Donald Trump Keeps Taking Credit For Tech Sector Jobs He Had Absolutely Nothing To Do With
from the taking-credit-for-the-sunrise dept
Last week, buried under the fracas surrounding the failed update to the Affordable Care Act, the Trump administration conducted an adorable little stage play few actually noticed. The Administration invited Charter CEO Tom Rutledge to the Oval Office, where the CEO -- alongside Texas Governor Greg Abbott and Energy Secretary Rick Perry, repeatedly implied that Trump's policies were somehow to thank for the creation of 20,000 jobs and $25 billion in investment at the cable giant. Press Secretary Sean Spicer was quick to applaud the "new" jobs on Twitter.
At the same time Charter issued a statement expressing "confidence in the deregulatory policies of the Administration," the President's office rushed to release a video patting itself on the back for the "landmark deal":
Today, I was thrilled to announce a commitment of $25 BILLION & 20K AMERICAN JOBS over the next 4 years. THANK YOU Charter Communications! pic.twitter.com/PLxUmXVl0h
— Donald J. Trump (@realDonaldTrump) March 24, 2017
The FCC also quickly issued a statement by new FCC boss Ajit Pai in which he claimed FCC policies were to thank for the jobs:
I’m pleased to see that our investment-friendly policies, along with the Administration’s overall regulatory approach, are already producing results.
And Pai Chief of Staff Matthew Berry also lent a hand to help the FCC pat itself on the back for a job well done:
Charter announces $25 billion broadband investment over next 4 yrs. New reg approach from FCC and Administration already producing results.
— Matthew Berry (@matthewberryfcc) March 24, 2017
The problem: neither the job creation nor the investment promises are new. And neither Donald Trump nor the FCC had absolutely anything to do with them.
The 20,000 jobs in question were actually announced more than a year ago by Charter. The jobs, purportedly to be created by eliminating off-shored labor, were part of the sales pitch for its massive, $79 billion acquisition of Time Warner Cable and Bright House Networks. Like most megamerger promises, there was no real timeline affixed to the jobs, which may or may not ever actually get created. Job losses are far more common in such M&As due to the elimination of redundant positions, but holding companies accountable for false merger promises simply isn't fashionable for either major political party.
The $25 billion investment (to be made over four years) isn't new either. In fact, if you look at Charter SEC filings (page 221) from August 18, 2015, you'll note that the $25 billion is in line with what Charter pretty consistently spends over any four-year span. Some journalists on Twitter were also quick to point out that the $25 billion is actually down a bit from what Charter would have normally spent during the same period (ironic for a company that whined about net neutrality's impact on investment):
@TonyRomm Charter spent $7.5bn (pro forma) on capex in 2016. $7.5bn x 4 = $30bn. So $25bn is actually lower than historic rate
— Jan Dawson (@jandawson) March 24, 2017
Granted, taking credit for jobs and investment he had nothing to do with has sort of become Trump's MO in his first few months in office. Sprint owner Softbank has also been letting the President take credit for job creation and investment he had nothing to do with in order to curry regulatory approval of a pending T-Moble, Sprint merger. Charter, which is rumored to be considering a possible megamerger with Verizon or T-Mobile, clearly hopes that buttering Trump up will pave the way for its own M&As.
It's a win for the companies and the administration alike: companies get to get their names in bright lights as job creators (whether it's true or not doesn't matter), and Trump gets more credit with a base that derides any contradictory evidence as fake news. The real losers remain American consumers. The deal, approved under the Obama administration, has already resulted in higher rates and even worse customer support than ever -- no small feat for an industry already ranked last in terms of customer satisfaction and support. Synergies, indeed.
Just so we're clear: the previous administration approved a deal that has already proven horrible for consumers; and the current administration is falsely taking credit for the stale and bogus job creation claims used to prop that bad deal up.
There's additional irony in that Trump ran his election based on killing megamergers of this type, promising to not only block AT&T's proposed acquisition of Time Warner, but to break up Comcast's already completed 2011 acquisition of NBC Universal. Most analysts expect neither to happen. In fact, the most likely outcome is that Trump and AT&T (the king of bogus telecom merger claims) will use the Time Warner deal to create a supernova of bogus job and investment promises the likes we've never seen before.
And while that's bad news for consumers, if you're the type that likes it when governments and companies use flimsy promises and half-cooked data to prop up bad tech policy and hollow partisan rhetoric -- you may soon find yourself in hog heaven.