“Confession: You’re paying my phone bill,” Jillian Kay Melchior reports for National Review. “In the past month, I have received three shiny new cell phones, courtesy of American taxpayers, that should never have fallen into my hands.”
“The Federal Communications Commission oversees the so-called Lifeline program, created in 1984 to make sure impoverished Americans had telephone service available to call their moms, bosses, and 911. In 2008, the FCC expanded the program to offer subsidized cell-phone service, and since then, the expenses of running the program have soared,” Melchior reports. “In 2012, the program’s costs had risen to $2.189 billion, up from $822 million before wireless carriers were included. As of June, there were 13.8 million active Lifeline subscriptions.”
“To be eligible for Lifeline, the applicant is supposed to be receiving some significant government benefit — food stamps, Medicaid, Supplemental Security Income, public housing assistance, etc. But because welfare eligibility has expanded under the Obama administration, more people than ever before are qualified to receive ‘free’ cell-phone service — part of the reason why Lifeline mobiles have become commonly known as Obamaphones. Alternatively, applicants can qualify if their household income is less than 136 percent of the federal poverty line,” Melchior reports. “But as with any federal program with too much funding, too little oversight, and perverse financial incentives, Lifeline has become infamous for rampant fraud and abuse. There have been news reports about recipients flaunting dozens of subsidized phones. And in February, the Wall Street Journal reported on an FCC audit of the top five Lifeline providers, which found that “41% of their more than six million subscribers either couldn’t demonstrate their eligibility or didn’t respond to requests for certification.””
Melchior reports, “Representative Tim Griffin (R., Ark.) has long opposed the Lifeline wireless subsidies, making it a pet cause. He reiterated the basic point I had learned from this experience: The problems began when the federal government got in the business of providing free cell phones, and the FCC’s recent reforms aren’t sufficient. ‘I saw all the horror stories of people getting 10, 20, 30, 40 phones,’ Griffin says, ‘the [wireless] companies not paying a lot of attention and in some cases no attention to who was getting them and whether they were getting duplicates.’ And if you’ve been wondering why the companies are so eager to hand out free phones, the incentive is built into the program. As Griffin explains, ‘Of course, the way the program was set up, [wireless companies] were getting money for every one they could give out, so they gave out as many as they could.’ And still do.”
Read more in the full article here.
MacDailyNews Take: “Too much funding, too little oversight, and perverse financial incentives” is the recipe for fraud, abuse, and waste.
Not just Apple, this affects every mobile phone maker, for those people who could afford to pay for their own phone/plan, yet choose instead to leech off the “system,” despicably defrauding their fellow citizens, are not participating in the open mobile phone market. For shame.
[Thanks to MacDailyNews readers too numerous to mention individually for the heads up.]