I have testified a bunch of times before Congress about various government programs and their efficiencies — and, more often, their lack thereof. One very common pattern I have observed is that legislators tout as successes the mere existence of government subsidies, or the fact that the beneficiaries of subsidies and other handouts enjoy getting “free” money from the government.

This is exactly what happened this morning during testimony before the Senate Budget Committee on Commerce on the pandemic-era boondoggle called the “Emergency Broadband Benefit Program” and later rebranded the Affordable Connectivity Program (ACP). This program extends $30 a month to qualifying beneficiaries for internet service.

During the hearing, Democratic members and witnesses made various arguments for the program based on the fact that beneficiaries were happy to get some money to pay for their internet service. The number of people benefiting from the program was also used as evidence that the program was necessary. We also heard it argued that without the money, these beneficiaries (often members of minorities, seniors, tribal communities, or members of the military) would lose connectivity. Of course, we were warned that this loss would damage the entire economy.

What we didn’t hear from them was the question of whether the money used for these subsidies might be put to better use elsewhere or whether the government is the best means of delivering the desire outcome of broadband affordability.

I was therefore glad to read and listen to the testimony of the Economic Policy Innovation Center’s Paul Winfree, who addressed many of these issues. For instance, he explained why a subsidy is the least effective route to provide broadband affordability and why such subsidies could backfire. As he noted, the surest way to make broadband services better and their prices lower is market competition. He also explained that existing regulations are raising broadband prices. So even if we assume that all those households that do not have broadband lack it because its not affordable for them, deregulation would go much further than would subsidies in making broadband more affordable. Besides, Winfree provides data to show that the ACP has in fact increased the price of internet services and is therefore contributing to the problem.

He also outlined the fact that, as is almost always the case with government handouts, the ACP subsidies are being paid to many people who already have broadband. He writes, for instance:

The FCC has said that a goal of ACP is to close the digital divide for low-income consumers. However, most ACP subsidies are going to households who already have broadband. FCC surveys have found that around 80% of ACP recipients already had broadband before the subsidy.

He adds:

The FCC has also tried to study the effect of losing ACP on internet service. In a survey conducted earlier this year, the FCC reports that “more than three quarters (77%) of survey respondents say losing their ACP benefit would disrupt their service by making them change their plans or drop internet service entirely.” However, this is an inaccurate reading of the survey.

The 77 percent referenced by FCC is derived by adding two responses together including the 29.3 percent of respondents who said that they would choose a different service and the 47.6 percent who said that they would choose a lower cost service. Only 15.7 percent said that they would drop their service with no alternative. This 15.7 percent that would lose coverage in the absence of ACP is very similar to the rate of new take-up in internet service after the adoption of ACP based on other FCC data.

Dominic Pino recently covered this misleading use of data by the FCC.

A final point: I am quite shocked that, at a time when the government’s debt is enormous and growing fast — with no relief in sight — and with interest rates and inflation high, most members of Congress don’t even feign an interest in fiscally responsible behavior. Listening to this hearing, it was obvious to me that very few people care. You might say that the ACP is a relatively low-cost program, but multiply it by the number of every single need (real and imaginary) or request from special interests and it becomes easy to see why we now confront such a big fiscal mess.

If the Democrats believe that this program is so important that it should be extended, they should offset its cost. What is it going to be?