Technology | Media | Telecommunications

Thursday, November 10, 2005

Lamar Alexander Assistant Nominated to FCC

Who is Deborah Tate? That's a question that many people in the telecom sector will be asking in the coming weeks. Nominated by the Bush administration to replace an exiting FCC commissioner, we should all be concerned. Why? From 1979 to 1985, she was on the senior staff and as assistant legal counsel to then Governor Lamar Alexander.

Fast forward to January 2004, now Senator Lamar Alexander (R-TN), and Senate Majority Leader Bill Frist became famous for their unrelenting attempts to apply a new tax to internet access services.

A month later, when that effort failed to gain enough support, Senator Alexander said he instead wanted to increase the federal excise tax on telecom services. "Congress should raise the federal excise tax from 3 percent to 4 percent," said Alexander at that time.

Senator John McCain of Arizona had previously made the case to end the Federal Excise tax, but was unable to gain enough support for the bill. Note, many democrats and republicans secretly favor keeping the tax, because it creates a slush fund that can be channeled into a variety of undisclosed causes (again, the original intent of the excise tax was to pay for the brief Spanish-American war that started and ended in 1898).

To this date, the tax is applied to every basic telephone service in America.

U.S. government policy apparently views telecommunications services as a vice -- telecom is currently subjected to higher taxation than any industry, except tobacco and alcohol.