Follow the money
Remember the exhausted cry of victory from the mobile-phone industry when the Senate sealed the deal on relocation fund, E911 and universal service legislation last December? It was in fact a dramatic chain of events leading to passage of a bill critical to wireless carriers and consumers.
But, of course, it’s not over. Few things rarely are in official Washington. There’s always a catch. And there’s one here. The import of what Congress and industry pulled off cannot be fully appreciated without realizing the context-the fiscal reality-in which the legislation now lives.
The backdrop for most everything in 2005, perhaps for years to come, is a record $427 billion budget deficit. President Bush vowed to cut the deficit in half by 2009, or about the time he’ll be back in Crawford, Texas. Prospects for more tax cuts, continued military spending in Iraq and Afghanistan, and possible social-security reform could make Bush’s deficit reduction goal difficult to achieve. Indeed, the pledge could come back to haunt the White House. China and Japan will not bail out the U.S. forever.
What about the here and now?
Money matters. That is why the relocation fund was created and why the measure is so critical to 3G wireless deployment in the U.S. It is doubtful the Department of Defense would have agreed to surrender additional spectrum to the wireless industry if there was uncertainty about receiving the billions of dollars carriers agreed to pay-with 3G auction dollars-to relocate military radio systems from the 1700 MHz band to other frequencies. The relocation fund is that guarantee. The mammoth budget deficit does not change that.
The same is not necessarily true of the establishment of a wireless E911 state grant program. The bill authorizes a maximum $250 million a year for fiscal years 2005 through 2009. The funding and other provisions are key to transforming E911 from a perpetual finger-pointing food fight to a reality that saves lives.
The tough-love 2006 budget Bush sends Congress today, as well as parochial spending priorities in Congress, could shortchange the E911 grant program. Everyone will be dialing for dollars.
Where else could the budget crunch be felt?
Will the Federal Communications Commission’s office of inspector general get the added staff and resources needed to determine the depths of E-rate corruption? With the FCC pushing new wireless technologies and spectrum into the marketplace, will there be enough money for enforcement and interference control?
Will the National Telecommunications and Information Administration get sufficient funding to implement Bush’s spectrum policy? It will take 21st century tools to do so. Do the Justice Department and Federal Trade Commission have the financial wherewithal to analyze the massive telecom, media and tech consolidation that’s taking shape? Will there be money to monitor and enforce telecom trade agreements with China and others? And so on.
The deficit is the driver.
