RBOCs are Spending Money, Find Out Where (cont'd)

RBOC Political Contributions Drive Regulation
Considering that 2004 is a significant election year, it is critical to note that multiple legislative acts have been passed or proposed that largely favor RBOC interests. The RBOC infuence over telecom regulation and the committees that govern it on Capitol Hill is strong and likely the result of continuous investments in campain contributions, political action committees (PACs) and lobbying efforts.

Overall, RBOCs and the USTA are on average spending more than 4.5 times as much on political contributions as the rest of the top 40 telecom industry contributors combined. Included in the ‘rest of the top 40' are corporations such as AT&T, Motorola and Sprint. Consider that during the 1999-2000 election cycle, RBOCs gave more than $11 million to Political Action Committees (PAC). The United States Telecom Association (USTA), the obvious lobbying voice of the RBOCs and other incumbent telephone companies, gave nearly $300,000 in 1999-2000 to PACs. Combined, the RBOCs and USTA made up the five largest political contributors from the telecom industry.

During the same time period, the remaining 35 of the top 40 telecom contributors gave a combined $21 million to PACs. In the 2001-2002 election cycle, the RBOCs gave only $10 million to PACs, with USTA donating more than $475,000. In contrast, the remaining 33 of the top 40 political contributors from the telecom industry gave a total of $15.6 million. As of July 5, 2004, during the 2003-2004 election cycle the RBOCs gave nearly $4.5 million to PACs, with the USTA chipping in more than $160,000. The remaining 33 of the top 40 contributors gave a combined $4.2 million.

How Much is That Candidate in the Window?
RBOCs have not simply given money to faceless PACs, but also to congressional and presidential candidates. PAC contributions to federal candidates from RBOCs reached almost $3.5 million in the 2003-2004 cycle and more than $4.5 million for the 2001-2002 cycle. SBC ranked ninth among all PAC Contributors to Federal Candidates (2003-2004) and Verizon ranked eighteenth among all PAC Contributors to Federal Candidates (1999-2000) across all industries.

During the 1999- 2000 election cycle alone, the 4 RBOCs combined to spend more than $26 million on lobbying expenditures. 2004 data are incomplete, but in 2003 the RBOCs combined to expend more than $33 million for lobbying alone at the Federal level. Consider that the definition of lobbying used under the lobbying disclosure act is narrow. The reported lobbying figures account only for money spent to contact Congresspersons and executive branch officials but do not include state-level lobbying, public relations work, legal work, or Congressional testimony. Futher, were state lobbying totals included, the overall totals would be significantly greater.

Looking deeper, it’s clear that the members of Congress supporting RBOC and ILEC interests most actively are those who receive the most benefits from RBOC-related contributions. For the 1999-2004 Senate election cycle, Telecom ranked third among industries supporting Senator Dorgan – author of the pro-ILEC VoIP amendment - trailing only Lawyers/Law Firms and Lobbyists. For the same time period, Telecom was the leading industry supporting Senator Burns – author of the stringent E911 VoIP amendment - with Lobbyists third and Lawyers/Law firms sixth. Furthermore, Leadership PACs were fifth on the list.

Numbers taken from PAC donations and individual contributions from 1997-2002 reveal that Senator Burns received the second highest level of contributions from telecom contributors among Senate candidates. Senator Dorgan was fourth. Senator John McCain (R-AZ) ranks first and Senator Hollings (D-SC) ranks third. In contrast, Senator Stevens – who opposes the amendments that threaten VoIP - ranks near the bottom of the list of those receiving contributions from telecom operators. Despite Senator Stevens’ position on the Senate Committee for Commerce, Science and Transportation, telecom ranked 17th among industries contributing to his fundraising from 1997-2002. For Senator Sununu, who introduced the pro-VoIP Regulatory Freedom Act of 2004, telecom does not rank among the top 20 contributors.

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