Irate Over E-Rate
March 19, 2021
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“The humanities teach us the value, even for business, of criticism and dissent. When there’s a culture of going along to get along, where whistleblowers are discouraged, bad things happen and businesses implode.” — Martha Nussbaum
“If you see fraud and do not say fraud, you are a fraud.” — Nassim Nicholas Taleb
Irate Over E-Rate
(Roberto Machado Noa via Getty Images)
The Schools and Libraries portion of the Universal Service Fund is known as E-Rate. The program was part of the Telecommunications Act of 1996, and set up by the Federal Communications Commission (FCC). The purpose was to help connect schools and libraries everywhere to telecommunications services, including what was then a burgeoning Internet. It was particularly focused on getting service to rural, underserved, and poorer communities at a variable discounted rate, depending on the cost of services and level of poverty.
All telecom customers pay a small fee on every phone bill into a fund that provides subsidies for the neediest schools. In return, telecom companies are required to charge what the law calls the “lowest corresponding price,” or LCP, defined as no more than what similar customers pay. E-Rate has delivered telecom companies billions of dollars in revenue. However, the carriers are responsible for certifying that they are in compliance with the law. And because the program relies on companies to self-certify that they are offering the low prices required, government watchdogs say E-Rate is vulnerable to fraud and abuse.
Theodore Marcus began working at AT&T as an in-house lawyer in 2000, part of a team that managed the company’s federal policy positions and represented AT&T to regulators at the FCC. His duties included reviewing whether the telecom giant was overcharging schools and libraries for Internet and telephone service.
In 2008, Marcus attended a meeting in Dallas about the E-Rate program. AT&T officials distributed a 61-page training document for employees working on E-Rate — with no mention of any of the LCP requirements. That same year, a Wisconsin consultant named Todd Heath — who helped school districts figure out if they had overpaid for services and, if so, win refunds — noticed some of his clients were paying far more than others for essentially the same services. Heath filed a federal lawsuit against Wisconsin Bell, a division of AT&T.
Marcus was made the company’s “legal point person” on its response to Heath’s lawsuit and other E-Rate issues. Over time he came to believe the company wasn’t charging low prices as required by law, and had misled the US attorney’s office about its compliance with the rules. In 2009 he conducted an internal investigation and learned AT&T employees working for years on E-Rate deals for schools and libraries had no knowledge of a lowest-price rule. Two longtime sales managers had never even heard the term “lowest corresponding price.”
For the next two years, Marcus tried to get his supervisors and AT&T’s legal department to take his concerns seriously. When he was rebuffed, he left in 2011 and turned all his documentation over to the lawyer suing the company.
Federal regulators have done little to enforce E-Rate rules despite growing evidence of fraud and abuse. The closest they came was in 2016 when the FCC issued an enforcement action against AT&T for charging two Orlando area public school districts six times what it charged other public schools in Florida. Then Trump became president, and his new FCC chairman, Ajit Pai, buried the action.
Now in 2021, AT&T is accusing Marcus of “shocking” legal misconduct and trying to persuade a federal judge to dismiss Heath’s sweeping lawsuit because of it. The future of the case will depend in part on whether the court views Marcus as a whistleblower trying to right a wrong, or a corporate lawyer violating his duty to his former employer. (WaPo, $)
Conservationists Can’t Bear China’s New Hotel
(STR via Getty Images)
- Conservationists and animal rights groups are concerned about an unusual attraction that just opened in China. It’s a theme park with what it claims is the first polar bear hotel. The lodging has 21 guest rooms, all looking out over an indoor enclosure where polar bears roam across a floor painted to look like an ice floe. Fake rocks line the courtyard, and fake icicles dangle overhead.
- “This hotel is akin to a 21st-century bear pit,” said the acting director of Britain-based Wild Welfare. He explained that polar bears need fresh air, space to roam around, and the ability to seek out natural stimulation, unbothered by visitors. A video shared on social media on Monday by a Beijing-based conservationist showed a polar bear pacing back and forth in the enclosure, displaying what experts say are clear signs the animal is distressed.
- In a statement, the senior vice president for People for the Ethical Treatment of Animals (PETA) Asia said “Polar bears belong in the Arctic, not in zoos or glass boxes in aquariums — and certainly not in hotels. Polar bears are active for up to 18 hours a day in nature, roaming home ranges that can span thousands of miles, where they enjoy a real life.” Nevertheless, rooms at the hotel go for $290 – $352 a night, and they’re sold out. (WaPo, $)
On Emissions, Bottom Trawling Comes Out On Top
- A new study published Wednesday in the journal Nature found that one industrial fishing method — bottom trawling — emits as much carbon dioxide annually as airplanes do. Bottom trawling entails dragging a weighted net along the ocean floor to catch low-lying seafood such as shrimp, crab, and flounder.
- The method was already notorious for wreaking havoc on ecosystems because, in addition to its targeted catch, turtles and other marine life can get tangled up in the large nets and die. Now we know that trawlers also release significant carbon dioxide emissions into the ocean by disrupting the carbon-rich sediments as they rake the seafloor.
- Further, the research shows that an area isn’t depleted of carbon after being trawled once. Emissions are still released for up to 400 years at a rate of 40% of the initial year’s emissions as new layers of sediments are disrupted. It’s hoped the study will help inform negotiations as world leaders convene this May in Kunming, China for the most significant UN biodiversity conference in a decade. (Vox, Reuters)
Additional World News
- Oil firms knew decades ago fossil fuels posed grave health risks, files reveal (Guardian). We should’ve known they’d be slippery.
- As 4th Election Looms, Some Ask: Is Israel’s Democracy Broken? (NYT, $)
- The Brexit deal was astonishingly bad, and every day the evidence piles up (Guardian)
- The Unlikely Issue Upending France: Meatless School Lunches (NYT, $). Soy Vey! I hope they didn’t serve tofu.
- Egypt prepares to start move to new capital, away from the chaos of Cairo (Reuters)
- Good Vibrations: Bladeless turbines could bring wind power to your home (Guardian)
- The Victims of Agent Orange the US Has Never Acknowledged (NYT, $)
- Putin responds to Biden’s comments that he’s a killer (WaPo, $)
- Sexual consent app proposal sparks criticism in Australia (Al Jazeera). That the top cop thought up the idea doesn’t bode well for the department’s understanding of assault.
- World’s Largest Vaccine Maker Makes Millions Of AstraZeneca Doses A Month (NPR)
- The US vaccine effect: rapid rollout starts to bear fruit (Financial Times). We’d prefer it to save lives, but fruit is nice too.
- EU regulator reviews AstraZeneca shot and blood clot links (AP)
Quid Pro Quo
- The Biden administration has been seeking help from Mexico to manage a record influx of Central American teenagers and children at the southern border. And recently, Mexican President Andrés Manuel López Obrador and Canadian Prime Minister Justin Trudeau have asked President Biden to help them fill vaccine shortfalls.
- Announcements are expected Friday that Mexico has pledged to take back more families “expelled” under a US emergency health order, and the US has agreed to send 2.5 million “releasable” doses of the AstraZeneca vaccine to Mexico, and another 1.5 million to Canada.
- The decision to share the British-developed vaccine — which has not yet been approved for use in this country — came after officials determined there was enough of the three vaccines already approved to meet all of America’s needs. (WaPo, $)
Much Ado About Nothing: Wealthy New Yorkers Want Their Beachfront Clean Of Clean Energy
- The Hamptons is a wealthy New York enclave. Wainscott is an even pricier small hamlet outside East Hampton, south of the Montauk Highway on the South Fork of Long Island. Here, jetsetters can still find historic farmhouses and fields not far from their own airport, an exclusive gated community, and dazzlingly unobstructed views of Georgica Pond and the Atlantic Ocean.
- These folks Do Not want their little slice of heaven to have any part of the state’s first offshore wind farm, Thank You very much. It’s not even about the 15 wind turbines themselves, a cluster called South Fork Wind Farm that would sit about 35 miles off Montauk, the extreme eastern end of Long Island. The turbines wouldn’t even be visible from Wainscott‘s beach, but a cable to connect the wind farm would have to burrow underneath its beach and several of its streets to join with a substation further inland.
- The underground extension cable would help provide power to about 70,000 Long Island homes. A flurry of angry letters to the local newspaper has escalated to petitions, the hiring of high-powered lobbyists, and now lawsuits. It may be that wealthy homeowners who just aren’t having it will become a whole new obstacle to President Biden’s plans for a huge expansion of renewable energy across America. (Guardian)
Additional USA News
- Catholic Order Pledges $100 Million to Atone for Slave Labor and Sales (NYT, $)
- The Financial Crisis the World Forgot (NYT, $)
- White House Announces $10 Billion For COVID-19 Testing In Schools (NPR)
- Can corporations walk the walk? Coca-Cola stays silent as Georgia Republicans bid to restrict rights (Guardian)
- Joe Manchin just threw cold water on plans for filibuster reform (Vox)
- America’s Drinking Water Is Surprisingly Easy to Poison (ProPublica). Soon, the wealthy will be hiring personal poison testers.
- Education Department Rolls Back Trump Student Debt Policies (NPR)
- ‘A specific kind of racism’: Atlanta shootings fuel fears over anti-sex-work ideology (Guardian)
- 12 Republicans opposed Congressional Gold Medals for police who protected them on Jan. 6 (WaPo, $). Maybe they’d have been alright with silver?
- Drug Overdose Deaths Surge Among Black Americans During Pandemic (NPR)
Call Me Salmon, Expensive Good Looking Salmon
- It seemed like a good idea at the time, but was it really? A chain of sushi restaurants in Taiwan ran a two-day promotion wherein any customer whose ID card contained “gui yu” — the Chinese characters for salmon — would be entitled to an all-you-can-eat sushi meal along with five friends. Taiwan allows people to officially change their name up to three times, and about 150 people, mostly young, went to government offices to officially change their name.
- One college student surnamed Ma changed his name to ‘Bao Cheng Gui Yu,’ which roughly translated means “Explosive Good Looking Salmon.” He and his friends immediately went to chow down on almost $250 worth of sushi.
- Local media labeled the phenomenon “salmon chaos” after getting reports of people changing their names to things like “Salmon Prince,” “Meteor Salmon King” and “Salmon Fried Rice.” Then there was the adventurous soul who added a record 346 new characters to his name, most of which were seafood-themed, including characters for “abalone,” “crab” and “lobster.”
- Taiwanese officials were not amused. “This kind of name change not only wastes time but causes unnecessary paperwork,” the deputy interior minister told reporters on Thursday. He urged the public to “cherish administrative resources.” (Guardian)
Additional Weekend Reads
- Feeding cows seaweed could cut their methane emissions by 82%, scientists say (Guardian). Seaweed: good for farts… and the environment!
- Embryo-Like Forms Coaxed From Skin Cells Offer a Divisive New Way to Study Human Life (Science Alert)
- How the creators behind Contagion, World War Z, and Palm Springs, nearly predicted the Covid-19 pandemic (Vox). In a year stranger than fiction, we look to sci-fi.
- The Secret Auction that Set Off the Race for AI Supremacy (Wired)
- March Madness Brings Vibrant Art and Energy to Indianapolis (NYT, $)
- You will watch the Snyder Cut in 4:3 aspect ratio because HBO Max respects cinema (Verge)
- Perseverance rover captures the sounds of driving on Mars (Phys)
- If You Look at Your Phone While Walking, You’re an Agent of Chaos (NYT, $)
- The Double Bongcloud: Why grandmasters are playing the worst move in chess (Guardian)