AT&T’s $39 billion bid for T-Mobile is a deal that consumer advocates hate but labor unions love. And that puts the Obama administration squarely between two powerful constituencies that typically support Democratic presidential candidates.
A vast array of public interest groups and a growing number of state officials fear that the deal will lead to too much concentration in the wireless industry and higher cellphone bills for Americans.
But the Communications Workers of America union says the transaction will create jobs — and give it more members. If the administration blocked the merger, it would risk upsetting a key union at a time when the labor movement is facing an erosion of its influence and is looking to Democrats to help reinforce its flagging ranks.
“The administration is in a tricky spot,” said Paul Gallant, a research analyst at investment firm MF Global. “Labor is often an under-appreciated ally of the major phone companies, and they are undoubtably playing an important role in this merger.”
The CWA has been among the most vocal supporters of the merger. As the communications industry’s biggest union, with 700,000 members, it has lobbied regulators at the Federal Communications Commission to approve the deal. CWA chief Larry Cohen has testified at congressional hearings that the joined resources of AT&T and T-Mobile could bring high-speed Internet connections to rural areas more quickly and create more jobs. Last week, CWA members met with Justice Department officials to reiterate that message.
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