The “Obamaphone” lie

TeaPublicans love to rant about the “Obamaphone.”  So much so that there’s a bullshit email that TeaPublicans love to send to each other:

I had a former employee call me earlier today inquiring about a job, and at the end of the conversation he gave me his phone number. I asked the former employee if this was a new cell phone number and he told me yes this was his “Obama phone.”

I asked him what an “Obama phone” was and he went on to say that welfare recipients are now eligible to receive (1) a FREE new phone and (2) approx 70 minutes of FREE minutes every month. I was a little skeptical so I Googled it and low and behold he was telling the truth. TAX PAYER MONEY IS BEING REDISTRIBUTED TO WELFARE RECIPIENTS FOR FREE CELL PHONES.. This program was started earlier this year. Enough is enough, the ship is sinking and it’s sinking fast. The very foundations that this country was built on are being shaken. The age-old concepts of God, family, and hard work have flown out the window and are being replaced with “Hope and Change” and “Change we can believe in.”

The email is bullshit, as is the case with every email message that shrieks SEND THIS TO EVERYONE YOU KNOW.

Here are the facts:

Welfare recipients, and others, can receive a free cell phone, but the program is not funded by the government or taxpayer money, as the e-mail alleges. And it’s hardly new.

How It Works

SafeLink Wireless, the program mentioned in the e-mail, does indeed offer a cell phone, about one hour’s worth of calling time per month, and other wireless services like voice mail to eligible low-income households. Applicants have to apply and prove that they are either receiving certain types of government benefits, such as Medicaid, or have household incomes at or below 135 percent of the poverty line. Using 2009 poverty guidelines, that’s $14,620 for an individual and a little under $30,000 for a family of four, with slightly higher amounts for Alaska and Hawaii.

SafeLink is run by a subsidiary of América Móvil, the world’s fourth largest wireless company in terms of subscribers, but it is not paid for directly by the company. Nor is it paid for with “tax payer money,” as the e-mail claims. Rather, it is funded through the Universal Service Fund, which is administered by the Universal Service Administrative Company, an independent, not-for-profit corporation set up by the Federal Communications Commission. The USF is sustained by contributions from telecommunications companies such as “long distance companies, local telephone companies, wireless telephone companies, paging companies, and payphone providers.” The companies often charge customers to fund their contributions in the form of a universal service fee you might see on your monthly phone bill. The fund is then parceled out to companies, such as América Móvil, that create programs, such as SafeLink, to provide telecommunications service to rural areas and low-income households.


The SafeLink program has actually been offering cell phones to low-income households in some states since 2008, not beginning “earlier this year,” as the e-mail claims. But the program is rooted in a deeper history.

When phone lines were first laid out in the late 19th century, they were not always inter-operable. That is to say the phone service created by one company to serve one town may not have been compatible with the phone service of another company serving a different town nearby. The telecom companies themselves saw the folly in this arrangement, and so in 1913, AT&T committed itself to resolving interconnection problems as part of the “Kingsbury Commitment.”

That common goal of universal service became a goal of universal access to service when Congress passed The Telecommunications Act of 1934. The act created the FCC and also included in its preamble a promise “to make available, so far as possible, to all the people of the United States, a rapid, efficient, Nation-wide, and world-wide wire and radio communication service with adequate facilities at reasonable charges.” There was a fear, expressed by telecom companies themselves, that market forces alone might encourage companies to pass on providing service to hard-to-reach places. This would both hurt the people who wouldn’t have service as well as existing customers who wouldn’t be able to reach them. So the new FCC was tasked with promoting this principle of “universal service.”

This informal practice was codified when the Universal Service Administrative Company (USAC) was created as part of the 1996 Telecommunications Act to “ensure all Americans, including low-income consumers and those who live in rural, insular, high cost areas, shall have affordable service and [to] help to connect eligible schools, libraries, and rural health care providers to the global telecommunications network.” The USAC includes four programs to serve rural areas, high cost areas, rural health care providers, and schools and libraries. Since 1997, USAC has provided discounted land line service to low-income individuals. (A more limited program to offer assistance to low-income individuals was created a decade earlier; the telecommunications act expanded and formalized it.) According to Eric Iversen, USAC director of external relations, the Universal Service Fund more recently began funding programs that provide wireless service, such as the pre-paid cellular SafeLink program mentioned in the chain e-mail.

The president has no direct impact on the program, and one could hardly call these devices “Obama Phones,” as the e-mail author does. This specific program, SafeLink, started under President George Bush, with grants from an independent company created under President Bill Clinton, which was a legacy of an act passed under President Franklin Roosevelt, which was influenced by an agreement reached between telecommunications companies and the administration of President Woodrow Wilson.

Wilson Phones, anyone?

More facts.  Note the second fact — the “Obamaphone” started UNDER THE REAGAN ADMINISTRATION.
  • Lifeline Assistance is a program of the FCC that helps over 10 million Americans who cannot afford a phone and service, in order to help them keep in contact with employers, family, and medical and emergency services.
  • Lifeline began under the Reagan administration to help low-income Americans afford their landline phone service, and was updated during the Bush administration to include mobile phones.
  • Lifeline was nicknamed Obamaphone since the popularity of the program exploded under the Obama Administration.
  • Obamaphones are available from companies in 49 states, plus the District of Columbia and Puerto Rico.
  • U.S. citizenship is not a requirement to receive an Obamaphone.
  • Only one Lifeline phone per household is allowed, whether it be a discounted-service landline phone or a cell phone.
  • There are over 50 companies offering Obamaphones.
  • The largest company, Safelink Wireless, has 3.6 million customers, and is owned by Tracfone, a company owned by the richest man in the world, Mexico’s Carlos Slim.
  • Most companies offer 250 minutes of talk and text a month, but recently more minutes and 1,000 texts to even unlimited texts are being offered.
  • Some California companies offer has the best deal in the country — unlimited talk and unlimited texting.
  • The Lifeline program is not taxpayer-funded. It is funded by the Universal Service Fund fees that are required by law to be collected by telecommunications companies. The fund is used for various telecommunication projects, including Lifeline Assistance.
  • The FCC has initiated fraud and abuse controls which save hundreds of minutes of cost each year.
  • A household is eligible for an Obamaphone if a member of the household participates in any of the following public assistance programs:
    – Food Stamps (SNAP)
    – Medicaid
    – Supplemental Security Income (SSI)
    – The National School Lunch Program (Free Lunch Program)
    – Federal Public Housing Assistance (Section 8)
    – Low-Income Home Energy Assistance Program (LIHEAP)
    – Temporary Assistance to Needy Families (TANF)
    – * Other state-specific program eligibility is often available.
  • A household is also eligible if the total household income is at or below 135% of the Federal Poverty Guidelines for that state. Arizona, Florida, Kansas, Michigan, Nevada, New Jersey, Ohio, Rhode Island and Texas. California, Nevada and Vermont allow 150%.
  • The cell phone companies receive $9.25 for each subscriber (higher for Tribal) in order to provide the cell phone and service free to the subscriber.
  • There is no contract to sign to receive the service, which lasts for one year. The service can be renewed annually with a quick recertification process.
  • The program is free in nearly every state, but some states require very small monthly fees ($1 per month in Oklahoma, $1 from some companies in Alaska, and a $5 monthly fee was proposed but rejected in Georgia).