The U.S. Post office is a monopoly! or is it?
January 10, 2001 8:39 AM   Subscribe

The U.S. Post office is a monopoly! or is it? USPS allows rate hike under protest...
We can't choose another vendor for this service. It is illegal for anyone to deliver to a mailbox other than the USPS. Has there ever been a substantial court case challenging this?
Should it be privatized? Your thoughts?
posted by ooklah (40 comments total)
If you think our postal system sucks, try one in just about any other country in the world.
posted by Postroad at 8:53 AM on January 10, 2001

Just look for the muted horn.
posted by sad_otter at 9:32 AM on January 10, 2001

I'll agree that, for the most part, the USPS is unjustly given a bad reputation. They generally deliver everything to the right address in a reasonable time, and for a very reasonable price.

But it'd be nice to have another choice. A little competition from UPS-PS or FedExBlue might spur the USPS to improve service.
posted by waxpancake at 9:43 AM on January 10, 2001

It can't be challenged in court because the USPS is given its mandate directly by the Constitution. Article I, Section 8:

Congress shall have Power To... establish Post Offices and post Roads

The rights granted to Congress in that section are exclusive; Congress gets to do them and no-one else can.
posted by Steven Den Beste at 9:47 AM on January 10, 2001

What I don't understand is why the post office needs to raise rates since they're profitable. Do they need more money than to cover their expenses? No.
posted by owillis at 9:54 AM on January 10, 2001

Addendum: No-one else can, unless Congress grants them permission.
posted by Steven Den Beste at 9:56 AM on January 10, 2001

Anyone that willingly and swiftly delivers rotting fish and unwrapped feather dusters is all-right by me.
posted by Avogadro at 10:05 AM on January 10, 2001

Let's de-regulate the post office just like they did power in California! I hear it works great!
posted by capt.crackpipe at 10:13 AM on January 10, 2001

Profitable? I was under the impression that the post office loses about $200 million/year.
posted by grimmelm at 10:23 AM on January 10, 2001

34 cents is an outrage! I'm sure the private sector can do it for less while making profits for some high paid ceo's. They'll simply need to cut pay and benefits for the workers.

The free market can always do it better, just look at our health care system, that works great too.
posted by chrismc at 10:29 AM on January 10, 2001

owillis: Your concern is well-founded, and hopefully addressed here:
Preparations for the rate changes started more than a year ago as the postal service looked ahead to a future of more fax machines and e-mails, where so-called snail mail would carry a smaller portion of the world's communications.

"There are several reasons that we're raising rates. One is basically the cost of doing business you know utilities, labor costs, we have to pay employees to process and deliver mail," said Larry Dozier, a post office spokesman. But on top of that " we project that by the year 2005 we will have lost about $17 billion from customers using the Internet rather than first class mail."

Higher fuel costs and wage increases in particular have cut into revenues, said Al Desaro, with the U.S. Postal Service in Denver, Colo.

"The postal service is run completely by postage, not by one-cent of taxpayer money, and so we need to recoup the costs of doing business," he said.

In fact, the post office had wanted bigger rate hikes, but was turned down on Nov. 13 by the independent Postal Rate Commission. The commission approved a smaller increase than the post office had asked for. The post office's Board of Governors ordered the increases into effect under protest and has asked the rate commission to reconsider the cuts it made to some of the proposals. That leaves the possibility of additional increases in the future. But as long as it's one penny at a time, customers probably won't be all that phased.

But don't worry about our disgruntled deliverers of letters, 'cause help is on the way.
posted by allaboutgeorge at 10:45 AM on January 10, 2001

Eww. The Postmaster General used the word "leverage." I feel dirty.
posted by solistrato at 10:53 AM on January 10, 2001

Oh, and don't ever antagonize the horn.
posted by solistrato at 10:55 AM on January 10, 2001

How is 34 cents outrageous? How is a week for mail delivery bad? You have all these other options if you want speedier service...I do agree that mailboxes should be made available to other agencies, which are licensed strictly by the gov't...I don't want just anyone putting random things in my mailbox, especially since my mailbox is built into my wall and comes directly into my house.

So there. Nannynannybooboo.
posted by thebigpoop at 11:09 AM on January 10, 2001

I don't understand why people are so outraged at this. What else can you buy for 34c these days?

6 (and 4/5) pieces of small candy? A local phone call at a payphone, if there happens to be a penny laying on the ground? (Well, if the phones took pennies.) That's all I can think of.

Or, your quarter and dime can reliably send any reasonbly-sized envelope up to around 3000 miles, in an average of 4-5 days. If they paid attention to each letter indiviually, sure, they could get everything there in one, but since it's done in batches (disclaimer: I don't know that this is how they really do things, it's just my best guess)...

Day 1. You put your letter in your mailbox. Mailman (excuse me, letter carrier) comes and collects it, and brings it to the post office where it's sorted. From there, it's delivered to the USPS's nearest major hub.

Day 2. Mail is moved from the hub to the airport. It's loaded on a plane where it's flown to another airport. From there, it gets unloaded and sent to that area's hub.

Day 3. Your destination's hub sorts through what they've got, and puts your letter in the pile for the destination town's post office. It gets sent there by truck.

Day 4. Local post office sorts the incoming mail and distributes it to the carriers, one of whom puts your letter in your friend's mailbox.

Now consider that the exact same thing happens to *millions* of these pieces of paper every day, and that they almost never get lost in the process. That's worth 34c to me.
posted by CrayDrygu at 11:11 AM on January 10, 2001

It can't be challenged in court because the USPS is given its mandate directly by the Constitution. Article I, Section 8.

Technically speaking, that's where Congress gets its authority to create the postal service. There's nothing in the Constitution about establishing a postal monopoly.

However, it's probably permissble to do so under the Commerce Clause, although recent court rulings would suggest that intra-state mail delivery could be outside the reach of Congress' power.
posted by mikewas at 12:05 PM on January 10, 2001


This is going to cost me 3 extra cents a month. I'm so upset.

I suppose someone who corresponded with friends and family via snail mail instead of email might pay an extra half dollar a month under the new rates.

What a crisis.

posted by Mars Saxman at 12:32 PM on January 10, 2001

Does anybody really use first class post often enough for a one-cent hike to really be much of an issue? I mean, it's a penny. I've got a jar full if you're really concerned.

At least now when you buy a stamp you'll either be able to get rid of an extra penny (if you pay exact) or get one less penny back in change.

The USPS is doing people a favour! :-)
posted by cCranium at 12:50 PM on January 10, 2001

What I don't understand is why the post office needs to raise rates since they're profitable. Do they need more money than to cover their expenses? No.

Well, the USPS has billions and billions of debt to repay, and expenses go up every year.

There's no reason to be upset about this. Besides being cheaper than most any other first-world country, our postal rates haven't actually gone up much (if at all) over the past 30 years. A first class stamp in 1970 cost 8 cents. In 2000 it costs 34 cents. According to this inflation calculator, 8 cents in 1970 is actually equal to 35 cents today.

[Other forms of communication]
One argument I've seen a lot from conservative sources is that even though the price of stamps hasn't significantly risen in the past 30 years, the prices for competing forms of communication have dropped off dramatically. What competition? Long-distance telephone service, email, wireless phones... But these aren't in the least bit comparable. For one thing, telephone and other electronic forms of communication have experienced a huge increase in use over the past 30 years, while sending letters via the USPS has declined. Ever hear of something called "economy of scale"?

And electronic forms of communication can be hugely automated, to where communications can occur with no human intervention. On the other hand, the USPS depends on human carriers to pick up the mail, drop off the mail, drive the mail, and sort the (often-poorly handwriting-addressed) mail. Keeping a human staff doesn't get cheaper over time; automation does.

[Privitization of the USPS]
Unless strictly regulated, this is a bad idea. One of the primary benefits of the postal service today is that it offers comparable levels of service to everyone in the country. Private companies aren't going to have any incentive (other than government regulation) to run rural mail routes or to give rural routes much service at all. Besides, the USPS isn't subsidized by the federal government, it operates solely on its own revenue.

Its only benefit is the monopoly of service to and from a mailbox, but UPS and FedEx provide quite similar services. They won't put the letter/package in your mailbox, but they will bring it to your door, for a tremendously larger price.

I just don't think the service we get from the USPS is all that bad, especially considering the low low price. Why then, do we need to reform it (besides "the principle")?
posted by daveadams at 1:19 PM on January 10, 2001

Just a note about the mailboxes. Coming from a country (Canada) where pretty much anyone can put pretty much anything into the mailbox, it seems a mite weird to me that that's an actual law about that.

It makes sense on many levels, it's just weird is all. :-)
posted by cCranium at 1:30 PM on January 10, 2001

I don't begrudge 'em a rate hike, I just think it would be more efficient to do it two cents at a time and do it half as often...

I'm sick of all the stamps going out of date all the damn time. I still have 32 cent stamps I haven't used up. GAH!
posted by beth at 1:42 PM on January 10, 2001

I don't begrudge 'em a rate hike, I just think it would be more efficient to do it two cents at a time and do it half as often...

Agreed. Because a couple years down the line, they'll raise it again, and we'll bitch about it all over again, whereas if they raised it two cents, I doubt we'd bitch twice as much. And 35 cents is such a nice, round number.
posted by dagnyscott at 2:10 PM on January 10, 2001

And 35 cents is such a nice, round number.

Rounder than 33 or 34, sure, but not round enough for me. I hate 35 cent payphones. Until last year, the payphones in Arkansas were still only 10 cents. 10, now that's a nice round number. 50 is almost as good.
posted by daveadams at 2:36 PM on January 10, 2001

<random gripe>
Can we hurry up and abolish the penny already? I can't remember the last time I encountered a telephone or vending machine that accepted them. The only thing they're good for is dropping in the tip jar on your way out the door.
</random gripe>
posted by Mars Saxman at 2:52 PM on January 10, 2001

I for one was being sarcastic in my outrage at 34 cents.

For what we pay, the USPS is really good. Also as an operation, it shows how you can pay workers well with good benefits, if you don't need to pay ever higher dividends to share holders.
posted by chrismc at 3:22 PM on January 10, 2001

I want a pneu
posted by rodii at 4:37 PM on January 10, 2001

It's not the one cent that bothers me, it's the 75 cent increase in the basic Priority Mail rate. (So they added a new one pound rate, but they increased that 30 cents. Either way, it's a big jump.) It's not much for you, but I run a mail order business and ship a lot of Priority Mail packages. That's a relatively large price jump for me.
posted by litlnemo at 4:54 PM on January 10, 2001

I'm all for penny-abolition myself. Seems like a waste to spend so much time, effort, and materiel to crank out billions and billions of one-cent pieces every year, just to have them more-or-less instantly fall out of circulation.
posted by youhas at 7:18 PM on January 10, 2001

I don't know what you mean by "fall out of circulation". I seem to get at least a few almost every day.
posted by jjg at 8:54 PM on January 10, 2001

I recall seeing a poster at my local Post Office a while back that compared our postal rates to those of other industrialized nations, and guess what? The US was the lowest. Lower than Canada, England, France, and way lower than Japan, where a first class letter cost the equivalient of two US dollars!
posted by Potsy at 11:35 PM on January 10, 2001

"Lower than Canada, England, France, and way lower than Japan, where a first class letter cost the equivalient of two US dollars!"

Canadian letter rate postage is 47 cents, CDN$, which is about 28 cents, US$. And the package rates are way cheaper.

Nitpicking about who has the cheapest postal service aside, I really like the US post office - my letter carrier is fabulous, and the people at my local office are very helpful and pleasant. In Canada, postal outlets are franchised out to stores - my post office was actually a counter in the 7-11, and that was a nightmare - God forbid you had to do anything other than buy a few stamps, because no one had a clue about anything else, and twice they handed over someone else's mail to me, because the counter person couldn't read enough english to match my name to the name on the package. Several times i showed up with the little 'you have a package' slip, and they couldn't locate the package. No explanation.

No privitization. The extra one cent is totally worth it.
posted by kristin at 12:49 AM on January 11, 2001

The article is ridiculous.
1. The Post Office is not a monopoly...ever heard of UPS, FedEX, DHL, etc.?
2.The Post Office is, although it is still a government agency, is being run like a private gets no public funs and must run on its own revenue.
3.Until the day of Star-Trek like transporters how the hell are we going to send and get packages at such a low cost?
I don't have tons of love for the USPS, but after living in Italy and paying higher prices for lesser services I'll gladly pay an extra $.01 for a stamp. Besides, we get more services than ever from the USPS now.
In fact, some of the rates at the Post Office have gone down. For example, now a money order only costs $.80.
posted by Bag Man at 1:11 AM on January 11, 2001

It's a no-brainer. You retain the Post Office hegemony over low-weight deliveries, and preserve a flat-rate service across the nation. Keep the USPS, and get rid of those stupid fucking copper pennies.
posted by holgate at 2:16 AM on January 11, 2001

(Example: in the Netherlands, supermarkets round up -- or down -- to the nearest 5 cents. Simple.)
posted by holgate at 2:17 AM on January 11, 2001

Sorry jjg, to clarify: I get a several pennies in my day-to-day transactions, too, along with all my other coinage. But whereas my nickels and dimes and quarters get consumed by vending machines and laundromats and the like, my pennies go pretty much nowhere. I end up accumulating more and more of them, but rarely going through the time/effort to return any number of them to circulation. It's a fairly widespread problem. Excerpted from here:

Coin circulates much differently than currency. This is especially true for pennies, which do not circulate with the same frequency as other coin denominations. The Mint and Federal Reserve have experienced other periods in the 1980s and 1990s when the demand for pennies exceeded the Reserve Bank inventories and the Mint's production capacity. The location of the coin, not the amount of coin, is quite often the problem. People tend to accumulate coins in desk drawers, jars, or on the tops of dressers. One company identified this phenomenon as a business opportunity and placed coin collection machines in supermarkets. In 1999, this company returned 20 billion coins to circulation.
posted by youhas at 3:22 AM on January 11, 2001

kristin, I think I've had a completely different set of experiences with Canadian Postal Service than you have. This is just intended as a differing data point

I haven't had to pick up packages, either, so I've always gotten to pick which outlet I deal with, but of the 5 or 6 I've dealt with on a semi-regular basis over the past couple of years, I've never had a problem with the staff or the service.

I like the fact that Canada Post outlets are all over the place, I never have to worry about sending a package between 8am and 6pm, or whatever the actual Post Office's hours are.

Again, just a different data point.
posted by cCranium at 6:10 AM on January 11, 2001

The USPS is a funding-free government organization that runs a deficit annually. The New York Times article I read on the day the rates changed (no link, sorry, I read it the old-fashioned way) stated that even with the new rates in place the USPS expects to lose $480 million in 2001.

Personally, I'd pay 54 cents instead of 34 if it meant the USPS would make money, which would let it better compensate its employees, which would lead to better and faster service.
posted by werty at 7:05 AM on January 11, 2001

I'm all for penny-abolition myself. Seems like a waste to spend so much time, effort, and materiel to crank out billions and billions of one-cent pieces every year, just to have them more-or-less instantly fall out of circulation.

As long as it costs less to make a penny than one cent, the government will continue to make them at a profit.
posted by mikewas at 10:52 AM on January 11, 2001

Check out for prolific portions of pro-penny propaganda.

Personally, I'd be happy to get rid of the penny (along with the one-dollar bill). They're worth so little at this point, that they have become far too cumbersome to be worthwhile, but stores will still (annoyingly) distribute them as long as they're in production. I'd even let the stores round up to the next nickel to avoid getting all those pennies.
posted by daveadams at 11:40 AM on January 11, 2001

Yeah, I've pretty much resigned myself to tolerating pennies 'til the seigniorage shrinks to nil, personal whims notwithstanding. I'm actually more surprised that the one dollar bill hasn't been axed in favor of the one dollar coin for the similar seigniorage gains.

posted by youhas at 1:13 PM on January 11, 2001

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