Wednesday, April 26, 2006

Lafayette Cuts a Deal

Lafayette, BellSouth/ATT, and Cox have cut a deal to avert a bloody battle in the legislature and the courts. The surprise agreement includes Lafayette's promise to withdraw its bills to repeal the Local Government Fair Competition Act which has been the basis for multiple lawsuits delaying the construction of the fiber optic based telecommunications utility voted in last summer. For its part, BellSouth and Cox (dba LCTA) agrees to withdraw the latest of those lawsuits. This ceasefire does not clear the way for the bond sales as a class action lawsuit filed by a Plaquimine firm, whose previous filing had been tied to the incumbents, has not withdrawn its lawsuit. That suit, like the ones withdrawn, seeks again to block the bond sales.

You can get the story from either the Advocate or the Advertiser. Both are pretty good stories though you'll find more crucial detail in the Advocate who was first out with the story.

For what it's worth (damned little) this deal seems like a lousy one for the people of Lafayette and Louisiana. What's most amazing is that we've apparently decided to trust the deal-making honesty of BellSouth and Cox Communications. By all accounts "understandings" cut at the negotiating table between Lafayette and the incumbents as the Local Government (un)Fair Competition Act was being hammered out were never honored--in fact the bonding/cross subsidization issue was supposed to have been at the heart of that understanding. Similar games were played throughout the referendum campaign to the point where the city-parish swore not to trust anything they couldn't get in writing.

This retreat will leave the citizens of the state outside Lafayette to contend with a law designed to make municipal broadband of any stripe--wired or wireless--very difficult to start and regulated by the state to force the prices up and make running it unnecessarilty difficult. The law distorts technological choices that localities make to accomodate the profits of monopoly providers of telecom services. In many cases it will leave small, resource-poor communities to languish. The corporations will refuse to serve them and they will be forbidden to take care of their own by the state. Lafayette will have a moral obligation to pursue this issue once its own system is secured.

The current deal would be easier to see as a strategic retreat if Lafayette actually had cleared the way to sell its bonds. But it hasn't. The class action lawsuit by a firm associated with and aided in the past by the incumbents still stands.

At the end of the day Lafayette is still being sued to block its bonds and has given away its attempts to repeal the law that might have actually solved that problem for itself and the state in return for BellSouth and Cox not also suing. All in all its hard to see this as a good deal.


Anonymous said...

There is a line at the end of the movie "Lawrence of Arabia", in which after all the fighting and killing, Lawrence is trying to implement the policy of "Arabia for the Arabs", the ideology for which he was fighting and leading the Arabs. Lawrence enters a meeting of the Arab King and the English generals and politicians and tries to further this ideal. The king dismisses Lawrence with a line something to this effect: "Wars are fought by the young idealist; the peace is made by old men and politicians who are skilled in treachery and deceit.”

Tim Supple

John said...


Thanks for that memory. I vividly recall seeing that show on the big screen and being absolutely transported. For years it was my favorite show bar none.

Though it is odd to think of myself as a young idealist I do think that there is wisdom in the idea that fighting the fight and ending the fight are provinces of different types of folks.

John said...

Reader Jeff reminds me of another good qoute from the movie with a dueling bit of wisdom:

"The trick is not minding that it hurts."

Good point.