Written by: Beck

...said the free market to the government. You probably don't remember when law first went into action--I vaguely remember hearing something about it and then promptly dismissing it as just another stealth tax ramrodded through congress by a congressman with a hard-on for the phone companies. Essentially, everyone gets a small tax on their phone bill, the money from which ($2.25 billion/year, not a small sum) goes towards subsidizing schools' efforts to computerize and get online. Big surprise: the government woefully mishandles the entire project, corruption abounds, and great swathes of money go to waste.

But [the program, called E-rate, is] messy, as cases of wasted equipment, improper or falsified purchases, insufficient payments and poor oversight have been found or alleged nationwide.

Completed audits and investigations underway show E-rate has an unacceptably high risk of fraud, waste and abuse, said H. Walker Feaster III, inspector general of the Federal Communications Commission, in testimony Thursday to a subcommittee investigating the program.

He called for more auditors so the vast technology project would get adequate oversight, and for program changes to ensure competitive bidding, clear rules and solid record-keeping.

Yes, as always, when you ask the government for a solution to a problem created by the government in the first place, their invariable answer: More Government!

Of 122 audits done over the past year, about a third revealed substantial violations, Feaster told the House Energy and Commerce Subcommittee on Oversight and Investigations.

That's right. One third. This is not a small time problem. This is not a few random instances of fraud and mismanagement. This is one in every three cases. The program is run by the sorry sods at the FCC in cooperation with a not-for-profit corporation. I've always had an instinctive distrust of any institution that exists for a purpose other than profit. Those not motivated by the bottom line aren't motivated, period, and their work output reflects it.

I'm not arguing that it isn't a noble cause to bring technology to schools. As long as you're going to have public schools, they might as well teach something useful, and to do that these days you need good computers and an internet connection. My point is that there were other ways to handle the implementation of this--ways which take advantage of pre-existing market infrastructure. Rather than letting the companies with the expertise work on it, new institutions are legislated into existence. Anyone who has ever worked for a major corporation knows that such businesses go hog wild for chances to show that they're charitable and "involved in the community." At many Silicon Valley companies, where liberal social ideology often dominates, the desire to volunteer time, effort, knowledge, and know-how, is entirely sincere and quite pervasive. Why not tap into this? You can leave the phone-bill tax in place, raise that $2.25 billion, and then let these people go hog wild. Of course, that never happens (take the recent example of Ted Kennedy gutting every market-based mechanism from the prescription drug benefit legislation). Instead, you get outcomes like this:

An investigative team found in February that about 74,000 wireless computer cards purchased for schools were sitting unwrapped on a loading dock in a warehouse. The cards were purchased in 1999 for about $24 million, including supposed installation charges.