Wireless phones cheaper for rural areas

WIRELESS PHONES CHEAPER FOR RURAL AREAS, STUDY SAYS
[SOURCE: Chicago Tribune, AUTHOR: Jon Van jvan@tribune.com]
Rural phone-service subsidies are so bloated and inefficient that providing wireless or even satellite phones is cheaper, an economic analysis prepared for a senior citizen advocacy group suggested Wednesday. Taxes to support the universal service fund, which is intended to pay for higher costs of serving rural areas, are growing so fast as to force some low-income citizens to drop current phone service, said Thomas Hazlett, a George Mason University economist who prepared the analysis for the Seniors Coalition. "It's perverse when shifting tax money around for the universal service fund results in more people leaving the network than joining it," said Hazlett. Totaling more than $7 billion a year, universal service outlays have nearly tripled in the past decade. The fund is now financed by a tax of more than 10 percent on long-distance phone service, but the Federal Communications Commission is looking for new revenue sources.
http://www.chicagotribune.com/business/chi-0607200172jul20,1,5769160.sto...