By Stelios


Ever been at the DMV or the courthouse, or some other place where you get to interact with a true cross section of the local community, and wonder why it seems like everyone — regardless of their apparent socioeconomic status — seems to have a cellphone?  Could everyone, including the working poor, the long-term unemployed and welfare recipients, really think that a cellphone is such a necessity that they would divert the necessary amount of their (very limited to nonexistent) discretionary income to purchasing one?  Apparently, the answer is ‘no.’   Many low-income people simply get their cellphones free of charge.

The Federal Communication Commission website provides the following description of something called the “Universal Service Charge”:

  • The Universal Service Fund (USF) provides support to promote access to telecommunications services at reasonable rates for those living in rural and high-cost areas, income-eligible consumers, rural health care facilities, and schools and libraries.
  • All telecommunications service providers and certain other providers of telecommunications must contribute to the federal USF based on a percentage of their interstate and international end-user telecommunications revenues. These companies include wireline phone companies, wireless phone companies, paging service companies, and certain Voice over Internet Protocol (VoIP) providers.
  • Some consumers may notice a “Universal Service” line item on their telephone bills. This line item appears when a company chooses to recover its USF contributions directly from its customers by billing them this charge. The FCC does not require this charge to be passed on to customers. Each company makes a business decision about whether and how to assess charges to recover its Universal Service costs. These charges usually appear as a percentage of the consumer’s phone bill. Companies that choose to collect Universal Service fees from their customers cannot collect an amount that exceeds their contribution to the USF. They also cannot collect any fees from a Lifeline program participant.

What does this mean?  Well, several states have programs called “Lifeline Programs” (there may be other labels) that allow lower-income folks to receive cellphones and service absolutely free.  In states that participate, all you normally need to do to qualify is fill out a one page application and certify EITHER that you receive Medicaid, Food Stamps/SNAP, Temporary Cash Assistance, Supplemental Security Income (SSI), Indian Affairs Programs, Section 8 housing assistance, Low-Income Home Energy Assistance (LIHEAP) or receive free school lunch; OR that you earn less than $16,335 (single), $22,065 (two person household) or $27,795 (three person household). 

This “Lifeline Program” in effect equates cellphones with food, housing and home heat as necessities critical to America’s welfare state, the so-called “social safety net”.  It is paid for by levying the cellular phone providers, who in turn add that cost directly to our cellphone bills and call it a “Universal Service Charge” (which is because the government funds the cellphone handouts out of the Universal Service Fund, so we shouldn’t blame AT&T and Verizon for the creepy euphemisms in play here).

Do the American people know that paying cellphone customers are funding free cellphones for lower-income Americans?  I doubt it.  Could this be a game-changer for an American public fed up with bloated government programs, waste and wealth redistribution?  Possibly.  There are some signs within the culture that people are starting to realize how vast, pervasive and overreaching the entitlements regimes have become.  A friend sent me this clip from the daytime courtroom show Judge Judy:

This self-described college student receives free tuition, cash stipends, and cash for rent which he doesn’t use for rent, ever.  Ironically, his roommate didn’t pay much rent either, so there’s no one to root for among the litigants, but that’s beside the point.  What’s noteworthy and worth rooting for is the sense that Judge Judy, her bailiff and a lot of the people watching are disgusted and fed up with the parasitic class which, far from struggling in abject poverty, seems able to lead a very comfortable existence in many cases by simply drawing on government programs funded by hard-working people like Judge Judy’s bailiff.  You can see the disgust in his eyes.

I wonder how many people in America are working hard at entry level service jobs, apprenticeships or low-paying blue collar work — paying the price to work their way up from the bottom the right way — and are unqualified for any government assistance, but can’t afford housing and do without non-necessities like cellphone service?  How many people do you know who live with their parents, or who started out in cheap apartments with multiple roommates until they could afford a decent place of their own?  What happens to a society when a person can do as well or better than the low-paid worker by not working and going on the dole?  What’s the incentive to bust one’s ass in sweaty, dangerous or menial work when the guy down the block collects a similar amount in gov’t housing, “energy assistance”, food stamps, “Lifeline” program benefits, etc. — and he spends his day playing Xbox and smoking blunts?

I think most Americans are comfortable with some form of welfare state.  It’s a sign of strength and a sign of the conscience of the people that Americans are perfectly willing to fund a social safety net that prevents people from starving to death, becoming homeless or freezing to death in the winter.  Most people think it’s fair and reasonable to have an unemployment insurance system that gives people a small income while they are between jobs.  But when the system creates people like the student in the Judge Judy clip, when the system is giving free cellphones for 10 years at a clip to people who in many cases are making no effort to work or lead productive lives, when the system can provide an enterprising person with a package of benefits for not working that meets or exceeds what he could make at an entry level job, then the system is broken.  And most people in the productive class, if they knew the full details of our present system, would say “that wasn’t what we agreed to.”  It’s time for people to become fully informed about what an out-of-control hydra the welfare state has become. 

Eliminating the Universal Access Fund would be a simple way to release millions of dollars in spending power back to the working population, and would remove yet another incentive for people on welfare to remain there instead of joining the productive class and contributing to society.