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FCC Rural Phone Subsidies Reach As High As $3,000 Per Line
jfruh writes "The FCC's Universal Service Fund has a noble goal: using a small fee on all U.S. landlines to subsidize universal phone coverage throughout the country. But a recent report reveals that this early 20th centuryy program's design is wildly at odds with 21st century realities: Its main effect now is that poor people living in urban areas are subsidizing rich people living in the country. The FCC says that it's already enacted reforms to combat some of the worst abuses in the report — like subsidies to rural areas that add up to $24,000 per line — but even the $3,000 per line cap now in place seems absurd."
It depends on what they are including in that cost and how they are amortizing it. For instance setting up a local relay station for a small town including buying land, building the structure, outfitting it with equipment, etc, can represent a significant one time cost.
"That's not unique to phones. It also applies to highways, minor airports, housing tax incentives, and a number of other "American Dream" elements that really have nothing to do with having a successful society."
So it's not socialism? Damn!
Much like other government regulations, these subsidies were written with certain assumptions that haven't been reassessed over the years. In this case, the assumption that a couple copper wires were the primary driving factor in whether someone had access to modern telecommunications. Today, wires aren't actually necessary in most cases in the first place. The land line for dedicated voice service at home is rapidly fading into obscurity, and even home access to Internet services in some rural areas is arguably losing the wires and transmitting to antennas or mobile devices where conventional wired broadband is unavailable.
I'm just having a really hard time seeing this subsidy as necessary in this day and age.
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Its main effect now is that poor people living in urban areas are subsidizing rich people living in the country.
Uhhh, I grew up way out in farm country in Ohio. I have lived in five different major metro areas. The people in the country are not rich. What kind of bullshit psy-ops lobby-funded advertising is this, and why is it being parroted blindly here? Let's just do a quick bullshit check. One web search, second hit, talks about a study done in Oregon:
In 2011, the (per capita personal income) in non-metro counties was $31,383 and in the metro counties it was $39,267; a difference of $7,884 (25 percent). The difference was due primarily to the difference in earnings from work.
Obviously that's just one data point, feel free to do more comprehensive research yourself. I'll tell you from personal experience; people in the country make less money on average than people in the city. This report is some assholes like the Koch brothers, a lobby called "Alliance for Generational Equity," trying to create infighting so they can drown the government in the bathtub. Let's not start being their lickspittle mouthpieces, parroting their easily debunked lies.
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OK, you can keep your broadband. Us country folk will keep all the lumber, minerals, and produce.
Yeah yeah, and we'll keep all the money, finished goods, and medicine(or at least the intellectual backing thereof). Or... it could be we live in a complex interconnected society, and every discussion of fairness doesn't need to slide into "well our subculture is better than yours".
Certainly not to the same extent, no.
According to the Institute on Taxation and Economic Policy, a Washington, D.C.-based research organization, Washington families living at the federal poverty level pay 17 percent of their incomes in state and local taxes, whereas the highest-income families pay 3 percent.
Anybody paying for phone service pays for this subsidy via the USF. http://en.wikipedia.org/wiki/Universal_Service_Fund
It's also worth noting that because of the way that the poverty level is calculated, people that are in urban areas don't qualify when they would be pretty well off in more rural areas, if they were making the same amount of money. Which makes subsidies to the poor at the federal level disproportionately favor the freeloading states over the states that actually contribute to the pot of money being used to provide the subsidies.
Not true.
The rich do not become rich by spending. Sure it probably is true that a larger portion of expenditures are subject to sales tax for the wealthy. But, ultimately, a smaller portion of their income is spent rather than invested.
And no, I don't give a rat's ass about them investing their money. Especially given that there's no guarantee that the investments will benefit me or other Americans. And their tax rates are lower than they are for people that are less well off.
And the poor pay 0 federal tax, or even get a few grand back, while the "rich" (everyone who makes more than you) pay 10-40% of their income. So?
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Investments move the economy. I'm not sure why that is considered evil.
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Claiming that renters (there are renters outside the city, BTW) are paying property tax is also as dumb as claiming that when I take out a loan or use a credit card,
You got this one wrong. You have to examine the incidence of taxation. The property owner has to pay taxes but he pays this by passing the cost on to the people renting the property. The actual tax incidence is on the renters, not the landlord. The amount of the tax is irrelevant in this case in determining who is the one ultimately burdened with the tax even if the amount of the tax is just one penny.
For the same reason this is why gasoline taxes are fundamentally a regressive tax (hurts the poor more than the rich). The oil companies do not absorb the cost, they merely pass it along to their customers, more of whom are poor than are wealthy.
There is a cap on the SS tax because there's a cap on benefits.
That would be a more credible argument if they amount paid in equaled the amount paid out in benefits to each beneficiary. Most beneficiaries receive more in payments than they pay to social security. And let's be frank, there is a cap on SS tax because the wealthy are a powerful lobby and have undue influence when it comes to financial legislation. Your argument is just some sugar to help get rid of the icky taste of reality.
The guys producing the food win. As much as ag subsidies piss me off, a reliable food supply is the first order of business for any society.
Socialism: a lie told by totalitarians and believed by fools.