Suitably Flip

Private Correspondence

The U.S. Postal Service offers a reminder that private enterprise gets things done more efficiently than government.

United Parcel Service Inc. and the U.S. Postal Service have agreed to a deal to be announced on Wednesday that will put mail on the package-delivery company’s planes, a UPS spokeswoman said.
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If UPS is successful, it could be in a strong position to compete for some or all of the postal business now handled by FedEx Corp. when that $1.3 billion annual contract comes up for renewal in 2007, the newspaper said.

How much of its core business will the USPS need to outsource to more efficient private carriers before it is finally laughed into suspending the entirety of the monopoly-sustaining Private Express Statutes, opening the industry up to free market competition?

Protected monopolies are generally loathe to do themselves in, but it's not as though the Postal Service has shareholders to look out for.  Its primary constituency is the mail-sending and mail-receiving public.  To the extent it offloads more and more capacity to private carriers, it increasingly assumes the role of a needless, costly middleman, imposing unnecessary costs and reduced service quality on those constituents.

There's exactly one group of people that benefits from keeping the slow, expensive, ancient Postal Service on life support: the 330,000-member strong American Postal Workers Union.  Granted, that's a lot of Americans.  But even if the function of mail delivery is privatized, it will still require skilled workers, the bulk of whom would presumably be drawn from the APWU.  Besides, the entrenchment of a workforce alone does not argue for preserving the service it provides, particularly when that service has superior, readily available alternatives.  I notice there are terribly few jobs left for elevator operators.

And if the USPS thinks it might be able to run efficiently, then they don't even have to disband.  Let them suspend the PES, allow free competition, and see how they do.  If they're to prove me wrong and survive without monopoly protection, good for them.  At very least, the competitive pressures would force them to find ways to cut costs and improve service.

It's hard to argue that wouldn't be in the public interest, which is the stated necessary condition for suspension of the statutes.

The Postal Service is authorized to adopt suspensions to the PES for specific circumstances in which the public interest might be best served by a private carrier.

So what kind of impact are we looking at?  With $72 billion in annual revenue, the Postal Service would rank among the 20 largest U.S. companies.  Its monopoly allows it to book more in annual sales than any private company in the country.  It's expected to run a deficit this year, so annual expenditures are larger still.  If private enterprise were to provide this service with even a 10% gain in efficiency, the annual savings would roughly equal the annual budget of the Department of the Interior.

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Private Correspondence

The U.S. Postal Service offers a reminder that private enterprise gets things done more efficiently than government.

United Parcel Service Inc. and the U.S. Postal Service have agreed to a deal to be announced on Wednesday that will put mail on the package-delivery company’s planes, a UPS spokeswoman said.
...
If UPS is successful, it could be in a strong position to compete for some or all of the postal business now handled by FedEx Corp. when that $1.3 billion annual contract comes up for renewal in 2007, the newspaper said.

How much of its core business will the USPS need to outsource to more efficient private carriers before it is finally laughed into suspending the entirety of the monopoly-sustaining Private Express Statutes, opening the industry up to free market competition?

Protected monopolies are generally loathe to do themselves in, but it's not as though the Postal Service has shareholders to look out for.  Its primary constituency is the mail-sending and mail-receiving public.  To the extent it offloads more and more capacity to private carriers, it increasingly assumes the role of a needless, costly middleman, imposing unnecessary costs and reduced service quality on those constituents.

There's exactly one group of people that benefits from keeping the slow, expensive, ancient Postal Service on life support: the 330,000-member strong American Postal Workers Union.  Granted, that's a lot of Americans.  But even if the function of mail delivery is privatized, it will still require skilled workers, the bulk of whom would presumably be drawn from the APWU.  Besides, the entrenchment of a workforce alone does not argue for preserving the service it provides, particularly when that service has superior, readily available alternatives.  I notice there are terribly few jobs left for elevator operators.

And if the USPS thinks it might be able to run efficiently, then they don't even have to disband.  Let them suspend the PES, allow free competition, and see how they do.  If they're to prove me wrong and survive without monopoly protection, good for them.  At very least, the competitive pressures would force them to find ways to cut costs and improve service.

It's hard to argue that wouldn't be in the public interest, which is the stated necessary condition for suspension of the statutes.

The Postal Service is authorized to adopt suspensions to the PES for specific circumstances in which the public interest might be best served by a private carrier.

So what kind of impact are we looking at?  With $72 billion in annual revenue, the Postal Service would rank among the 20 largest U.S. companies.  Its monopoly allows it to book more in annual sales than any private company in the country.  It's expected to run a deficit this year, so annual expenditures are larger still.  If private enterprise were to provide this service with even a 10% gain in efficiency, the annual savings would roughly equal the annual budget of the Department of the Interior.