Historically, one of the important roles of the US federal government has been to maintain and enhance the infrastructure of the country. When one thinks infrastructure, they usually think roads, but it is much more than that, and there are many other institutions that play a big role in the maintenance of a well connected country.
One of those key institutions is the post office. Keeping up communications, especially in a country as large as the US, was a very tall task, so the government took an active role in establishing a postal service, and it is even an enumerated power in Article 1 of the US Constitution. Benjamin Franklin served as the first postmaster general, and stressed the importance of an effective system of communications in the US. This was very influential in the eventual westward movement of Americans, especially when the new state of California had to be connected to the rest of the country through the Pony Express.
However, despite its historical significance, the post office in its current form has been plagued with a wide array of problems and inefficiencies. In the last eight years, the postal service has lost nearly $50 billion and its volume of usage has sank significantly. Despite immense evolution in the way Americans communicate and transport small goods, the US Postal Service has gone largely unchanged in the last hundred years in terms of how it operates, and it has failed to keep up with modern times.
The USPS holds a monopoly on both mailboxes and shipping of first class mail, yet the communications market of the US has shifted heavily away from that. Email took over the demand for first class mail, as more businesses, correspondence, and advertisements went paperless and moved towards other platforms that the post office did hold a monopoly over. Once social media became a big part of our daily lives and communications, demand for mail fell even further, which is why the volume of first class mail sent each year has sank significantly in the last ten years. Despite the massive legal and logistical advantages held by the USPS, the free market has found a more efficient way for people to communicate, and consumer behavior shows just that.
Here lies the big difference between the three shipping companies. While the government owned USPS loses over fifty billion per year, UPS and Fedex are far more efficient, making $52 billion and $47 billion of revenue each year. Additionally, while USPS has been increasing the prices of its stamps and its deliveries at a relatively alarming rate, the two private companies have largely been efficient in their pricing, and have even worked to lower prices in order to gain a competitive edge over one another.
The USPS has been plagued by inefficiency, mostly because of its insistence on relying on a centuries-old business model incompatible with the 21st century, but also because of pressure from both unions and Congress. Unions have long resisted reform and privatization because of losses of pension and job security that would come with it, not to mention the loss of their own power that would come with privatization and bosses that would focus more on efficiency as a goal rather than employment. Congress hasn't been much better though, as they have pressed heavy regulations on how the post office can operate, and those regulations are arguably what has kept the USPS from advancing into the practices of 21st century business. The Post Office is technically an independent but government owned corporation that tries to earn a profit, but the restrictions placed on them by congress, insistence on inefficient but politically favorable business practices, and the resulting lack of profit shows that there are fundamental problems with the post office and how it operates.
The solution to consider here might be tough for the unions and the politicians controlling the USPS, but the best thing to do to save the post office would be to let it go, and allow it to be a private company. As things stand, the USPS is struggling to earn a profit, has been increasing its costs while cutting its services, and has been hampered by red tape and inefficiencies. The people deserve better, and those who work for the USPS deserve to work for a thriving company that can keep up with the times.
What I envision is a system where the USPS becomes a private company that gains a government contract to deliver mail and government paperwork and use mailboxes. The difference is it would no longer be hampered by government regulations, and it would no longer have monopoly power, as other firms with potentially better business plans can enter the market and make an improved pitch for that contract. Packages, on the other hand, would be operated in a system of open competition, as we have already seen that private companies can deliver packages cheaper and with more efficiency than the USPS.
Some might counter that the US government has an Article 1 duty to provide a postal system, and it would be unconstitutional for the postal service to be privatized. However, the Constitution, while enumerating the government with that power, doesn't necessarily mandate it. And while there is a very long tradition of the USPS, America was a country that always evolved towards what is more efficient. This was what Benjamin Franklin championed when he created the postal service, and this is what we must consider in order to make sure the USPS lives up to its full service potential.
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