FCC Approves Expansion into ‘ObamaNet’ Broadband Subsidy

Published September 14, 2015

The Federal Communications Commission (FCC) has decided to expand the LifeLine telephone subsidy program, funded by the Universal Service Fund (USF) fee, which is collected from taxpayers’ telephone bills, to include broadband Internet service for lower-income people.

Seton Motley, president of Less Government, says FCC’s LifeLine program and other programs funded by the Universal Service Fund create new entitlements at taxpayers’ expense.

“The justification is going to be we’re spending all this money on broadband, and we need to get that money from somewhere,” Motley said. “It’s like Obamacare: ‘We’re going to raise your taxes to pay you subsidies for your health insurance that we made more expensive in the first place.’ They’re going to raise taxes to pay for Internet services that they made more expensive in the first place.”

Motley says FCC has expanded the LifeLine program beyond its legally authorized mission.

“When did Congress have a vote and pass a law that said LifeLine will now apply to broadband?” Motley said. “The answer is that hasn’t happened. Where do they get the authority to expand a program that was supposed to be for landline phones, transmogrified into cell phone [access], and yesterday transmogrified to broadband Internet access?

“It was supposed to be for emergency landline phone lines, for the event that people in rural areas needed to call 911,” Motley said. “How does that come within a million miles of broadband Internet access?”

Ernest Istook, president of Americans for Less Regulation, says USF-funded entitlement spending has spiraled out of control.

“It has metastasized,” Istook said. “The program when Ronald Reagan was president was one-tenth the size of what it is now, with the number of people and the costs.”

Istook says entitlement spending at FCC is no different from other government agencies’ distribution of entitlements, continually growing once established.

“The people who are supposedly in need when they create a program are just a small number of people, but once they start giving things away, more people want it, and the program keeps growing,” Istook said. “It’s buying votes, it’s buying offices, it’s buying power.”

Rudy Takala ([email protected]) writes from Washington, DC.

Internet Info:

Jerry Hausman, “Efficiency Effects On The U.S. Economy From Wireless Taxation,” National Bureau of Economic Research: https://heartland.org/policy-documents/efficiency-effects-us-economy-wireless-taxation/