The Federal Communications Commission's plan for spurring 5G wireless deployment will prevent city and town governments from charging carriers about $2 billion worth of fees.
The FCC proposal, to be voted on at its meeting on September 26, limits the amount that local governments may charge carriers for placing 5G equipment such as small cells on poles, traffic lights, and other government property in public rights-of-way. The proposal, which is supported by the FCC's Republican majority, would also force cities and towns to act on carrier applications within 60 or 90 days.
The FCC says this will spur more deployment of small cells, which "have antennas often no larger than a small backpack." But the commission's proposal doesn't require carriers to build in areas where they wouldn't have done so anyway.
Philadelphia is one of numerous local governments that objects to the FCC plan.
"The City respectfully disagrees with the Commission's interpretation of 'fair and reasonable' compensation," Philadelphia officials told the commission this week. "For many cities, public rights-of-way are the most valuable and commonly used public asset."
The FCC plan proposes up-front application fees of $100 for each small cell and annual fees of up to $270 per small cell. The FCC says this is a "reasonable approximation of [localities'] costs for processing applications and for managing deployments in the rights-of-way." Cities that charge more than that would likely face litigation from carriers and would have to prove that the fees are a reasonable approximation of all costs and "non-discriminatory."
But, according to Philadelphia, those proposed fees "are simply de minimis when measured against the costs that the City incurs to approve, support, and maintain the many small cell and distributed antenna system (DAS) installations in its public rights-of-way."
Philadelphia said it "has already established a fee structure and online application process to apply for small cell deployment that has served the needs of its citizens without prohibiting or creating barriers to entry for infrastructure investment." The city has also negotiated license agreements for small cell installations with Verizon, AT&T, and other carriers.
Rural governments also cry foul
Localities both large and small object to the FCC plan. A group representing 35 rural California counties told the FCC that its "proposed recurring fee structure is an unreasonable overreach that will harm local policy innovation."
The FCC-proposed limit of $270 per small cell site is too low, said the group, which is called the Rural County Representatives of California (RCRC).
"That is why many local governments have worked to negotiate fair agreements with wireless providers, which may exceed that number or provide additional benefits to the community," the RCRC wrote. "The FCC's decision to prohibit municipalities' ability to require 'in-kind' conditions on installation agreements is in direct conflict with the FCC's stated intent of this Order and further constrains local governments in deploying wireless services to historically underserved areas."
Los Angeles Mayor Eric Garcetti expressed similar concerns, saying the FCC plan "will insert confusion into the market and sow mistrust between my technology team and the carriers with whom we have already reached agreements."
Local governments are right to be angry at the FCC, according to telecom industry adviser Blair Levin. Levin was the FCC's chief of staff from 1993 to 1997 and oversaw development of the FCC's National Broadband Plan in 2010.
The pending FCC order "presents a framework in which industry gets all the benefits (reduced fees to access state and local property) with no obligations to reinvest the resulting profits in rural broadband—even though the purported rationale for the reduced fees is that they will lead to new investment," Levin wrote in a blog post Wednesday. "At the same time, states and localities will be forced by federal mandate to bear all the costs and receive no guaranteed benefits."
Levin described the move as "a 'power grab' in which the FCC majority substitutes [its] judgment of what is best for local communities for the judgment of duly elected local officials."
Carriers don't need the FCC's help negotiating with cities, Levin wrote. "As the carriers themselves have acknowledged, they have sufficient leverage to walk away from any locality that creates too many obstacles to deployment," he noted.
Local governments are also able to encourage deployment without FCC interference, Levin wrote.
"[L]ocal governments have a strong recent track record of endeavoring to enable and facilitate broadband deployment, as the Google Fiber experience conclusively demonstrated," Levin wrote. "Vilifying them based on fees for use of public property is not only a distraction but also unfair."
Fees are less than 1% of 5G deployment costs
The FCC's 5G plan was spearheaded by Republican Commissioner Brendan Carr, who said in a speech that carriers will have to spend $275 billion to deploy small cells throughout the US.
Carr said in another speech that eliminating $2 billion worth of local fees will "stimulate $2.4 billion in additional investment" and "flip the business case for building 5G and next-gen networks in rural and less affluent communities." Carr quoted a Republican state senator from Montana as saying that carriers spend most of their investment capital in large urban areas "primarily due to the high regulatory cost and the cost recovery [that] can be made in those areas" and that "this leaves the rural areas out."
Carr claims that the FCC's proposed changes are necessary for the US to beat China in "the race to 5G."
The "race to 5G" is frequently invoked by the FCC and carriers in arguments to eliminate various regulations. T-Mobile and Sprint now claim they need to merge in order to create a robust 5G network, even though each company previously said it would build a top-tier 5G network by itself.
Even AT&T cast doubt on this narrative in a recent FCC filing that responded to the T-Mobile/Sprint merger. AT&T told the FCC that "the US is already the world leader in 5G" and that "AT&T plans to serve more than 400 markets [with 5G] by the end of 2018."
FCC claims are “highly questionable”
The FCC's 5G proposal claims that additional deployment created by carriers' $2 billion in savings will occur almost entirely in "rural and suburban communities that otherwise would be on the wrong side of the digital divide."
But Levin is skeptical. "[E]ven if one accepts the FCC claim about the $2.5 billion—which is highly questionable—that amount is about one percent of what the FCC and industry claim is the necessary new investment needed for next-generation network deployments and, therefore, is not likely to have a significant impact," he wrote.
Other federal government actions—such as new tariffs on China—will have an even greater impact on 5G deployment but in the opposite direction, he wrote.
Reducing local fees would make it cheaper for carriers to deploy small cells in areas where they would have done so anyway. But there's no reason to think carriers will use those savings to build 5G networks in areas where doing so would be unprofitable, Levin wrote.
"[T]e FCC's draft order is based on a fallacy that no credible investor would adopt and no credible economist endorse: that reducing or eliminating costs for small cell mounting on public property in lucrative areas of the country (thus reducing carriers' operating costs), will lead to increased capital expenditures in less-lucrative areas—thus supposedly making investment more attractive in rural areas," Levin wrote.
Though the FCC claims the carriers' savings would be re-invested in rural areas, the commission isn't imposing any requirement that carriers do that.
"[W]hile the FCC may ignore reality, the carriers and Wall Street understand that increasing profitability in Market A will not make Market B more attractive for investment," Levin wrote. "Market B will still be an area that is unprofitable or otherwise unattractive for investment, and the new requirement that Market A subsidize carriers by reducing fees will not benefit Market B under these circumstances."
Instead, carriers are more likely to devote savings to "stock buybacks, debt reduction, or dividend support" than to new capital investments, he wrote.
AT&T, Verizon in favor
So who's in favor of making 5G deployment cheaper for carriers, even without any guarantee of additional deployment? The carriers, of course.
The FCC plan "takes the critical next step of addressing state and local processes that may impede the deployment of advanced wireless networks," Verizon told the FCC Wednesday. If approved, Verizon said the FCC proposal "would establish meaningful guidance for state and local governments, while preserving their role in those reviews."
AT&T is hoping the FCC will go even further. AT&T urged the commission to apply its new standard to existing agreements between carriers and municipalities instead of just future agreements. This would require changing the draft order before next week's vote.
"The Commission should clarify that this standard applies not only to municipal regulations but also to existing and future agreements between municipalities and carriers," AT&T wrote Wednesday. "Otherwise, carriers paying exorbitant fees under an existing agreement with a jurisdiction will operate at a competitive disadvantage relative to new entrants who pay presumptively reasonable fees."
Instead, before the story was even published, the Linux project leader Linus Torvalds suddenly announced that he was temporarily stepping down from his leadership role. He also instituted a new code of conduct for the Linux kernel community after resisting years of requests for one.
I was (and am) astonished. So is everyone else. Now that I’ve read the New Yorker story, I am even more surprised–everything in it is public knowledge. Here’s why I don’t think the story explains why he stepped down.
Torvalds has been in charge of Linux for 27 years, and he’s been verbally abusive most of that time. I know, I personally spent more than 15 years struggling to change the Linux community for the better, first as a Linux kernel developer for more than 7 years, then as co-founder and executive director of a non-profit working to make things better for my fellow kernel developers. In 2016 I sent a letter to the Linux Foundation board of directors detailing pervasive mismanagement at the foundation. Nothing I or anyone else did changed the culture of Linux.
I finally realized why the Linux community was enduringly toxic and resistant to change: because Torvalds likes it that way, and he can inflict millions of dollars of losses on anyone who tries to stop him.
How? Well, if Torvalds’ employer, the Linux Foundation, pressures him, he can quit and they will lose millions of dollars in revenue, because paying Torvalds is the main reason sponsors give the foundation money. If a Linux Foundation sponsor tries to make Torvalds change, he can retaliate by refusing to integrate the sponsor’s code into the Linux kernel, forcing that sponsor to pay millions of dollars in software maintenance costs. If an individual Linux developer confronts Torvalds about his abusive behavior, their Linux career will end.
Torvalds also fostered a cult of personality whose central tenet is that Linux will fail if Torvalds is not its leader. In this system, Torvalds has little incentive to stop doing anything he enjoys, including verbally abusing other Linux developers.
My hope was that if a news story exposed this underlying power structure and showed how Linux Foundation sponsors such as Google, Intel, and HP are paying millions of dollars to fund toxic harassment of their own employees, the sponsors would act in concert to force some change, hopefully sometime in the next year. Instead, the usually intractable Torvalds abruptly stepped down before the story was even published.
I can’t think of anything I told Cohen that would result in anyone risking millions of dollars to confront Torvalds this quickly and forcefully. Maybe it’s a coincidence; when the New Yorker reached out for comment, Linux developers were also angry about another issue. It’s possible Torvalds took other developers’ feedback about his abusive behavior seriously for the first time–in 27 years. But the announcement seemed weirdly rushed even to the developers asking for change.
But you know who probably does know the explanation? Senior former Linux Foundation employees, and with the recent high turnover rate at the foundation there are quite a few.
Here’s what I suggest: Linux Foundation sponsors should demand that the Linux Foundation release all former employees from their non-disparagement agreements, then interview them one-on-one, without anyone currently working at the foundation present. At a minimum, the sponsors should insist on seeing a complete list of ex-employee NDAs and all funds paid to them during and after their tenure. If current Linux Foundation management balks at doing even that, well, won’t that be interesting?
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"Here’s what I suggest: Linux Foundation sponsors should demand that the Linux Foundation release all former employees from their non-disparagement agreements, then interview them one-on-one, without anyone currently working at the foundation present. At a minimum, the sponsors should insist on seeing a complete list of ex-employee NDAs and all funds paid to them during and after their tenure. If current Linux Foundation management balks at doing even that, well, won’t that be interesting?"
The ‘will they won’t they’ publish question, discussed in my previous post, was answered this week when the ERG decided not to release their detailed plan for Brexit, despite having promised – or threatened – throughout the summer to do so. The reasons, apparently, were that they could not agree on it and that the draft contained ideas of such barminess that widespread mockery was feared. It is worth reflecting for a moment on just how extraordinary this is. Here we have a group of politicians who in some cases have been dreaming and scheming for Brexit for 25 years or longer. Yet now, over two years after the referendum and just weeks before finalisation of the Withdrawal Agreement, they still cannot agree what they think Brexit should mean or which they dare articulate in public. Even more absurd, despite this they persist with the claim that the 17.4 million who voted leave in 2016 knew exactly what they were voting for. Rehashed hash In place of producing the document, two others were launched. First, on Tuesday, Economists for Free Trade (EFT, formerly known as Economists for Brexit), the eccentric but media-savvy group led by Patrick Minford, published its latest document. It was a rehash of their familiar refrain about ‘trading on WTO terms’, rather meaninglessly – and misleadingly - rebranded as the ‘World Trade Deal’ (this is part of a wider recent attempt by Brexiters to avoid the term ‘no deal’, having noticed how badly it plays with the public). It was almost immediately trashed by those long-acquainted with the EFT approach - a “shoddy piece of analysis” according to trade expert Sam Lowe of CER – whilst Tom Peck in The Independent described it as “deranged” and “bizarre gibberish”. Wholesale critiques of the EFT’s approach have been undertaken again and again, for example by several leading economists from the LSE and Sussex University - and Ian Dunt did so for the present iteration – but the group never retracts and rarely responds. Truly, these are the Brexit Bourbons who keep returning, having learned nothing and forgotten nothing. Curiously, although their launch event was hosted by Jacob Rees-Mogg, the EFT are not propounding the ‘Canada-style’ deal which he and other ERG Ultras claim to want, but rather the ‘no deal’ Kamikaze Brexit (which, many suspect, is also the secret dream of many of the Ultras). But both approaches share the well-rehearsed problem of the Irish border. The EFT report is about the post-Brexit trade arrangements rather than the Withdrawal Agreement (which, under the ‘World Trade Deal’ – i.e. no deal – would not be signed) and simply wishes the border problem away in a few sentences (p.11-12). By contrast, the ERG document, launched by the group itself on Wednesday, with the ubiquitous Rees-Mogg again in the chair, is solely concerned with the Irish border conundrum. As with the EFT report it was a restatement of already discredited ideas, in this case about technologies which do not currently exist in the permutation proposed, and which would take years to develop, if at all (the brief mention in the EFT plan refers to the same fantasy). It was effectively a reheat of the MaxFac proposal of earlier this year, introduced at the launch by David Davies - who having been Brexit Secretary at the time must surely be aware of all the reasons why it doesn’t work and wasn’t pursued. But he still proposes it. One of the strangest features of this is that if the Brexiters genuinely believe that they have a solution to the Irish border of the sort they outlined then they have no reason to oppose the Northern Ireland backstop in the Withdrawal Agreement. As agreed in December, this would only come into force if other options, including the kinds of things the ERG are proposing, failed to avoid a hard border. So if they are right, the backstop would never be invoked and there is no need for them to fight against its inclusion. Or is it that, in fact, they know they are proposing unworkable solutions? Convergent divergence Of course one issue is that the ERG are not just gunning for the NI backstop but also for the common rule book for goods, which is a central part of the Chequers Proposal’s attempt to develop an alternative of the Irish (and other border) issues. On this both the ERG and the EFT documents have as their central intellectual and practical flaw the fact that they rely on notions of regulatory equivalence and mutual recognition* to avoid border checks and non-tariff barriers to trade, which is depicted as achievable because, of course, the UK is currently in full regulatory convergence with the EU (this has long been a Brexiter fantasy, and underpins Liam Fox’s discredited ‘easiest deal in history’ claim). But at the same time they demand, and claim as a key benefit of Brexit, the right to regulatory divergence. Beneath all the relatively complex detail of the two proposals, this fundamental contradiction (which is, I suppose, a rarefied form of ‘cakeism’) makes their ideas completely unworkable, and to the extent that either report acknowledges the problem, it is in vague terms with no realistic solution proposed or in terms which are simply factually incorrect. Much of this – especially the use of semi-digested factoids about WTO rules – seems to derive from the familiar Brexiter pathology whereby what they believe ‘must be true’ and so every piece of evidence to the contrary is either ignored or distorted, sometimes in the most grotesque way. A good example came when Bernard Jenkin appeared on Radio 4’s The World Tonightto defend the ERG document. In response, Irish Senator Neale Richmond pointed out very forcefully that the proposal was based on a fantasy that had already been discredited. But the particularly revealing moment came in relation to the question of UK access to EU VAT databases post-Brexit, which would be needed as part of the frictionless border. Jenkin opined that there should be no problem as Britain and the EU already had a “shared system” for this (another aspect of ‘convergence’). Richmond pointed out the obvious: that this was a “ridiculous statement” because it was not a ‘shared system’ between the EU and the UK but something the UK was part of because of being a member of the EU, and so would not continue after Brexit. All Jenkin could say in reply was that if the EU insisted on being “hardline” then the outcome would just have to be WTO Rules! Here in microcosm was not just the convergence-divergence paradox but the wider way in which Brexiters continually expect many of the features of EU membership to persist because it would be ‘common sense’ and refuse to recognize that losing such features is an inevitable consequence of ending that membership (and, hence, one reason why ‘common sense’ would dictate not leaving). When this blatantly obvious point is put to them directly and plainly – as it far too rarely is – they can only respond with bluster about punishment or bullish talk of walking away with no deal.
How can our country have got the point where the preposterous clowns of the ERG and EFT have their nonsensical proposals reported as headline news as if they constituted a serious response to what is rapidly becoming a national crisis? There are, of course, many answers to that which would take a book to enumerate. But one immediate explanation is because the Government’s own Chequers Proposal - most obviously as regards the Irish border but also, although less widely discussed, on issues of mutual recognition and equivalence - is equally unworkable. On that, if nothing else, the ERG are correct. And so we have the ludicrous spectacle of a political debate of great urgency and massive national importance being conducted in terms of the relative merits of two impossibilities.
That reflects the terrible error of judgment – one of several since she became PM – Theresa May made in developing as her Chequers Proposal something that finally lost her the support of the ERG without the corresponding benefit of the kind of soft Brexit that would have been just about viable, both economically and in terms of healing some of the societal divisions. As I wrote at the time, the proposal garnered all the pain of taking on the Ultras with none of the gain of creating a pragmatic plan. That is the real leadership story about what is happening, rather than the narrower issue of whether or not May will survive as PM.
The latter does matter in its own way, though, albeit not as a Westminster bubble story about personalities and political careers. If she does survive, it will most likely mean the scenario depicted in my previous post, whereby a much-modified version of the Chequers Proposal enables a Withdrawal Agreement alongside a very vague statement about future terms to get through parliament. If she doesn’t survive it will most likely be because the ERC topple her and in the process create a crisis which would open up all kinds of possibilities, including an extension of Article 50, and election or even another referendum.
Ironically, then, the best hope for remainers, or just for soft Brexit pragmatists, now lies in whether the ERG try and succeed in deposing May. In that sense, what the clowns do in the next few weeks could have deadly serious consequences for what happens in the next few decades.
*The EFT position of Mutual Recognition Agreements (MRAs) is completely contradictory. On the one hand, they dismiss (p.8) their significance in relation to how they supplement basic WTO terms in the trade that the EU does with third countries (such as the US) with which it has no FTA, noting that this “anti-Brexit” argument (which has been widely made by many, including me) “often is technically true” but then claim it is “not very relevant”. The weasel words are ‘technically’ (as if to imply that, somehow, it’s not really true) and ‘not very’. (They also claim, with no justification at all, that it “should not pose serious problems” (p.9) for the UK to renegotiate the existing EU MRAs with third countries). Yet, on the other hand, they make MRAs the central pillar for replicating existing terms of trade with EU, making it therefore abundantly clear that MRA adjustments to basic WTO terms are far from being irrelevant, but in any case completely failing to understand that MRAs do not and could not remotely cover the full range of regulatory harmonization which characterises the single market. For more detailed analysis of the limitations of MRAs in this respect see hereand here.
No other recent Supreme Court nominee has come before the Senate with so many unanswered questions regarding finances. That’s partly because many of Kavanaugh’s predecessors were a lot richer than he is. Chief Justice John Roberts, for instance, had been making $1 million a year in private practice before joining the DC Circuit as a judge. The poorer nominees had debts, but explainable ones, such as the $15,000 Sonia Sotomayor owed to her dentist. Neil Gorsuch came the closest to financial scandal when he disclosed that he owned a mountain fishing lodge in Colorado with two men who are top deputies to the billionaire Philip F. Anschutz, who had championed Gorsuch’s nomination.
Kavanaugh’s finances are far more mysterious. During his confirmation hearing last week, he escaped a public discussion of his spending habits because no senator asked about it. But on Tuesday, Sen. Sheldon Whitehouse (D-RI), a member of the Senate Judiciary Committee, sent Kavanaugh 14 pages of post-hearing follow-up questions, many of which involved his finances. On Thursday, Kavanaugh supplied answers, but he dodged some of the questions and left much of his financial situation unexplained.
In April 2015, as a young writer, I was granted the rare opportunity to explore this notion. I was working at the New Republic magazine at the time, enjoying the warm auspices of an editor mostly content to let me pursue what I found most interesting. With his blessing, I reached out that spring to the girl whose name had appeared in acronyms and spray-painted slurs, and asked whether she was interested in talking to me about 2006.
Her name was Amber Wyatt, and she was.
On and off over the next three years, I reviewed police documents, interviewed witnesses and experts, and made several pilgrimages home to Texas to try to understand what exactly happened to Wyatt — not just on that night, but in the days and months and years that followed. Making sense of her ordeal meant tracing a web of failures, lies, abdications and predations, at the center of which was a node of power that, though anonymous and dispersed, was nonetheless tilted firmly against a young, vulnerable girl. Journalists, activists and advocates began to uncover that very same imbalance of power from Hollywood to Capitol Hill in the final year of this reporting, in an explosion of reporting and analysis we’ve come to call the #MeToo Movement. But the rot was always there — even in smaller and less remarkable places, where power takes mundane, suburban shapes.