September 25, 2023

John Palmer, 77, Correspondent for NBC News

The cause was pulmonary fibrosis, his wife, Nancy, said.

Mr. Palmer worked for NBC from 1962 to 1990, and then returned to the network from 1994 to 2002. He was news anchor on “Today” during the run of Jane Pauley and Bryant Gumbel as co-hosts, when the program often led in the ratings.

In the 1970s, Mr. Palmer was based in Beirut and covered the 1973 Arab-Israeli war, the war in Cyprus and the civil war in Angola. He was later a correspondent in Paris and at the White House.

In April 1980 he broke the news of the Carter administration’s failed effort to rescue the American hostages in Iran. Eight American servicemen died when a helicopter crashed into a C-130 transport plane at a staging area in Iran.

He received the Merriman Smith Award for excellence in presidential news coverage, the first broadcast journalist to do so.

In 1986, Mr. Palmer was the anchor for the first hours of NBC’s coverage of the Challenger space shuttle explosion.

He left the network in 1990 to anchor a syndicated news program, “Instant Recall,” interviewing prominent people like the former presidents Jimmy Carter, Gerald R. Ford and Ronald Reagan as well as Jonas Salk and Chuck Yeager. He was also the host of the weekly “Discovery Journal” on the Discovery Channel and anchored a daily newscast on the television channel of The Christian Science Monitor.

NBC hired him again in 1994 to be a national correspondent.

John Spencer Palmer was born Sept. 10, 1935, in Kingsport, Tenn. He was a graduate of Northwestern University and held a master’s degree from Columbia University. After leaving NBC he was a host on Retirement Living TV.

Besides his wife, survivors include three daughters.

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High & Low Finance: A Starting Point for Tax Reform: What Reagan Did

Tax Reform report of the Treasury Department to President Ronald Reagan, November 1984

As Washington grapples with the budget, it might be worth asking a simple question: What would Ronald Reagan do?

He was the last president to preside over a significant tax reform, one that did exactly what both candidates in this year’s presidential election said they want to do: lower tax rates and close loopholes.

And a critical part of that reform was to end the historical system of taxing capital gains at lower rates than ordinary income.

In the name of fairness, the Tax Reform Act of 1986 raised the maximum tax rate on long-term capital gains to 28 percent from 20 percent at the same time it reduced the maximum rate on ordinary income to 28 percent from 50 percent.

Doing that again in a tax reform act of 2013 would do more than raise revenue and increase fairness. It would bring an abrupt end to the “carried interest” tax dodge, in which managers in the private equity business are able to define their compensation as capital gains and thus pay far lower income tax rates than do ordinary people with far less income.

Ideally, there will be two tax reform efforts in the next 18 months.

The first, going on now, is a simple patch-up, aimed at dealing with the pending increases in taxes brought on largely by the expiration of the Bush “temporary” tax cuts. If the lame duck Congress and President Obama can avert disaster, raising some revenue while not devastating the economy, they will have succeeded.

But the next move should be aimed at comprehensive tax reform. The Obama administration should look to President Reagan’s second term for inspiration. The Reagan method included a comprehensive, well-thought-out proposal that dealt with the myriad details that can rise up to frustrate any efforts at change, put together painstakingly by the Treasury Department.

Then there was a bipartisan effort to get it through Congress, with inevitable compromises but with clear goals in mind.

The proper way to approach that proposal is to accept that the government needs to raise a certain amount of money. There can be differences over spending, obviously, but there should be consensus that whatever decisions are reached, the tax system adopted should be expected to finance those expenditures over an economic cycle, with deficits in difficult economic times and surpluses in good years.

With an agreement that taxes should raise a certain amount of revenue — presumably expressed as a percentage of G.D.P. — then the debate on actual tax policies can take place in an atmosphere very different from the ones we have had in the past. Every tax deduction and every tax exemption should be viewed not just as giving a break to whatever deserving group has hired a good lobbyist but as forcing the rest of us to pay more.

One way to do that would be to calculate a system, based on a simple progression of tax rates, without any deductions or exclusions, that would produce the needed revenue. Then the debate over each tax break would include a discussion of just how much the rates would have to rise if that break were granted for those who can take advantage of it.

Do you want to preserve the deduction for interest on home mortgages, in the name of encouraging homeownership? Fine. Just understand that it would raise the marginal tax rate for every one of us by a certain number of percentage points. The same goes for charitable deductions, or not taxing certain fringe benefits like the cost of health insurance premiums.

With that in mind, we come to the capital gains tax break. It is defended as critical to economic growth and prosperity, on the theory that without it money will not be invested. But the empirical data to back that up is lacking, to say the least. Over the last 30 years, the economy and the stock market has tended to do better when the capital gains rate was high.

That does not prove causation, of course. But if the data went the other way you can be sure supporters of low capital gains rates would be citing it.

It also needs to be understood that the current system ends up discriminating against many who own stocks and mutual funds and thus receive capital gains and dividends. If your investments are in retirement plans, like 401(k) accounts, the profits are not taxed until the money is taken out. And then the money is taxed at ordinary income tax rates, regardless of whether it originated as capital gains.

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For Wealthy, Tax Cuts Since 1980s Have Been Gain-Gain

The last major overhaul of the tax code, signed by President Ronald Reagan in 1986, set tax rates on capital gains at the same level as the rates on ordinary income like salaries and wages, with both topping out at 28 percent. But that link was uncoupled by his successor, President George Bush, and the rates on capital gains were reduced by President Bill Clinton. President George W. Bush then lowered the rates on capital gains and dividends to a high of 15 percent — less than half the 35 percent top rate on ordinary income.

While rates for all American taxpayers have fallen to near 50-year lows, the wealthy have reaped the most savings from the changes because they derive a larger proportion of their income from investments.

Between 1985 and 2008, the wealthiest 400 Americans saw the percentage of their income paid in federal income taxes drop from 29 percent to 18 percent, according to data from the Internal Revenue Service.

Some economists say the cuts are necessary to keep capital from fleeing the United States to lower-tax countries. Scott A. Hodge, president of the conservative Tax Foundation, has written extensively that a capital gains tax is effectively double taxation on profits that have already been taxed at the corporate level. Many investors, and political leaders in both parties, have lobbied for tax cuts on capital gains and dividends by arguing that they spur investment and, therefore, job creation.

But there is little data to support that contention: the nonpartisan Congressional Research Service issued a report last year concluding that tax cuts on capital gains reduce federal revenues and do little to stimulate economic growth. And as income inequality and tax fairness have become major concerns for many Americans, the issue of tax fairness has brought calls to alter the tax code’s preferential treatment of investment income.

One outspoken critic has been Warren E. Buffett, a billionaire himself. Mr. Buffett stirred debate about the issue last year when he wrote an opinion article for The New York Times stating that the low rates for investment income had allowed him to pay only about 17 percent of his income in federal taxes, less than the effective rate paid by his secretary or any of the other 19 workers in his office.

President Obama responded to the outcry by proposing the “Buffett Rule,” which would stipulate that those earning more than $1 million a year should pay at least the same percentage of their earnings in federal taxes that middle-income Americans did. Though estimates showed his plan would raise tens of billions of dollars a year in federal revenue, it met strong opposition from the business community and failed to win approval in Congress. Still, the idea of taxing the wealthy at a higher rate could be an issue in this year’s presidential campaign.

Another point of contention is determining which investments should qualify for lower tax rates. Appreciation on stock and real assets like property has traditionally been classified as investment income because it involves investment risk on assets held for some extended period, typically at least a year. But during the last decade, hedge fund managers — who are frequently paid 2 percent of a fund’s assets annually plus 20 percent of its profits — have also been able to pay the lower rates on their earnings. Similar rules often apply to those who manage private equity funds and other types of investments.

Hedge fund and private equity managers have argued that their tax treatment is warranted because their earnings are contingent on whether their investments make a profit. But others have characterized it as a loophole that benefits the very wealthiest Americans, and Mr. Obama and other Democrats pledged to eliminate it during the 2008 election campaign.

In 2010, when Democrats controlled both houses of Congress, the effort to end the exemption for carried interest was met by a muscular lobbying campaign by investors and never made it out of committee.

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Obama to Ask Congress for Power to Merge Agencies

Mr. Obama called on lawmakers to grant him broad new authority to propose mergers of government agencies, which the Congress would have to approve or reject in an up-or-down vote.

The president, announcing the plan at the White House, said he would begin his pruning exercise by folding the Small Business Administration and five other agencies involved in trade and business, into a single agency that would replace the Commerce Department.

The White House said the consolidation would save $3 billion over 10 years and result in the elimination of 1,000 to 2,000 jobs, though he said those reductions would occur through attrition rather than layoffs.

“From the moment I got here, I saw up close what many of you know to be true: the government we have is not the government we need,” Mr. Obama told an audience of small business owners.

It is not clear whether Congress, which has blocked the bulk of Mr. Obama’s legislative agenda, will go along with the initiative. White House officials said that no president since Ronald Reagan has had the so-called “consolidation authority” Mr. Obama is seeking.

Republicans were immediately skeptical. They suggested that the White House was more interested in honing its re-election message than in reducing the size of government.

“Yesterday, President Obama asked for a $1.2 trillion increase in the debt limit, today he is proposing to shrink the federal government,” said Senator John Cornyn, Republican of Texas. “Unfortunately, President Obama does not have much of a record to back up his newfound, election-year enthusiasm for limited government.”

A spokesman for House Speaker John A. Boehner said that Republicans would take a look at the plan.

“We hope the president isn’t simply proposing new packaging for the same burdensome approach,” said the spokesman, Brendan Buck. “However, eliminating duplicative programs and making the federal government more simple, streamlined, and business-friendly is always an idea worth exploring. We look forward to hearing more about his proposal.”

By putting the onus for streamlining government on Congress, however, Mr. Obama was seizing a core issue of Republican presidential candidates like Mitt Romney — the inexorable growth of the federal government — and trying to turn it to his own political advantage.

It was the latest sally by the president, who has gone on the offensive against Congress as he embarks on his re-election bid. He appointed a new head of the Consumer Financial Protection Bureau, Richard Cordray, as well as other appointees to regulatory agencies, during a Congressional recess, to get around the opposition of lawmakers.

Under the terms of the reorganization proposed Friday, six relatively small agencies — the Small Business Administration, the Office of the United States Trade Representative, the Export-Import Bank, the Overseas Private Investment Corporation, and the Trade and Development Agency — would be consolidated into a single agency focused on opportunities for the private sector.

The administrator of the Small Business Administration, currently Karen G. Mills, would be elevated to the cabinet.

To illustrate the tangled maze of government services for businesses, the president gestured toward a screen behind him that showed the dozens of Web sites, offices, and customer service centers that a company must contend with, many with overlapping functions.

Mr. Obama championed the goal of streamlining government during his State of the Union address last year. On Friday, he cited an example of duplication from that speech: the Interior Department oversees salmon in fresh water, while the Commerce Department has jurisdiction over them in salt water.

The president said he would use the “consolidating authority” only for bureaucratic reorganizations that cut costs and made the government more efficient. And he challenged Republican lawmakers to support an idea that they themselves have embraced.

“With or without Congress, I’m going to keep at it, but it would be easier if Congress helped,” Mr. Obama said. “This is an area where we should receive bipartisan support because making our government more responsive and strategic and leaner should not be a partisan issue.”

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Off the Shelf: ‘Collision Course’ Looks at Reagan vs. Patco

The columnist George Will celebrated the defeated strike as a sign that years of liberal permissiveness had ended. “In a sense,” he wrote, “the ’60s ended in August 1981.”

A kind of myth has arisen — that the Reagan administration had this all planned, that it lured the Professional Air Traffic Controllers Organization, or Patco, into a trap so that it could be demolished. But as Joseph A. McCartin writes in his excellent history of the strike, “Collision Course: Ronald Reagan, the Air Traffic Controllers, and the Strike That Changed America,” (Oxford University Press), nothing could be further from the truth.

The book says that the Ronald Reagan of early 1981 was no union buster, that he had been reaching out for union support and that, in Patco’s case, he agreed to grant concessions more plentiful than any ever granted to a public employee union by an American president. It was Patco’s hubris, contends Mr. McCartin, an associate professor of history at Georgetown University, that forced Mr. Reagan’s hand and led to the union’s subsequent implosion.

“Collision Course” charts the rise of Patco and other public-sector unions over the course of 20 years, from the moment that President John F. Kennedy allowed government workers to bargain collectively. This power, however, came with strict limitations; unions like Patco were not allowed to strike or bargain for higher wages. Their negotiations with the government typically revolved around working conditions.

Mr. McCartin is especially good at showing why air traffic controllers quickly emerged as perhaps the most militant group of government workers. As air travel surged in the 1960s and ’70s, conditions in American control towers didn’t keep pace. Controllers were working longer hours than ever, often with equipment dismally out of date. Many controllers had come from blue-collar backgrounds — many were sons of union members, in fact — and came to believe that the responsibility they carried for the safety of millions of travelers entitled them to white-collar wages, a contention that few in government agreed with. Supervisors at the Federal Aviation Administration tended to treat the controllers as drones.

The story of Patco’s formation in the late 1960s is a stitch. The would-be unionists hired the press-hungry lawyer F. Lee Bailey to oversee its birth. With communication among the far-flung controllers primitive at best, he took to telegraphing important moves, including a 1968 work slowdown, during appearances on “The Tonight Show.”

The collision course that Mr. McCartin evokes took shape in the 1970s, as Patco’s growing militancy seemed out of place in a fiscally strained nation in which cities like New York were teetering on the edge of bankruptcy. Patco began a series of work slowdowns and sickouts that the F.A.A. was largely able to quell with little real improvement in working conditions. But that made the Patco rank and file only angrier; its hard-liners took each defeat as another humiliation. By the late ’70s, the union had grown even more restive with the influx of hundreds of younger, Vietnam-era controllers who often had a reflexive distrust of authority figures.

AS controllers’ salaries and work hours did slowly improve, the more militant among them kept asking for more. The flashpoint came in 1978 over a demand that, in retrospect, seems remarkably ill advised. Patco controllers, like many workers in the airline industry, had long enjoyed the benefit of a limited number of free airline seats. This “familiarization program” enabled controllers to see air operations up close and was limited to domestic flights. In 1978, Patco began demanding that its members receive free seats on international flights as well.

When airlines and the F.A.A. balked, Patco leaders instituted a work slowdown, causing delays at major airports. The decision was widely unpopular with the flying public, and even among some in Patco who thought it overreaching. Even one of Patco’s lawyers privately called the slowdown “indefensible.” Faced with court fines if it continued, Patco caved in, ending the action.

That, Mr. McCartin shows, was the final straw for Patco militants. The union’s president was overthrown in a boardroom coup, making way for hard-liners to take over. For these men — and they were almost all white men — the union’s long string of defeats was too much to stomach. They began itching for a strike well before the 1981 contract talks. A network known in the union as “the Choirboys” emerged to begin spreading the gospel of a strike, never mind that any strike would be illegal. “In the eyes of many union members,” Mr. McCartin writes, “the Patco fight concerned a fundamental human right: the freedom all workers should have to strike in protest of their conditions.”

By and large, the new Reagan administration took little notice of Patco. The union had endorsed Mr. Reagan in the 1980 election, after cutting a closed-doors deal in which Reagan advisers, while promising few specifics, made it clear they would look kindly on union demands. But Patco leadership emboldened by the deal, demanded pay raises. In June 1981, Mr. Reagan actually gave in, granting the union what Mr. McCartin shows was possibly the most generous set of concessions made to a federal public employee union in government history.

It wasn’t enough. The rank and file rejected the deal, setting the stage for a strike that, in retrospect, had little to do with salary. This was about respect, about a deep-seated anger at years of perceived humiliation at the hands of F.A.A. supervisors. It was only after the union rejected the government’s offers, Mr. McCartin demonstrates, that Mr. Reagan took his historic hard line. Any controllers who struck, he vowed, would be fired. And they were fired, in the thousands. Supervisors and military controllers filled in, and replacements would be trained and hired. For the most part, the public applauded while unions cringed. The cause of organized labor was set back years, if not decades.

History books seem to come in two guises these days: popular and academic. “Collision Course” is a successful fusion of the two; the author is an academic who can tell a story. The book can be dry in places — much high drama, including the suicides of some Patco strikers, is passed over glancingly — but the narrative is clear and well paced. Mr. McCartin deals with policy but also with personalities, and the book is better for it. For anyone at all interested in labor or business history, I recommend it.

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Economix Blog: George Shultz on Politics and Budgets

I called George Shultz, the former more-or-less everything, this week to see what he thought of the government now. I discovered that he is rankled by the budget process but impressed by at least one candidate for the Republican presidential nomination.

And I found that a long perspective can serve as a reminder that life is not made up of one disaster after another.

“It’s an interesting thing to look back and see how much turmoil we have in the last 100 years, and how it also has been a period of great progress,” he said, mentioning the reduction in poverty and increase in life expectancy around the world. “In many respects, the U.S. had a big hand in creating a global commons that everyone benefited from, including us.”

On Monday, he will receive the Economics Club of New York Award for Leadership Excellence, and he told me he had no desire to scoop his speech, which will discuss the world as he sees it now.

But he did say the current budget process “is undoubtedly a catastrophe. We are living in continuing resolutions. They don’t have any thought in them. They just continue things.”

He spoke wistfully of the days when the presidents and congresses of different parties were able to reach agreement on budgets. “From what I read,” he said of the current poisoned atmosphere in Washington, “it is not recognizable.”

Mr. Shultz was a young White House economist in the Eisenhower administration. He served as secretary of labor, as budget director and as Treasury secretary in the Nixon administration, and as an economic adviser and as secretary of state under Ronald Reagan.

“And,” he told me, “I did things for Kennedy and Johnson.”

When he was not working for the government, he taught at the Massachusetts Institute of Technology, Chicago and Stanford, and was president of Bechtel, a large construction company.

I pointed out that doing things for presidents from the other party was now considered a political liability in some circles, noting the criticism of Jon M. Huntsman Jr., the former Utah governor, for serving as ambassador to China under President Obama. Mr. Huntsman’s campaign for the Republican presidential nomination has yet to catch fire.

“Why,” asked Mr. Shultz, “don’t we elect somebody who is patriotic, competent, sensible, has experience in government and has shown that he can manage well?”

He said Mr. Huntsman had greatly impressed people in Singapore, where he was George H.W. Bush’s ambassador before he was elected governor, adding that impressing Singaporeans was not easy.

Mr. Shultz said he was not ready to endorse anybody, but he passed up the chance to volunteer nice things about any of the other candidates.

Of Mr. Huntsman, he said, “He looks a lot better to me than he does in the polls.”

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Letters: How the Debt Ballooned, and How to Deflate It

To the Editor:

“U.S. Has Binged. Soon It’ll Be Time to Pay the Tab.” (Fair Game, May 29) echoed what historians already know — that nations with empires to maintain soon run out of money to maintain them. It happened with Rome and the British Empire, and now it’s happening with our own.

Since Ronald Reagan was president, we have fought both our hot and cold wars by borrowing without having the money to pay for them. And we have starved the beast of government revenue by creating policies that transferred huge amounts of wealth to the wealthiest. This, in turn, has resulted in starving the biggest engine of our growth: the lower- and middle-income consumers who now have declining real incomes and wealth.

As developing countries begin to mature — and with notably less debt — they are becoming the engines of growth and will be its future dominant players.

Harlan Green

Santa Barbara, Calif., May 30

To the Editor:

How can the United States pay for its binges? We can count the ways:

Use pay-as-you-go budgeting, means-testing for all government assistance programs, sunset provisions for agencies and programs that have completed their missions. End pork-barrel item spending and stop paying farmers to not grow crops. Abolish corporate welfare subsidies in the form of favorable tax code deductions. Start a real campaign against waste, fraud and abuse. And the list goes on.

If we don’t take action, not only the poor, but also our vast middle class will suffer. And if we kick the can to future generations, there will eventually be no safety net for anyone. Larry Penner

Great Neck, N.Y., May 29

Letters for Sunday Business may be sent to

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Arsenal of a Lobbyist: Hardball and Cupcakes

IN this covetous town, the delicacies of the Georgetown Cupcake shop stand alone as symbols of wish fulfillment — heaping swirls of luscious confection atop rich, creamy pastry.

Therefore: Operation Cupcake. As the Federal Communications Commission debated final rules last December on how Internet service providers should manage their traffic,  ATT delivered 1,500 of these opulent desserts to the F.C.C.’s headquarters here.

Like many other big corporations, ATT annually blankets power brokers with token holiday gifts, but the cupcake campaign was notable for its military precision. A three-page spreadsheet, stamped “ATT Proprietary (Internal Use Only),” detailed how the desserts were to be deployed to each of the 63 commission offices: four dozen were assigned to the enforcement bureau, 10 dozen to the wireless divisions, 12 cupcakes to each of four commissioners, and 18 to the chairman, and so on.

As it turns out,  ATT had begun its $39 billion courting of T-Mobile about the same time. The resulting ’deal, announced a week ago, would transform the industry if approved. It would narrow the field of major wireless providers to three and vault ATT into the No. 1 spot, ahead of Verizon; consumer advocates say the combination will lead to higher prices.

As interested parties lobby for and against the merger, one person will be pulling at the levers of power more often and with more influence than anyone else, according to both friends and foes: ATT’s chief lobbyist, James W. Cicconi. A master strategist, Mr. Cicconi (pronounced si-CONE-ee) internalizes the art of regulatory and legislative war — and Operation Cupcake is but one of the efforts to come out of his shop.

Tutored by James A. Baker III in the ways of politics in the administrations of Ronald Reagan and George H. W. Bush, Mr. Cicconi, 58, plays hardball — literally, as a pitcher in an adult baseball league, flinging fastballs toward batters more than a decade younger.

His roots are in Texas, and he never forgets the lesson of the Alamo: the Texans lost. Other battles have different lessons for him. He once took his staff on an overnight retreat to Gettysburg, Pa., where it toured Cemetery Ridge and Little Round Top and absorbed lessons on battlefield tactics.

In 13 years at ATT, Mr. Cicconi has helped guide the company through roughly a dozen mergers, large and small, and he has made his share of enemies in Washington. As a testament to his power, however, few of them will criticize him on the record.

“He’s smart, he’s savvy, he’s strategic,” says Gigi B. Sohn, president of Public Knowledge, a media and consumer advocacy group that has often wrestled with him. “I don’t think there’s a lobbyist in town who I disagree with more on the issues, but I have the utmost respect and admiration for the way he does his job. He’s always thinking three steps ahead of the competition.”

MR. CICCONI, senior executive vice president for external and legislative affairs, is not alone, of course, in spreading ATT’s corporate message. Five other executives rate a similar rank, and four more are group presidents or chief executives, all under ATT’s chairman and C.E.O., Randall L. Stephenson.

Nor is Mr. Cicconi’s lobbying effort a one-man show. He oversees a division that spent $115 million on lobbying over the last six years, putting it among the top five corporate spenders in the country, according to the Center for Responsive Politics, which tracks lobbying and campaign spending.

ATT employs an army of outside lobbyists, including at least six prominent former members of Congress, including the former Senate majority leader Trent Lott, a Mississippi Republican, and former Senator John Breaux, a Louisiana Democrat.

Over the last two decades, ATT employees and its political action committees have pumped more campaign contributions into federal politics than any other American corporation, the Center for Responsive Politics reports. In the last election cycle, ATT contributions found their way to 390 representatives and 70 senators.

“They are a behemoth,” says Dave Levinthal, editor of, the center’s online lobbying database. “When you have dozens of former federal officials doing your bidding in Washington with a detailed knowledge of how Washington works, it is exponentially easier to grease the skids of government.”

As Congress discusses the merger, Republicans and Democrats will duel over the balance of market forces and regulatory intervention. The White House will strive to balance the president’s campaign promises to get tough on antitrust issues while trying to prove he is not anti-business.

In advocating for the T-Mobile merger, ATT and Mr. Cicconi have their work cut out for them. The Justice Department’s antitrust unit will aim to determine whether the deal will substantially limit consumers’ choices. After the merger, ATT and Verizon would together control nearly 80 percent of the cellular market, with Sprint a distant third.

(Verizon declined to comment on Mr. Cicconi or on ATT’s deal to acquire T-Mobile.)

And the F.C.C., which along with Justice must approve the merger, wants to reapportion the scarce broadcast wavelengths on which wireless broadband operates. The T-mobile deal would result in fewer potential bidders in its airwave auctions.

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