'Obama Phones' Increasing in Kentucky


by Adam Walser


Posted on October 12, 2012 at 6:08 PM

Updated Monday, Oct 15 at 8:28 AM

(WHAS11) -- They're known on the street as “Obama phones”... free phones given away by the thousands.

The giveaway is part of a federal program meant to help low income people, and the phones are now becoming a big business.

Budget Mobile just opened at the corner of 18th and Broadway in February, but it's already pulling in plenty of customers with promises of free phones and free minutes.

But there's a cost, and if you pay a phone bill, you're paying for it.

They're high tech. They're functional.

“You can text. You got a big screen. You're got speakers here,” said one man demonstrating his new cell phone.

And best of all, they're free.

“It's a government assistance phone,” said an employee of Tag Mobile..

“It’s an Obama phone, so you can't vote for Romney,” said a customer.

Tag Mobile’s distribution plan may look low tech… there are handmade signs, two employees handing out dozens of phones an hour from a card table on the sidewalk beside Wayside Christian Mission.

But their business is booming.

The company raked in $280,000 from the federal government in Kentucky alone last month.

“I stood in line for an hour and a half,” said Randall Maynard, who got his phone outside the shelter.

“I drove up about 15 minutes ago. They said, ‘you know they giving away free phones? Give you a government phone.’ I wish I'd have known that a long time ago. I'd have thrown this phone away,” said Christopher McFarland, who was waiting in line for another phone.

The company getting the most government reimbursements in Kentucky last month was Budget Mobile, which has a store on West Broadway.

The business also hosts "events" advertised on Facebook, like a phone giveaway outside a West Louisville liquor store Friday.

In September, Budget Mobile received $495,000 to support low income customers in Kentucky.

The phones are part of a federal program called the "lifeline program" aimed at giving people who already receive state or federal benefits access to phones.

It started in 1984 under President Reagan, but has lately been more closely identified with the current president, especially after a YouTube video surfaced two weeks ago showing a woman in Ohio bragging about her “Obama phone” while demonstrating against Mitt Romney.

“Everybody in Cleveland got Obama phones. Keep Obama president, you know,” the woman said. “You sign up. If you on food stamps, on social security, you got low income, you disability.”

While the phone company employees weren't talking politics today, some of the customers were.

“If you still getting government assistance, then your phone will come back on and you'll get another 250 minutes every month,” said Arthur Thompson. “But you can't vote for Mitt Romney. If you vote for him, you won't get a phone. “

Who's paying for it?

If you pay a phone bill, you do.

It's a fee tacked on each month called the Universal Service Fund.

Records we obtained show that the monthly cost of the program in Kentucky has more than tripled in the last four years, from $645,142 in January 2009(the first month Obama was in office) to $2,171,106 last month.

“The government is like a big business. If you don't take care of the people, people ain't gonna take care of the business, you know what i mean?” said Eldon Fuller, as he waited for a free phone.

When asked if he found it strange that the phones were showing up on the street so close to the election, Fuller said “No, I don't  think it's strange. Things happen in mystical ways, and I seen it happen.”

There is no evidence the phones are in any way connected to a campaign to get voters.

As we said, the program started under President Reagan, and these businesses are  completely legal.