Legislature must curtail unfair cell provider advantage

Although Sen. David Vitter is a bit of a latecomer to the argument over government paying for people to use cell phones, his actions have revealed the extent of reform needs beyond what he and others have recommended that can be addressed by Louisiana.

Vitter has made headlines recently through criticizing the freewheeling subsidization of cell phone operation for individuals that qualify under a variety of government programs. The Lifeline program was started in 1984 to subsidize landline phone service for the purposes of ensuring contact was available for emergency purposes, contact with family and friends, and for assisting in contact for employment purposes. Modest in size until 2008, it has grown 15 times in since.

One reason was because the program was changed late in the Pres. George W. Bush Administration to allow for cell phones. This means the government pays basically for 250 minutes a month and 1,000 text messages, but the cell phone providers authorized in the program offer low priced-to-free phones and add-on options at very low rates that grant users access to the same features non-qualifiers may pay hundreds of dollars a month to get the same. And while the program prohibits households having more than one, many apparently use it as an additional phone to others they already contract for out of pocket.

Another is the relaxation of eligibility policies for qualification to many federal programs under Pres. Barack Obama, combined with the economic slowdown induced by his policies that has expanded considerably the number of people who qualify – regardless of whether there is any actual need or inability to pay to qualify. For example, given my wife’s severe physical disability that qualifies her for government assistance, regardless of the fact I am a full-time university professor and she teaches there part-time, our household is eligible to receive one (naturally, we turned down the offer upon her qualification). That others use them as additional household phones also testifies to the fact that the eligibility requirements as currently constituted produce superfluous waste of taxpayer resources.

(Speak of the devil! Shortly after I wrote the below paragraph, I got our mail and there was a solicitation for a free cell phone. The provider, Tracfone – more about them below – promised delivery after “3 easy steps” and this came in English, Spanish, and French. The deal: 250 minutes a month, voice mail, and unlimited text messages. If you accept only 125 minutes a month, then you could roll over minutes. If you accept only 68 minutes a month with rollover, you also get free calling to 100 countries. I guess options to pay to expand these and to buy the phone come only after approval of the initial application (although another flyer did say as part of this you could "Get a FREE Cell Phone"). You have to assent insisting this is the only free phone in the household, that you will inform the company within 30 days if you no longer qualify or move, and that you believe you qualify. Interestingly, it asks you to fill in a contact phone number. Gentle readers, fear not – we will not pull a little more change from your pockets by taking them up on this.)

Finally, the program is riddled with fraud. Besides violating the one-per-household requirement, apparently the dead also get them (used by the living) and non-qualifiers apparently get them with ease. These incidents led Rep, Tim Griffin of Arkansas a couple of months prior to Vitter’s initial legislative efforts to rein in the program to introduce H.R. 176 to return the program to landline-only status.

But Vitter has ratcheted up complaints against the program, drawing the ire of the largest provider (owned by the world’s richest man, Mexico’s Carlos Slim), Tracfone (see above). It ran a newspaper ad criticizing his proposal that would end the program funded by a surcharge on telephone bills, and then sent out text messages to program users telling them “Save Lifeline! Call Sen Landrieu at 202-224-3121. Due to Sen Vitter program is in jeopardy.”

As Vitter noted, that the biggest recipient of corporate welfare related to this activity reacted as it did shows precisely the relatively large amount of business it feels is at stake and that it must know the facts behind this transfer of wealth are unflattering concerning it. And as the information above demonstrates, Vitter entirely is correct that much of what the program merely makes cell phone access an entitlement for a large portion of the population, and that the emergency function of it easily can be provided by charities or at very low cost to government by taking old, unused cell phones and converting them to 911 use only.

Perhaps there can be some melding of the Vitter amendment to S. 954 and the Griffin bill with other provisions to make this a program that serve the truly needy. For households comprised of all unemployed people, perhaps service for 911 and a menu of very limited minutes and texts can be provided for those who don’t choose a landline option. Beyond that in housegolds of employed people, perhaps government could just provide a cell phone that is 911 enabled that receivers (under much tighter eligibility requirements focusing on the truly needy) on their own dime can use, funded through a program where the government buys back used phones not longer in service for a very small price. Something like this would ensure only those that can’t otherwise afford them would get them, and anything services beyond that they, not taxpayers, would ante up.

But how this controversy has unfolded also points out another area of reform. It’s illegitimate for a government contractor such as Tracfone to use the means provided by that contract and through the contracted service itself for political advocacy on an issue related to the contracted service. While federal law would address the program, it also can, and so can Louisiana (within the state), pass a law that prohibits a government contractor in performance of that contract to engage in political advocacy regarding the contracted program. This would prevent a provider from using the infrastructure on which delivery of the program through the contract to advocate about that program, but would leave it free to use other means of advocacy, such as newspaper ads, to achieve this expression.

Even though it’s late in the session, a strategic amendment to a related bill in the Louisiana Legislature could make this illegal in the state. There’s no reason taxpayers should subsidize political speech by a contractor they pay regarding how and if that contracted activity should be performed through the very mechanism of the contracted activity. That goes beyond neutrality to government assistance in enabling a private entity to propagate speech that can advocate its continued ability to do that, which the First Amendment does not require. Legislators seeking fairness need to write up and introduce that amendment starting now.