Nobody likes paying a telephone bill, landline, cell or otherwise. The long-term contracts, early termination fees and the bewildering array of fees and limits make comparison shopping a drudge. This isn't so, however, for nearly 1 every 10 Maryland residents who get their telephone free from the Lifeline subsidy program. The rest of us pay for it.
The Baltimore Sun reported Sunday that the number signed up for free telephones in the aptly named Free State has exploded 90-fold from a mere 5,821 in 2008 to nearly 509,000 in 2012. The number would have been higher if not for a targeted Federal Communications Commission audit that pushed more than 230,000 freeloading Marylanders off the program late last year.
The Lifeline program was started as part of the Universal Service Fund in 1985. Legislators from rural states thought it was a great idea to tax the telephones of city dwellers to cover the cost of running telephone lines to remote locations in, for example, Alaska. With tens of billions in taxes paid, the goal of universal service was accomplished. Landline phones are widely available with wireless alternatives available to fill gaps in availability. So the program shifted focus.
A "viral" video during last fall's presidential campaign gave the program, widely called "Obamaphones," long legs. "Keep Obama [as] president, you know," one enthusiastic fan of the president rejoiced. "He gave us a phone!"
White House defenders have circled the cable trucks, seeking to inoculate President Obama from responsibility for this particular scam. Politico, the Capitol Hill daily, recently published a front-page article, " 'Obama Phone' Facts Still A Hang-Up in Washington." First among the five "myths" it sought to prick was that "it's an Obama phone," noting that it was under Mr. Bush "in 2005 that the FCC started allowing some prepaid wireless providers to participate. This shift sparked tremendous growth." It's true the program was far too big by the end of the Bush administration, costing $820 million per year. Under Mr. Obama, it has tripled in size to $2.2 billion.
As much as supporters insist this program is needed for the poor, it smells more like a program for well-connected cronies. Calls have grown louder on Capitol Hill for congressional review, reform or even repeal of Lifeline. Reformers must be prepared, however, to run up against a gantlet of proponents, including telecommunications companies that have profited handsomely from this corporate welfare. The top Lifeline provider, Mexican billionaire Carlos Slim's TracFone, has received $1,506,634,841 from taxpayers since Mr. Obama was first sworn in. Mr. Slim is one of the major shareholders of The New York Times. Telecommunications firms won't give up without a fight, and it's up to the public, gouged on every telephone bill, to tell Congress to hang up the Obamaphone.
The Washington Times
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