Imagine paying $340,000 a year to keep the internet running in a building where no one lives. Now imagine that building is in Alaska, and the company collecting that money has zero incentive to question it.
You’ve probably heard about government waste, but this is different. This isn’t incompetence. This is design.
The real scandal isn’t that a company is gaming the system – it’s that the system was built to be gamed.
Here’s the setup: The FCC runs a subsidy program intended to connect underserved communities. It’s a noble goal. But the way it’s structured, once a telecom company gets approved for funding, the payments become virtually permanent. There’s no built-in mechanism to audit whether the buildings being wired are actually occupied. No way to adjust the payments when a community shrinks. No incentive for the company to say, ‘Hey, we’re overpaid.’
So in Adak, Alaska – a town of fewer than 100 people – the FCC is paying to keep fiber running to empty buildings. The company collects its check. The buildings sit dark. The public pays the bill.
You want to blame the corporation. I get it. But that’s like blaming a fish for swimming in the water you poured into the tank.
This isn’t a fraud. It’s a structural annuity – a legal transfer of public money to private pockets, with zero accountability.
The FCC’s own rules lock in these payments. They can’t audit dynamically. They can’t adjust based on real-world data. The program was designed for a static world where need never changes. But communities change. People leave. Buildings empty. And the money keeps flowing.
We’re told to expect some waste in government. But this isn’t a rounding error. This is a feature of the system, not a bug. The FCC has the power to reform its own rules – but it doesn’t. Why? Because reforming would require admitting that the program is broken. And that’s politically inconvenient.
So next time you see a headline about a corporation ‘defrauding’ the government, ask yourself: Who designed the game? Who set the rules? Who benefits from keeping them broken?
Until the FCC can audit and adjust, this isn’t a scandal. It’s a feature.
FAQ
Q: Isn't this just a case of a company defrauding the government?
A: No. The company is following the rules as written. The real problem is the rules themselves – they lack any mechanism for dynamic auditing or adjustment. The company is legally entitled to the money.
Q: What's the practical implication for taxpayers?
A: Your tax dollars are being funneled into guaranteed income streams for telecoms, regardless of whether the service actually reaches people. The only fix is to redesign subsidy programs to include performance metrics and renewal conditions.
Q: Isn't the contrarian take that government programs are inherently inefficient?
A: That's lazy. The real contrarian view is that this inefficiency is not inevitable – it's a choice. The FCC could implement audit trails, sunset clauses, and outcome-based payments. It chooses not to, because those reforms would break the cozy relationship between regulators and the regulated.