@jbtaylor on tech

Jim Cicconi, AT&T's top lobbyist, is apparently the company's top economist, too.

Hours after Attorney General Eric Holder told the U.S. Senate that the Justice Department is, "ready and eager to go to court against AT&T," Cicconi goes on a mini media tour repeating the claim that if AT&T is allowed to takeover T-Mobile it will create up to 96,000 jobs.

Of course, that is not true at all.

The study AT&T cites never said that and that claim simply doesn't square with the fact that the company told Wall Street it would eliminate jobs. (That's where the company comes up with $40 billion in merger synergies.)

Karl Bode with Broadband Reports explains it very clearly:

"In fact, the job creation numbers cited rely entirely on AT&T's claim that network investment will be increased as part of the deal, which isn't true. While AT&T and the CWA are busy telling regulators the deal will increase network investment by $8 billion, AT&T is on the record telling investors the deal will reduce investment by $10 billion over 6 years."

Nevertheless, Mr. Cicconi put on his economist hat yesterday and repeated the lies to any reporter who would listen.

My favorite whopper he delivered was what he told Politico Pro (sub. req.). In criticizing research by labor economist David Neumark of UC Irvine, Cicconi says Neumark's research is "the musings of a single professor, who, absurdly, estimates job losses several times higher than the total employment at T-Mobile."

Except Professor Neumark never wrote that and never said that. Ever.

What he did do was to apply EPI's theories about capital expenditures and "job-years."

EPI, the Economic Policy Institute, was asked by CWA, AT&T's union, to conduct a study which would estimate how many jobs would be created based on the assumption that AT&T would invest $8 billion after the company is allowed to takeover T-Mobile.

EPI estimated that up to 96,000 job years would be created in that scenario. A job year is a job that lasts one year.

That is NOT the same thing as creating 96,000 jobs.

At any rate, Professor Neumark looked at AT&T's public statements to Wall Street, which shows an overall lowering of investment (see Karl Bode's article above.)

Using EPI's own logic, and AT&T's own statements to Wall Street, Neumark concluded that AT&T claims about job creation are "unfounded" and that the proposed transaction would actually lead to job losses in the thousands.

That's why the rest of what Cicconi told Politico about Professor Neumark made me laugh:

"Frankly, opponents are letting their fervor cause them to make arguments that are illogical and, in some cases, downright silly."

Actually, that describe what everyone thinks about AT&T and CWA's claims that "up to 96,000 American jobs will be created" with the T-Mobile takeover.

It's downright silly.

If you live in Washington, D.C. AT&T's television, print and online ads promoting its proposed takeover have been inescapable in recent months. The ads are beautifully produced, with bright scenes of Americana, inspirational copy and in the case of the TV spots, soaring orchestral scores.

They make you feel good about AT&T and T-Mobile coming together to form a new company.

Except the ads are not credible -- they're meant to mislead the public. And AT&T knows it.

And when you call out AT&T for the company's misleading statements about this stinker of a deal, AT&T officials never address the substance of the accusation -- they merely insult you in a sad effort to distract media attention away from the heart of the accusation.

Last week, Media Access Project, a Washington, D.C. public interest law firm wrote a 4-page letter to a Washington, D.C. television station asking it to stop running the ads because of the misleading and inaccurate statements they contain.

You can read that letter here.

Rather than address the serious, substantive allegations Media Access Project raised, AT&T's top lobbyist, Jim Cicconi, said this in a statement to media:

“How odd for a group called the Media Access Project to be working to limit media access. Or free speech rights,” Cicconi said.

This prompted a Media Access Project spokesman to respond, "AT&T has a First Amendment right to give inaccurate information to the public, but MAP has a First Amendment right to call them on it."

Okay, but what about the questions raised about the ads? Will AT&T answer those questions? I'm not holding my breath.

Late yesterday, Sprint gave AT&T another opportunity to do so when it wrote the FCC a letter questioning how the AT&T's advertising claims about job creation square with what AT&T has told the Commission in a filing made on October 31.

Rather than respond directly to the allegations raised by Sprint, AT&T's top lobbyist was trotted out again to respond with an insult meant to distract from the allegations.

Here's what he said:

"AT&T has made specific commitments in terms of preservation of call center jobs, return of thousands of jobs from overseas and investment of $8 billion in capital — on top of the roughly $18 [billion] to $20 billion we continue to invest annually in the United States. We are waiting for any comparable commitments on jobs or investment from Sprint. So far, however, Sprint has done a far better job of criticizing the investment plans of others than laying out any credible plans of their own.”

The problem with that response is that AT&T has already told Wall Street something entirely different. They've indicated that the net investment of the new company will decline. And they've promised to close calls centers, shut down cell sites and close retail stores to deliver $40 billion in "merger synergy savings" to investors.

But back to AT&T's lobbyist and his insults. It's irrelevant what Sprint's capital expenditure plan is. Sprint isn't the one running these ads which are simply untrue. And its also not trying sell the public on a merger which the Justice Department and 8 state Attorneys General have found to be illegal.

That would be AT&T.

And that's an inescapable fact that AT&T's lobbying team would rather you forget.

Today, Sprint sent the following letter to the FCC calling AT&T's claims that the proposed merger with T-Mobile will create jobs, "not credible" and "misleading".

The TV spot in question is linked to above.

Sprint's attorney writes:

“AT&T has claimed that its proposed takeover of T-Mobile will increase jobs, and even has mounted a TV ad campaign asserting that the takeover will create “as many as 96,000 American jobs.” AT&T has never supported these claims, and after dragging its feet for months, has finally responded to FCC requests for specific facts on how the proposed transaction will affect American workers. The documents and information AT&T has finally produced undercut AT&T’s jobs claims and fail to even mention, let alone support, AT&T’s “96,000 jobs” assertion.

But one fact in particular completely dispels the job creation myths AT&T has been peddling: in its October 31, 2011 filing (p. 6), AT&T “estimates that payroll and other job-related savings account for a range of approximately [Begin Highly Confidential Information] XXXXXXXXXXXXXXXXXX [End Highly Confidential Information] of the total synergies associated with the transaction.” It is simply not credible to say that the proposed takeover will increase American jobs when AT&T is relying on such payroll “savings” – i.e., the elimination of jobs – to achieve its planned $40 billion in merger synergies.

You can’t believe everything you see on TV.”

So some of you may ask, why is there "highly confidential information" in this letter. That's a good question to ask AT&T.

The company has chosen to high these figures from the public because it deems the information to be proprietary or confidential.

If you ask me, if the public is being told that the proposed takeover of T-Mobile will create jobs, and the FCC asked for AT&T to substantiate that claim, AT&T shouldn't have anything to hide.

This week, the FCC sent a firmly worded letter to AT&T, demanding the company substantiate the claims that it, Deutsche Telekom and T-Mobile have repeatedly made which say that AT&T's proposed takeover of T-Mobile will create jobs.

In other words, the FCC is calling out AT&T for its B.S. as well they should.

In response, late today, AT&T issued another PR statement which touted this promise that the company will relocate 5,000 foreign call center jobs to the U.S., but only if the transaction is approved.

Every time they make that statement, I'm reminded of what one government official said in response to that news when it was first announced:

"We should distinguish between patriotism and extortion."

I couldn't agree more.

In this case, if AT&T wanted to bring these jobs back to the U.S. they could do so today. This is simply a cynical ploy by a company desperate to make a big deal which will be great for AT&T shareholders, but screw everybody else.

That said, I agree that this proposed transaction has created jobs and as the title of this post suggests, they all belong to lobbyists, investment bankers and antitrust lawyers -- and also the PR people who have advised the company that repeating discredited and false claims about jobs being created is a smart strategy.

AT&T can do better and so can the American people.

p.s. Please remember that this is my personal blog and that these views do not reflect the views of my employer.

Earlier today, I helped host a news conference with Professor David Neumark of University of California, Irvine. Mr. Neumark presented a study commissioned by Sprint which debunked the claims that both AT&T and CWA have made surrounding AT&T's proposed takeover of T-Mobile.

The chart above sums up a key point: in 8 of the last nine years AT&T has eliminated jobs -- over 100,000 jobs in fact. While in that same time period, T-Mobile has created jobs.

The study -- which is an easy read for a non-economist -- shows what critics have said all along -- the T-Mobile takeover is a jobs killer.

Take a look for yourself. Here's the news release describing the study and here's the study itself.