Heartland Institute Reacts to FCC’s Reform of the USF

Published October 27, 2011

The Federal Communications Commission today voted unanimously to redirect the mission of the Universal Service Fund from subsidizing rural phone service to subsidizing rural high-speed broadband.

The following statements from telecommunications experts at The Heartland Institute – a free-market think tank – may be used for attribution. For more comments, refer to the individual’s contact information below. To book a Heartland guest on your program, please contact Tammy Nash at [email protected] and 312/377-4000. After regular business hours, contact Jim Lakely at [email protected] and 312/731-9364.

“It’s Halloween, and U.S. consumers have been forced into another FCC trick-or-treat scenario. The FCC has finally recognized that the $8 billion of USF funding – derived from fees tacked on to consumer bills – for areas under-served by land-line phone service was outdated and unnecessary, and has taken steps to rectify it.

“Rather than treating consumers in a woefully under-performing economy by rescinding the fee altogether, the FCC has tricked us by simply reallocating the money for broadband buildout serving a frightfully small percent of the U.S. population.”

Bruce Edward Walker
Managing Editor, InfoTech & Telecom News
The Heartland Institute
[email protected]

“We found out early this year that the government found a way to waste more than 50 cents on every dollar they pulled into the USF. Instead of investigating the wastefulness of this consumer-funded boondoggle, the FCC today passed a massive expansion of the program.

“The last remaining hope for fiscal responsibility was that the USF funded a dying technology. Reallocating those monies to new technology gives life to one of the least efficient and least useful endeavors the FCC has undertaken – and that’s saying something.

“What should consumers expect from the new USF? Higher mobile phone bills, more confusing charges, and a ton of corporate handouts. The FCC has stumbled yet again.”

Marc Oestreich
Legislative Specialist for Technology Policy
The Heartland Institute
[email protected] 312/377-4000

The Heartland Institute is a 27-year-old national nonprofit organization with offices in Chicago, Illinois; Washington, DC; Austin, Texas; Tallahassee, Florida; and Columbus, Ohio. Its mission is to discover, develop, and promote free-market solutions to social and economic problems. For more information, visit our Web site or call 312/377-4000.