Bug exists in Ubuntu 8.04.1

In a terminal I typed "groups" and I was listed as being part of the 'dip' 
group.
Typed "adduser <username> dip" and was told I was already part of the dip group.
Removed myself from the dip group and added again, rebooted. Same error.
Rebooted to a Recovery screen and removed/added as Root. Rebooted, same error.
I have done everything I can to get this to work to no avail.
It breaks wvdial as well, because apparently it can't start pppd for the same 
reason.

Perhaps I'll try removing networkmanager, but I don't see how that would
be the reason.

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Pon/poff don't work as normal user...
https://bugs.launchpad.net/bugs/278828
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