Wednesday, April 24, 2013

A Balanced Look at Lifeline and Its Reform - Part II

The House Energy & Commerce Committee' s Subcommittee on Communications and Technology is holding a hearing tomorrow entitled, "The Lifeline Fund: Money Well Spent?"
For a long time I've maintained the Lifeline fund provides an important "safety net" for those low-income persons who otherwise might go without communications service. Most recently, I wrote about this in "A Balanced Look at Lifeline and Its Reform." 
A balanced look at Lifeline means recognizing that it is important to root out fraud and abuse in the program, while also recognizing the positive role the program plays in today's society when being "connected" is more important than ever. 
We know this intuitively, and the hard evidence abounds. But an article in today's Wall Street Journal online, "How Your Smartphone Could Get You a Job," drives the point home again, especially with regard to the value of wireless phones made available to low income persons through Lifeline's subsidies. The article details how job-hunting is rapidly moving to mobile devices. Indeed, it refers to the IDC study predicting "that mobile devices will overtake desktop and laptop computers as Americans preferred method for accessing the Internet by 2015." 
Interestingly, there is now a lot of data available indicating that minorities are more likely than non-minorities to own smartphones, and this phenomenon has helped to close the so-called "digital divide." No doubt Lifeline's subsidies that allow low-income persons to obtain mobile devices has played a role in this regard. 
My FSF colleague, former FCC Commissioner Deborah Taylor Tate, has been a steadfast supporter of Lifeline. With the hearing tomorrow, her earlier pieces, "A Vital Lifeline" and "FCC's Lifeline Reforms Should Keep Low-Income Consumers Connected," are worth reading again. 
Like me, former Commissioner Tate recognizes the need for Lifeline reforms, such as implementation of a functioning, accessible, and accurate eligibility database, to prevent abuse of the program. But past problems regarding screening and enforcing eligibility requirements are not a reason to ignore the program's value.
Finally, like me, Commissioner Tate recognizes that the existence of a healthy Lifeline program means policymakers, if they are truly reform-minded, should focus on curtailing growth in other parts of the program, such as the high-cost fund, where the subsidies to rural telcos are distributed on a more indiscriminate, less targeted basis. 
As she put it in "A Vital Lifeline": 
"And here's an important point about the Lifeline program that should be emphasized: The fact that the program exists, as a means of targeting subsidies to those truly in need, makes it easier to argue convincingly that those parts of the overall USF program which distribute subsidies in a much more indiscriminate fashion, such as the high-cost program, should be subject to hard caps and gradual reductions.
So, when the House subcommittee convenes tomorrow, I hope it takes a balanced look at the Lifeline program, which over many years now, has enjoyed bipartisan support.