Saving the great American post office
By Daniel Deagler For one dollar, you can send a birthday card to your uncle in Alaska (3,370 miles from Philadelphia) and an anniversary card to your aunt in Hawaii (4,910 miles away), and the post office will give you back 12 cents change.
By Daniel Deagler
For one dollar, you can send a birthday card to your uncle in Alaska (3,370 miles from Philadelphia) and an anniversary card to your aunt in Hawaii (4,910 miles away), and the post office will give you back 12 cents change.
Remember, we're talking actual greeting cards, filled out at your kitchen table and then physically moved many thousands of miles by real people, for 44 cents apiece. How on earth can the U.S. Postal Service make a profit on this transaction?
It can't. But profit is not the mission of the post office. Its mission is to get your letter delivered in a timely fashion.
Although it may appear as if the U.S. Postal Service and its private-sector competitors are providing the same service - moving some physical object from point A to point B - the private competitors do it to make money. If they can't make money doing it, they don't do it.
The Postal Service, on the other hand, does it out of a commitment to universal delivery. If you have a letter with a stamp and a valid address, it's going. So the critical difference between the Postal Service and its private-sector competitors is not what they do, but why they do it.
Mail delivery is about as old as civilization, and it has almost always been a function of government. The Second Continental Congress established what is now called the U.S. Postal Service in Philadelphia in 1775, with no less a figure than Benjamin Franklin as the first postmaster general. It is one of the few agencies of government specifically authorized by the U.S. Constitution: Article 1, Section 8 empowers Congress "to establish Post Offices and post Roads."
In 1971, the Department of the Post Office was replaced by the U.S. Postal Service, an independent agency of the federal government. The Postal Service has the same mission as the old Post Office Department, but with one important difference: It is to be self-sufficient, meaning it is not supported by taxes. Unlike a private-sector entity, however, the Postal Service is prohibited from making a profit. Any profit it makes - money that a private company might reinvest in its operations - must be appropriated by Congress.
This system worked well enough for several decades, but self-sufficiency, let alone profit, is now almost impossible for the Postal Service for many reasons, the biggest being competition from the Internet. There are more than 31,900 postal facilities around the country, and many cannot make enough money selling stamps to pay for their own electricity.
Last month, Postmaster General Patrick Donahoe announced that the agency was looking into closing up to about 3,600 post offices. If the Postal Service were a business, there would be no question that many of them should be shuttered.
But that's the thing: It's no more a business than the State Department or Department of Agriculture. Is the Navy expected to be financially self-sufficient? Is your local police department? Of course not. Taxes pay for government services, and mail delivery is a government service.
Although the Postal Service does charge for services, it cannot freely raise its prices to cover its costs. When the price of gasoline goes up by one penny, it costs the Postal Service $8 million. And yet every increase in the cost of postage must be approved by the slow-moving Postal Regulatory Commission. The price of a first-class stamp was 44 cents when gas cost $2.50 a gallon; today, with prices past $3.50 a gallon, it's still 44 cents.
This country has 3.79 million square miles, and in pretty much every one of them, the post office delivers six days a week. The 31,900 or so post offices create the network that binds the country together. Most are in small towns, and it is true that they don't bring in much cash. But they are the hubs of their communities, the place where the flag proudly flies. Quite often, it is the post office that make the town a town, and the people who live there think they're worth keeping open.
Every year, the U.S. government gives more than $30 billion in aid to foreign countries and $4 billion in subsidies to oil companies. Why shouldn't it give the U.S. Postal Service a few bucks to keep the post offices open in these American towns?