Examining the Competitive Impact of the AT&T-Time Warner Transaction
Subcommittee on Antitrust, Competition Policy & Consumer Rights
Date: Wednesday, December 7, 2016
Time: 10:00 AM
Location: Dirksen Senate Office Building 226
Presiding: Chairman Lee
Witnesses
Mr. Randall Stephenson
Chairman & Chief Executive Officer
AT&T
Dallas, TX
Mr. Jeffrey Bewkes
Chairman & Chief Executive Officer
Time Warner
New York, NY
Mr. Mark Cuban
Chairman
AXS TV
Owner
Dallas Mavericks, Landmark Theatres, And Magnolia Pictures
Dallas, TX
Mr. Gene Kimmelan
President & Chief Executive Officer
Public Knowledge
Washington, DC
Ms. Daphna Ziman
President
Cinémoi
Los Angeles, CA
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December 2, 2016
"to elevate the condition of men--to lift artificial weights from all shoulders, to clear the paths of laudable pursuit for all, to afford all an unfettered start and a fair chance, in the race of life." --Abraham Lincoln
Chairman's Note: Stop President Obama’s Last Special-Interest Bailout
In December 2008, just weeks after President Obama was first elected, environmental activists sued the Environmental Protection Agency (EPA), claiming that the agency had failed to regulate certain “hazardous air pollutants” emitted by power plants pursuant to the Clean Air Act.
Resolving a lawsuit that involves a federal agency like the EPA can take a very long time – years even – especially when the suit is initiated in the first year of a new administration. But not in this case. Within 10 months, President Obama’s EPA decided to settle the suit with the environmental activists. How did they do it so quickly? By promising to enact new regulations of American power plants.
This is a classic case of a “sue-and-settle” scheme, the pernicious practice of activist organizations suing the federal government with the sole intention of reaching a closed-door settlement that achieves the group’s preferred regulatory goals much faster than could occur through the normal bureaucratic rulemaking process.
Indeed, the environmentalists’ lawsuit provided the EPA the pretext they needed to issue regulations that were far stricter – and more expensive – than otherwise would have been possible. The EPA’s own studies estimate that the resulting set of regulations – called the Utility MACT (Maximum Achievable Control Technology) Rule – will cost the U.S. economy $9.6 billion every year. That’s a staggering sum, but it’s only a drop in the bucket of the total cost of the draconian environmental regulations that the Obama administration has issued in response to similar lawsuits. According to the U.S. Chamber of Commerce, the Obama administration has entered into an estimated 60 such settlements.
Using lawsuits to extort new regulations from executive agencies is an affront to the rule of law and democratic government. But it’s proved to be highly effective for special-interest groups seeking to shape the law in their favor, which is why we see it spreading to other policy areas, like health care.
At least six insurance companies that participated in the Obamacare exchanges are now suing the Department of Health and Human Services (HHS), claiming that HHS owes them billions in “risk corridor” program payments that would have prevented their heavy Obamacare losses.
When Obamacare was first passed, the program was supposed to be funded by payments from other insurance companies who did not have to spend a lot of money covering health-care claims from their policyholders. But since almost all insurance companies were spending more than they expected on Obamacare patients, no one was paying into the program.
President Obama first went to Congress and asked for money to cover the unpaid insurance claims but Congress said no. Then in September, HHS issued a memorandum claiming that the insurance companies who had sued HHS might be able to get their unpaid risk corridor bills paid through the Department of Justice’s Judgment Fund.
The Congressional Research Service has since concluded that such payments were not authorized by statute, but that hasn’t stopped President Obama in the past.
That’s why last month I joined my colleagues, Sens. Ben Sasse (R-NE), Marco Rubio (R-FL), John Barrasso (R-WY), to introduce the HHS Slush Fund Elimination Act. The bill would prohibit the government from using the Judgment Fund, or any other federal funds, to pay final judgment or settlement related to any lawsuits pertaining to the Obamacare risk-corridor program.
Federal bureaucrats and special interests should not be able to create policy through sue-and-settle schemes. Congress has already relinquished far too much of its legislative powers to the Executive Branch. This bill would make sure we don’t give away even more.
Issue in Focus: Cures for Fiscal Maladies
The U.S. national debt is just a few months away from exceeding $20 trillion – an astronomical sum of such epic proportions that it’s difficult to fathom. Trying to understand the scale of even a fraction of it can boggle the mind. For example, if you were to spend $1 million every day since Jesus was born, you’d still be about $2.5 billion short of spending $1 trillion, and another $19 trillion short of our national debt today. And if contemplating the sheer size of the debt isn’t overwhelming – and terrifying – enough, consider the meteoric speed at which it is increasing: every second of every day, the federal governments spends roughly $27,500 more than it takes in.
How is this possible?
Politicians like to pin the blame on the federal policies and programs that they dislike the most. Those who believe the U.S. military should be leaner and less aggressive abroad say that an inflated defense budget is the cause of our ballooning debt. Those who think that our social safety net programs are counterproductive and wasteful blame our fiscal woes on the welfare state. And so forth.
But this argument misses the forest for the trees. Yes, the budget of virtually every federal department needs to be overhauled. And yes, the spending for countless federal programs needs to be curtailed – if not eliminated altogether. But the real source of our out-of-control national debt isn’t one agency or program or political party – it’s a self-serving political culture in Washington that has been built by politicians of both parties, over the course of decades, who habitually place their short-term career prospects over the long-term interests of the nation.
A case in point is the 21st Century Cures Act, which the House recently passed and the Senate will consider next week.
Those who support the bill proudly claim that it reduces government spending by $6 billion, which is, at best, only a half-truth. The Cures Act does save $6 billion, but it also paves the way for those so-called “savings” to be spent in upcoming years through an appropriations process – and here’s the kicker – that is not subject to the budget caps established in the Budget Control Act.
Proponents of the Cures Act might ask what good just $6 billion in savings would do when the national debt is about to reach $20 trillion, but of course that’s exactly the kind of question that got us into this mess in first place.
