CEI - Today in the News: Free Wireless, Federal Spending, and Fannie and Freddie


Free Wireless


The FCC is dropping its plan to implement a nationwide free wireless network.


Associate Director of Technology Studies Ryan Radia explains why the FCC's original plan was a bad idea.


"Setting aside 25 mhz of the airwaves—a $2 billion chunk of spectrum—to blanket the nation with “free” wireless broadband would mean less spectrum available for more robust services. At a time when wireless firms are experimenting with a number of strategies for monetizing the airwaves, allowing a single firm’s business model—especially one that many experts have suggested is simply not viable—to reign over other, more effective models would hurt consumers who yearn for more than basic, plain vanilla broadband service."



Federal Spending


Federal domestic spending rose by 16% in 2009.


Senior Counsel Hans Bader says that the $862 billion stimulus package actually caused jobs to be lost.


"The $862 billion stimulus package increased unemployment by wiping out thousands of jobs in America’s export sector, while giving 79 percent of its green-jobs funding to foreign firms. Obama falsely claimed that the $787 billion stimulus package was needed to prevent 'irreversible decline,' but the Congressional Budget Office admitted that it would actually shrink the economy 'in the long run.'  As the Washington Examiner notes, 'If his stimulus program was approved, Obama promised, unemployment would not go above 8 percent . . . The reality is that it passed 10.3 percent.'"


Fannie and Freddie

Federal Reserve Chairman Ben Bernanke is testifying before the Financial Crisis Inquiry Commission today.
Director of the Center for Investors and Entrepeneurs John Berlau says that the Financial Crisis Inquiry Commission needs to fix the Fannie Mae/Freddie Mac problem.

"So far, the firms have taken $15o billion in taxpayer aid.  The Treasury Department’s 'Christmas bailout' of the GSE’s–the December 24 order removing the caps of $200 billion dollars that Treasury was authorized to spend on each of the two mortgage underwriters–exposes the American taxpayer to unlimited liability for the entities and their potential new missteps. Competitive Enterprise Institute President Fred Smith had long warned about the systemic risk Fannie and Freddie posed to the financial system, warning as early as 2000 that their implosion could cause a taxpayer bailout of as much as $200 billion.  Members of Congress expressed shock and outrage, but Smith turned out to have underestimated the ultimate costs."