The Imminent Death of the U.S. Postal Service?(the-american-interest.com)
the-american-interest.com
The Imminent Death of the U.S. Postal Service?
http://www.the-american-interest.com/article.cfm?piece=614
5 コメント
Your argument is basically that universal service is "nice".
Yes, I know you wouldn't phrase it that way, but it is what it boils down to.
The counterargument is the simple fact that as the system is working and structured now, we can't afford it.
An awful lot of the problem with the way we've been responding to this economic crisis is the way that people have been acting as if we can just wish for nice things that we can't afford, and somehow it'll all just work out. Car companies may be losing money by the billions, but it sure would be nice if they made a profit, so let's wish a few more billion at them to lose, rather than making the hard decisions. It sure would be nice if the postal system could make money without making the hard decisions, so let's wish a few more billion at them.
At some point, you have to make the hard decisions. People spit at the word "profit" because of the various (mostly stupid) negative connotations given to it, but remember that no matter how socialist or even communist you may be, SOMETHING has to make a profit! Whether it's a profit in money or a profit in credits or a profit in sweet, sweet love, something has to generate more value than the effort you put into it, or you have no money or credits or love to subsidize your other desires with.
Now, if you make the right hard decisions, we can probably keep universal service. The article has several constructive suggestions. But some hard decisions will have to be made. (And for all the exciting rhetoric from the Obama administration about making hard decisions, I can't hardly name one actually hard decision he's made, rather than wishing more taxpayer money at things that make no money.) Individually, maybe we could afford a postal service that loses billions, but against an economy where everything is having trouble, we probably need to go to a model where the post office at least breaks even... and if that means losing something "nice", well, so be it.
Yes, I know you wouldn't phrase it that way, but it is what it boils down to.
The counterargument is the simple fact that as the system is working and structured now, we can't afford it.
An awful lot of the problem with the way we've been responding to this economic crisis is the way that people have been acting as if we can just wish for nice things that we can't afford, and somehow it'll all just work out. Car companies may be losing money by the billions, but it sure would be nice if they made a profit, so let's wish a few more billion at them to lose, rather than making the hard decisions. It sure would be nice if the postal system could make money without making the hard decisions, so let's wish a few more billion at them.
At some point, you have to make the hard decisions. People spit at the word "profit" because of the various (mostly stupid) negative connotations given to it, but remember that no matter how socialist or even communist you may be, SOMETHING has to make a profit! Whether it's a profit in money or a profit in credits or a profit in sweet, sweet love, something has to generate more value than the effort you put into it, or you have no money or credits or love to subsidize your other desires with.
Now, if you make the right hard decisions, we can probably keep universal service. The article has several constructive suggestions. But some hard decisions will have to be made. (And for all the exciting rhetoric from the Obama administration about making hard decisions, I can't hardly name one actually hard decision he's made, rather than wishing more taxpayer money at things that make no money.) Individually, maybe we could afford a postal service that loses billions, but against an economy where everything is having trouble, we probably need to go to a model where the post office at least breaks even... and if that means losing something "nice", well, so be it.
FedEx and UPS take the most profitable business from the USPS, while the post office serves everywhere and everything
That is an awesome insight, it really cuts through all of the noise.
If it weren't for the universal service requirement .. But personally, I like getting my mail no matter where I live.
This part I question .. shouldn't people who live in expensive to serve places and/or people who want to send mail to those places pay for the costs that they're imposing on the system?
That is an awesome insight, it really cuts through all of the noise.
If it weren't for the universal service requirement .. But personally, I like getting my mail no matter where I live.
This part I question .. shouldn't people who live in expensive to serve places and/or people who want to send mail to those places pay for the costs that they're imposing on the system?
There's a long-standing tradition that communication between any two of a country's citizens is important to protect as it is a public good. Postmaster General was a cabinet position for many years because of this. The desire to impose market pricing on market costs for everything is unsettling to me.
Postal communication between citizens is a classical private good. It is both rivalrous (my letter takes up space in the mail carrier's bag which your letter can not occupy) and excludible (if you don't pay, they don't deliver).
A public good is not just a good you want the government to provide, the term actually has a meaning.
http://en.wikipedia.org/wiki/Public_good
A public good is not just a good you want the government to provide, the term actually has a meaning.
http://en.wikipedia.org/wiki/Public_good
You're only looking at it from the shipper's perspective, not the receiver's. The postman is a romantic figure because of the recipient, not the sender.
And, frankly, the idea that my letter excludes your letter from the carrier's mailbag is laughable. No, they cannot fit in the same physical space, but there's room for more than one letter in the bag/carrier/truck.
And, frankly, the idea that my letter excludes your letter from the carrier's mailbag is laughable. No, they cannot fit in the same physical space, but there's room for more than one letter in the bag/carrier/truck.
Carrying letters is rivalrous. As more people send letters, the bag will fill up and more mail carriers will be needed.
Compare this to a real public good, e.g. national defense. National defense is non-rivalrous because me enjoying living in a non-communist country does not hinder you enjoying the same thing.
As for the postman being a romantic figure, not sure how that fits into the question of whether mail delivery is a public good or not.
Compare this to a real public good, e.g. national defense. National defense is non-rivalrous because me enjoying living in a non-communist country does not hinder you enjoying the same thing.
As for the postman being a romantic figure, not sure how that fits into the question of whether mail delivery is a public good or not.
Government control of the post office was more about controlling the flow of information. Recently I was reading a biography of Ben Franklin, and the reason the Postmaster position was so important back then was that you could use it to control the newspapers that went out. "Bradford was the postmaster of Philadelphia, and he used that post to deny Franklin the right, at least officially, to send his Gazzette through the mail" - http://books.google.com/books?id=L64OOJGaCKIC&printsec=f... ( search for "postmaster" )
This is very true. We should protect communication between citizens. I'd personally rather that we do this through protection of Internet communications. People don't send letters anymore, they send email (or tweets, or whatever).
I'd be happy if the money that is going to keep the postal service subsidized instead went into subsidizing universal internet access.
I'd be happy if the money that is going to keep the postal service subsidized instead went into subsidizing universal internet access.
Did you read the article, or have you been paying attention? Communication between citizens has changed a little over the years.
Ignoring the market doesn't make costs & benefits disappear. In fact the author argues that's what got them into this fix.
Ignoring the market doesn't make costs & benefits disappear. In fact the author argues that's what got them into this fix.
Utilities are public goods, and people pay proportional to the cost they impose on the system. And the economics work out well, not because there is a conscious effort to impose markets on people, but instead because incentives are aligned.
With utilities, you pay based on how much you use, not on how difficult it is to get them to you. So, for example, if you live on a farm in the middle of nowhere, it is more expensive to give you power than if you live in the city (you need dedicated infrastructure to get the power to you, and chances are you are further away from the power plant which means more power gets lost in transmission). Yet you pay the same per kw/h as if you lived in the city. Where you start paying more is if you use more power. (at least, this is the case where I live. Sorry if it is different in the US)
Postage works exactly the same way. No matter how expensive it is to get a package to you, you pay a fixed rate for it. However, you also pay proportional to the cost you impose on the system is that you pay per package.
Postage works exactly the same way. No matter how expensive it is to get a package to you, you pay a fixed rate for it. However, you also pay proportional to the cost you impose on the system is that you pay per package.
> With utilities, you pay based on how much you use, not on how difficult it is to get them to you.
Actually, you do pay for untilities based on how expensive it is to get to you. The local power folks won't run a line to whereever you happen to be "for free". They'll charge you, the developer, someone. If you're a long way from "enough" capacity, the cost can be significant.
That's why some folks aren't on the untilities grid.
Actually, you do pay for untilities based on how expensive it is to get to you. The local power folks won't run a line to whereever you happen to be "for free". They'll charge you, the developer, someone. If you're a long way from "enough" capacity, the cost can be significant.
That's why some folks aren't on the untilities grid.
Rates vary - substantially - by reigion depending on sources of power and transmission costs. If you live in an area with hydroelectric power, you pay much lower rates, for example. If you live a rural area, you have to pay for the connections.
Perhaps utilities were a bad choice of example on my part because of this usage confusion.
Perhaps utilities were a bad choice of example on my part because of this usage confusion.
> There's a long-standing tradition
You are attempting to rely on a well-known logical fallacy.
See http://www.nizkor.org/features/fallacies/appeal-to-tradition...
You are attempting to rely on a well-known logical fallacy.
See http://www.nizkor.org/features/fallacies/appeal-to-tradition...
What is your opinion on "urban sprawl"?
What effect do universal service subsidies and other public works (such as highways) have on the rate of expansion of settlements?
What effect do universal service subsidies and other public works (such as highways) have on the rate of expansion of settlements?
>FedEx and UPS take the most profitable business from the USPS, while the post office serves everywhere and everything, very nearly.
Yes, they actually send unprofitable packages through the USPS.
Yes, they actually send unprofitable packages through the USPS.
Talking about the post office's losses without citing that context [universal service] is disingenuous.
The article devotes much discussion to the Universal Service Obligation; its origin, rationale, effects, and ways it can be updated without generating the tens to hundreds of billions of dollars of losses the USPS is now racking up. Did you read the article?
But personally, I like getting my mail no matter where I live.
Should the rest of the country pay tens to hundreds of billions of dollars for your convenience, if they don't share your preference?
The article devotes much discussion to the Universal Service Obligation; its origin, rationale, effects, and ways it can be updated without generating the tens to hundreds of billions of dollars of losses the USPS is now racking up. Did you read the article?
But personally, I like getting my mail no matter where I live.
Should the rest of the country pay tens to hundreds of billions of dollars for your convenience, if they don't share your preference?
I used to work for the post office, and I think their big problem is universal service, unionized labor, and lack of investment in labor-saving technology (for whatever reason). They also can't just adjust prices as needed.
If they're not responsible like a real corporation, nobody told their management that. The work environment there is like a pressure cooker, and they chew out carriers for going 5 minutes over their allotted time. But there's really nothing else they can do besides acting unpleasant because it's almost impossible to fire a carrier after they've passed their probationary period.
I doubt that a private corporation would do much better with the same constraints. Of course, in the age of the internet and telephones 6-day/week universal service may not be as important as it was in the 19th century.
Also, what's this BS about calling the post office a "ponzi scheme" because they rely on advertising and we're in a recession? Are google and broadcast TV also ponzi schemes? Is the recession going to last forever?
If they're not responsible like a real corporation, nobody told their management that. The work environment there is like a pressure cooker, and they chew out carriers for going 5 minutes over their allotted time. But there's really nothing else they can do besides acting unpleasant because it's almost impossible to fire a carrier after they've passed their probationary period.
I doubt that a private corporation would do much better with the same constraints. Of course, in the age of the internet and telephones 6-day/week universal service may not be as important as it was in the 19th century.
Also, what's this BS about calling the post office a "ponzi scheme" because they rely on advertising and we're in a recession? Are google and broadcast TV also ponzi schemes? Is the recession going to last forever?
It seems that these days "Ponzi scheme" == "Anything I don't like that involves money"
Do you truly have universal service?
I know that some of our (Australia) more remote locations get less than the 5 days per week we get in the cities. Even in some of the outer outer suburbs of Melbourne (I'm talking Cockatoo) -- I know there are some roads/areas that the postie wont deliver to - instead the residents have to pickup from the local general store/"post office".
(remembering that we have 21 mil people in an area almost the size of the lower 48 states - and one of the highest urbanization rates in the world - so it's big big cities with lots and lots of open space in the middle)
I really like the tone of this article. While informed by the market-liberal/competitive-economics viewpoint, it's not doctrinaire. It's respectful of the historical rationale for the USPS and realistic about the political environment for reform. It makes practical suggestions with examples of the companies and other countries that have succeeded with similar policies.
Here's where I stopped reading:
[..] some 20 percent of direct-mail advertising volume is comprised of credit card, mortgage and other financial offers. So yes, the USPS has contributed in a subtle yet very real way to our burst economic bubble.
Ludicrous. If that's the level of the author's insight, why bother reading the rest?
[..] some 20 percent of direct-mail advertising volume is comprised of credit card, mortgage and other financial offers. So yes, the USPS has contributed in a subtle yet very real way to our burst economic bubble.
Ludicrous. If that's the level of the author's insight, why bother reading the rest?
It's funny. That's where I stopped too.
Then you missed a lot of meaty info because of a throwaway line.
Compared to other subsidies the government has been giving bad actors, this USPS subsidy to the credit industry is minor, yes. But it's surprising how merely mentioning it closes your mind to the rest of the analysis. It's almost like you've got a post-hypnotic suggestion preventing you from questioning certain monopolies!
Compared to other subsidies the government has been giving bad actors, this USPS subsidy to the credit industry is minor, yes. But it's surprising how merely mentioning it closes your mind to the rest of the analysis. It's almost like you've got a post-hypnotic suggestion preventing you from questioning certain monopolies!
Hardly. I don't live in America, in fact I'm in a country mentioned as an example of a "good" post office.
The assertion that a subsidy on direct mail somehow contributed to the ongoing financial crisis is just stupid and calls into question the author's basic understanding of the subject and ability to identify relevant information. You might as well say that coffee contributed to the crisis because it enabled bankers to stay up later and write more bad contracts. Hell, name anything you want and I'll connect it to the crisis using some bullshit six-degrees-of-separation methodology like the author used for direct mail.
The assertion that a subsidy on direct mail somehow contributed to the ongoing financial crisis is just stupid and calls into question the author's basic understanding of the subject and ability to identify relevant information. You might as well say that coffee contributed to the crisis because it enabled bankers to stay up later and write more bad contracts. Hell, name anything you want and I'll connect it to the crisis using some bullshit six-degrees-of-separation methodology like the author used for direct mail.
You do the math on that universal service vs. choosing the profit maximization thing.
Talking about the post office's losses without citing that context is disingenuous.
Also, from having worked at a mailing house, I can tell the author doesn't understand much about how the post office actually routes mail.