Supporters rally to defense of 'Obama phone' program

Republicans have targeted a federal phone subsidy, widely referred to as the "Obama phone" program, as a prime example of wasteful government spending.

But supporters of the program are coming to its defense, arguing that it is crucial for ensuring that needy people are able to communicate with their loved-ones and call for help in an emergency.

"Allow me to set the record straight," said Mignon Clyburn, a Democratic member of the Federal Communications Commission, in a speech on Friday. "Without this program, 15 million low-income families would literally be choosing between feeding their children or going without a dial tone that potentially could save their lives and put them on a better economic path."

Consumer advocacy groups Public Knowledge, Free Press, the Center for Media Justice and the Utility Reform Network issued statements praising Clyburn for her full-throated defense of the subsidy.

The nearly $2 billion program, officially called Lifeline, is managed by the FCC and began long before President Obama took office.

Congress first enacted the Lifeline program in 1985, during the Reagan administration. In 2005, under President George W. Bush, the FCC expanded the program to cover cellphone service.

The program pays for phone service, not the phones themselves. But many companies that receive funding through the program offer free and low-cost phones to their subscribers.

The program is funded through fees that the telephone companies pass on to consumers on their monthly bills.

Lifeline gained more attention last year when conservatives seized on a viral video of a woman saying she would vote for President Obama because he gave her a free phone.

Conservative radio host Rush Limbaugh claimed the program shows that Obama is making people dependent on the government. Sen. Tom Coburn (R-Okla.) said Lifeline is "ballooning out of control" and has "morphed into a massive entitlement."

Rep. Tim Griffin (R-Ark.) introduced legislation that would ban the program from supporting cellphone service.

Many Republicans argue that as the government cuts costs as a result of sequestration, Lifeline should be one of the first programs to go.

FCC Chairman Julius Genachowski has called the program "vital," but when speaking about it, he usually emphasizes his efforts to rein in its costs.

He has acknowledged that Lifeline has "created perverse incentives for some carriers" and "invited fraud and abuse."

In an effort to eliminate waste, the FCC last year toughened its eligibility standards and created a database to ensure that multiple companies were not receiving subsidies to provide service to the same customer.

Clyburn touted the reforms to the program on Friday, saying they trimmed $200 million last year and are on track to save $400 million this year.

"We are open to making additional adjustments where necessary, but in no uncertain terms should qualifying low-income consumers who have followed the rules be refused service," said Clyburn, the daughter of Rep. James Clyburn (S.C.), a member of Democratic leadership in the House.
 
She argued that Congress should not limit Lifeline to traditional wireline phone service, warning that the people who rely on mobile service to connect with the world — such as migrant workers and homeless families — would be left out of the program entirely.

Clyburn argued that Lifeline is a bargain compared to other social service programs, such as Medicaid and food stamps.

"Spending $2 billion a year to connect 50 percent of qualifying families is worth it," Clyburn said. "Without access to 911, these families would be especially at risk, as the number of communications alternatives has decreased significantly, reinforced by the fact that fewer than 500,000 payphones remain in the United States."