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[aprssig] LightSquared and WH pressured AF General over GPS interferance

Kent Hufford khufford at atlanticbb.net
Thu Sep 15 20:23:45 UTC 2011

White House Pressure for a Donor?

The Pentagon has worried for months that a project backed by a prominent
Democratic donor might interfere with military GPS. Now Congress wants to
know if the White House pressured a general to change his testimony. 

by Eli Lake  <http://www.thedailybeast.com/contributors/eli-lake.html> |
September 15, 2011 12:24 AM EDT 

The four-star Air Force general who oversees Air Force Space Command walked
into a highly secured room on Capitol Hill a week ago to give a classified
briefing to lawmakers and staff, and dropped a surprise. Pressed by members,
Gen. William Shelton said the White House tried to pressure him to change
his testimony to make it more favorable to a company tied to a large
Democratic donor.

The episode -confirmed by The Daily Beast in interviews with administration
officials and the chairman of a congressional oversight committee -is the
latest in a string of incidents that have given Republicans sudden fodder
for questions about whether the Obama administration is politically
interfering in routine government matters that affect donors or fundraisers.
Already, the FBI and a House committee are investigating a federal loan
guarantee to a now failed solar firm called Solyndra
ails.html>  that is tied to a large Obama fundraiser.

Now the Pentagon has been raising concerns about a new wireless project by a
satellite broadband company in Virginia called LightSquared, whose majority
owner is an investment fund run by Democratic donor Philip Falcone
t.html> .

According to officials familiar with the situation, Shelton's prepared
testimony was leaked in advance to the company. And the White House asked
the general to alter the testimony to add two points: that the general
supported the White House policy to add more broadband for commercial use;
and that the Pentagon would try to resolve the questions around LightSquared
with testing in just 90 days. Shelton chafed at the intervention, which
seemed to soften the Pentagon's position and might be viewed as helping the
company as it tries to get the project launched, officials said.

"There was an attempt to influence the text of the testimony and to engage
LightSquared in the process in order to bias his testimony," Rep. Mike
Turner (R-OH) said in an interview. "The only people who were involved in
the process in preparation for the hearing included the Department of
Defense, the White House, and the Office Management and Budget."

Turner is chairman of the House Armed Services subcommittee that oversees
Shelton's space command and GPS issues; the panel explored the issues
between LightSquared and the Pentagon at a hearing Thursday. 

On Thursday, LightSquared CEO,Sanjiv Ahuja told The Daily Beast that his
company was not trying to use politics to affect the regulatory process and
the firm's goal was to expand broadband access across America.

"Any suggestion that we have run roughshod over the regulatory process is
contradicted by reality: Our plans to begin implementing America's first
privately funded, wholesale, affordable, coast-to-coast wireless broadband
service have been delayed for a year and we have been forced to commit more
than $100 million to find a solution that will allow consumers to benefit
from both our service and GPS," Ahuja said.

"For a company that allegedly is 'wired' inside the Beltway, we've been
unable to even get the House Armed Services Committee to allow us to have
one representative today's hearing - a hearing in which we are the subject,"
he said.

Shelton finally gave his testimony Thursday, and made clear the Pentagon's
concern about LightSquared's project.

The general told Turner's committee that preliminary tests of a new
LightSquared proposal to use only a portion of the band that it was licensed
originally in 2004 would cause significant disruptions to GPS. 

He said the GPS spectrum was supposed to originally be a "quiet
neighborhood," meaning that lower strength signals could exist near the GPS
spectrum. Speaking of the LightSquared plan, he said, "If you put a rock
band in the middle of that quiet neighborhood, that's a different

The White House confirmed Wednesday that its Office of Management and Budget
suggested changes to the general's testimony but insisted such reviews are
routine and not influenced by politics. And it said Shelton was permitted to
give the testimony he wants, without any pressure.

OMB "reviews and clears all agency communications with Congress, including
testimony, to ensure consistency in the administration's policy positions,"
said White House spokesman Eric Schultz. "When an agency is asked by a
congressional committee to testify, OMB circulates the agency's proposed
[draft] testimony to other affected agencies and appropriate [executive
office of the president] staff. If a reviewer has a comment to the proposed
testimony, that suggestion is typically conveyed to the agency for their
consideration. When divergent views emerge, they are often reconciled
through discussions at the appropriate policy levels of OMB and the
agencies." The general's office declined to comment.

LightSquared has previously acknowledged it met with officials from the
White House Office of Science and Technology Policy as it tried to shepherd
the project, which is consistent with President Obama's goal of trying to
expand broadband wireless access nationwide. That office has a mandate to
meet with members of private industry.

Melanie Sloan, who runs the nonpartisan ethics groups Citizens for
Responsibility and Ethics in Washington, said the emerging allegations about
possible White House involvement in LightSquared's matter seemed to mirror
earlier allegations in the Solyndra case
-loan.html> .

"With this new set of facts, it starts to sound like a pattern of the White
House improperly pressuring people at agencies involving decisions that
affect companies tied to donors and fundraisers," Sloan said. "It's always a
problem when the White House is pressuring anyone's testimony. I don't care
if you are a four-star [general] or a GS-15 [career employee], you should be
giving your true opinion and not an opinion the White House is seeking for
political expediency." 

Sloan recalled similar instances during the Bush administration, when
officials were accused of trying to meddle with climate scientists'
testimony. "It doesn't matter what party is in charge, money frequently
trumps good policy in Washington," she said.

Mr. Ahuja gave a little more than $30,000 to both the Democratic and
Republican parties in the last two years. Mr. Falcone and his wife have gave
more than $60,000 in 2009 to the Democratic Senatorial Campaign Committee.
Mr. Falcone has also given a smattering of money to Republicans.

At issue is a conditional Federal Communications Commission waiver granted
in January to LightSquared to build cheap terrestrial wireless capacity in a
section of the wireless spectrum close to the GPS bandwidth. Harbinger
Capital, the hedge fund belonging to Falcone, owns a majority stake in

"There was an attempt to influence the text of the testimony and to engage
LightSquared in the process in order to bias his testimony," said Rep. Mike

The FCC license has come under scrutiny because technical experts have
warned that LightSquared's proposal to build tens of thousands of ground
stations for a wireless network could drown out the GPS signal. On Tuesday,
the FCC issued a public notice stating that LightSquared may not move
forward on establishing its wireless service until further testing proves
the GPS would not be harmed.

Falcone says the FCC waiver was spurred by the demands of the wireless
industry. "LightSquared wanted the waiver because some of its wholesale
partners wanted the choice of being able to sell devices with either
satellite only, terrestrial-only or combined satellite-terrestrial service,"
he told The Daily Beast. "The waiver allows us to meet the specific needs of
our customers - but it in no way affected the spectrum issue."

Falcone added, "The GPS industry decided not to oppose us in the early
2000's because they thought we'd never be successful. It was only after they
realized we were not just a concept, but a viable technology with a viable
business model, that they decided to oppose us. Meanwhile, LightSquared
invested billions of dollars - that is money that comes from private
individuals all over the country - based on the promise the FCC gave us
under a Republican administration six years ago. The point is that any
suggestion that the waiver created LightSquared out of thin air is both
specious and absurd."

Turner said Shelton told his committee that LightSquared had obtained his
earlier prepared testimony. But Jeffrey J. Carlisle, Executive Vice
President for Regulatory Affairs and Public Policy for LightSquared said
Thursday that the company never received Shelton's testimony scheduled for
August 3.

A U.S. government official who spoke on the condition of anonymity said the
White House specifically asked Shelton to include a paragraph in his
testimony that stated the military would continue to test the proposed
bandwidth for ways LightSquared could still use the spectrum space without
interfering with GPS. The proposed language for Shelton's testimony also
stated that he hoped the necessary testing for LightSquared would be
completed within 90 days. 

The White House has said it did not try to influence the licensing process
for LightSquared at the FCC. Chairman Julius Genachowski also has said the
White House never lobbied him about LightSquared. Republicans are now
questioning whether the administration has been rushing approval of the
project over the objections of experts ranging from GPS companies like
Garmin to the military's own advisory committee on satellites.

"The FCC's fast-tracking of LightSquared raises questions about whether the
government is rushing this project at the expense of all kinds of other
things, including national security and everyone who uses GPS, from
agriculture to emergency medical technicians," said Sen. Chuck Grassley
(R-IA). "Without transparency, and with media coverage of political
connections in this case, there's no way to know whether the agency is
trying to help friends in need or really looking out for the public's

In April, Grassley asked Genachowski to hand over all records of
communications, including emails between Falcone and the FCC, and
LightSquared and the FCC. Genachowski declined to turn over those records.

The Center for Public Integrity, a nonprofit investigative journalism
organization, published emails this week
ications-white-house-campaign-donations-were-made>  it had obtained showing
meetings between White House technology advisers and LightSquared officials.




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made payable

to 'The United States of America ' for any amount, up to and including their


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