USF is actually even worse than what you describe. It’s the perfect example of a system with zero checks on its ability to grow combined with an incentive for abuse.
The contribution rate is set based on whatever funds the program needs. Need an extra billion for lifeline? No problem, the USF percentage just adjusts itself. The providers add this to the bottom line as a fee. Nothing requires the recovery fee to equal the USF remittance - this becomes a big profit center for the provider. The providers get to keep charging excessive fees for locked in customers and get reimbursed by USF. Getting money out of USF from the various funds is difficult. This has inspired a entire industry of consultants to help schools, libraries, providers, etc. to navigate the process. Consultants only want to work with the largest providers who have a staff to deal with USF so there is zero incentive for the schools, libraries, etc. to search for competitive or local access. The recipients of the schools and libraries funds have no incentive to search for competitive providers since they are paying only a small portion of the actual rate. It funds an entire bureaucracy and industry of consultants. Small rural carriers are prolific and effective contributors to the politicians of both parties that enable the system. The only check on this is Congress - and talking to your congress critter about USF just makes them go to sleep. It’s not exciting, and on the list of issues they are hearing about its about number 9,748. Any attempt to reign it in is met by ’think of the kids’, ’telemedicine’ and some made up number about how many people lack the basic human right of Internet. Showing up in DC lobbying to not spend money is not effective. Nobody ever won an election by saving money. What do we do about it? Wish I had the answer. So far the best WISPA has been able to come up with is doing our best to make USF funding available to all providers and to try to avoid funding overbuilds. The issue is made more difficult by providers who are not willing to do the work required to avoid being overbuilt - file 477’s and offer phone service. Mark > On May 29, 2019, at 8:31 PM, Ken Hohhof <[email protected]> wrote: > > OK, some may think I’m getting into politics, but that is not my intention. > > It strikes me that we are starting to get things that look like taxes, swim > like taxes, and quack like taxes, but are not treated like they’re taxes. > Tariffs are starting to seem that way. Another example that bothers me more > and more as the contribution rate goes up is USF. What is that other than a > tax on long distance phone service? That generates a slush fund for some > unelected bureaucrats to dispense. Mostly to big telcos. > > Normally taxes are passed by Congress, and they take the heat for it at the > next election. Normally Congress also decides how to spend the revenue. > > As long as tariffs are relatively small, you can view them as part of trade > policy. Same with USF, if it wasn’t so big, you could overlook that it is > essentially a tax that nobody voted for, used for corporate welfare. > > > From: AF <[email protected] <mailto:[email protected]>> On Behalf > Of Lewis Bergman > Sent: Wednesday, May 29, 2019 5:37 PM > To: AnimalFarm Microwave Users Group <[email protected] > <mailto:[email protected]>> > Subject: Re: [AFMUG] tariffs on servers > > I don't think there is much thought to how it works in the consumer level > other than it is supposed to make the tariffed goods more expensive thereby > making other options more competitive. > In that respect, it is likely working. Changing global supply chain > relationships doesn't move quickly though. Vietnam for instance has had > trouble meeting the same standards as China. Seems hard to imagine but after > a few decades of manufacturing for the US China has gotten pretty good at it. > > On Wed, May 29, 2019, 5:23 PM Jason McKemie <[email protected] > <mailto:[email protected]>> wrote: >> One thing about the tariffs that is especially irritating to me is that if >> tariffs are imposed at, for example 30% on steel, then the domestic supplier >> just raises their prices by 29%. Is this the way that this is supposed to >> work? >> >> On Wed, May 29, 2019 at 3:18 PM Ken Hohhof <[email protected] >> <mailto:[email protected]>> wrote: >>> I’m in the process of buying a couple Supermicro servers, and I’m told that >>> due to tariffs, prices have already gone up around 10% and will be going up >>> another 15% on or about June 1. >>> >>> Are others running into the same thing? It sounds like I need to place my >>> order now. That’s not a trivial increase. >>> >>> We’ve also received tariff notifications from tower steel vendors, power >>> supply vendors, cable vendors, and we saw Cambium increase prices a few >>> months ago. Some of these like the steel and cable you just eat, but >>> potentially everything we buy except bandwidth may be going up. I wonder >>> if bandwidth suppliers will figure out a way to jack up prices claiming >>> tariffs! >>> -- >>> AF mailing list >>> [email protected] <mailto:[email protected]> >>> http://af.afmug.com/mailman/listinfo/af_af.afmug.com >>> <http://af.afmug.com/mailman/listinfo/af_af.afmug.com> >> -- >> AF mailing list >> [email protected] <mailto:[email protected]> >> http://af.afmug.com/mailman/listinfo/af_af.afmug.com >> <http://af.afmug.com/mailman/listinfo/af_af.afmug.com>-- > AF mailing list > [email protected] <mailto:[email protected]> > http://af.afmug.com/mailman/listinfo/af_af.afmug.com > <http://af.afmug.com/mailman/listinfo/af_af.afmug.com>
-- AF mailing list [email protected] http://af.afmug.com/mailman/listinfo/af_af.afmug.com
