August 1, 2013
Wisconsin has seen many types of welfare fraud, from food stamps to unemployment compensation. In fact, the MacIver Institute reported recently on the large about of unemployment fraud in the Badger State. However, there is another government program that may be rampant with fraud and it is very easy to do.
The program? Obamaphones.
Jillian Kay Melchior, from the Franklin Center for Government and Public Integrity, recently tried to figure out how easy it is to get a free phone from the government in New York City. The following article is her account of how she received three free phones from the government, and she does not even qualify for the program.
Confession: You're paying my phone bill.
by Jillian Kay Melchior
Thomas L. Rhodes Fellow for the Franklin Center for Government and Public Integrity
In the past month, I have received three shiny new cell phones, courtesy of American taxpayers, that should never have fallen into my hands.
The Federal Communications Commission oversees the so-called Lifeline program, created in 1984 to make sure impoverished Americans had telephone service available to call their moms, bosses, and 911. In 2008, the FCC expanded the program to offer subsidized cell-phone service, and since then, the expenses of running the program have soared. In 2012, the program's costs had risen to $2.189 billion, up from $822 million before wireless carriers were included. As of June, there were 13.8 million active Lifeline subscriptions.
To be eligible for Lifeline, the applicant is supposed to be receiving some significant government benefit -- food stamps, Medicaid, Supplemental Security Income, public housing assistance, etc. But because welfare eligibility has expanded under the Obama administration, more people than ever before are qualified to receive "free" cell-phone service -- part of the reason why Lifeline mobiles have become commonly known as Obamaphones. Alternatively, applicants can qualify if their household income is less than 136 percent of the federal poverty line.
But as with any federal program with too much funding, too little oversight, and perverse financial incentives, Lifeline has become infamous for rampant fraud and abuse. There have been news reports about recipients flaunting dozens of subsidized phones. And in February, the Wall Street Journal reported on an FCC audit of the top five Lifeline providers, which found that "41% of their more than six million subscribers either couldn't demonstrate their eligibility or didn't respond to requests for certification."
The FCC supposedly buckled down on eligibility standards last year and established other safeguards aimed at reducing fraud. I was curious about how tough it was to get one of these phones, so last month, I hit the streets of New York. And out of respect for the law and my journalistic integrity, I did not lie to obtain a phone.
Now is the point, I suppose, where I should explain that I really, really shouldn't have received a single phone. Despite what you hear, not all 20-something writers in the Big City are starving. Given my earnings, even if I were supporting a family of eight, my income would still rule me out. Nor do I receive any type of government benefit. By the Lifeline program's standards, I am unambiguously ineligible.
My first task was figuring out where to register. The rule of thumb is that wherever you can sign up for food stamps, you can apply for an Obamaphone.
Representatives from SafeLink and Assurance, two of the leading New York Lifeline vendors, stand outside the food-stamp offices, paired like Mormon missionaries, young and polite and earnest. They carry electronic tablets and ask all passersby whether they've received their free phone "yet" -- as if it were an inevitability.
They approached me for the first time outside the food-stamp office at Tenth Avenue and 216th Street, on the northern tip of Manhattan. The SafeLink vendor, a man probably in his mid 20s, asked me whether I was enrolled in any benefit programs.
"No," I said, "but I'd certainly like to be. I'm hoping to be." And indeed, while doing research for another story, I had gone through the motions of applying for New York City welfare, which I also don't qualify for. I showed him my Human Resources Administration paperwork packet and the case number assigned to me. I reiterated that though I had once applied, I had never been approved for any sort of benefit.
He brought out his electronic tablet immediately to sign me up for phone service. He asked if I had an insurance card, so I pulled out my trusty Blue Cross Blue Shield. He looked at it for a second, puzzled, then asked if I had Medicaid. No, I told him, just private insurance through my work plan.
"Private insurance? What's that?" he asked, maybe not facetiously. My BCBS card was nevertheless photographed, as well as the first page of my Human Resources Administration paperwork. He asked for my name and my home address, and that was about it. The whole process took less than five minutes, and I had to provide no documentation verifying my income level or (nonexistent) welfare status.
The SafeLink vendor then referred me to his opposite number, a rep from Assurance. She too took down my information, registering me for another Obamaphone.
This article was originally posted on National Review Online.