Financially oriented prelude(s) to a post:
I am staggered at how easily the concepts of Democracy and the Rule of Law – two of the pillars of the modern world – have been brushed aside in the interests of political expediency.
And this as well:
Bond and Currency markets are now so rigged by policy makers that I have no meaningful insights to offer…
Now, on with the countdown!
From the annals of crony capitalism, rent-seeking, and regulatory capture it is revealed that the regulatory concerns regarding LightSquared, a world-class GPS signal-killer, appear to have been brushed aside in the interests of political and personal expediency.
Before Barack Obama became president, he was personally an investor in SkyTerra [the company that would become LightSquared]. [Philip] Falcone’s Harbinger Capital Partners [LightSquared’s financial backers] donated $50,000 to Obama’s inaugural committee on Jan. 20, 2009, according to the Center for Responsive Politics. At the time, Falcone was still looking for the FCC’s sign-off on his hedge fund’s desire to purchase a majority stake in SkyTerra . The George W. Bush administration had failed to green-light the deal.
According to White House visitor logs, Obama’s new FCC chairman, Julius Genachowski, a classmate of the president’s from Harvard Law School, met with White House Personnel Director Don Gips on Feb. 18, 2009. Gips’ personal financial disclosure forms show he had between $250,000 and $500,000 of his personal finances invested in SkyTerra via stock options. Gips bundled at least $500,000 in donations to Obama’s 2008 election campaign, and served on the advisory board of Obama’s White House transition team.
On the same day Goldberg [Henry Goldberg of Harbinger’s law firm, Goldberg, Godles, Weiner & Wright] sent that email to [FCC International Bureau Chief Howard] Griboff — July 24, 2009 — SkyTerra asked the FCC to allow it to delay the launch of a new satellite because there was a “potential delay in [its] delivery.” The FCC approved the request, but later denied a near-identical one for SkyTerra competitor GlobalStar based on “extenuating circumstances” in 2010. This appeared to be one in a long line of instances in which the FCC favored SkyTerra, the future LightSquared, over GlobalStar.
…later, Falcone and his wife each donated the maximum legally allowed — $30,400 each — to the Democratic Senatorial Campaign Committee.
Of course, largely ignored is the effect of the LightSquared network on GPS. To quote myself, should LightSquared be looking for a new logo, something like “The first full-fail 4G network” or “SkyJam”?