Keep the Sock Puppets Out of Your Stimulus

I wrote here two
weeks ago about why a multi-billion dollar investment in broadband must
be part of the massive economic stimulus package now being crafted in
Congress.

I touted the detailed plan
put forward by colleague S. Derek Turner, which proposes $44 billion in
broadband stimulus spending, and I listed some of the key elements --
such as future-proof speeds, universal service, and no blank checks --
that must be part of any legislation.

But I forgot to include an important warning: Beware of sock puppets.

Sock puppets,
for those unfamiliar with the creatures commonly found inside the
Beltway, are mouthpieces who rent out their academic or political
credentials to argue pro-industry positions. These pay-to-sway
professionals issue white papers, file comments with key agencies, and
present themselves to the press as independent analysts. But their
views have a funny way of shifting depending on who's writing the
checks. (To be clear, at Free Press we take no industry money.)

Sock puppets sometimes show up in unexpected places -- even right here on the Huffington Post. You may recall Mike McCurry -- the former Clinton press secretary turned marionette -- trying to convince the blogosphere that Net Neutrality was a bad idea. (Here's a post from McCurry and a wrap-up from National Journal.)

And now comes one "Robert Atkinson, Ph.D.," of the Information Technology and Innovation Foundation (ITIF). In a recent HuffPost piece,
he attacks Free Press for trying to advance our nefarious "agenda of
getting open networks and even more broadband competition."

Well, he's got us there -- guilty as charged -- and while we're at
it, let me confess that we want faster speeds and lower prices, too.

If Atkinson, Ph.D., doesn't like openness and competition, what does
he want? Apparently he prefers spending your tax dollars on a massive
giveaway to the biggest phone and cable companies -- with zero
accountability.

Today, his group published its own $30 billion plan,
which he touts as more "pragmatic" and "shovel-ready" than the
alternatives. On the surface, his proposal seems somewhat similar to
the Free Press plan, using tax credits and incentives to bolster
broadband supply, especially in rural and other underserved areas.

But a closer examination shows Atkinson, Ph.D., suspiciously
avoiding any proposals that might actually bring some needed
competition into the broadband market. He has criticized our proposed
$10 billion "Bonds for Broadband" program, claiming there are few
companies that would take advantage of it and it would take too long to
spur investment. But an independent study released yesterday by the Fiber to the Home Council
estimated that such a program would result in substantial investments
in 2009, creating nearly 200,000 new jobs this year alone.

The Free Press proposal would require that tax credits and other incentives only be awarded for newinvestments
beyond what was already planned by the phone and cable giants.
Companies would have to pre-apply with the Treasury Department to claim
the credits on their tax returns. The point is to ensure that --
without slowing down those shovels -- that taxpayers are only funding
networks that wouldn't have been built otherwise.

ITIF claims that their tax credits are structured to "actually spur
additional investment." But their plan has no accountability. ITIF
states "credits should apply only to capital expenditures that exceed
85 percent of 2008 capital expenditures for companies." The thinking
here is that because of the recession, investment will be below 2008
levels. Fine -- but in practice this gives the public zero guarantee
the money is being used for new investment, much less investment in the
world-class, super-fast broadband we need.

In fact, the ITIF plan -- which doesn't distinguish between dollars
spent on high-speed Internet deployment and other capital expenditures
-- would permit companies like AT&T, Verizon and Comcast to spend
less on broadband and use the tax credits to fund other projects, like
anti-consumer snooping technologies that allow ISPs to interfere with
your Web browsing.

When you drill down, you see that while the Free Press proposal is
designed to prevent giveaways to incumbents and spur competition,
ITIF's would allow incumbents to reduce planned investment in fast
broadband and replace it with tax-payer funded investments in just
about anything these carriers want.

Or as one commenter on Atkinson's post neatly summarized: "In other
words ... why don't we just give the money to ATT and Comcast and
expect nothing but a kick in the ... insert your most tender parts here
... in return?"

It's hard to tell from ITIF's Web site or the group's financial
disclosures exactly who's funding this operation. Whether Atkinson,
Ph.D., is already on the industry payroll -- or just auditioning for
the gig -- the beneficiaries of his efforts will undoubtedly be the
biggest phone and cable companies.

They're all too happy to avoid the public spotlight and hide behind
independent-sounding analysis, even as their army of lobbyists descends
on Capitol Hill to cash in on the fast-moving stimulus bill.

I suppose it's possible I've misjudged Atkinson, Ph.D.'s
motivations, and that he honestly believes giving billions to these
companies -- with no strings attached -- is the best way to go.

But if the sock fits ...