Skip to comments.To go Postal or not to go Postal
Posted on 08/14/2011 7:36:22 AM PDT by Kaslin
Yesterdays front-page Washington Post headline screamed: Proposal to slash horse & buggy jobs blasted by unions.
The Post went on to discuss a plan by horse-and-buggy management to lay off 120,000 workers, a move that would further wound an already ailing labor movement. Horse-and-buggy unions pleaded that workers have made many concessions previously in an age of dwindling rider volume.
Wait a second . . . did I write horse & buggy? Heavens! I meant to write postal, as in the United States Postal Service. Just switch the word postal for horse & buggy and all is well.
Or not so well.
Apparently, just as the with the long-suffering horse-buggy sector of the economy, the Postal Service is a storied institution that is struggling with stiff competition, declining demand . . . and a conflicted identity.
Im not certain what to prescribe for a conflicted identity. Im not a licensed psychiatrist. But in business it is important to be focused, rather than conflicted, on products and services with actual profit-making demand from modern-day, living customers.
Though the recession has certainly been a factor in reducing demand, in both the case of buggies and that of mail delivery, the bigger problem is strong competition that has been stripping away consumer demand for decades. All the while, our conflicted elected officials have done little to nothing in effectively protecting the buggy business from the onslaught of the automobile and the subway. Likewise, the Post Office cannot simply hit the kill-switch to block bill-paying over the Internet or thwart human communication via basically free email and very inexpensive phone service.
Of course, the horse-and-buggy folks have one critical advantage over the postal people: Congress is not part of the management team at Buggies R Us.
The Post Office should be so lucky.
Since 1970, reporters Alec MacGillis and Lisa Rein inform, the Postal Service has operated as a quasi-private monopoly that receives virtually no taxpayer support but is hamstrung in competing with companies like FedEx and UPS because it cannot raise prices above a certain level, must maintain minimum levels of service and must now make the annual retiree payments.
Of course, virtually no taxpayer support means some taxpayer support and quasi-private monopoly really equates to a government-enforced public monopoly. The Congress has outlawed any competition with the post office in delivering first-class mail. But though that specific monopoly gives the USPS an advantage, Congress takes away the advantage (and arguably more) by dictating how the protected service will be run.
The Postal Service keeps trying to do all the things that a sensible business does in response to decreased demand for their service. They have fought with the Congress to raise postage rates. Congress wants low rates to please constituents, who are likely not to remember to blame those same congressmen for USPSs huge operating losses.
Postal management wants to break union contracts, both because they have more workers than productive, profit-making work to offer them and in order to alter the current medical and retirement benefit packages, which are the most generous among all federal employees and for which postal workers pay less in premiums. What else can be done when labor costs consume 80 cents of every dollar spend by the post office?
USPS is also trying to close unneeded post offices and to end Saturday delivery nationwide. The Saturday closing alone would save $3 billion a year. But these solutions are blocked, waiting for a dysfunctional Congress to act. No one — management, labor or customer — can possibly take comfort in reading that congressional aides said their bosses would address the Postal Services woes first thing after the August recess.
Imagine if your business (or your employer) depended on the U.S. Congress to approve crucial decisions. It might be losing $9 billion a year, just like USPS.
The only good thing mandated by Congress is the requirement that the Postal Service put money aside to pay retirement benefits for the next 75 years. Its long past time to require business and government and labor to actually pay for the pension benefits they promise, rather than fraudulently underfund their commitments and then renege entirely, likely triggering yet another taxpayer bailout.
Without question, the Constitution gives Congress the power To establish Post Offices and post Roads. But it certainly doesnt require, some 224 years later, that rational people continue squandering $9 billion each year, when times have clearly changed.
Instead of losing billions, why not free the Postal Service by selling it to the highest bidder? The federal government could not only make some much needed cash, but the post office would be run far more efficiently.
What about our beloved representatives in Congress? Lets put them in charge of bringing back the horse and buggy.
We need a federal government to do about 10% of what it is currently doing. Let the individual, sovereign states decide what they wish to do, and let the people do the rest.
Government is the problem, not the solution.
They need to retool. They do and have done a decent job for me. Has to be cost effective and self sufficient, though.
My wife and I discussed it and we could start doing all bill paying on line and probably save ourselves money and lower our security risks. We are prepared to do this.
However, there are still a lot of people who don't have a computer or online access or wouldn't be able to figure out how to pay bills on line.
10% of gigantic is still a sh!tpot of power!
It can't compete because it can't raise its prices. Now that's a new one to me.
This is the question I ask myself frequently.
This night happen but only after much wailing.
I don’t run a business and so don’t need 6 days a week of delivery. Once a week is fine with me. Even once a month, but I’m afraid they’d need a dolly to haul that much junk mail.
Thanks for the posting
Our legal sustem and government depends on the integrity of the USPS as does many other aspects of our lives. The author of this piece however dumps on the latest congress which took office this January.
The problems have been building for years finger pointing to the reformers for inaction is undeserved.
Rural deliveries are part of why the post office is an essential government service explicitly mandated by the US Constitution and not a business.
In my coastal community of about 35,000 people UPS is open from 3:30 to 5:30 PM. Fed Ex doesn’t even have an local office.
The post office would be much better off financially if the private firms were not skimming off the high profit markets around the big cities and leaving the rest of the country high and dry.
Congress has 18 enunerated powers under Article 1. The post office is not an optional duty. It is specific ad precise. There is no dicussion about this.
Sorry clear, just re-read article 1. Congress has the power to post offices which you are right, it is not mandated.
It’s the economy, stupid. Fix the national economy, fix the post office. Businesses hoarding cash, not advertising? New businesses NOT being started up, due to uncertainties of the current administration? Lack of consumer spending due to unemployment?
Seriously, fixing the Post Office is a band-aid on a broken leg. Fire Obama and the Democrats, cut taxes and regulations, and the economy will roar. The Post Office difficulties will be history.
Great post. That’s exactly why the post office needs to be saved. The best reform would simply to end the excessive congressional oversight and let the CEO make the needed decisions without having to lobby congress for permission to make simple and obvious business decisions.
I think stopping Saturday deliveries would be okay, if needed...but the unions would have to agree to a much smaller work force and to changes in their medical and pensions...
I would even pay more for stamps if there were substantial savings elsewhere....
the postal service is important, especially for the smaller areas...
The Post office needs to quit being a bank for those who can not or choose not to have a bank account or just to launder cash. It is disturbing to wait in line to mail a parcel when those in front of you are buying thousands of dollars in money orders to send who knows where.
Correct me if I’m wrong too but it seems the post office does most of the APO work as well (delivery of mail and packages to troops overseas).
The truth is that the Postal Service has been and remains a bargain, much maligned by the public and Congress every time stamp prices rise. The Postal Service prepays billions into the retirement healthcare pension fund. Money that’s not there five minutes after it’s deposited. Why? Because Congress takes the money out and spends it on other things.
They’ve looted the Postal Service for years, they sold off profitable parcel business, refused to allow them to employ new and innovative moneymaking schemes....because FedEx and USPS lobbied Congress and said it was unfair competition. Nothing about this is simple. And Congress certainly won’t stand up and point the finger of blame where it belongs. If the Postal Service of all the federal agencies, quasi or otherwise, have to prepay billions into a fund that’s siphoned off in a blink of an eye, they’d be profitable and make money.
Not necessarily. Congress is authorized to “To establish Post Offices and post Roads”. There’s nothing that requires the Postal Service to make actual delivery. They could satisfy their Constitutional responsibility by handling interstate transport, and allow the states to do the rest.
Very true. Adjusted for inflation, it is cheaper to mail a first class letter today than it was when the post office started in the late 1700’s.
I get in trouble with the post office all the time because my box is smaller than a shoe box (one of those gang boxes that serves ten people) and I only check it about once every two weeks. I never, ever read junk mail, which is the preponderance of what over-fills my box.
I think if I were to run the post office, I'd cut back on employees, vehicles and only deliver letters (there should be a federally protected delivery service for legal notices and such, if for no other reason), no more junk mail, let the paper boy carry that stuff around. UPS and FedEx can deliver packages.
Because Congress loves its right to meddle in the post offices' business, that's why.
The Germans sold their post office to DHL several years ago. Their system now makes a profit.
Sounds like a good idea. Why don’t we selloff the Postal Service in a ‘right-to-work’ like Texas to UPS or FedEX and then see how the finances look a year from now.
If the Texas test works, then go nationwide with a non-union privatized postal service.
That last sentence should read: if the Postal Service didn’t have to prepay billions....it would be profitable.
A relative who is a postmaster in a fair-sized town says, "'Junk mail'? -- we call that, 'REVENUE'!!"
Hmmmm... a quasi-government "business" that makes it income from hustling paper SPAM...