Shedding the Light On LightSquared
Generally speaking, generals do not tell lies. Nor are generals in the practice of concocting stories before congressional committees. That is why Air Force Space Command General William Shelton’s gutsy and potentially career-ending and provocative testimony to the House Armed Services subcommittee recently should be taken seriously.
General Shelton claims he was pressured to alter prepared congressional testimony, or “say things” he “didn’t agree with” that would, in the end, benefit the communications and satellite company, LightSquared, which is funded by major Democratic Party campaign donor, Philip Falcone.
According to General Shelton, LightSquared’s plan for a 4G network could seriously impede the effectiveness of the military’s GPS receiver systems, and testified he was pressured to say “the interference problems could be mitigated.” The “interference” has been described as participating in a telephone conversation during a rock concert, and precision GPS could be severely degraded or jammed, as a result.
Irrespective of potential national security implications LightSquared was given the green light, in what some describe as a “fast-track approval” by the Federal Communications Commission (FCC), currently chaired by President Obama’s long-time basketball buddy Julius Genachowski.
On March 1, 2011, Ken Boehm, of the National Legal and Policy Center (NLPC), reported, “Under extremely unusual circumstances, the FCC recently granted…LightSquared the right to use wireless spectrum to build out a national 4G wireless network. LightSquared will get the spectrum for a song, while its competitors [like AT&T and Verizon] have to spend billions.”
Back in early February, the NLPC had requested an investigation by the House Committee on Oversight and Government Reform, alleging favoritism was granted in exchange for campaign contributions to the Democratic Senatorial Campaign Committee, after a visit to the White House by hedge fund billionaire Phil Falcone, who runs Harbinger Capital, the owner of LightSquared.
Falcone claims he is a Republican, and at worst, neutral politically, but the fact remains he is among a small percentage of Americans who have had the privilege of paying a personal visit to the White House that appears to have paid off personally.
While it is tempting to blow this off as yet another “Pay for Play” deal, which runs the risk of being normal in politics these days, think again.
You see, the company, LightSquared, used to be called SkyTerra. In 2005, Barack Obama invested more than $50,000 in SkyTerra – at the bidding of SkyTerra investor – and, according to ABC News, a friend of President Obama – George Haywood (the same George Haywood that was invited to the White House India State Dinner).
In March, 2007, the New York Times reported four principal owners of SkyTerra (and friends of Obama), had raised more than $150,000 for Obama since 2004. When questioned about his investment, Obama claimed he had opened a blind trust and “had no knowledge of any stockholding [sic] with this account at any time,” explaining “After I got [sic] my [$1.9 million] book contract, I had money to invest…” insinuating that his investment in a company principally sponsored by political allies was mere coincidence. Obama later sold his investment at a loss after assessing the potential political ramifications.
On September 15, 2011, LightSquared Chairman and CEO, Sanjiv Ahuja issued a defensive statement on its website, Lightsquarred.com, saying it is “ludicrous to suggest LightSquared’s success depends on political connections.” During the hearing the same day, House Armed Forces Subcommittee Chairman Michael Turner, R-Ohio, took the opposite opinion, chastising the administration for approving LightSquared proposals and reprimanding FCC Chairman Julius Genachowski for both granting a January 26 waiver to LightSquared, and failing to show up at the hearing to “discuss the significant harm to national security that may result from the FCC’s action.”
Promising a “possibility of real change” while speaking about campaign finance reform during a speech in 2008, Obama complained that, “special interests drown out the voices of the American people and will continue to erode our politics.”