Archive for March, 2011

Where is the USF Really Going?

Friday, March 18th, 2011

Our own Scott Wallsten participated in a Heartland InfoTech and Telecom News podcast to discuss his recent paper, “The Universal Service Fund: What Do High-Cost Subsidies Subsidize?“”  Just how much of of the funds are going to expenses not directly related to providing telecommunications service?  According to Scott’s research, 59 cents of every dollar is used for administrative and overhead.

The podcast covers a brief description of the policy goals of the Universal Service Fund, issues with the way the program is funded and distributed, and the incentives resulting from the subsidies for firms to increase costs.  In addition to discussing reforms underway to shift the program to subsidize broadband services, Scott also proposed specific reforms, including focusing on low-income assistance and distributing funds directly to consumers.

The podcast, hosted by Bruce Edward Walker, managing editor of Infotech & Telecom News, can be found on the Heartland Institute website.