They’re often called “Obama phones” but the program behind them has been in place since 1985. The Lifeline program was enacted to provide a discount on phone service for qualifying low-income customers to, according to the FCC, “ensure all Americans have the opportunities and security phone service brings.” Indeed, getting a job without a reliable phone would be difficult, if not impossible. In 2005, under President Bush, Lifeline discounts were made available for pre-paid wireless service plans. In fact, very few of the eligibility requirements have changed at all under the Obama administration.
The cell phone distribution program began in 2008, except Barack Obama was not actually inaugurated until 2009. Similar to Obamacare, many on the Right have attached the president’s name to the program derisively, while many on the Left welcome the new name as they are proud of the program and want to see their man’s name attached to it.
What is undeniable is that spending on the program has ballooned. It has increased from $819 million in 2008 to nearly $2 billion today. In that same time frame, to finance this increase in spending, the tax rate on phone bills has increased by 83%. In California, around 1.5 million people are subscribers in the program. New York has around one million as well. Originally, the program offered participants a discount on service. Now it offers free service.
The program has been fraught with waste and abuse and Scott’s bill would put a cap in place to act as a guard. One area where abuse is rampant is due to the policy difference regarding the subsidy for tribal lands. The FCC apparently considers most of Oklahoma as tribal land and the state is reaping big benefits through the Lifeline program. The typical subsidy is $9.25 per month. Those designated as tribal receive $34.25 per month. Thanks to this, Oklahoma received $128 million in Lifeline funds in 2014, second only to California. Of the 300,000 receiving support, just over 300 did not qualify for the tribal subsidy, despite the majority of Oklahoman Lifeline participants not being Native Americans.
Another budget balloon is coming as the FCC just issued an order to expand Lifeline service to include high-speed internet access. The new projected budget is expected to be $2.5 billion. Congressman Scott’s bill would cap the budget at $1.5 billion.
“I have been fighting to end the unchecked spending and lack of accountability in the Lifeline Program since I came to Congress,” said Congressman Austin Scott. “While the program’s original purpose had merit, the program in its current form is wrought with fraud and abuse, and it is past time for Washington to respond to the calls of our constituents to rein this program in. American citizens, who are all too familiar with “Obama Phones”, understand this and can agree that it is simple good governance to ensure we are curbing wasteful spending while also promoting accountability across the federal government. We have a responsibility to the American citizens to practice the same spending discipline they would in their own homes.”
Scott’s bill would also bar the use of Lifeline fund for the purchase or subsidy of devices, including smartphones, tablets or laptops.
It remains to be seen if the bill will be able to pass, and if so, whether Obama would sign it. The Lifeline budget will likely continue to increase and with Washington gridlock looking to continue for the foreseeable future, a fix may not make it through anytime soon.
