WHAT COULD A TELECOM MERGER MEAN FOR ECONOMIC DEMOCRACY?


I have a new post up on Dissent asking what an AT&T merger could mean for economic democracy:

If you’re on the left and you buy groceries, chances are at some point you’ve been faced with a choice between a neighborhood corner store and a unionized chain supermarket. That choice exposes a tension between two long-held progressive goals: anti-monopolism and workers’ industrial power.

The progressive puzzle I’m analyzing here reminds me of sociologist Albert Hirschman’s discussion of two ways people deal with inadequate institutions: exit and voice. It plays out in this case as a tension between improving customers’ chances of dumping an unjust company for another one and improving workers’ chances – together with consumers – of transforming their company.

Check it out.

Update (7/3): Alek Felstiner offers some interesting thoughts in response:

1) there was no discussion of the fact that mergers, while potentially creating more union members, also tend to eliminate jobs. And unemployed workers are the ultimate voiceless. This seems to be the history with the various telecom mergers, and progressives – even those who don’t care at all about anti-monopolism – may fault CWA on that ground.

2) CWA’s opposition to true net neutrality is nominally based on a fear that net neutrality will discourage broadband buildout, and thus discourage job creation. That’s totally silly. The only impact net neutrality will have is to prevent telecoms from capturing enormous premiums on preferred content. They’re still going to build out, and people are still going to pay, because they want Google and Amazon just as much as they want cable TV.

3) There’s actually a compound effect (I think) in CWA’s support of mergers and opposition to net neutrality. Because competition and regulation are the two main ways to combat discrimination in internet content. When telecoms want to discourage regulation, they point to the invisible hand of competition that will weed out discriminators. When they want to get a merger approved, they argue that monopolistic dangers will be checked by all the wonderful regulation we currently have. CWA, often an eloquent voice for consumer rights and information access, is dropping the ball on both these issues. The merger support is defensible, if not inevitable. The net neutrality opposition seems like just a favor – or perhaps an informal bargaining concession.

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2 thoughts on “WHAT COULD A TELECOM MERGER MEAN FOR ECONOMIC DEMOCRACY?

  1. Hi Josh,

    I read your thoughtful post and I agree there is a great struggle going on in the progressive community around the AT&T/T-Mobile sale. You did a great job laying out the bigger question of what is best to hope for to make our society better. Naturally, the CWA, where I am a member and where I work, believes union members (organized labor) are essential to the social transformation you wonder about http://goo.gl/Tyz35.

    Many opponents may look at it as the unionized supermarket (AT&T) vs. the neighborhood grocery (T-Mobile) — looking for the union label and trying to support local businesses can be a challenge. But, this case is different. First, T-Mobile is not a mom-and-pop operation. T-Mobile is a large, multi-national company owned by the German telecommunications giant, Deutsche Telekom. In the U.S., T-Mobile/Deutsche Telekom engages in the kind of extreme anti-union behavior that has become the norm in the US but which would not be tolerated Germany http://goo.gl/nFs1x.

    The second problem of the neighborhood grocery scenario is that you assume the grocery wants to stay in business independently. T-Mobile is unlikely to survive on its own (see http://goo.gl/BEzrH and http://goo.gl/t9Di0 and http://goo.gl/z5gks and http://goo.gl/M0QN2) and Deutsche Telekom has been looking for a partner. In fact, DT/T-Mobile had no plans for investment in the U.S. and was sending profits earned in the U.S. to help finance operations in Germany and elsewhere. Neighborhood establishments may not survive, but it’s not because money is siphoned off to some far away owners.

    Progressives should feel good about supporting workers who seek collective bargaining and can help them do that in an atmosphere free from anti-union activity by the employer by supporting the merger.

  2. Pingback: RADIO INTERVIEW: INDUSTRIAL POWER AND CONSUMER POWER « Josh Eidelson

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