TracFone, Vitter Dial Up Obama Phone Fight

TRACFONE, THE CELLPHONE company owned by Carlos Slim, the world’s richest man, is ramping up its lobbying efforts in the face of strong opposition, according to POLITICO. The Miami-based company is seeking to protect the Lifeline program (dubbed The Obama Phone by its critics), the goal of which is to distribute cellphones and Internet service to unemployed Americans so that they can find jobs, learn new skills, and draft résumés.

But TracFone is being criticized for its lobbying campaign to shift the program from disbursing Internet service to distributing smartphones, which would benefit the company’s bottom line.  Critics argue that the program merely provides free cellphones without the benefits promised by TracFone.  Sen. David Vitter (R-La.), one of Lifeline’s staunchest opponents, argues:

This phone program has expanded far beyond its original intent, and as so many middle class Americans struggle underneath this economy, it is really offensive for Washington to make taxpayers pay or free cellphones for others.

According to the FCC, however, the modern version of Lifeline is actually an expansion of a Reagan-era program that subsidizes phone service for the very poor so that they can contact the authorities in case of an emergency.  During the George W. Bush administration, the program was expanded to include cellphones, and in 2012 was reformed once again to incorporate a Broadband Adoption Pilot Program that provides Internet access to lifeline-eligible households.

Although TracFone and its detractors continue to fight over the nature of the program, for now it seems evident that Lifeline is more than just a source for government handouts.  Whether or not Slim and others can escape from the charge remains to be seen.


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