world and another 20,000 contractors ready to go. They claim that they have trained tens of thousands of security personnel since 1998.

In the aftermath of hurricane Katrina in New Orleans, The Nation’s Jeremy Scahill reported that, “I saw Blackwater mercenaries speeding up and down the streets in unmarked cars, heavily armed with M4 machine guns, flak jackets, other weapons strapped to their legs.”

The New York Times reports:

The company and its executives and personnel have faced civil lawsuits, criminal charges and Congressional investigations surrounding accusations of murder and bribery. In April 2010, federal prosecutors announced weapons charges against five former senior Blackwater executives, including its former president, Erik D. Prince.

Nearly four years after the federal government began a string of investigations and criminal prosecutions against company personnel, some of the cases have fallen apart, burdened by legal obstacles including the difficulties of obtaining evidence in war zones, of gaining proper jurisdiction for prosecutions in American civilian courts, and of overcoming immunity deals given to defendants by American officials on the scene.

But in April 25, 2011, a federal appeals court reopened the criminal case against four former American military contractors accused of manslaughter in connection with the Nisour Square shooting in 2007.

At the onset of the strike, Verizon employed the services of the NJ State Police to escort trucks and non-union workers through picket lines. Now, Verizon’s hiring of a for-profit army during the strike proves two things. First that this is indeed a war on the middle class, and second, that Verizon will bear any expense to win this war.

Can you imagine a country where the billion dollar corporations have the world’s largest and deadliest private, for-profit army at their disposal? What would Blackwater guards actually do on a picket line? I guess we will find out soon enough.

I already wrote about how the un-trained, non-union replacement workers are violating Verizon safety rules and costing the company thousands by making mistakes on the job, most notably by destroying a Verizon bucket truck. In addition to that, Verizon spent $20,000 in postage to mail letters to striking union workers stating that they are terminating their health care on August 31. A union delegate for the IBEW also said that Verizon is offering contractors in Florida $75 an hour, plus hotel rooms, to come up north to work as non-union replacements, but they refuse to keep the terms of the previous union contract.

Verizon said that the concessions they are seeking on the striking union workers from the IBEW and CWA will save their company $1 billion a year. So far, Verizon has refused to budge on these demands. I wonder how much longer Verizon can refuse to sit down at the bargaining table before their union busting activities exceeds that $1 billion mark. For a company sitting on $100 billion in revenue with net profits of $6 billion last year, $1 billion seems like chump change.

The Verizon Strike as the Next Wisconsin

Saturday, August 13, 2011 by Dissent Magazine

by Mark Engler

 

The picket lines are up. This past weekend 45,000 Verizon workers on the East Coast, represented by the Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW), went on strike. The cause of the strike was the company’s attempts to win massive concessions from the unions. Verizon argued that the employees should give up gains they had won over many years of struggle and negotiation in previous contract fights.

As the Wall Street Journal put it, “Verizon Communications Inc. is seeking some of the biggest concessions in years from its unions.” Demands include the weakening of health-care benefits, cuts in pensions, reduced job security, and elimination of paid holidays such as Martin Luther King, Jr. Day. This despite the fact that the company reported billions in profit last year, and that, in the words of New York Times reporter Steven Greenhouse, “Verizon’s top five executives received a total of $258 million in compensation, including stock options, over the last four years.” The unions argue that Verizon has made some $20 billion in profit in the same time period, and Citizens for Tax Justice has pointed out that the company has done so while paying little to nothing in corporate income taxes.

Without a doubt, this is a conflict of national significance. As Bob Master, CWA District 1 legislative and political director, explained Wednesday in a conference call with supporters,

This is an enormously profitable company, which we believe is trying to take advantage of an anti-union environment and, in a sense, to replicate at a giant private-sector corporation what the governors of Ohio, New Jersey, and Wisconsin have been trying to do to the public sector. Our members feel very strongly that we need to draw a line here.

The parallel to Wisconsin is apt for several reasons. First, like the Republican elected officials in their attacks on unionized schoolteachers and other public employees, Verizon is taking aim at one of the last bastions of the American middle class. As a main strategy in its public relations, the company is trying to stoke resentment about the fact that the CWA and IBEW workers actually have living-wage jobs. It is hoping that “I don’t have a pension, why should they” logic will carry the day.

Accordingly, on Wednesday Verizon took out a full-page ad in the Philadelphia Inquirer suggesting that a typical employee makes $80,600 in annual pay and $42,000 in benefits. The union disputes this claim, contending that salaries are generally in the $60,000 to $77,000 range, and that benefits are less costly than the company would suggest. But, regardless, the debate over numbers misses some critical questions: What’s wrong with workers sharing in the profits of a healthy corporation? Isn’t that the way our economy is supposed to work?

(On a side note, it’s always a treat when companies plead poverty at the negotiating table and then turn around and spend big bucks on media spots, anti-union consultants, and pricey PR firms—but that’s another story.)

The fate of 45,000 middle-class jobs is a big deal for all of America. Last month, the entire U.S. economy had a net gain of only 117,000 jobs. Not only is that for the whole country, it represents a pretty decent month given the numbers from the past year. Furthermore, almost all of the new jobs now being created are low-wage. Given these realities—and the fact that concentrating all wealth in the hands of the rich is a very bad strategy for creating the kind of demand the economy needs to rebound—what happens to the Verizon workers is a matter of broad public concern.

Bob Master is right that Verizon’s aggressive bargaining stance, like Governor Scott Walker’s public-sector power grab, is the product of a political climate in which corporate interests feel they can do whatever they want to working people, and employees will have no recourse. The Verizon strike is unfortunately akin to Wisconsin in that it is a defensive battle—an effort to stop tragic rollbacks in previously established standards of fair employment.

The background for the contract dispute is that Verizon is now making most of its profits from its wireless services. While a small number of wireless technicians are involved in the strike, that part of the company is mostly non-union. In an ideal world, CWA and IBEW would be able to “bargain to organize,” balancing any concessions at the negotiating table for current union members with agreements that the company will remain truly neutral and allow workers at Verizon Wireless to make their own decision about whether or not to unionize. But this is not an ideal world. Like in Wisconsin, labor and its allies face a difficult fight merely to stave off the worst of a rabidly anti-union assault.

That said, there is a case for hope. The mass protests in Madison earlier this year gave some cause for optimism that a new type of energetic, broad-based, community-labor mobilization might become a lasting force in that state’s politics—and become a model for movements in other parts of the country. Wisconsinites’ success this week in recalling some Republican State Senators (although not as many as hoped) suggested that the struggle will be a long one, but that progressive efforts could have some real legs.

As for the strike, all those who have been wondering when working America will be fed up enough to finally stand up and fight should not sit this one out. If the Verizon strike becomes a rallying point in this country for a movement against runaway corporate power and for a fairer economy, it could have much broader implications than what contract terms are ultimately hammered out for those now walking the picket lines. That these workers are not rolling over in the face of company insistence on concessions is important and courageous. And they deserve widespread support.

***

Those on the East Coast can find a picket line to visit here.

Supporters all over the country will soon be able to “adopt a Verizon Wireless store” in their area and help to organize pickets at that location.

Finally, without even leaving your computer, you can sign the petition in support of the 45,000 CWA and IBEW workers on strike.

Verizon Strike

Does AT&T Really Need Federal Assistance?

Oh Come on!!!
By Eric K. Arnold | Sourced from The Media Consortium 

May 4, 2011

The proposed AT&T/T-Mobile merger continues to dominate media policy headlines, but the wireless merger isn’t the only game in town. AOL’s recent buyout of the Huffington Post has raised intellectual property issues, rural communities still lack speedy broadband access, and a proposed Verizon antenna in Oakland has come under fire by neighborhood activists.

AT&T an Underdog?

Telecommunications giant AT&T is many things, and an underdog in need of federal assistance isn't one of them. Yet Colorlines.com’s Jamilah King says that’s exactly how the company is portraying itself in its proposed $39 billion dollar takeover of T-Mobile.

In its official filing with the Federal Communications Commission (FCC), King reports, “AT&T spends nearly 90 pages describing T-Mobile’s weaknesses, while detailing the roadblocks it says it’ll face if federal regulators don’t green light the deal.” If federal regulators block the deal, AT&T argues, its customers “would face a greater number of blocked and dropped calls as well as less reliable and slower data connections. And in some markets, AT&T’s customers would be left without access to more advanced technologies.”

It’s hard to feel sorry for AT&T, though, since the deal has raised concerns that consumers ultimately will pay more for cell phone service, which could adversely impact low-income, minority, and immigrant users who rely on the low-cost plans currently offered by T-Mobile. If the merger passes federal muster, King writes, “it’ll likely mean the unheralded return to prominence of the former Ma Bell monopoly that ruled American telecommunications for most of the twentieth century.”

Competition without Competitors

As Nancy Scola writes in The American Prospect, AT&T’s 381-page FCC filing essentially comes down to this: “you can have the benefits of competition without actual competitors.”

Scola traces the history of the telecommunications industry, touching on the 1982 antitrust case which resulted in the break-up of Ma Bell (aka AT&T) into seven Baby Bells, as well as analyzing current media policy in Washington:

As a powerful company that just announced $31 billion in revenues last quarter AT&T retains great sway. The FCC often defers to the company's role as the founders of American telecommunications. And Congress, a recipient of large sums of AT&T cash, often seems dazzled by the company's bright lobbyists who talk in confusing but exciting ways about ‘spectrum synergies’ and ‘LTE deployment.’

The takeaway? Congress and federal regulators need to put consumers’ needs ahead of the telecoms:

In 21st-century America, mobile phones are simply far too important a technology for Washington to give them the usual treatment. With a breathtaking nine out of 10 Americans now owning a cell phone, the wireless market is one that has to work for consumers.

HuffPo Lawsuit, Boycott Highlight IP Issues in New Media Era

The AT&T/T-Mobile merger has garnered a lot of media attention, but it’s not the only merger worth scrutinizing. Truthout’s Nadia Prupis takes a closer look at reactions to the class-action lawsuit recently filed on behalf of Huffington Post’s unpaid bloggers. HuffPo was recently sold to AOL for $315 million. As Prupis reports, “the class-action suit, filed by freelance journalist Jonathan Tasini, alleges that the posts created by unpaid writers were worth an estimated $105 million, and that the profit should have been used as compensation.”

HuffPo founder Arianna Huffington is quoted as saying, “The vast majority of our bloggers are thrilled to contribute - and we're thrilled to have them."

Yet the merger—and the lawsuit—highlight one of the biggest issues facing contemporary journalism: The devaluation of intellectual property. For that reason, a number of former bloggers have instituted a boycott of HuffPo. As Prupis notes, “The Newspaper Guild of America, the National Writers Union and the AFL-CIO have all endorsed the boycott, with many of their members refusing to contribute to the web site until Huffington agrees to talk with the unions about how best to approach the changing landscape of online journalism.”

Rural Broadband Access Still Slow

Mark Scheerer of Public News Service tackles the issue of broadband access in rural communities – an important topic in a down economy, since faster connectivity could result in economic stimulus for small businesses, such as livestock farmers.

A new report (PDF at link) issued by the Center for Rural Strategies concludes that “communities without broadband service could be hobbled economically, losing the race to those with faster connections.”

Farmers in places like Stamping Ground, Kentucky, Scheerer says, are paying for high-speed broadband, yet receiving dial-up download speeds, which hinders efforts to “streamline and economize their livestock sales.”

The report essentially mirrors the FCC’s 2010 findings: “broadband providers are not expanding their services in a timely and satisfactory fashion.”

Activists Push Back Against Verizon Antenna

As Oakland Local’s Dennis Rowcliffe reports, a proposal by Verizon to install a powerful cellular antenna close to two schools and several residential units has been met with opposition by community groups.

“The residents, school parents and teachers express concerns about the potential health effects of sustained nearby exposure to increased levels of the electromagnetic frequency, or EMF, radiation emitted by the antennas,” Rowcliffe writes, adding that a group called East Bay Residents for Responsible Antenna Placement (EBR-RAP) has suggested several alternate sites, all of which were rejected by Verizon.

Verizon executive John Johnson is quoted as saying, “Please note that we intend to retain our rights to the city-approved location and to use it as the project site if we are unable to identify a viable alternative after further review.”

However, EBR-RAP members say they intend to keep up the pressure on Verizon until an alternate site is found.

Astroturfing Net Neutrality

Tuesday, April 19, 2011 by Save the Internet
by Tim Karr

Free speech online has come under withering attack from the Astroturf lobby -- corporate front groups that are determined to hand control of the Internet to companies like AT&T and Comcast.

They've joined the forces of the Tea Party and pro-corporate attack groups like Americans for Prosperity to urge weak members of Congress to betray the public interest by voting to strip the Federal Communications Commission of its ability to protect our basic freedom to access an open Internet.

And betray us is exactly what House representatives did earlier this month, passing a "Resolution of Disapproval" (H.J. Res. 37), which is designed to let phone and cable companies block any speech they don't like, charge users anything they can get away with, and hold innovation hostage to their profit margins.

If this resolution gets by the Senate and White House, there will be little anyone could do to stop these companies. The good new is that President Obama has already vowed to veto this resolution. (You can make sure that it doesn't get to his desk by urging your senators to kill H.J Res. 37).

The aim of front groups supporting this industry agenda is to stoke partisan rancor and fear over a principle called Net Neutrality -- a basic rule that keeps service providers from deciding what content we get to see and share via digital networks.

A favorite line of theirs is to portray Net Neutrality as part of a left-wing conspiracy, dismissing the vast coalition of people of every political stripe who believe that an open Internet is a basic requirement of a healthy, modern democracy.

An article earlier this month at Andrew Breitbart's website Big Government painted Net Neutrality as "oppressive" and "leftists policies" and urged readers to phone up Democrats and urge their vote for a Congressional "Resolution of Disapproval" that had been embraced by Rep. Michele Bachmann and pushed by House Speaker John Boehner.

Americans for Prosperity, the industry-funded Astroturf group with deep ties to the Koch Brothers, had asked its members to send letters to these and other congressional offices calling Net Neutrality "Obama's Internet takeover."

"Regulating the Internet under the banner of so-called network neutrality has been a far-left obsession for years," argues Americans for Prosperity VP of Policy Phil Kerpen.

Rhetoric aside -- it’s worth noting that companies like AT&T and Comcast have delivered truckloads of money to the re-election campaigns of most of those who voted against Net Neutrality. A recent report by MapLight.org illustrates the corrupting influence corporate donations have had in “convincing” members of Congress to turn against the interests of their constituents on this issue.

In the House, front groups' targeted Democratic Reps. Jason Altmire (PA-4), Sanford Bishop (GA-2), Leonard Boswell (IA-3), Jim Costa (CA-20), Henry Cuellar (TX-28), Reuben Hinojosa (TX-15), Tim Holden (PA-17), Rick Larsen (WA-2), Mike McIntyre (NC-7), Jerry McNerney (CA-11), Gregory Meeks (NY-6), David Scott (GA-13), and Heath Shuler (NC-11).

Of these, only two – Reps. Bishop and Scott – caved to industry pressure by voting for the resolution. But most every one has received considerable sums from the phone and cable lobby.

Now members of the Senate are hearing the same tune.

This push comes at a time when phone and cable companies have begun limiting our ability to connect with others and share information. Some like MetroPCS have already announced plans to block certain video applications via the mobile Web. Corporations like AT&T, Comcast and Verizon are seeking to degrade access to competing services or sites that might threaten their bottom line; they’re also moving to penalize users who use their Internet connection for more data-intensive purposes than simple Web surfing.

Net Neutrality – like the First Amendment itself – is an issue that should transcend politics.

Despite the partisan blather, it has received support from all corners -- from the socially conservative Christian Coalition to the rights advocates at ACLU, from librarians and educators to video gamers, journalists, musicians and even Harry Potter fans.

More than two million Americans have sent letters to the FCC and Congress urging leaders to "stand with the public by protecting Net Neutrality once and for all."

That's what real grassroots look like.

Just last week, Internet pioneer and die-hard Net Neutrality supporter Tim Berners-Lee said that access to the open Internet is "human right" that we all have "duty" to protect.

He’s right.

But don’t let that stop the hyperventilating among Beltway hacks intent on turning this into a divisive and politically charged issue.

Members of Congress without regard to party or ideology should ignore the astroturfing of a few to protect an open Internet that helps so many.

US Uncut: The New Movement against Austerity and Corporate Tax Cheats

Sunday, April 17, 2011 by CommonDreams.org
by Brian Tierney

By Monday April 18th most Americans will have finished filing their taxes, helping to boost government revenue at a time when the only thing most politicians care to discuss is how to cut the deficit.


But a large pack of corporate citizens will probably not be worrying about paying their dues; tax day, like any other day for them, will be strictly devoted to growing their bloated profit margins.

Recent reporting that some of the largest U.S. corporations have paid little to nothing in federal income taxes in the past few years hasn’t stopped the upside-down debate in Washington. The beltway budget battle remains focused on one blunt question: how much of a beating should be given to workers and the poor in order to bring down the deficit while leaving the corporate bottom line unscathed?

Beyond Capitol Hill, however, the scope of corporate tax-dodging during a period of devastating budget cuts has inspired the ire of thousands of Americans and given birth to a new people-powered movement to hold big business and their mouthpieces in Washington accountable for the cuts. It’s called US Uncut, a campaign that has produced hundreds of direct actions targeting notorious tax cheats like Bank of America and Verizon while agitating around other major offenders like General Electric and Citigroup.

Thanks to tax breaks, creative accounting schemes, loopholes and off-shore havens, these companies are raking in billions and getting away with systematic tax-evading operations that would land ordinary people in jail.

Launched back in February, US Uncut has so far made Bank of America and Verizon the primary targets of its actions. According to US Uncut, Bank of America’s 2009 pre-tax income was $4.4 billion. As the fifth largest corporation in the world, Bank of America received $45 billion in bailout funds in 2008 and 2009 but didn’t pay a single dime in federal income taxes in 2009. In the same year, Bank of America received up to $1.9 billion in tax refunds.

How did they get away with it? Bank of America has 115 foreign tax-havens where it keeps its income in order to avoid taxes. And Bank of America is not alone. Roughly 25 percent of the largest U.S. corporations don’t pay any federal income taxes.

US Uncut has adopted a model of organizing first used in the U.K. where an organization called UK Uncut has been using hundreds of creatively-themed, non-violent direct actions targeting companies that flout their duty to pay taxes while budget crises are crippling social programs. The “flash mob”-style actions are meant to both pressure companies and galvanize the broader population through attention-grabbing and highly publicized direct actions.

According to its website, “US Uncut is a grassroots movement taking direct action against corporate tax cheats and unnecessary and unfair public service cuts across the U.S.
Washington’s proposed budget for the coming year sends a clear message: The wrath of budget cuts will fall upon the shoulders of hard-working Americans. That’s unacceptable.”

The approach taken by US Uncut relies heavily on the use of social media and a decentralized, do-it-yourself system for organizing protest actions and posting them on its website.

George Taghi, a leading organizer with US Uncut in Washington DC, explained that US Uncut wants to change the public discourse around the budget and the deficit and engage the public with its approach to activism.

“US Uncut’s goal is to punctuate and change the narrative that says ‘we have a spending problem’ to ‘we have a revenue problem,’” Taghi says.

When asked why US Uncut is focused on tax-dodging companies rather than the lawmakers who enable them, Taghi pointed to the corporations as the real source of power in Washington:

“US Uncut has focused on bringing protests to companies’ storefronts, instead of lawmakers, because that is where the true powers lie. On the whole, for companies to claim ignorance or deny responsibility for our lopsided tax code – that legalizes off-shoring of profits and accounting gimmicks – is a farce.  These companies have lobbied Congress for such privileges and donate to representatives to enact loopholes.”

In addition to Bank of America, US Uncut is shining the spotlight on other corporations like Verizon, which reported a pre-tax income of $24.2 billion last year and was rewarded with a $1.3 billion tax refund. Citigroup has paid zero dollars in taxes in the last four years, according to US Uncut. The company also was the largest recipient of government bailout money, totaling a staggering $476 billion.

The issue of corporate tax-dodging has been pushed into the limelight in recent months. Last month, Vermont Senator Bernie Sanders compiled a list of “the 10 worst corporate income tax avoiders.” The list included companies such as those on the US Uncut target list, in addition to Exxon Mobile, which made $19 billion in profits in 2009, paid no federal income taxes and received a $156 million tax rebate, according to SEC filings. While the official corporate tax rate is 35 percent, Goldman Sachs managed to whittle its tax obligations down to 1.1 percent of its income in 2008.

In March, the New York Times published a front-page article describing how General Electric, the second largest corporation in the world, paid nothing in federal income taxes last year while it reported $14.2 billion in profits. On top of that, GE claimed a tax benefit of $3.2 billion.
“Its extraordinary success,” according to the Times article, “is based on an aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore.”

Add to all of this GE’s anti-worker policies – which include plant closures that have eliminated a fifth of GE jobs in the U.S. since 2002 and the company’s drive to cut the wages and benefits of its mostly unionized workforce – and you have what President Obama lauds as a “model” for American business.

On Wednesday that model was the target of a hoax executed by the same activists of US Uncut, in partnership with the “Yes Men,” an anti-corporate group notorious for pulling pranks that parody corporate propaganda. The two groups put out a fake GE press release that announced GE’s plans to return all of its $3.2 billion tax refund in response to public outrage. The stunt brilliantly put GE into an awkward public relations situation in which the company was forced to openly admit that it in fact had no intention of paying anything back. 

Given GE’s relationship with the White House, the egregiousness of its tax-dodging helps to contextualize the willingness of the Obama administration to inflict such harsh cuts like the ones that went through Congress last week to avert a government shutdown. Instead of being sanctioned for its tax cheating, GE’s CEO, Jeffrey Immelt, was awarded a top position in the Obama administration as chair of the president’s Council on Jobs and Competitiveness.

So when it comes to spending and budget cuts, forget hope and change. Compromise and capitulation is the catchphrase of this administration, and this should surprise no one who knows the company that Obama keeps. In fact, the president’s “compromise” last week with Republican House Speaker John Boehner cannot even be called that. Democrats and the White House conceded even more in spending cuts than what Republicans themselves originally proposed at the beginning of the year. And it was a “compromise” that Obama applauded as the largest annual spending cut in U.S. history.

On Wednesday Obama delivered a speech in which he seemed to be changing course and finally turning back to the progressive ideals that inspired millions during his campaign. His argument for progressive tax policies, making the wealthy pay more and preserving critical programs like Medicare and Social Security was a rhetorical departure from what we’ve seen from his administration over the past several months of budget wrangling.

Following the speech, liberal commentators voiced their exuberance and suggested that Obama’s disillusioned base can again find some cause for excitement. Others were not as impressed.

“[Obama] has given so many great speeches before, only to disappoint. Unfortunately, he stills adheres to the right’s narrative that spending cuts on domestic programs has to happen to the tune of nearly $1 trillion over ten years,” said Taghi from US Uncut.

The speech also left the door open to unspecified reforms to Social Security and Medicare that will play into the hands of the right-wing tea party-backed Republicans in Congress who want to privatize and destroy those programs.

Last week Congress voted to chop $38 billion dollars from the budget with cuts that will affect health programs, heating assistance to the poor, education programs, the Environmental Protection Agency, and food safety. Funding for essential women’s health services provided by Planned Parenthood just barely made it passed the GOP’s ideological chopping block, but Obama and the Democrats still traded away money for those services for residents of the District of Columbia.

And while the let-them-eat-cake budget cutters are using the deficit to justify these cuts at the federal level, they have also been on the attack at the state level where budgets are being slashed and unions are under assault.

The campaign against unions has helped breathe some life back into the labor movement. But what started as an anti-union crusade in Wisconsin – inspired and funded by the right-wing billionaire Koch brothers – has spread to other states, and it’s not just Republicans who are out to make union workers scapegoats for the deficit. Democratic governors in California, New York, and Illinois are using the deficit as an excuse to force major concessions from public sector unions.

In response, unions and labor activists have been mobilizing and fighting back. A national day of action last week on April 4th saw over a thousand union rallies and other actions for labor across the country.

In the midst of this labor upsurge, US Uncut is another component of the progressive fightback, and it’s a campaign that goes directly to the corporate tax-dodgers who are materially and ideologically feeding the narrative about a deficit crisis that can only be solved through budget cuts. A unified progressive fightback – including labor, environmentalist and consumer rights groups – is needed in order to push back against austerity and fight to rebuild the tattered social safety net that Washington is poised to shred altogether.   

The right yearns for capitalism unfettered, and to get there they are relying on a structure in Washington that can only be described as plutocracy. And neither party is willing to consider serious cuts to the massive Pentagon budget. Unpopular wars abroad and unpopular tax cuts at home for the wealthy are all evidently worth the resultant suffering inflicted on millions here in the U.S. under the budget ax.

In Wisconsin and other states where workers have been fighting back, an important example has been set. This class war no longer needs to be asymmetrical. Working people can and must fight back, not just against the budget cutters in Washington, but against their corporate paymasters whose anti-worker and tax-dodging practices have helped set the stage for ruthless austerity.  

We simply cannot defeat the high-powered corporate lobbyists on their own turf. If ever there was a time for progressives and the left to abandon the tired and feeble strategies of lobbying, letter-writing, and petition-signing, that time is now. We need to exert pressure where it will be felt – on the streets and in the workplace through mass mobilizations, strikes, and yes, militant direct actions.

US Uncut called for national days of action on “Tax Weekend,” April 15th to the 17th, and on Friday there were over 130 actions across the country posted on its website through tax day.
It’s time to go directly after the corporate powers using creative direct action and other forms of protest to expose their dirty war against workers and the poor.

The Most Important Free Speech Issue of Our Time

tuesday, December 21, 2010 by The Huffington Post
by Sen. Al Franken

This Tuesday is an important day in the fight to save the Internet.

As a source of innovation, an engine of our economy, and a forum for our political discourse, the Internet can only work if it's a truly level playing field. Small businesses should have the same ability to reach customers as powerful corporations. A blogger should have the same ability to find an audience as a media conglomerate.

This principle is called "net neutrality" -- and it's under attack. Internet service giants like Comcast and Verizon want to offer premium and privileged access to the Internet for corporations who can afford to pay for it.

The good news is that the Federal Communications Commission has the power to issue regulations that protect net neutrality. The bad news is that draft regulations written by FCC Chairman Julius Genachowski don't do that at all. They're worse than nothing.

That's why Tuesday is such an important day. The FCC will be meeting to discuss those regulations, and we must make sure that its members understand that allowing corporations to control the Internet is simply unacceptable.

Although Chairman Genachowski's draft Order has not been made public, early reports make clear that it falls far short of protecting net neutrality.

For many Americans -- particularly those who live in rural areas -- the future of the Internet lies in mobile services. But the draft Order would effectively permit Internet providers to block lawful content, applications, and devices on mobile Internet connections.

Mobile networks like AT&T and Verizon Wireless would be able to shut off your access to content or applications for any reason. For instance, Verizon could prevent you from accessing Google Maps on your phone, forcing you to use their own mapping program, Verizon Navigator, even if it costs money to use and isn't nearly as good. Or a mobile provider with a political agenda could prevent you from downloading an app that connects you with the Obama campaign (or, for that matter, a Tea Party group in your area).

It gets worse. The FCC has never before explicitly allowed discrimination on the Internet -- but the draft Order takes a step backwards, merely stating that so-called "paid prioritization" (the creation of a "fast lane" for big corporations who can afford to pay for it) is cause for concern.

It sure is -- but that's exactly why the FCC should ban it. Instead, the draft Order would have the effect of actually relaxing restrictions on this kind of discrimination.

What's more, even the protections that are established in the draft Order would be weak because it defines "broadband Internet access service" too narrowly, making it easy for powerful corporations to get around the rules.

Here's what's most troubling of all. Chairman Genachowski and President Obama -- who nominated him -- have argued convincingly that they support net neutrality.

But grassroots supporters of net neutrality are beginning to wonder if we've been had. Instead of proposing regulations that would truly protect net neutrality, reports indicate that Chairman Genachowski has been calling the CEOs of major Internet corporations seeking their public endorsement of this draft proposal, which would destroy it.

No chairman should be soliciting sign-off from the corporations that his agency is supposed to regulate -- and no true advocate of a free and open Internet should be seeking the permission of large media conglomerates before issuing new rules.

After all, just look at Comcast -- this Internet monolith has reportedly imposed a new, recurring fee on Level 3 Communications, the company slated to be the primary online delivery provider for Netflix. That's the same Netflix that represents Comcast's biggest competition in video services.

Imagine if Comcast customers couldn't watch Netflix, but were limited only to Comcast's Video On Demand service. Imagine if a cable news network could get its website to load faster on your computer than your favorite local political blog. Imagine if big corporations with their own agenda could decide who wins or loses online. The Internet as we know it would cease to exist.

That's why net neutrality is the most important free speech issue of our time. And that's why, this Tuesday, when the FCC meets to discuss this badly flawed proposal, I'll be watching. If they approve it as is, I'll be outraged. And you should be, too.

Phone Co.s Screwing the US with $320 Billion Broadband Rip-Off

Americans are stuck with an inferior and overpriced communications system, compared with the rest of the world, and we're being ripped off in the process.
By David Rosen and Bruce Kushnick, AlterNet
Posted on October 7, 2010

Since 1991, the telecom companies have pocketed an estimated $320 billion --- that's about $3,000 per household.

This is a conservative estimate of the wide-scale plunder that includes monies garnered from hidden rate hikes, depreciation allowances, write-offs and other schemes. Ironically, in 2009, the FCC's National Broadband plan claimed it will cost about $350 billion to fully upgrade America's infrastructure.

The principal consequence of the great broadband con is not only that Americans are stuck with an inferior and overpriced communications system, but the nation's global economic competitiveness has been undermined.

In a June 2010 report, Organization for Economic Co-operation and Development (OECD) ranked the U.S. 15th on broadband subscribers with 24.6 percent penetration; the consulting group, Strategy Analytics, is even more pessimistic, ranking the U.S. 20th with a "broadband" penetration rate of 67 percent compared to South Korea (95 percent), Netherlands (85 percent) and Canada (76 percent). Making matters worse, Strategy Analytics projects the U.S. ranking falling to 23rd by year-end 2010.

But these are just overall statistics. Today, people in Japan, Korea, Europe and other countries get broadband services that are 100-mbps services in both directions for what we pay for inferior, Asymmetric Digital Subscriber line (ADSL), while in Hong Kong companies have started to offer 1-gigabit speeds.*

Part of the reason for this is these countries have sunk more fiber optical cable into the ground and connected more homes to the next-generation grid. According to the OECD, the U.S. ranks 11th with only 5 percent fiber penetration, compared to Japan (54 percent), Korea (49 percent) and European OECD countries (11 percent).

Another reason for the woeful state of U.S. broadband is that we have one of the slowest networks in the world. According to the technology company, Akamai, the U.S. ranked 22nd globally in average connection datarate speed, averaging only 3.8-mbps in Q-4 2009. In comparison, Korea's average datarate was nearly three-times faster (11.7-mbps), Hong Kong more then double (8.6-mbps) and Japan was at 7.6-mbps. A surprise to many, Romania had an average rate of 7.2-mbps and Latvia clocked at 6.2-mbps.

Screwed

Grand cons regularly screw Americans. Millions bet the lottery that never pays off; millions go to Las Vegas and Atlantic City hoping for the big score and leave with empty pockets; and millions bet big-time on a housing run-up and lost big, big time. Hustlers offer a zillion get-rich schemes over TV and the Internet that people accepted either out of naivety, greed or desperation. But one of the greatest -- and little reported -- scams perpetuated on the American public is the broadband con.

The scam was simple. Starting in 1991, Verizon, Qwest and what became AT&T offered each state -- in true "Godfather" style -- a deal they couldn't refuse: Deregulate us and we'll give you Al Gore's future. They argued that if state Public Utility Commission (PUCs) awarded them higher rates and stopped examining their books, they would upgrade the then-current telecommunications infrastructure, the analog Public Switched Telephone Network (PSTN) of aging copper wiring, into high-speed and two-way digital optical fiber networks.

State regulators, like state politicians, are seduced by the sound of empty promises -- especially when sizable campaign contributions and other perks come their way. Hey, what are a few extra bucks charged to the customer every month for pie-in-the-sky promises? And who cares about massive tax breaks, accelerated depreciation allowances and enormous tax write-offs? The promises sound good on election day and nobody, least of all the voter, reads the fine print.

The broadband con has been played out across the country. In California, Pacific Bell (now part of AT&T) claimed it would spend $16 billion and have 5.5 million homes wired by 2000. Instead, after a merger with SBC in 1997 (renamed AT&T in 2005), it secured state deregulation and simply stopped building out the fiber-based broadband infrastructure. On the East Coast, things were pretty much the same. Bell Atlantic, which covered New Jersey to Virginia and is now part of Verizon, claimed it would spend $11 billion and have 8.7 million homes wires by 2000. And in Connecticut, SNET (now also part of AT&T) promised to spend $4.5 billion and have the entire state rewired by 2007. In the mid-West, the story was similar. Ameritech (now part of AT&T and which controlled five states, including Illinois and Ohio) claimed they would have 6 million homes wired by 2000. For Ohio, Ameritech claimed it would rewire every school, library and hospital with fiber by 2000. None of these promises have been realized.

Over the last two decades, the telcos have engaged in a lot of sleight-of-hand tricks to make Americans believe that broadband was real and their service was the world's best. In 1996 the Internet hit and everyone wanted to go online. This migration to the World Wide Web was led, not by AT&T and Verizon, but by thousands of small and larger ISPs from AOL and Prodigy to over 9,500 small ISPs.

By 1998, not only did the telephone companies mostly stop building out their networks, but instead of rolling out the next-generation "info superhighway," they pulled a bait-and-switch and rolled backward, offering customers ADSL service, a watered-down "broadband" connection that runs on good old copper wire.

Another trick used by telecoms has been to submit to federal and state regulators falsified cost models, often lying to regulators and the public. For example, the great lie was voiced in 1991 when the telecom boldly announced the new broadband age based on technologies that they claimed capable of delivering 45-mbps bi-directional services, but the technologies didn't exist and couldn't work out at the cost models submitted. When pushed, the phone companies presented self-produced, self-funded or self-serving "research" by shill think-tanks to buttress their claim for higher rates.

Now, nearly two decades after Gore announced the Info Superhighway and the telcos secured deregulation to build out the next-generation communications infrastructure, the nation's two largest phone companies, Verizon and AT&T, have begun to seriously deploy fiber services. In 2004 and with much fanfare, Verizon introduced FiOS, a fiber-to-the-home service. Today, it claims only 3.6 million subscribers and new subscriptions have stalled.

AT&T, which originally promised to launch its advances service, U-verse, in 2006 in 15 markets, got it running in 2007 but in only 11 markets -- and then not through an entire market. As of the end of Q-2, 2010, it claimed 2.5 million subscribers. Sadly, the telecoms have only 6 million full broadband fiber subscribers as of 2010. What happened to the other 94 million households they promised to sign-up?

Americans have paid and paid again billions of dollars for an imaginary upgrade to create a fiber optic future. The estimate of $320 billion has already been collected which means that every household has paid almost $3,000 to upgrade the phone networks. The question no wants to really address is simple: What have Americans gotten for the telecom broadband rip-off?

Playing the con

In order to understand how the broadband con works, it is useful to examine how it has played out in one state and extrapolate this to the other 49 states. In this case, we will examine New Jersey as representative of a nationwide policy.

New Jersey state law requires that by 2010, 100 percent of the state is to be rewired with 45-mbps, bi-directional service. To meet this goal, Verizon collected approximately $13 billion in approved rate increases, tax break and other incentives related to upgrading the Public Switched Telephone Networks. To cover its tracks, Verizon submitted false statements year after year, claiming that it was close to fulfilling its obligations. For example, in its 2000 Annual Report, it claimed that 52 percent of the state could receive "45-mbps in both directions or higher."

Based on such false claims, Verizon has benefited for significant pricing increases for essentially inexpensive computerized services. For example, Call Waiting and Call Forwarding cost less then $.01 cent to offer yet the company charges $4-$7 for such features. In addition, fees for inside wiring went up to $7.00 from $1.25.

The company also benefited from more invisible perks. It secured massive write-offs on its network even though it wasn't being replaced; it actually secured a write-off of over 105 percent above the amount of construction. These write-offs helped save it billions in taxes. These factors have helped significantly heighten the company's Return on Equity, the standard measurement of profits, jump from 12-14 percent before deregulation to 30-40 percent.

But all this gets complicated as they are no longer required to submit full New Jersey annual or quarterly reports and the FCC's filing requirements stopped in 2007. So, in 2009, Verizon, New Jersey outlined financials showed a "net income" loss of $194 million dollars, and a $160 million "tax benefit" and a series of "affiliate transactions," meaning transferring expenses to the utility but without showing monies flowing back.

Verizon's New Jersey coverage is for approximately 3.2 million households, which represents about 3 percent of total U.S. households. Extrapolating from New Jersey, we estimate that Americans have been bilked of at least $320 billion since deregulation went into effect in the mid-'90s.

Digital Houdini

Federal and state regulators ignore the great telecom rip-off -- politicians simply get too many contributions from too many lobbyists to worry about their constituents' phone bills. Telephone companies have orchestrated a massive digital Houdini act in which they present an image of an essential service that offers customers more for less.

After almost 20 years of telecom deregulation, the American communications infrastructure is in shambles. The FCC's broadband plans are now in play. While much debate has taken place over the future of net neutrality, particularly in light of the Google-Verizon proposal to maintain Internet net neutrality on wireline distribution and end it on wireless communications, little attention has been paid to the never-ending rate hikes, failure to deliver on previous promises, poor state of fiber deployment, and into who pocketed the missing $320 billion in over charges.

In 1967, James Coburn stared in a wonderful satire, The President's Analyst, about the corrupting power of a secretive TPC, the phone company. The film pits the Central Enquiries Agency (CEA) against the Federal Bureau of Regulation (FBR), an all-male agency consisting of J. Edgar Hoover look-alikes all under five-foot-six-inches tall. In the intervening four decades, but especially since the break-up of AT&T in 1984 and deregulation starting in 1993, the power of the telecommunications companies, including the cable industry, has both increasingly grown and become increasingly invisible.

A century ago, giant corporate trusts dominated America's economic landscape. A century later, they are back in full force and even greater control over the nation's economic life and political culture.

(For more detailed analyses of the great broadband rip-off, visit www.teletruth.com.)