Every dollar the government spends has a constituency. In this case, the private companies providing the phones are perversely motivated to ignore eligibility requirements — the more phones they pass out, the more money they make. The recipients of the phones are voters, and the administration has no incentive to alienate its own voters to save such a piddling amount as $2.1 billion.
Federal programs are judged on their intent, not their performance. For example, the General Accounting Office two years ago identified $18 billion of waste in federal job training initiatives, and yet there’s been no move to cut off those funds, because no politician wants to vote against job training.
Although called Obamaphones, the program actually started under President Ronald Reagan and originally paid only for land lines. The hope was that phones would help poor people find jobs, although Melchior was never asked about her employment status. The program exploded in 2008 after it was changed to cover cellphones and eligibility loosened thanks to Obama’s massive expansion of welfare.