Posted on 04/19/2002 5:58:48 AM PDT by Phantom Lord
On phone bills, a revolting charge
By MORTON LURIE
RALEIGH - Today marks the anniversary, more than 200 years past, of "The shot heard 'round the world" and the start of our revolt against England in 1775. A revolt set off by a tax, a minor tax. A tax that put little hardship on the colonists of what was then British America. It was even a tax levied for a good purpose (the common defense of the colonies).
But it was laid on arbitrarily and without consultation by the remote British Parliament. It was an affront to the traditional and hard-fought rights of the colonists as British subjects. The affront was such that explicit provisions were written into our Constitution in 1787 to guarantee that the federal government cannot levy a tax nor spend money unless specifically authorized by law enacted by Congress (Article I, sections 7 & 9).
The framers of the Constitution knew from British history that the greatest check on the power of the executive (or on a king) is the control of taxes and spending. As Madison said in Federalist No. 58, "The power of the purse may, in fact be regarded as the most complete and effectual weapon with which any constitution can arm the immediate representatives of the people, for obtaining redress of every grievance, and for carrying into effect every just and salutary measure."
But these days, history, the American Revolution and our Constitution seem to mean little. An outrageous example can be found on your telephone bill. In effect, the bureaucrats at the Federal Communications Commission have gone into the tax-and-spend business.
It all started as a small "charge" (a tax) to provide phone service to poor families. BellSouth lists this as the Federal Universal Connectivity Charge on your local bill, currently 50 cents per month. In 1997, while long-distance rates were being deregulated, the FCC expanded the scope of this charge to cover long-distance calls. As long-distance rates have gone down, this charge has been going up.
My AT&T bill calls it the Universal Connectivity Charge, and currently levies it at 11.5 percent of the long-distance bill. The money collected is funneled into the Universal Service Fund administered by the nonprofit Service Administration Corp. Besides phone service for low-income customers, other good purposes now supported by this tax include phone service in remote rural areas and discounted Internet service for schools and libraries (known as the E-rate).
The bureaucrats claim this is only a charge to the telephone companies, which the companies "choose" to pass on to their customers. Where else does the FCC think the companies would get the money?
And it's a considerable amount, in 1999 over $4 billion. Since then the FCC has raised the charge, so the take is even larger now. Of course, since this isn't a federal tax, the phone companies are allowed to recover their costs of collecting it. So part of the charge on your bill goes to BellSouth, or AT&T or whichever carrier you use to pay for collecting this tax. Evidently the FCC suspected phone users might not be happy with the tax, for it tried to get the companies to hide it on the bills.
Then too, the billions in the Universal Service Fund are a good deal for the phone companies. Much of it goes right back to them as providers of the good purposes of the fund. Making the circle complete, the board of the Service Administration Corp. is staffed in good part by telephone company executives.
As Heritage Foundation President Edwin Feulner put it two years ago, "True, the E-rate grew out of the Telecommunications Act of 1996, which Congress passed with the intention of helping to expand Internet access, but that didn't give the FCC the power to usurp a basic constitutional duty." He added, "The time to settle these questions -- why the E-rate is hidden and if it's constitutional -- is now, before the tax climbs even higher."
Maybe this charge (tax) is a good thing and the expenditures are for good purposes. If so the Constitution tells us how to proceed. It is for the Congress under the Constitution to determine taxes and authorize expenditures of the federal government, and not bureaucrats in the back room at the FCC. Congress needs to do its duty, or perhaps we need to start another revolt.
Morton Lurie is a retired computer programmer who lives in North Raleigh.
But personally, i find the most revolting charge on my phone to be the tax that was levied over 100 years ago to help fund the Spanish-American war. The war has been over for more than 100 years, but the tax is still with us. Congress repealed it several years ago but Clinton vetoed the bill. Imagine that.
Information about the war tax on our phones posted here would be greatly appreciated as well.
This is true of many other taxes as well. I have heard politicians justify imposition of sales taxes as not being taxes on "the people", but on merchants for the privilege of doing business in a particular locale. But where do the merchants get their money? Why, from their customers, i.e., "the people", of course. These jerks really do take us for idiots, but, sadly, for the majority of the sheeple, they're probably right, they are idiots. Just look at the support for taxes on "corporations" to pay "their fair share". Well, fine, everybody pays, buts its people who pay those taxes, not corporations. So why don't they just be honest about it and say they're raising taxes? Ooops. That's a non-starter...
How about a 'War on Tax'?
That sounds like a real American kind of thing.
So true. Consider as well the capital gains tax. The rich don't have to invest their money which creates jobs and builds homes. They can just sit in their wealth. The demagogue who rails against the rich wants to claim he's "doing something, anything" and the poor end up suffering. But the politician gets to walk away thinking he's a good person, because he supposedly cares about the poor he's harming by his tax policies.
See:
Bliley, Tauzin Release New FCC Data on Gore Phone Tax
"Consumers In Three-Quarters of the States Are Getting a Raw Deal," Bliley Says WASHINGTON (May 27) -- As the Democratic-led FCC voted to double the Gore Tax today, Chairman Tom Bliley (R-VA) and Subcommittee Chairman Billy Tauzin (R-LA) released FCC data confirming that this monthly phone tax is both unfair and unevenly assessed. Under the current tax, consumers in three-quarters of the States end up exporting their hard-earned tax dollars elsewhere.
Bliley and Tauzin requested the FCC data in a May 13th letter they sent to FCC Chairman William Kennard on the proposed phone tax increase.
"This is a double whammy," Bliley said. "The Gore Tax is forcing all consumers to pay more for their telephone, wireless and paging services. And then, to add insult to injury, consumers in most states end up subsidizing someone else's Internet access.
"Take, for example, my own state of Virginia. Even before the FCC doubled the tax today, Virginians paid $50.2 million during the first cycle of the Gore Tax, but in return, got back only $24.9 million from the FCC," Chairman Bliley said. "By contrast, Puerto Rico paid only $13.3 million in the first cycle, but pocketed a whopping $47.6 million in subsidies!
"The Gore Phone Tax is fundamentally illegal and unfair. It's unfair to all consumers, and it's unfair to three-quarters of the States," Chairman Bliley said.
"No one should be surprised by today's vote," Subcommittee Chairman Billy Tauzin (R-LA) said. "Clearly the FCC is getting its marching orders from the White House. In my opinion, this is a thinly veiled attempt to prop up Al Gore's sagging Presidential campaign," Tauzin said.
"This is an illegal tax on telephone consumers nationwide," Subcommittee Chairman Billy Tauzin (R-LA) said.
Under the current tax, the 38 states (plus the District of Columbia) that export consumer tax dollars are: Arkansas, California, Colorado; Connecticut, Delaware; District of Columbia; Florida, Hawaii; Idaho; Illinois; Indiana; Iowa; Kansas; Maine; Maryland; Massachusetts; Michigan; Minnesota; Missouri; Montana; Nebraska; Nevada; New Hampshire; New Jersey; North Carolina; North Dakota; Ohio; Oregon; Pennsylvania; Rhode Island; South Carolina; South Dakota; Tennessee; Utah; Vermont; Virginia; Washington; West Virginia; and Wyoming.
So what exactly is the team that defeated Gore doing about it?
And the problem is?
And don't worry, Gray Davis will see to it that no one in the state has electricity.
I only have the bare minimum of service on my home phone. Will probably step up to unlimited nationwide minutes with free long distance in the near future and can the home phone all together.
I got RR for the internet.
To quote Homer Simpson [to his son, Bart], "Your ideas are intriguing to me, and I wish to subscribe to your newsletter."
You must have missed out on reeducation camp. We all know that it is not a tax, but it is a FEE. And all right thinking people know that a fee is not a tax.
Now find for me the clause in the Constitution that says only congress can levy fees.
Now find for me the clause in the Constitution that says only congress can levy fees.
Would it not be better to ask,
Find for me the clause in the Constitution that says Congress can levy "fees" period?
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