Ever wondered what those mysterious charges known as the “Universal Connectivity Fee” on your phone bill are for? Apparently it’s for something called the “Obama phone.” At least that’s one low-income Obama supporter believes.
A video went viral this week showing an Obama supporter touting her “Obama phone” while protesting at a Mitt Romney event. What the star of this video didn’t realize was that she was putting the spotlight on an obscure federal program that provides discounted or free cell phone service to qualifying low-income Americans.
“Keep Obama as president,” the woman says on the video. “He gave us a phone.”
The woman in the video was talking about a government program, known as “Lifeline,” which is another of the many entitlements available to the poor in this country. It also highlights the growing percentage of Americans who pay no income taxes but reap the benefits of an ever-growing list of government benefits.
To be fair to Mr. Obama, he didn’t initiate the program that led to the creation of Lifeline in 2008, but under his direction the program has exploded, swelling from $772 million when Mr. Obama took office to more than $1.6 billion today.
“It’s a government-run, taxpayer-funded program that’s running wild and costing more and more,” according to a statement on Rep. Tim Griffin’s, R-Ark. official House of Representatives website.
Private carriers who contract with the government, including TracPhone and Sprint, have websites intended to publicize the program. Some attempt to dispel the program’s connection to the president, such as freegovernmentcellphones.net, while others, including obamaphone.net, embrace it.
Griffin, who introduced H.R. 3481 in November to end the program, claims to have evidence of dead people getting free cell phones in the mail, ineligible people getting multiple phones and electronic kiosks in convenience stores to encourage people to get the phones.
“The truth is, though, that taxpayers are footing the bill,” the website reads. “The program is called Lifeline, but in reality it’s turned into Uncle Sam’s Unlimited Plan.”
Lifeline was originally intended to subsidize landline phone service for poor Americans, paid for with that pesky Universal Connectivity Fee charged on our phone bills. According to the Federal Communications Commission (FCC), consumers must either have an income that is at or below 135 percent of the federal poverty guidelines or participate in any number of assistance programs, including Medicaid, Head Start or Supplemental Security Income. In 2008, the plan was extended to supply cellphones and cellular service as many Americans began using those devices as their primary telephone.
“It’s a government-run, taxpayer-funded program that’s running wild and costing more and more,” Griffin says.
The program, according to FCC officials, has helped tens of millions of low-income Americans afford basic phone service, which is essential to finding a job or getting help during an emergency. To that end, the percentage of low-income households with phone service has increased from 80 percent in 1985 when the program began to nearly 92 percent in 2011.
A family of four with an income of about $30,000 can qualify for a subsidized line, according to Bloomberg News. The program is available to consumers in every state, territory, commonwealth and on tribal lands.
In 2008, there were 7.1 million Lifeline accounts nationwide. There are 12.5 million today, according to Bloomberg News. About half of those are mobile phones sold by Miami-based TracFone, Sprint and hundreds of smaller regional companies. The government pays those carriers up to $10 per month for each program subscriber. Users, in turn, get free phones and 250 minutes of monthly airtime.
Sen. Claire McCaskill, D-Mo., received a mailed solicitation last year informing her she was eligible for a phone, leading her to question the program.
“I am troubled by the expansive potential for the program to be abused,” McCaskill wrote the FCC in December.
The FCC, meanwhile, announced in July that comprehensive reforms to the program had saved nearly $43 million and were on track to save $200 million in 2012. The reforms included eliminating unnecessary subsidies, cutting off duplicative subscriptions and requiring better proof of eligibility.
What’s next? Obama cars? Perhaps Obama golf outings for the poor? Give him four more years and the poor will be living at a higher standard than the middle-class.
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