Administration Disavows Any Plans For National Cellular Infrastructure Amid Blowback From Industry and FCC

I had a strong doubt that such a vision of a public information infrastructure would be legitimate. It is being dismissed by White House officials as an 'outdated' proposal from the National Security Council (NSC) that drew a swift negative reaction from the telecoms industry and FCC Chairman Ajit Pai.

How can we expect such a visionary project from a government that places something so basic to the public good as net neutrality in the waste bin?

There will likely be a proposal for a national infrastructure of roads and bridges, which I expect to be largely an underfunded headline grabber that throws the burden of the realization of it on states and local governments.

This excerpt below is an update on the national cellular network story from ZeroHedge which you can read here.

Update: Several senior White House officials told Recode Monday that the Trump administration has no plans to build a "nationalized" US 5G network. The presentation, compiled by an unnamed senior NSC aide, was merely a dated proposal that will probably never see the light of day, the officials said.

The administration sources also pointed out that the FCC has a much larger role in setting broadband policy, and Ajit Pai, the current FCC chairman, has said he opposes the nationalization idea.

The NSC, they said, is only one component of a much larger decision-making process on the part of the federal government to set broadband policy. Its say is not final on these matters — and its memo does not appear to have gained traction with other tech-focused arms of the White House, according to multiple sources within the Trump administration.

A spokesman for the NSC, meanwhile, did not respond to an email seeking comment Monday.

US Government Considers Nationalizing US Cellular Network And Unifying Upgrade to 5G Next Generation Wireless

This 'leak' suggests that the US government may take a greater interest in building out the US information infrastructure, and modernizing it with more speed and greater standardization.

When I first heard of this the first thing that occurred to me was the Eisenhower plan to modernize and upgrade the US transportation infrastructure with the Interstate Highway System.  It provided for a significant upgrade and expansion to the national transportation infrastructure and a significant boost to the post-war economy.

I would be surprised if the major carriers would be interested in this, unless they were to put their competitive advantages in coverage differences aside to go after the government funding for the expansion to new technology and a wider, more uniform infrastructure.

Forming strategic initiatives around key infrastructure is such a good idea for the nation and the public as a whole that I cannot imagine it being adopted in any kind of reasonable and productive manner by the current government.   Telecommunications is a heavily lobbied industry.

Recall that this is a government of knuckle-dragging kleptocrats that could not even sustain a defense of a no-brainer policy like 'net neutrality.'

I wonder if this cellular infrastructure proposal was a candidate for headline busting big idea projects in Trump's upcoming State of the Union speech.  In that speech he is expected to note our economic progress, and ask for bipartisan support for infrastructure projects and increase military spending.  And perhaps the celluar project did not make the cut, which is why it was leaked now.  Or perhaps it did, and this is a trial balloon to see who applauds and who screams.  In any event, it seems to have been a calculated leak with intent.

 But look at what a cynic I have become.

There are certain shared and basic resources like roads, air traffic control, electric power distribution, and a national wireless system that need to be under some for of strategic government regulation. The amount of regulation and the forms it takes are another matter.

The pendulum has been swinging away from government initiatives and involvement in the US infrastructures for the past thirty years, leaving it to the 'invisible hand' of self-serving individuals and corporations.

And it shows in the quality and reach of many shared, public systems that become dominated by private monopolies, each pursuing their own narrow agendas and short term objectives.

As they used to say in economics class, some of these things are 'natural monopolies' given the complexity, reach and capital requirements involved, and of course the public good, which is heavilyt discounted as a priority in a predatory kleptocracy.

The imperative in this is that the US is falling behind in certain types of national infrastructure compared to other countries that take a more strategic, long term interest in these matters.  And that makes it less competitive in a number of areas.

And it is certainly falling behind most developed nations in the availability and affordability of  public healthcare and higher education.  But that is another matter, but a similar symptom.

Let's see what happens.  We're still reading and thinking about some of the implications of the attachment at the end of the article at Axios which is the leaked memorandum.  My son is taking the technologists view, and I am thinking like the guys who have to deploy, use, and maintain them.

Let the lobbying games begin.

Related: 
Trump Expected To Tout Economic Progress, Infrastructure Projects in State of the Union
Trump's Infrastructure: Trillion Dollar Initiative or the New Hunger Games for States and Municipalities

Axios
Scoop: Trump team considers nationalizing 5G network
Jonathan Swan, David McCabe, Ina Fried, Kim Hart

Trump national security officials are considering an unprecedented federal takeover of a portion of the nation’s mobile network to guard against China, according to sensitive documents obtained by Axios.

Why it matters: We’ve got our hands on a PowerPoint deck and a memo — both produced by a senior National Security Council official — which were presented recently to senior officials at other agencies in the Trump administration.

The main points: The documents say America needs a centralized nationwide 5G network within three years. There'll be a fierce debate inside the Trump administration — and an outcry from the industry — over the next 6-8 months over how such a network is built and paid for.

Two options laid out by the documents:

The U.S. government pays for and builds the single network — which would be an unprecedented nationalization of a historically private infrastructure.

An alternative plan where wireless providers build their own 5G networks that compete with one another — though the document says the downside is it could take longer and cost more. It argues that one of the “pros” of that plan is that it would cause “less commercial disruption” to the wireless industry than the government building a network.

Between the lines: A source familiar with the documents' drafting says Option 2 is really no option at all: a single centralized network is what's required to protect America against China and other bad actors.

The source said the internal White House debate will be over whether the U.S. government owns and builds the network or whether the carriers bind together in a consortium to build the network, an idea that would require them to put aside their business models to serve the country's greater good.

Why it matters: Option 1 would lead to federal control of a part of the economy that today is largely controlled by private wireless providers. In the memo, the Trump administration likens it to "the 21st century equivalent of the Eisenhower National Highway System" and says it would create a “new paradigm” for the wireless industry by the end of Trump's current term.

But, but, but: The proposal to nationalize a 5G network also only covers one part of the airwaves; there’d be other spaces where private companies could build...

Read the entire article here.

Stocks and Precious Metals Charts - FOMC Meeting And Non-Farm Payrolls Next Week - Exuberance In Davos

"And the beast was given a mouth for uttering haughty and blasphemous words, and it was allowed to exercise authority for forty-two months."

Rev 13:5

The attendees were describing the mood in Davos today as 'exuberant.'

Trump addressed the assorted billionaires movers and shakers, there this afternoon, asserting that 'the US is open for business.'   He also took some time to take a shot at the press and 'fake news' in response to reports that he had tried to fire the special counsel Mueller last June, and was stopped by the White House counsel who threatened to resign. And he was loudly booed by the august gathering.

Trumpolini is now on his way back to Washington, and will be delivering his first State of the Union address to Congress next week.  He needs to get busy on developing those infrastructure plans, or we might never be able to say that he made the trains run on time.  The 'tax cut' is more likely to fuel speculation and monopolization than productive growth.

Speaking of the need for an infrastructure program, the second revision to the 4Q17 GDP number missed estimates, coming in at 2.6%, down from the initial 3.2%.

Perhaps more concerning in the numbers was the fact that at current consumption rates the US consumer is not saving, and continues to fall more underwater because of the stagnant wage situation.

Gold and Silver managed to move a little higher, off renewed US dollar DX weakness, finishing up the day at 88.90. Monsieur Draghi has a problem on his hands. And with 18 European nations sporting 2 Year negative real yields, one might understand his frustration.

There will be a double hurdle for the metals next week, if recent history is any guide, with the FOMC rate decision on Wednesday 31 January, and the January Non-Farm Payrolls report on Friday 2 February.

The US is experiencing its worst outbreak of flu since 2009.

I still believe that the Banks are continuing to scrape the bottom of the physical barrel for gold, to meet the continuing offtake in Asia. Although they have been innovative and risk-taking in their leverage, it does make one wonder how suddenly this might end.

And some others and I have been discussing how quickly the US economy may jump the rails, and what effect this might have on the global economy and the political landscape.

If the economy does falter, one has to wonder if there is enough collective experience and wisdom and basic humanity in Washington to help avert a greater disaster. I would not like to use post-disaster Puerto Rico as an example of their competency and compassion.

Have a pleasant weekend.