Internet activists have been deluging the Federal Communications Commission with protests of a proposal that was settled last May, all the while missing the action in an ongoing battle over rate increases that are being slapped on the nation’s phone bills.

For several weeks, the Internet has been buzzing with warnings of possible
per-minute charges for access being levied by local phone companies.

“Your local telephone company has filed a proposal with the FCC to impose per-minute charges for your Internet service,” says one typical posting. “They contend that your usage has or will hinder the operation of the telephone network.” Internet users are urged to send comments to an e-mail box set up by the commission no later than Friday, Feb. 13, 1998.

As it turns out, none of this is true. “Be aware this information is inaccurate,” says the FCC in an Internet fact sheet, regarding the recent flurry of e-mail alerts.

However, there was such a proposal. According to the FCC, phone companies had requested permission to impose per-minute rates last year, arguing that these would more accurately reflect the costs that Internet service providers (ISPs) impose on the network and would provide revenues to fund network upgrades needed to better handle data traffic. Those interested in the issue could send comments to an FCC created e-mail box, the final deadline being February 14, 1997.

People responded then, as they are doing now, and with apparent success. On May 7, the FCC released an order that local phone companies may not assess interstate access charges on Internet providers or impose per-minute charges on internet users.

That’s not to say there’s nothing to worry about. The FCC is hitting Americans with an even greater wallop than per-minute charges for the Internet. Not everyone uses the Internet — nearly everyone has a telephone.

On Dec. 2, James Glassman of the American Enterprise Institute and the Washington Post broke the news in his column “A new tax for the New Year.”

“Your phone bill will be increased to cover the cost of vast new government programs that you probably know nothing about and that Congress never thought would be so huge,” wrote Glassman.

The reason for shaking down phone customers is to pay for wiring the nation’s 2 million classrooms and 16,000 libraries — to the tune of $2.25 billion a year for the next four years at least.

“Add in another $400 million a year to wire rural health centers, and the grand total in 1998 will come to $4.9 billion, or an average of about $50 a year for every U.S. household,” according to Glassman.

This grand link-up builds on an old program, “universal service,” which has been around for decades. A relatively small fee is charged on phone bills to subsidize phone service to rural areas. Starting Jan. 1, the universal service programs expanded from $1.9 billion to $2.2 billion annually — a figure that will rise continue to rise year to year.

No one is certain what the rate increases will be, but they could run “perhaps to the tune of 4 or 5 percent.” The question is in the hands of the commission, a matter that strikes Glassman as “outrageous.”

“If it’s in the public interest to link schools to the Internet, then Congress should specifically say that and appropriate a specific amount for that purpose,” Glassman told WorldNetDaily. “They should say here’s what we want, here’s the amount of money that needs to be appropriated. That wasn’t done,” he said.

And it gets worse. Phone customers won’t be told how much of their phone bill is going to the link-up program. “We have a commission able to levy invisible charges on what amounts to an open-ended entitlement program which could go on for years,” said Glassman.

As Glassman explained, “The FCC is requiring most telecommunication companies — long-distance carriers, locals, and cellular — to fork over money for universal service, and they will pass it along to their customers. The long-distance companies wanted to show this on bills as a line item, but the commission objected. What is really scandalous is that the long-distance companies agreed not to show the charge as a line item on bills in return for lower charges. They agreed to obscure something that should be transparent.”

In the last month, considerable public controversy has been generated about these costs and the fact that the amounts are to be kept hidden from consumers by rolling them into the rates. At least one FCC commissioner deplores the situation.

“I am reluctant to support any new fees or taxes on consumers; I will never support any new fees or taxes negotiated in secret, without public notice or comment,” said Commissioner Harold Furchtgott-Roth in a public statement.

The FCC is preparing a report to Congress on universal service as required by law. The Common Carrier Bureau within the Commission is seeking formal and informal comment on several issues, among them “the commission’s decisions regarding the percentage of universal service support provided by federal mechanisms and the revenue base from which such support is derived,” and “who is required to contribute to universal service support mechanisms.”

The deadline for filing responses is January 20, 1998.

You may use the FCC’s Electronic Comment Filing System on the World Wide
Web at http://www.fcc.gov/e-file/ecfs.html. Informal comments may
also be sent by e-mail to .

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