AT&T Lays Off Thousands After Nabbing Billions In Tax Breaks And Regulatory Favors

from the ill-communication dept

Back in November of 2017 AT&T promised that if it received a tax break from the Trump administration, it would invest an additional $1 billion back into its network and employees. At the time, CEO Randall Stephenson proclaimed that “every billion dollars AT&T invests is 7,000 hard-hat jobs.” Not “entry-level jobs,” AT&T promised, but “7,000 jobs of people putting fiber in ground, hard-hat jobs that make $70,000 to $80,000 per year.”

Yeah, about that.

The Trump tax cut resulted in AT&T getting billions in immediate tax relief, and roughly $3 billion in tax savings annually, in perpetuity. Yet when it came time for AT&T to re-invest this money back into its network and employees, AT&T actually did the opposite and began laying them off in droves. Unions claim AT&T has laid off an estimated 23,000 workers worldwide since the Trump tax plan, with investors and executives unsurprisingly pocketing the savings. This week, the word came down that AT&T would be laying off thousands more as it wraps up fiber deployment:

“Leaked internal documents confirmed most of the 1,800 planned job cuts. One AT&T surplus declaration shows that more than 900 of the surplus jobs come from the company’s Southeast division in Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, and Tennessee. This document attributes most of the cuts to “economic” reasons and some to “technological/operational efficiency.”

While AT&T had been deploying fiber as per a 2015 DirecTV merger condition (something the Trump FCC tried to credit to killing net neutrality), the company recently finished up those obligations, and now has returned to the default state of most US telcos: skimping on fiber upgrade investment thanks to limited competition. There’s been nary a peep from Trump INC, because fattening investor and executive wallets, unless you’re new here or exceedingly gullible, was the entire point. Objective experts say the cuts uniformly failed to deliver any of the numerous investment and employment promises made by Trump INC.

Of course this is a shtick AT&T has been engaging in for decades now under both political parties. AT&T will promise a universe of jobs and network investment if it gets “X” (X=killing net neutrality, a tax break, eliminating consumer protections, approving a new merger, passing a law AT&T wrote), but then bails on following through. Nobody in the government much cares because AT&T’s among the wealthiest and most politically powerful companies in the world and turning a blind eye is politically helpful. Nobody in the press much cares because covering failed AT&T promises on the tech policy front doesn’t get hits, and most journalists are too young to remember the last forty times we’ve gone through this.

While the press likes to suggest that the Trump administration is “at odds” with AT&T because his DOJ sued to block AT&T’s attempted merger with Time Warner, that had more to do with pleasing Rupert Murdoch and angering CNN than any real disdain for AT&T. AT&T’s largely been a loyal ally to the Trump administration ever since one of its lobbyists paid Michael Cohen $600,000 for additional access to the President, and if you step back and really try to calculate the billions AT&T has gleaned from Trump and Ajit Pai’s apathetic tenures so far, you’ll quickly get a nasty headache.

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Comments on “AT&T Lays Off Thousands After Nabbing Billions In Tax Breaks And Regulatory Favors”

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PaulT (profile) says:

Re: Re: Re:

Probably. It’s the same "us vs them" crap they spew – not only are there only 2 possible "teams" but anything done to spite the other "team" is acceptable even if you destroy your own in the process. The people being laid off for profit don’t matter because the company that just canned them bought another company with a different political point of view. Thousands of peoples’ lives don’t matter because of some idiotic pissing contest. It’s pretty sick.

The scary thing is that Trump and his supporters are apparently not finding Fox pandering enough any more so they’re heading to more extreme venues…

JoeCool (profile) says:

Re: Re: Re: Re:

An idea on how to finally get rid of "us vs them" – all candidates fill out a form under oath stating their position on the issues (and going against that position later falls under perjury), then ballots contain NO NAMES AT ALL, merely statements like "the candidate who favors this position on this issue". Tally who got the most votes based on their affidavits.

Anonymous Coward says:

Re: Re: Re:2 Re:

That’s a great start but voter turnout would drop to the low 20s. The vast majority of the voting public have no idea what the issues are beyond maybe one they care about and vote entirely along party lines.

To improve on your idea slightly, don’t group the issues by candidate even if party isn’t stated. Just list the issues themselves sans candidates and people can vote for or against the issues. Then the candidates with the pre-election, declared best match to the popular issues get the jobs.

Still won’t help voter turnout but that’s probably a good thing. Only those familiar with the real issues will vote.

Anonymous Coward says:

Re: Re: Re:4 Re:

It works in Australia, although it has other downsides.

How about we mandate that voting methods rotate through a regular schedule? That way, any gerrymandering, clustering or dilution due to a single voting method will be reversed in the next election. If you go through three election methods and offset by one between the presidential election year and the off year, that means that any elected president wouldn’t be allowed to stand for the same election method twice, and for congress/senate, it would be 12 years between using the same election method — long enough that if they’ve survived, they probably deserve to be there.

Rotate between current FPTP with electors, STV runoff, and the GP’s "vote for the issues, not for the candidate" method, via STV runoff.

OGquaker says:

Re: Re: Re:3 Re:

You have just described ‘representative democracy’.

The problem is Grammar School in the 1880’s taught ‘civics’, modern times has no use for a responsible electorate: only ONE lawyer i have ask in the last 30 years could tell me what the U.S. 5th Amendment says.
I was ‘Inspector’ at a voting precinct for fifteen hours on the first Tuesday this June, 103 voters were ALLOWED to vote, another 35 had been eliminated from the ‘register’ and i was forced to let them vote ‘provisionally’…… out of 1,450 possible AT MY PRECINCT.

Gary (profile) says:

Re: Re:

If their lay-off include all of CNN then they are doing a great job.

REAL news comes from Info Wars! We need to know that Hillary is REALLY running a sex slave operation from a pizza shop. They aren’t afraid to tell the REAL stories.

Like that one where the fake school full of actors pretended to have a massacre in order to discredit the guns. That was REAL news.

/s, and El Cheetos saying he doesn’t like the coverage doesn’t make it "Dishonest" ya MAGAt.

PaulT (profile) says:

Re: Re: Re:

"El Cheetos saying he doesn’t like the coverage doesn’t make it "Dishonest" ya MAGAt."

His cult don’t care, though. They won’t even know that CNN International is very different in terms of coverage to the US version, that the reason he saw that and not Fox News in the UK was because nobody wanted to watch Fox, nor that he was too ignorant to even attempt to watch something not from one of those two networks while travelling. They will just nod in agreement as he leads them off to his new love affair with OANN and further away from reality.

Anonymous Coward says:

If AT&T failed to live up to its obligations for getting those tax breaks, then they should be taken away from them. It’s that simple. These monopolies need to be busted up. All these company’s need to be fighting for customers everywhere. I want AT&T, Comcast, TWC, etc, etc in every town and city fighting for people’s business. We need to end these government-created monopolies.

Anonymous Coward says:

Re: Re:

Government didn’t create these monopolies but it does reward them while doing nothing to fix the problem so I guess it’s close enough. The government doesn’t have the power to force them to overlap their service areas and breaking them up won’t really do much to help that either. Think about it: Even if Concast were broken up into small regional ISPs those ISPs don’t have any motivation to build out into an area already covered by AT&T, no more than the big corps do today. It costs a lot to extend your service area and if there is already an incumbent serving that area then you will struggle to convert enough customers to your service to break even on the expansion costs even over decades.

What the government can do is mandate that all infrastructure (above and below ground cabling and interchange points) must be shared regardless of who built it and open access to co-op services. Suddenly it becomes much, much cheaper to offer competing service. The government can also then subsidize infrastructure to incentivize expanding into poorly or unserved areas, set standard pricing caps and a fine structure for poor service.

The problem is solvable but not via breaking up too-big corporations.

Anonymous Coward says:

Re: Re: Re:

Government didn’t create these monopolies

Yes. Yes they did. On multiple levels. The government created the artificial personhood of corporations, and maintains that fiction. Without it, these monopolies wouldn’t exist.

One level up, Bell was set up as a monopoly by the government, and protected as a monopoly by laws passed by congress. Once the government realized Bell was threatening to capture government wholesale, they broke it up. The resulting companies eventually started merging back together with the government agreeing to the mergers as long as certain infrastructure agreements were met. Those agreements were NOT met, but the government didn’t break them back up again.

Today, what was originally Bell is now mostly AT&T and Verizon. Comcast/Charter are the only real telecommunications competition for them, and they don’t directly compete in most markets.

AT&T and Verizon still have a plethora of laws on the books that specifically protect their markets from competition. This prevents most startups from entering the market, and prevents community-based competition as well.

So if the government doesn’t break up AT&T and Verizon, they need to stop allowing them to merge based on broken promises. There need to be actual penalties for not following through on existing promises. AT&T and Verizon can’t just be allowed to move the goalposts each time new people are elected into government.

Anonymous Coward says:

Re: Re: Re: Re:

The government created the artificial personhood of corporations,

If it wasn’t for corporations, which have been around for a very long time, who would own things like church property, town halls, etc., how would a business survive its owners death, how can enough people come together to build a factory?

OGquaker says:

Re: Re: More KY please

Yes, we been screwed. That law is

I watched PacBell insert their glass fiber into the street, and then pull out of their ducts in front of this house. When i sent a cashiers check to buy DSL, five different phone techs showed up over the next month (Village People?), removing the loading coils off the existing copper POTs line to the CO, telling me all was hunky dory…. and then my new DSL provider mailed back my check; So Sorry.

GTE pulled out that next year, so i phoned the utility commission the day after Christmas and a sorry ass CPUC Commissioner answered.
Thus, GTE had a Dog v. Pony ‘public meeting’ and turned us over to PacBell/ Pacific Telesis/ SBC Communications/ AT&T Inc./ Ameritech/ AT&T Teleholdings; they all have the same genital herpes.

I bought 21 POT’s lines and two ISDNs for one month in 2000, no problem.
I bought 12 POTs and a fractional T1 for 6 weeks in 2001, no problem.
I bought 6 POT’s lines & a WATTS line from a third tier provider HERE, no problem. Need just phone? Fuck you, civilian.

Anonymous Coward says:

Any jobs AT&T was talking about were going to be temporary construction jobs as a result of increased cap-ex spending as a result of the tax cuts.

It never meant that job cuts associated with landline telephony wouldn’t continue as customers migrate towards newer technologies, particularly wireless technologies that don’t have a last-mile infrastructure between AT&T and customer to maintain.

I vaguely remember when they came up with direct-dial and got rid of switchboard operators.

Anonymous Coward says:

Re: Re: Re:

Separately, AT&T had a required fiber build-out in connection with the DirectTV merger. That has completed, and is a factor in this round of layoffs.

And they’re going full tilt on wireless, the 5G stuff. No one is looking at the Cap-Ex on wireless.

There’s different stories elsewhere. According to AT&T, there has been a 30% drop in landline telephone customers in the last two years. It’s a labor intensive technology that is obsolete.

JoeDetroit (profile) says:

Re: Re:

AT&T has a ton of work. They just want to avoid having employees, union or not. They’ve been contracting it all out. That & abandoning rural areas by closing service & call centers & letting the infrastructure go to shit.

They’ve been pushing for lower labor costs for a years all while making billions, even before the tax cuts.

I do not know how far these multi-nationally owned mega-corporations are going to be able to push before people finally start to push back. Even after 20 years of mostly flat wages while profits continue to climb, the public still seems to have the "thank you sir, could I have another" point of view.

Anonymous Coward says:

They are waiting for the 'too big to do something' phase...

Followed by the ‘too big to care’ phase, where they just collect all the money (since they own ALL the communication linkages) – you know that ‘series of tubes’ that the internet is made from? Well AT&T owns all those and the ones is doesn’t already own it’ s in the process of putting the current owner(s) out of business so they can take over for pennies on the dollar (or just have the access granted to them by "lawpasters" like Blackburn who are only capable of copy/pasting the laws AT&T writes).

What can we do? Nuke em from orbit, it’s the only way to be sure…

All our bases are belonging to them, and nobody seems to give a frack…

Dave says:

Because that’s how corporate dictatorship works. Big corporations have clearly developed effective ways of getting lots of money in exchange for absolutely nothing, or scams for short. And big corporate scams are 100 percent legal, even those that cause huge financial crises like the one in 2008. And there’s not a damn thing any one person can do about it.

Gerald Robinson (profile) says:

AT&T breakup?

AT&T has repeatedly scaled the American people through Congressional greed! Fiber back haul is what makes cell (including 5g) work. If AT&T really made hard promises to get the tax breaks then they should be defended and penalties applied. But doesn’t look like they did anything but pay off Congress! Should we penalize AT&T- maybe. Should we penalize the dishonest Congress-defanitely! A start is Congressional term limits, limit lobying, and apply limits to staff. A better approach would be to limit voting to those who understand the issues; good luck!

Werner says:

They are definitely taken into account, but for the sake of brevity and the context of the discussion, having a tax break does not mean you will not have to lay off employees.

Let’s say I have a known tax-break that covers things like new technology. A good portion of TWC ( business is in Tech A, and my equipment and personnel are not compatible with my desire to take advantage of a tax break and move to Tech B. I use the break to move to tech B, and hire new people in that regard, but I still have to spin-down the older and less efficient Tech A.

Historically, newer things are more efficient than older things, so while I was able to hire 1,000 people for tech B, I had to let go of 5,000 people form the old Tech A who could not make the transition.

I advanced my technology and made things more efficient, as a result my business is more profitable and can grow, but it came at the cost of disposing of the older, more cumbersome Tech A logistics.

Change comes with a price. This has been going on for hundred of years. It is nothing new and not at all indication of any hypocrisy over tax breaks.

At the end of the day, business growth is not directly tied to the number of people you employ, it never has been. Besides that, read the article and you will see the problem with it.

Mascovi says:

pay their U.S. tax bil

AT&T and Deutsche Telekom cut the amount of cash they use to pay their U.S. tax bill by more than $10 billion , The Wall Street Journal said on Tuesday.In addition to shedding hundreds of workers, AT&T said it will cut out nearly $4 billion in regulatory credits it uses to promote its American wireless network in the next four years, the journal reported. That will reduce AT&T’s taxable annual profit by $1.6 billion.Deutsche Telekom said its United States revenue for the last three years amounted to $2.2 billion and its international revenue of $2.3 billion, meaning it would lose $700 million

Anonymous Coward says:

tons of work for at&t

Because that’s how corporate dictatorship works. Big corporations have clearly developed effective ways of getting lots of money in exchange for absolutely nothing, or scams for short. And big corporate scams are 100 percent legal, even those that cause huge financial crises like the one in 2008. And there’s not a damn thing any one person can do about it.

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