The Postal Service's Gloomy Twilight

Non Profit - The Postal Service's Gloomy Twilight

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Neither snow nor rain nor heat nor gloom of night will stop the postman from delivering your mail. Unfortunately, the bill for such high-end customer assistance is officially out of control.

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Bloomberg Businessweek's cover story for the week of May 30, focusing on the United States Postal Service, created a lot of seminar on the topic, but the emergency in our post office has been a long time coming. The easy culprit is the internet; email has truly been one of the biggest factors in the decline in first class mail over the past consolidate decades.

But this alone would not have been enough to send the Postal assistance into oblivion. Many other first-world countries have postal services that are stable, and some even thrive. Bloomberg's narrative uncovers a amount of other factors, from Usps workers' inflated pensions to post office locations in unprofitable areas, which are dragging the Post Office into the red - almost billion into the red.

Part of the question is that the Usps occupies a strange middle ground in the middle of a collective assistance and a profitable business. The Usps as it exists today came into being as a succeed of the Postal Reorganization Act of 1970, which made it a semi-independent, corporation-like agency. However, as one of the few government agencies specifically mentioned in the Constitution, the Postal assistance still occupies a extra place in American life and politics, granted importance that may very well exceed the actual ask for its services.

Consider a typical day's mail. For business, Palisades Hudson uses FedEx for parcels or items that need to arrive with a short turnaround. For non-urgent packages, we still use Usps, because it remains the cheapest option. Should this change, the branch would have to have a much stronger showing in services to keep us from switching to their rivals at FedEx or Ups.

As for personal mail, like most people, I get my bills, bank statements, and other important correspondence online. I don't get handwritten personal letters on a regular basis. Some of my friends and coworkers get the ubiquitous red envelopes for Netflix, but it's no hidden that the enterprise hopes to continue to move more into the profitable realm of streaming.

So what's filling my mailbox? When I bother to check it, my mailbox is filled with junk mail, or "standard mail," as the Post Office calls it. Approved mail has come to be the Usps' bread and butter since the drop-off in first-class mail. Agreeing to Bloomberg, the Usps needs three pieces of junk mail to replace every lost piece of first class. This was fine until the stepping back hit and even Approved mail began to fall off. Now, the Post Office is courting direct marketers and even raised some commercial mail prices this April.

But this is a small solution. commercial mail rates are still very low - they vary, but fall in the neighborhood of 11 to 20 cents per piece for small amounts, or per pound if enough is sent to qualify to mail by weight - but it's unclear how far the post office could raise prices before the amount of mail began to fall more sharply. With businesses happy to pay Usps rates and fill my mailbox with junk, I'll posit that a small increase in commercial mail rates would boost Usps revenues without hurting demand. Eventually, though, Approved mail might out-price itself, leaving the Usps in a worse position than before.

There are other solutions, of course. There has been active seminar of changing mail delivery to five days a week. It seems unlikely that the loss of regular mail on Saturday would cause a major outcry, especially among younger Americans. Since most of my mail is the standard-mail collection anyway, I can go almost a week without checking my mailbox with no great harm done, barring jury duty summonses and the like. And if some freestanding post offices closed, in favor of Postal assistance stations in convenience shop or coffee shops, I doubt many population would lose much sleep.

Part of the infer this latter plan appeals to the Postal assistance is because such locations would not have to be staffed with union employees. The postal workers' union is large and powerful, and in the middle of the agency's inability to lay off staff and the pension and benefit promises it continues to make, it's hard to see how attrition can curtail this major expense. Agreeing to The Washington Post (1), more than 850 senior Postal assistance staff members get their health care truly free, and Agreeing to Bloomberg, the Usps covers an average of 79 percent of its employees' health care costs.

Conor Friedersdorf, an join together editor at The Atlantic, points out in an editorial that "At Ups and FedEx, administration has a mighty incentive to hold down broad labor costs, and to keep the flexibility and adaptability of the respective companies. When Usps negotiates with the any of the four unions that laid out its employees, the dynamic is completely different: administration has fewer incentives to hold down costs, even as labor exercises substantially more clout due to is political influence." (2) The Usps isn't truly contentious with Ups and FedEx, because their constraints are completely dissimilar - as are their incentives.

If the Usps is to be run like a business, it needs to be run with more of a profit motive. If ask dips, you can raise prices, cut expenses, or quest for new, more lucrative services. The Post Office should, ideally, endeavor all three. European postal agencies offer services like scanning your mail to deliver it to you electronically, or turning pictures from your phone into postcards. Not all new ideas will work, but unless such new services are attempted, ask for the old services may die out altogether in the meantime.

And if the Usps is an branch run for the collective good, like the Epa or Nasa, then we need to seriously think fiscally responsible ways of running it. Right now, it is stuck in the middle of two models, promising its union more than it can afford, charging the same amount to send a letter 3 blocks and 3,000 miles, and waiting in vain for population to start sending bundles of personal letters again. While Republicans and Democrats don't agree on much these days, hopefully they can agree that it's time for reforms that are long overdue.

Sources:
1) The Washington Post, "Usps reform may be on the way, but is it too late?"
2) The Atlantic, "Can Progressives Fix the U.S. Postal Service?"

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