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Obamaphone Use Increased 100-Fold in Maryland

The use of consumer subsidized “Obamaphones” in Maryland grew 100-fold in three years, to 645,000, twice the number eligible for the program, Washington Examiner reports.

Officially called Lifeline, the federally run program, administered by the Federal Communications Commission, provides free cell phone service to qualified low-income customers.  Cell phone companies that sign up low-income customers are reimbursed $9.25 per customer through universal service charge fees on other cell phone customers’ monthly bills.

In testimony before the House Subcommittee on Communications and Technology of the Committee on Energy and Commerce last year a telecom consultant testified that:

The greatest increase in Lifeline subscribership has occurred in Maryland. In the third quarter of 2009, there were only 6,504 Lifeline subscribers in Maryland, representing only 2 percent of the eligible low-income households in that state.  By the third quarter of 2012, the number of Lifeline subscribers in Maryland had risen almost 100 fold to 645,000.  Moreover, the current number of Lifeline subscribers in Maryland is almost double the number of low-income households in the state, as shown by the graph. The dashed red line is the number of eligible low-income households. The blue line is the number of Lifeline subscribers by quarter.

One of the main suppliers of Lifeline service is TracFone, owned by Obama fundraiser Carlos Slim.  According to the Examiner, to one state regulator TracFone refused to answer questions about the company’s actual cost to provide the service.

Mark Newgent

Mark Newgent is a contributing editor to Red Maryland, the premiere blog of conservative politics in the Free State, voted one of the best state political blogs by the Washington Post two years in a row. His writing has appeared in the Baltimore Sun, Washington Examiner, National Review Online, and more. Twitter: @MarkNewgent

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Categories: Congress, Cronyism, Government Transparency, Must Read, Policy, Politics, Regulation, Transparency, Waste, Fraud and Abuse
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