April 17, 2012

ALEC Wants You To Pay 750 Percent More For High-Speed Internet

Telecom lobbyists battled public broadband in North Carolina.

The American Legislative Exchange Council (ALEC) is the most powerful corporate front group you’ve never heard of. Drawing the vast majority of its financing from big corporations, the group allows these firms to help write bills that it then secretly passes off to state legislators to get turned into laws.

The organization has come under fire recently for backing “Stand Your Ground” laws and voter suppression efforts, leading to an exodus of some of its strongest corporate funders. But the group’s policy agenda stretches far beyond these areas, and impacts just about every area of American life.

Take public high-speed broadband Internet. A few years ago, the city of Wilson, North Carolina, decided that it would create its own broadband system, which it called Greenlight. The service offered speeds twice as fast as private competitors in the area for a similar price. Soon, the success of the service spread, and a number of other cities began offering municipal broadband systems that were cheaper and/or faster than private competitors’.

But state legislators — who received $600,000 in contributions from the telecom industry in the previous election cycle — reacted to the spread of these successful services by undercutting them with a bill that made it very difficult for cities to operate their own broadband systems. One provision in the bill made it illegal for cities to offer broadband services that are priced below their costs. “This bill will make it practically impossible for cities to provide a fundamental service. Where’s the bill to govern [cable provider] Time Warner? Let’s be clear about whose bill this is. This is Time Warner’s bill. You need to know who you’re doing this for!” thundered Rep. Bill Faison (D) at the time. The bill was unfortunately passed into law.

ALEC did not publicly say that it was behind the North Carolina bill, but the bill bears similarities to ALEC legislation.  ALEC is an outspoken opponent of municipal broadband and crafts model bills to limit and kill these systems. Telecom companies like AT&T, Comcast, and Time Warner are all ALEC funders.

ALEC also unsuccessfully worked to undercut a public broadband system proposed by the city of Lafayette, Lousiana. ALEC’s Louisiana state chair (a legislator) introduced a bill that would’ve placed onerous restrictions on how the city could use fiber-optic cables to provide cheap broadband. The broadband-undercutting bill “almost word for word, matched a piece of legislation kept in the library of the American Legislative Exchange Council.” The most damaging provisions of the bill were removed before it was passed, and major telecom companies sued to try to stop Lafeyette from building its system anyway. Fortunately, they lost.

Lafayette’s public system offers Internet speeds at a whopping 750 percent cheaper than rival Cox’s service at the lowest tier. That means that if ALEC and the telecoms had succeeded in shutting down the system, life would be a whole lot slower.

The next time you groan at the thought of paying your broadband bill, remember that some of America’s biggest corporations — ranging from FedEx to WalMart — are funding a group that works to make sure your city is barred from offering a cheaper and faster service.


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  • Anything could be cheaper if the taxes from the public pay for it. Then you would be putting those businesses out. Then you would rely on your govt for service. It is called communism. Go back to school.

    • Zaid Jilani

      The system in NC was actually constructed with bonds and was run cheaper and faster than the private services. It wasn’t paid for by taxes but by user fees.

      • And the bonds magically appeared without taxes? Many people invested millions into globalstar, loral, qualcomm, verizon, etc to make these technologies possible- your answer is to just take them over and offer the fruits of their labor which will be paid for by taxes and “user fees” -OK,, but just call it what it is and odnt prtend that these things are magically cheap or free- we always pay someway

        • Phil23

          Nothing was being taken over, a cheaper and better services was being offered by another party. Why can’t the state government do that?

        • Superabound

          It was tax-funded government initiatives through the military, universities, and DARPA that created the internet in the first place. The telecom companies owe the government and the taxpayers for their success, not the other way around.

          The internet is not the fruit of corporations, its the fruit of socialized public policy.

        • Well, I’m interested in your rights to keep your ideological purity, so be sure to keep your arse and your car off our roads, don’t use our libraries, don’t send your kids to public school, put out your own house fires and get your own bleeding arse to the hospital on your own. And whatever you do, don’t plan any vacations in any national or state parks. Wouldn’t want you to soil your reputation or betray your conscience. It’s called “common good”….you might want to look it up sometime. When you’re not busy, trashing the government.

        • E

          You libertarians are blithering morons. Get out of the house and experience real life, not just fantasies and theories.

        • Good to see you have no clue how things actually work. Great job. We’re all a little dumber for having read your posts.

    • CatKinNY

      A system like the one we have now, where media markets are divided amongst big entities so there is no competition, and where they clearly collude on prices, is called a monopoly, and is illegal under federal law. You go back to school, and while you’re there, ask the teacher to explain to you why it is that you think it’s good for you to be trapped into overpaying for your TV, internet and land line services? Here’s your first essay assignment: ‘Communism vs Crony Capitalism, or Plutocracy: Which Is Worse to Live Under?’

      • You made my point–also please note that taxes are a big part of your current bills.

        • Superabound

          But apparently paying for internet though taxes ends up making it 750 times cheaper. The cable companies are inefficient and provide poor service, this much is proven. Businesses that provide bad and expensive service deserve to fail. Thats a basic tenet of capitalism, probably the most important one. BAD BUSINESSES DESERVE TO FAIL

          • Anon

            750 PERCENT cheaper and 750 TIMES cheaper are not even close to being the same thing.

          • Superabound

            Thanks for pointing that out, i accidentally put times instead of percent. Regardless, its still cheaper, because the city is offering the service at the actual cost, rather than jacking up the prices with meaningless and bullshit fees like the cable companies are infamous for doing, just because they can (because they have monopolies and engage in price fixing).

            Its almost like peoples brains shut down whenever they hear the word tax. Why does it matter if youre paying money in tax or paying it to a private business? Theres no difference, its still your money either way! So id rather just pay my money to whoever can offer me a good or service the cheapest, and at the best quality, regardless of who it is. Thats how the market is SUPPOSED to work.

          • Strinden

            750% cheaper would mean the city is paying customers to take Internet service. This is a complete math fail.

            The local provider, Cox, might be 750% more expensive, which means Cox costs 8.5 times as much. In other words, the city Internet cost is 0.117 times Cox’s price, i.e. 88.3% cheaper.

        • CatKinNY

          No, I disproved your argument by pointing out that capitalism without competition is not capitalism but plutocracy. I don’t mind paying taxes; I’m smart enough to know that I need roads and bridges, cops and firefighters, the armed forces, public schools, the FDA, the EPA, SS and Medicare so the elderly can live decently, Food Stamps so kids don’t starve, etc.

        • Not nearly as high as the $81 a month I pay for broadband…just broadband, not a bundle of any kind. Just plain old broadband. Personally, I like the things my taxes provide for us.

      • A monopoly is one seller- like your govt. A cartel is what you are describing, and I would always vote for unfettered capitalism because I have seen what governments can do.

        • purplelinguist

          Unfettered capitalism gave us things like the savings and loan crisis of the 1980s, Enron, the BP oil spill, and the housing crisis.

        • CatKinNY

          Do you work for ALEC? Is it your job to write legislation that protects monopolies and cartels at the expense of the people, and then push it on part time Republican state legislators who don’t understand the implications of what they are turning into state law in exchange for a $500.00 campaign contribution? You, and they, should be ashamed, and vewwy, vewwy fwightened. The pitch forks are coming, Athena.

        • If you are in favor of unfettered capitalism, let the government be one more vendor of services. Let’s see what happens if the local government offers services, and either raises taxes or doesn’t. Let’s see how the community responds to the availability of other options in the community. Rather than legislate away the right of a town to provide more services that would be beneficial to the residents, let’s see instead how a city government’s offerings can compete with a corporate giant’s services. If the people in the community want it, why not?
          More to the point, this article is just illustrating how the corporate interests seem to be overriding the free choice of the people. The corporations are using the government for their benefit now, but shouldn’t our communities be the real beneficiaries of legislation? Vote trustworthy people into office and THEN see what a government SHOULD be doing. Capitalism is a fine idea until all the money is in one place.

    • Leekoepfli

      Liked the fact that you are in favor of being ripped off for what should be cheaper..dumbass.

      • not worth a reply

        • Johnsmith

          Obviously it was, as you felt the need to make a comment to take a jab at the person

    • Abby Gregorsdóttir

      @Athena: That’s not communism at all, you fucking moron. Communism is the state in which Marx described wherein the people own the means of production. Maybe YOU should go back to school.

      • Reallocating the assets of private ownership to the public is what then? Please refrain from name calling.

        • Superabound

          But if corporations are people, then theres no difference between private and public ownership. Things arent being “reallocated”, youre simply describing the normal process of economic activity. Money is SUPPOSED to move around.

        • Phil23

          Again, I doubt there is a need to bring communism into this. Would you kindly point out where in the article it said private company’s were being taken over/reallocated by the state?

          • alwaysthink

            Name calling with commie and socialist is all they have left. Logical discourse based upon facts is not possible in Con world.

    • Superabound

      Id rather rely on the government for a service than the private company thats going to rip me off by charging 750 times more. And as someone who has had to deal with cable companies for many years, honestly id rather rely on NORTH KOREA than goddamn Comcast.

      The simple fact is that cable providers are nothing but monopolies and occasional duopolies. Theyve spent the past 30 years COMPLETELY eradicating any bit of competition from the market. See this for what it is. The city wanted to offer a competitive service (you know, competition, that thing capitalism relies on), and Time Warner said “nope, sorry, were fine with being the only choice in town and wed like to keep it that way.”

      All these decades of mergers and takeover and no trust-busting efforts has almost irreparably broken American capitalism. Everything in the country is either a monopoly, or pretty damn close to it. And monopolies are the single biggest threat to healthy capitalism.

      • alwaysthink

        The monopolies that ALEC champions are the antithesis of capitalism were competition runs the market. They have done a good job of neutralizing our anti trust laws.

  • Leo

    Brilliant analysis demonstrating a tremendous graph and knowledge of sound bites.

    • Titania Bonham-Smythe


  • eps62

    Anything for profit! ALEC is all for screwing the people.

    • Republicans??? How about politicians on BOTH sides of the isle?? Singling out one party does not help the situation as both are equally guilty of looking out for their next re-election bid. Your thought process along with comments like yours above are just as destructive to this country as voting for the scumbags that currently occupy the Senate and House.

      • Superabound

        Actually, singling out one party is good when theyre the ones mostly behind the problem. Democrats are only a problem when they act too much like Republicans.

      • Don’t sit here and pretend this isn’t a republican thing with your lame “both sides” crap. ALEC had one Dem member, now they have none. They are solidly republican. So you can cut the crap now.

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  • Fake

    Proscription. The Romans found they had to strip plutocratic families of their citizenship and property to protect their republic.

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  • alwaysthink

    In WI we have seen Walker and Co privatize many of the municipal systems. It the agenda of these bought and paid for politicians.

    For an example of a municipal utility that really works and provides cheaper service for We The People take a look at the Los Angeles Department of Water and Power. I no longer live there but I sure do miss the good service and low rates. When I moved a few years ago my water rates were 7X’s more.

  • wake up!

    I am sooooo tired of learning most of our problems with fairness and equality come out of a few people/organizations: ALEC, Citizens United, The Koch Brothers, Dick Cheney, Grover Norquist, Fox News. Boener and the boys are obviously not making any decisions for themselves on the National level, and the State legislatures seem anxious to follow suite…..take the cash, submit the bill written by the lobbiest, blame it on someone else.
    What ever happened to the Republican Party? Does it even exist any more, or are all of them just shills for the rich few who want it all….



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  • Chris2842

    This really sucks!

  • I’m about ready to give up my INTERNET services it’s been going up and up every few months. This is just sick.

    If the government can do it cheaper I say let them do it. The government is “we the people” so let us not forget that.

    The founding fathers were afraid of these huge corporations and wanted the government to do all that it could to keep them down in size before they took over the government, just like what is happening at this time. This must be stopped.

  • Everyone is so worried about “Big Governement”. Screw Big Government! It’s Big Corporations we need to be worrying about!

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