{"article":{"id":113687,"heading":"Millions Lost in Cyberspace","author":"Editorial","created":"2004-07-01 21:25:48","modified":"2004-07-02 06:15:35","last_modified":"Fri, 02 Jul 2004 13:15:35","article":"

Tucked into the Telecommunications Act of 1996 was a little-known program called the \"e-rate,\" setting up a tax that has cost consumers and phone companies upward of $2 billion a year. What has that money bought? A rudderless program riddled with fraud and waste.

The e-rate tax is aimed at providing schools and libraries with Internet access. The program, championed by Al Gore when he was vice president, was supposed to help schools allow low-income students to close the \"digital divide\" and gain new social and economic opportunities. Sen. John McCain (R-Ariz.) began raising questions about it during a hearing on the program six years ago. Since then, its problems have become more apparent. The e-rate fund has distributed $12 billion over six years, and estimates place the amount wasted in the billions. Because of lack of oversight, it's impossible to know the extent of the losses.

During a recent House hearing, legislators documented some of the lapses. They showed, for instance, how most of the $101 million in e-rate funds spent in Puerto Rico went to dubious purchases, such as 73,000 wireless connection cards for individual computers. The cards, purchased at more than $300 apiece five years ago, have grown obsolete in a warehouse outside San Juan. Most Puerto Rican children still access the Internet through dial-up modems on roughly two computers per school.

Other rural projects cited by supporters as successes have enormous per-pupil costs. A conflict of interest is built into the program's core: Its dollars are doled out by a nonprofit corporation run by telecommunications service providers whose businesses benefit from the money. They are barely overseen by the Federal Communications Commission.

Legislators are planning more hearings after the Fourth of July recess, and the e-rate program will come up for congressional reauthorization next year. Its overall success or failure has never even been measured. Unless the schools and libraries that want it renewed can help make the program accountable, there's not much point in continuing it.

The FCC should take over from the board and put e-rate on probation. Grant applicants should have to submit plans that use proven technologies in cost-effective ways. Surfing the Internet isn't enough.

<\/p>\n","contact":"","link":"","address":"","phone":"","parent_id":0,"mime_type":"text\/plain","summary":"Yet another example of where your hard-earned tax dollars in the clutches of Big Government end up: in the shitter. Liberals, remind us again why taxes should be even higher. It would be easier just to set the money on fire in the backyard.","numcomment":3,"fileurl":"\/uploads\/","filesize":null,"article_url":"\/news\/2004\/07\/113687.php"},"attachments":[],"comments":[{"id":113689,"heading":"OneEyedMan","article":"idiot: "Because of lack of oversight, it's impossible to know the extent of the losses. "\r\n\r\n...so just take my word for it!\r\n","author":"KPC","parent_id":113687,"mime_type":"text\/plain","created":"2004-07-01 22:43:47","modified":"2004-07-01 22:43:47","fileurl":""},{"id":113693,"heading":"Ask Dick where the money went","article":"Authority faulted over Halliburton hotel bills\r\n\r\nHouston Chronicle, June 30, 2004\r\n\r\nWASHINGTON -- Auditors looking into hefty charges rung up by Halliburton Co. and others at a beachfront hotel in Kuwait chastised the Coalition Provisional Authority for failing to better control costs. The authority's inspector general, examining $11 MILLION in charges being incurred annually at the five-star Kuwait Hilton, said the Provisional Authority "did not apply adequate oversight to ensure that operating costs were minimized."\r\n\r\n...Halliburton subsidiary KBR allowed lower-level workers to stay there as well. That pushed up costs by some $2.85 MILLION a year, the report said.\r\n\r\nThe government could have saved $191,000 for laundry service alone if it had installed washers and dryers in the villas for workers to use, rather than allow them to use the hotel laundry service...","author":"David Ivanovich","parent_id":113687,"mime_type":"text\/plain","created":"2004-07-02 01:23:52","modified":"2004-07-02 01:23:52","fileurl":""},{"id":113698,"heading":"some good some bad","article":"The main problem with programs like e-rate is that it's so hard to know the market conditions. If there were an ebay for e-rate, so that companies could know, then there'd be less fraud, and less waste.\r\n\r\nI've heard of e-rate being used to (finally) upgrade telecom wiring so there's internet and telephones in the class. That's good.\r\n\r\nWhat they *should* be using this money for is to help create a computer welfare program for poor kids, so they can get a computer for home use. Usually, the main impediment to getting computer skills is that the parents can't or don't accumulate enough money to afford a computer. Why should kids suffer for lame parents.","author":"more rational","parent_id":113687,"mime_type":"text\/plain","created":"2004-07-02 06:15:35","modified":"2004-07-02 06:15:35","fileurl":""}]}