ATR Opposes The Raise the Wage Act
Democrats have reintroduced the “Raise the Wage Act,” legislation that would raise the federal minimum wage to $15/hour by 2025, more than doubling the current wage of $7.25/hour.
If implemented, this legislation would eliminate millions of jobs, kill thousands of small businesses, and worsen the economic damage that COVID-19 has inflicted on the American economy. ATR opposes this legislation and urges Congress to reject the Raise the Wage Act.
While a $15 federal minimum wage would be a disaster in normal times, the impact during a global pandemic would be another slap in the face to businesses all across the country. Small businesses with thin margins would be forced to raise prices which will inevitably drive consumers elsewhere, leading to further losses of revenue and layoffs. Businesses that temporarily closed during the pandemic may not reopen in the face of a $15 minimum wage.
American workers would continue to lose their jobs if the Raise the Wage Act becomes law. In 2019, the nonpartisan Congressional Budget Office estimated that a nationwide $15 minimum wage would cost at least 1.3 million American jobs, and could cost as many as 3.7 million at the high end.
A $15 minimum wage would especially harm low-skilled, younger, less educated workers. A recent literature review from the National Bureau of Economic Research analyzed minimum wage studies and found that the preponderance of evidence suggests that a higher minimum wage has a negative effect on low-skill employment.
The authors of the review are clear as crystal: "....minimum wages reduce low-skilled employment. It is incumbent on anyone arguing that research supports the opposite conclusion to explain why most of the studies are wrong."
The Raise the Wage Act also ends the tipped minimum wage, an absurd proposal considering 10,000 restaurants have closed their doors in the last three months alone. Imposing a 600 percent minimum wage increase on an already struggling industry in the middle a recession would only lead to more closures. If the left is successful, one in three tipped workers could lose their job.
Government-mandated lockdowns in response to the pandemic have caused immense damage to the economy. Over 60 percent of business closures during the pandemic are now permanent. Nancy Pelosi’s $600-per-week unemployment payments discouraged Americans from going back to work, as 68 percent of Americans got paid more on unemployment than in the workplace. A drastic minimum wage hike would only make this bleak situation worse.
Ultimately, raising the wage to $15/hour would harm businesses and workers all across the country and exacerbate the economic damage caused by COVID-19. Congress should reject the Raise the Wage Act.
Photo Credit: Shelly Provost
Pipeline Worker: "I've got my whole life invested in this."
Americans for Tax Reform is collecting personal testimonials of Americans hit by President Biden's executive actions. (If you would like to submit a short video, please send it to Mike Mirsky at mmirsky@atr.org).
Please watch this video from Jason, a member of Pipeliners Local Union 798:
“My name is Jason Jernigan, I’m 45 years old and I’m a member of Local 798, Pipeliners Union. I’ve been a pipeliner for 21 years. This is all I know how to do. The recent administration has taken my livelihood from me and expected me to get a job somewhere else. I’ve got my whole life invested in this.”
See also:
Rise of Personal Shoppers Shows Robust Competition in Same-Day Delivery Market
Coronavirus lockdowns have fueled a massive surge in online shopping, with American e-commerce growing a staggering 44 percent in 2020 and online spending representing 21.3 percent of all sales.
Brick-and-mortar retailers have responded to this demand by rethinking their business models and expanding the resources they dedicate to fulfilling digital orders. The resulting innovation and competition in the evolving same-day delivery market has expanded access to goods and services for American consumers and increased job opportunities for American workers.
Walmart now has over 170,000 “personal shoppers” dedicated to fulfilling online orders. These shoppers receive online orders, pick the items off of shelves, then prepare them for delivery to customers’ homes. These jobs start at over $13 an hour, more than Walmart’s $11 minimum wage, and approximately 40 percent of personal shoppers are existing Walmart employees looking to advance in the company.
The rise of personal shoppers expands access to goods and services for American consumers. With government-mandated lockdowns forcing the entire country into self-isolation, online delivery services have been a lifeline for Americans that need groceries, prescriptions, and other household essentials delivered directly to their door. With stores like Target and Bed Bath and Beyond adding personal shoppers to their respective workforces, consumers will have more places to shop from without leaving their homes.
Competition between companies in the same-day delivery market will also benefit consumers in the form of lower prices and greater perks. Walmart has rolled out Walmart+, a new membership service that directly competes with Amazon Prime by offering same-day delivery, as well as two-hour delivery for an additional fee. Increased competition in the same-day delivery space will only continue to benefit consumers as choices increase.
This new market also benefits American workers, especially those who saw their jobs vanish due to the pandemic. As retailers continue to amp up their online presence, new jobs will need to be filled, and plenty of Americans will be available to fill them.
Ultimately, competition is a rising tide that lifts all boats. The rapid expansion of the same-day delivery market will benefit American consumers through increased access to goods and services, lower prices, and better membership perks. American workers will benefit through increased job opportunities as demand for personal shoppers increases.
As our country attempts to recover from the economic damage inflicted by COVID-19, the evolving same-day delivery market is a welcome reminder that American innovation will always adapt to new challenges.
Photo Credit: Bev Sykes
Hawaii Must Reject Proposed Legislation That Would Increase Tobacco Related Deaths, Destroy Small Businesses
Americans for Tax Reform submitted testimony today in opposition to Hawaii’s HB 598 and HB 476, which would increase taxes on life-saving reduced risk tobacco alternatives such as e-cigarettes.
ATR Director of Consumer Issues, Tim Andrews, wrote: "These anti-science bills would have a disastrous impact on public health throughout the State, and lead to an increase in tobacco-related deaths. Further, aside from the public health harm caused by increasing taxes on a product proven to save lives, this bill would also cause considerable economic harm, particularly given the present pandemic-related economic downturn."
Andrews noted the ever-growing body of research showing vapor products are an effective harm reduction tool for adults looking to quit smoking: "Extrapolating from a large-scale analysis by the US's leading cancer researchers and coordinated by Georgetown University Medical Centre, if a majority of smokers in the state of Hawaii made the switch to vaping, over 40,000 lives would be saved. In seeking to tax these life-saving products, these bills place lives in jeopardy.
HB 598 and HB 476 fail to incentivize smokers to move away from deadly combustible cigarettes. Andrews noted that "As the price of a product increases, at its use decreases. In previous instances, levying taxes on vaping products has been proven to increase smoking rates as people shift back to deadly combustible cigarettes. Minnesota is serving as a case study on this already. After the state imposed a tax on vaping products, it was determined that it prevented 32,400 additional adult smokers from quitting smoking. Small increases in projected revenue should never come at the expense of human lives.”
The full testimony can be found here.
Photo Credit: Cord Cardinal
Lawmakers Should Reject Antitrust Proposals That Undermine The Consumer Welfare Standard
Congress is beginning to debate reforms to antitrust law. As lawmakers consider different approaches, they should reject any proposal that weakens or undermines the consumer welfare standard. Moving away from the consumer welfare standard would cripple free enterprise, discourage innovation and competition, and harm American consumers.
The consumer welfare standard, which maximizes consumer benefits instead of protecting individual competitors, has undergirded antitrust law for over four decades. Antitrust law under the consumer welfare standard is designed to protect consumers from monopolies and the competitive process, not to protect individual companies from being out-competed by other firms.
Importantly, the consumer welfare standard brought consistency to antitrust law by tying it to specific economic criteria. The standard emphasizes long-term innovation effects and a maximization of economic efficiency when determining if a company is engaging in anticompetitive behavior.
Additionally, the consumer welfare standard sharpened the focus and general direction of antitrust enforcement by giving judges and regulators a coherent principle to follow. Before the consumer welfare standard was widely adopted, antitrust law was vague and unfocused, leading to inconsistent rulings and enforcement actions designed to reward political allies or punish political enemies.
The consumer welfare standard’s objective, rule-of-law approach to antitrust enforcement ensures a level playing field for American companies and a robust competitive process with limited politicization.
In sharp contrast, some want to dismantle the consumer welfare standard in order to use antitrust law as a tool to address broader, unrelated political and social goals. Instead of using antitrust law to protect consumers or root out truly uncompetitive behavior, some want to use it to “break up” big companies or target political enemies.
It wouldn’t matter if breaking up a company would harm consumers, or if a company is actually engaging in uncompetitive monopolistic behavior. Overzealous regulators would target large companies no matter how much they improve American lives or compete fairly with other firms.
This activist, politicized approach to antitrust enforcement would have a chilling effect on American innovation. Successful firms under constant threat of antitrust investigation would be less likely to engage in robust competition, leading to higher prices and reduced access to goods and services for American consumers. Discouraging mergers and acquisitions would likely lead to fewer innovative start-ups, half of which say their long term goal is to be acquired by a larger firm.
Ultimately, antitrust law is not a tool to be used lightly, and enforcement actions have the potential to reshape entire industries. A broad, arbitrary approach to antitrust enforcement would empower faceless government bureaucrats to reshape the entire economy. This interventionist approach would have a chilling effect on free enterprise, crush innovation, and harm American consumers.
Lawmakers should reject any antitrust legislation that undermines the consumer welfare standard.
Photo Credit: chucka_nc
ATR Signs Coalition Letter Urging Congress to Reject the Restoration of Earmarks
Americans for Tax Reform joined a coalition of 17 organizations led by the Council for Citizens Against Government Waste (CCAGW) and signed a letter urging Congress to reject the restoration of earmarks, which were banned in 2011. The groups urge Congress to oppose any proposal to restore earmarks.
Democrat lawmakers led by House Appropriations Committee Chair Rosa DeLauro (D-Conn.) and Senate Appropriations Committee Chairman Patrick Leahy (D-Vt.) are considering bringing back earmarks.
Earmarks are provisions inserted by members of Congress into large spending bills directing funds to be spent on specific projects or programs. Before their ban, funds would often be directed towards specific congressional districts, pressuring members into voting for legislation they wouldn't normally vote for.
This facilitated the passage of unpopular, costly legislation filled with giveaways to lawmakers. It pushed members of Congress to vote not on the merits of the legislation, but because a small portion of the legislation would benefit their home district, a donor of theirs, or even themselves.
“Earmarks are the ‘broken windows’ of government overspending, the currency of Congressional corruption, and the price of bad votes for more spending,” said ATR President Grover Norquist. “Earmarks are used to buy the votes of congressmen who would never vote for the overall package standing alone, without a bribe.”
The most infamous example of an earmark leading to frivolous spending is the “Bridge to Nowhere,” a project which began in 2005 when some members of Congress from Alaska requested funding to build the Gravina Island Bridge in exchange for their votes. The bridge was going to connect the town of Ketchikan with a population under 9,000 to the Island of Gravina, an island with an airport and a population of 50. Despite the few number of residents and the availability of a ferry, taxpayers were going to fund the bridge for $320 million. While Congress put an end to this bridge project in 2015, other pork projects have been approved.
You can read the full letter here or below:
February 23, 2021
Dear Member of Congress,
On behalf of the undersigned organizations and our millions of members and supporters from across the country, we urge you to reject the proposed restoration of earmarks being considered by House Appropriations Committee Chair Rosa DeLauro (D-Conn.) and Senate Appropriations Committee Chairman Patrick Leahy (D-Vt.). Earmarks are one of the most corrupt, inequitable, and wasteful practices in the history of Congress. Dressing them up as “member-directed spending” will not change anything.
Since 1991, according to Citizens Against Government Waste’s Congressional Pig Book, there have been 111,417 earmarks costing taxpayers $375.7 billion, including $67.9 billion since the earmark moratorium was adopted in 2011. In 2006, one year after the 2005 highway bill had $24 billion in earmarks, including the infamous Bridge to Nowhere, appropriations earmarks totaled a record $29 billion. That was also the year Republicans lost the majority in the House of Representatives, followed soon thereafter by the incarceration of members of Congress, staff, and lobbyists as a result of the corruption associated with earmarks.
The inequitable and power-driven distribution of earmarks is demonstrated by the inclusion of the names of members of Congress who obtained earmarks in the appropriations bills during the 111th Congress. The 81 House and Senate appropriators, making up 15 percent of Congress, were responsible for 51 percent of the earmarks and 61 percent of the money. Proponents of earmarks argue that they would promote the passage of appropriations bills in a timely manner, but this is proven false by the fact that appropriations bills have been enacted on time in only four years since the passage of the 1974 Budget Act. In fact, they waste the taxpayers’ money as a form of “legalized bribery,” under which a few million dollars in earmarks are traded for votes in favor of hundreds of billions of dollars in spending. It makes no sense to believe that earmarks, which never constituted more than 1 percent of discretionary spending, would drive or control agreement on the remaining 99 percent of such spending.
Earmarks are a lazy, unfair, and corrupt way to circumvent the authorization and appropriations process. They are not a path to unity; they are a road to fiscal ruin for taxpayers.
The American people have made it clear they want business as usual to end in Washington. Earmarks for teapot museums, indoor rainforests, and bridges to nowhere should not be restored; they should be permanently banned.
Again, we urge you to be fiscally responsible and oppose any proposal to restore earmarks.
Sincerely,
Tom Schatz
President, Council for Citizens Against Government Waste
Grover Norquist
President, Americans for Tax Reform
Tim Phillips
President, Americans for Prosperity
Pete Sepp
President, National Taxpayers Union
David McIntosh
President, Club for Growth
Adam Brandon
President, FreedomWorks
Phil Kerpen
President, American Commitment
David Williams
President, Taxpayers Protection Alliance
Steve Ellis
Vice President, Taxpayers for Common Sense
Michael A. Needham
CEO, Heritage Action
George Landrith
President, Frontiers of Freedom
Saulius “Saul” Anuzis
President, 60 Plus Association
James L. Martin
Founder/Chairman, 60 Plus Association
Bethany Marcum
President, Alaska Policy Forum
Jeffrey Mazzella
President, Center for Individual Freedom
James Taylor
President, The Heartland Institute
Kevin Waterman
President, Annapolis Center-Right Coalition Meeting
Matthew Gagnon
President, The Maine Heritage Policy Center
Photo Credit: NASA HQ PHOTO
Two Massive Tax Hikes at Stake in Pennsylvania Budget Fight
Despite the grueling effects of the pandemic-induced recession, Gov. Tom Wolf of Pennsylvania has proposed the largest tax hike in Pennsylvania history in his executive budget.
The budget proposal includes a massive, job-killing 46% increase in the state income tax.
Gov. Wolf’s proposed income tax hike would dramatically affect working middle-class families, financially at-risk Pennsylvanians, and small businesses. Although he suggested that there would be a “tax forgiveness” program as part of the proposal, families at the median family income (fewer than five children) would still pay more. Even with tax forgiveness, residents will still have to pay $232 each, or $927 per family of four, on average.
This tax hike proposal would be also be detrimental to local, small businesses that already pay the state’s Personal Income Tax. From maintaining and extended, onerous shutdown, to vetoing limited liability protection legislation so businesses could operate without fear of incessant lawsuits, Gov. Wolf has proved himself to be a governor who does not look out for small businesses. Instead, he wants them to pay more taxes as they attempt to recover from the pandemic.
Also included in the budget proposal is a severance tax on the natural gas industry in Pennsylvania, the nation’s second-largest natural gas producer. This would be a double-tax, as Pennsylvania already imposes and impact fee on natural gas extraction.
Gov. Wolf thinks imposing a severance tax would help Pennsylvanians “come out of this pandemic pretty much faster than anything else,” but this is untrue. According to last year’s Pennsylvania Energy Employment Report, natural gas employment in the state declined by 7.4%. A natural gas severance tax would kill more energy jobs and hinder the state from recovering.
Gov. Wolf has advocated for a severance tax in each of his budgets for the last six years and has failed each time; it also remains widely unpopular among the Republican-controlled House and Senate.
Even with these proposed tax hikes, Gov. Wolf is still likely to find ways to overspend and put Pennsylvania deeper into debt. Since he took office in 2015, spending in Pennsylvania has dramatically accelerated and increased by more than $24.5 billion (more than $1,900 per person) and two of the last six budget cycles have yielded tax increases. Despite these tax increases, Gov. Wolf has continued to overspend the approved budget ($400 million in 2016–2017, $673 million in 2018–2019, and more than $1 billion in 2019–2020).
Gov. Wolf signed a late budget without any tax hikes in the final weeks of 2020, but it still contained a 4% spending increase from the year prior and failed to restrict supplemental appropriations. Although Gov. Wolf pushes for tax increases, citing the need for them to provide sufficient revenue for the state, he continues to ask the legislature for supplemental funding. Lawmakers and taxpayers should expect another hefty supplemental request – as it appears that no amount of money will be enough.
According to a report by Pennsylvania’s Independent Fiscal Office, it is projected that it will take about six years for employment to recover from the pandemic-induced recession and strict lockdowns imposed by the Wolf Administration. That's far too long for families and small businesses in the Keystone State who need immediate economic recovery.
Pennsylvania legislators should reject Governor Wolf’s massive tax hike proposals.
Photo Credit: Governor Tom Wolf
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ATR Opposes H.R. 1082 -- Sami's Law -- A Bill to Impose Federal Regulation of Ridesharing
Americans for Tax Reform opposes H.R. 1082, Sami's Law:
This Nancy Pelosi-driven bill is part of the Left's government-wide, full-court press against Americans working as independent contractors. Pelosi hopes to ram the bill through the House immediately without hearings or scrutiny.
H.R. 1082 would give Washington D.C. more power by imposing federal government regulation of Americans who use or provide ridesharing services. Ridesharing is already heavily regulated by state and local governments. This bill is a federal intrusion into ridesharing and comes with heavy-handed mandates and enforcement mechanisms from Washington.
The author of H.R. 1082 is a New Jersey congressman tight with labor union bosses. He even voted to ban Right to Work and voted to impose California-style restrictions on independent contractors and freelancers. Rep. Chris Smith voted for the top priority of union bosses called the PRO Act which declares war on the tens of millions of Americans working as freelancers and independent contractors. It would impose on a national level the same independent-contractor destroying scheme imposed by California Democrats -- AB 5 -- which destroyed the livelihood of countless California households. President Joe Biden and Vice President Kamala Harris have also endorsed the PRO Act, which imposes a national ban on Right to Work states. 166 million Americans live in the 27 Right to Work states.
H.R. 1082 will create a new 17-member federal regulatory commission that the Biden administration will stack with anti-independent contractor personnel. Democrats want to take away the independent contractor status of rideshare drivers and force them to become employees with a union-dues-collecting boss. They will use the commission -- under the guise of safety -- to regulate independent contractor drivers out of existence.
The Biden administration will fill the commission with heavy-handed central planners who will ensure states cannot compete with each other. H.R. 1082 will impose the equivalent of a taxi commission on a national scale to specifically saddle ridesharing with one-size-fits-all regulations. Ridesharing emerged in the first place because Americans were desperate to find an alternative to the innovation-stifling taxi commissions and entrenched taxi industry players who provided bad service at excessive cost. The bill would also allow the Biden administration to detail to the new commission -- at taxpayer expense -- an unlimited quantity of bureaucrats and political appointees from Biden's Department of Transportation.
Democrats will move to impose vehicle inspection mandates on states and withhold highway funds for states which do not impose a vehicle inspection regime. Democrats have already written down their next step: force states to impose a vehicle inspection regime. If states fail to comply, Washington will cut off 2.5% of their highway funds. This provision was spelled out in a version of the bill put forth by Sen. Ben Cardin (D - Md.) during the last congress.
The private sector has already developed extensive ridesharing safety features. Ridesharing services have voluntarily and proactively developed a variety of safety features for riders and drivers, including but not limited to the name and photo of the driver, the make, model, and color of the vehicle, the license plate number, as well as the ability for riders to share their realtime trip status with family and friends who can see their exact location and time of arrival.
The bill runs counter to Americans of all political stripes who widely recognize rideshare drivers as independent contractors. By a 3-1 ratio, Americans consider rideshare drivers to be independent contractors and not employees, according to a landmark Pew Research Center survey. The survey found that most Americans who were aware of the regulatory debate do not consider rideshare drivers to be employees, and believe the government should use a light regulatory touch in this area of the economy. As noted by Pew, "the clear preference for a light regulatory approach among partisans in all camps is striking." And as mentioned previously in this post, ridesharing is already regulated by state and local governments.
Pew also found that most recognize rideshare apps as software companies that connect drivers with people looking for a ride.
Here are the Pew Research graphs showing these two results:
Federal regulation of ridesharing could hinder America's recovery from the pandemic. Between work, family, and school commitments, households and neighborhoods benefit from the flexibility afforded by ridesharing. And by a 5:1 ratio, the Pew survey found that residents of majority-minority neighborhoods say rideshare services “serve neighborhoods taxis won’t visit." The study notes: "Ride-hailing services are seen by minorities as a benefit to areas underserved by taxis."
Below is a graph displaying these results.
The convenience and non-discriminatory nature of ridesharing has provided another form of mobility to communities otherwise left unserved. This factor will become even more important as Americans recover from the pandemic. Members of Congress should steer clear of H.R. 1082.
Indiana State Reps Break No-Tax Commitment for Second Time
On Monday, the Indiana House of Representatives passed House Bill 1001, a $36 billion two-year state budget that includes tax hikes on cigarettes and vaping. Under HB 1001, the cigarette tax would increase from $1 to $1.50 and a 10% retail tax would be imposed on e-cigarettes and e-liquids.
Among the 95 representatives who voted for the cigarette and vape tax hike included in HB 1001, 16 were Taxpayer Protection Pledge signees. Out of those 16, 12 have previously broken their pledge by voting in favor of a gas tax hike in 2017.
The following Republican House lawmakers broke their promise to voters not once, but twice, by supporting tax hikes on Hoosiers:
Representative Robert Behning (R-91)
Representative Timothy Brown (R-41)
Representative Martin Carbaugh (R-81)
Representative Bob Cherry (R-53)
Representative Steven Davisson (R-73)
Representative Jeff Ellington (R-62)
Representative Bob Heaton (R-46)
Representative Todd Huston (R-37)
Representative Don Lehe (R-25)
Representative Jim Lucas (R-69)
Representative Jerry Torr (R-39)
Representative Cindy Ziemke (R-55)
You can see the list of those who broke their pledge by voting for a gas tax increase in 2017 here.
Photo Credit: Judy van der Velden
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ATR Leads Coalition Opposing Wasteful Expansion of FCC Program
WASHINGTON – Today Americans for Tax Reform submitted a letter with along with over 20 other organizations to the Federal Communications Commission in opposition to their desire to expand the E-Rate program.
The E-Rate program was created by Congress to ensure that classrooms and libraries had affordable access to the internet, but the FCC wants to balloon the program to provide direct services and devices to students.
Ensuring that students can continue to learn during the pandemic is an important mission, that is why Congress has already appropriated almost $70 billion in COVID stimulus for this purpose; and much of this funding hasn’t even been spent yet.
The E-Rate program is funded by a regressive fee structure that can exhaust billions of dollars in just a few months. Expanding the mission of the program to millions more individuals would only accelerate the depletion of its funds – hurting those who rely on the program.
Expanding the E-Rate program to provide direct-services and devices to students would be duplicative, wasteful and inefficient.
You can read the letter below or click HERE for a downloadable version.
February 23, 2021
RE: Addressing the Homework Gap through the E-Rate Program, WC Docket 21-31
Dear Secretary Dortch:
We the undersigned organizations submit these comments pursuant to the Federal Communications Commission’s rules (47 C.F.R. §§ 1.415 & 1.419) in response to the above-referenced proceeding that the FCC announced in its Public Notice DA 21-98 (“Notice”) of February 1, 2021.
In its Notice, the FCC focuses on specific areas of inquiry, including on page 6 where it asks for comments addressing “Funding and Prioritization,” stating that “substantially more funding might be needed than is potentially available to support remote learning through the E-Rate program." Our comments seek to illustrate how:
- Additional funding for the E-Rate program is currently unnecessary because of the availability of more than $60 billion in public funding still unspent from other congressionally created programs. The FCC should assist in these disbursements before considering E-Rate expansion.
- Ongoing and well-documented inefficiencies in the Universal Service Fund make the E–Rate program an inappropriate vehicle to deliver effective relief to students while maintaining the solvency of the fund. The FCC should work with Congress on contribution and distribution reforms, if the USF is to continue.
The CARES Act (Pub.L. 116–136) established the Elementary and Secondary School Emergency Relief (ESSER) Fund as well as the Governor’s Emergency Education Relief (GEER) Fund, providing for an initial funding of $12.8 billion and $3 billion respectively. Of the $12.8 billion appropriated for the ESSER fund, only $3 billion has been spent. Congress appropriated an additional $54 billion for the ESSER fund and an additional $4 billion for the GEER fund in the Consolidated Appropriations Act of 2021 (Pub.L. 116–260). This makes a total of $68 billion currently available to support remote learning for students, including helping schools equip students with broadband connectivity, laptops, and tablets. Before moving to expand the E-Rate program, which is not statutorily able to support at-home devices and connectivity, the FCC should assist states and the Department of Education in disbursing these funds more effectively to better help students hit hardest by the pandemic.
The USF program provides funding to provide communications to areas of the country that are hard to reach (high-cost); rural health care; schools and libraries (E-Rate); and low-income support (Lifeline and Linkup). The companies paying into USF funding include wireline phone companies, wireless phone companies, paging service companies, and certain Voice over Internet Protocol (VoIP) providers. These fees or contributions are typically passed on to the consumer in the form of a USF fee. As many of these pools of contributors shrink, mobile customers increasingly take the brunt of these fees.
The contribution factor for USF has been on an upward trajectory for the last decade where it increased from 20% to 31.8% in just the last two years, putting exceedingly regressive fee percentages on individuals’ voice service. At the current contribution rate, if everyone eligible for Lifeline services signed up for the program, billions of dollars in funding could be exhausted in only just a few months. Simply expanding the E-Rate program, which also draws on USF, under current conditions is unsustainable.
Both the E-Rate and Lifeline program distribution processes should be examined for reforms. It is likely that distributions at the customer level will be more efficiently disbursed and utilized than distribution at the carrier level. Expansion of the E-Rate program before reassessing the contribution factor and distribution mechanisms will endanger all of the four programs that are part of USF including rural healthcare and the high-cost programs. The FCC should continue to work with Congress to use existing funds to support home-based connectivity during the COVID-19 pandemic. And, if USF programs are to continue, the FCC should work with legislators to develop the most cost-effective contribution and distribution reforms that reduce the strain on consumers and taxpayers before expanding any programs within the USF to protect its solvency.
The COVID-19 pandemic has created extraordinary challenges that require extraordinary efforts to solve. While the government works to ensure that students remain connected with their education, the FCC should continue its policy to support the work of the Department of Education and states instead of endangering the sustainability of the Universal Service Fund and all of the programs that it supports.
Sincerely,
Photo Credit: New America
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Public Health England Demolishes Anti-Vaping Misinformation
While lawmakers and multi-million dollar anti-vaping groups in the United States continue to spread misinformation about reduced risk tobacco alternatives and seek to deny adults trying to quit smoking the opportunity to save their lives, Public Health England earlier today completed it's latest analysis on all the scientific data as it relates to vaping and its efficacy in helping smokers quit. Their conclusion - based on science and not the emotional rhetoric favored by US activists - is clear: Vaping, which is 95% safer than combustible tobacco, remains the best possible way for smokers to quit, and the evidence for this just keeps growing.
Some of the findings included:
- Vaping is positively associated with quitting smoking successfully. In 2017, over 50,000 smokers stopped smoking with a vaping product who would otherwise have carried on smoking
- Quit rates involving a vaping product were higher than any other method in every region in England
- The 3 systematic reviews consistently found vaping products containing nicotine were significantly more effective for helping people stop smoking than NRT. This finding was supported by 2 non-randomised studies that reported higher quit rates among people using a vaping product who attended a stop smoking service, compared with those who used NRT.
- Most young people who had never smoked had also never vaped. Between 0.8% and 1.3% of young people who had never smoked were current vapers.
The update also expressed serious concern that "perceptions of the harm caused by vaping compared with smoking are increasingly out of line with the evidence" and this is "discouraging smokers from using vaping to quit”.
Professor John Newton, Director of Health Improvement at Public Health England specifically stressed: "For anyone who smokes, particularly those who have already tried other methods, we strongly recommend they try vaping and stop smoking"
With evidence of the effectiveness of vaping now beyond all doubt, it's time lawmakers stopped trying to tax and regulate a life-saving product out of existance, and actually let smokers quit.
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