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Adapting the Post Office To the Digital Age

Hugh Pickens writes "Paul B. Carroll and Chunka Mui write in the Washington Post that with projected deficits through 2020 of $238 billion, the debate over potential changes at the US Postal Service is like a fight over the dessert bar on the Titanic: email has already supplanted letters, more people will send money via PayPal rather than mail checks, people will download their movies and books, check their bills online, and receive information about their investments electronically. Delivery volume for first-class mail fell 22 percent from 1998 through 2007, tumbled an additional 13 percent last year and was down 3 percent in the first half of this year despite heavy mailings from the Census Bureau. USPS's future lies in things that need to be delivered physically: shoes, computers and other objects, and the USPS has assets that could let it take on UPS and FedEx. 'USPS needs to start with the future and work backward to the present,' write Carroll and Mui. 'It needs to forecast volumes for all types of its business five, 10 and 15 years out and design a business model that will thrive under those scenarios. Only then can it figure out what radical changes need to be made now.'"

31 of 299 comments (clear)

  1. Remove the artificial monopoly by Darkness404 · · Score: 3, Insightful

    The first thing that needs to be done is to remove the artificial monopoly congress created for the USPS making it so they are the only ones that can deliver first-class mail, once this happens more people will use mail (USPS or otherwise) because the inefficiency will be gone because it will either be deliver or go broke.

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    1. Re:Remove the artificial monopoly by ErikTheRed · · Score: 3, Insightful

      And then remove their union contract that states that they can never decrease their workforce, even if they don't need as many workers due to reduced volume.

      Here's what I don't get: the Political Left tells us out of one side of their mouth that only the government can be the perfect master of fairness in the workplace, and out of the other side of their mouth they tell us that government workers need unions. At the most, one of these can be true. Some would argue that neither is true...

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    2. Re:Remove the artificial monopoly by 2Y9D57 · · Score: 5, Informative

      The monopoly has been removed here in the Netherlands, and the old monopolist -- now owned by TNT -- is going broke. States granted a monopoly on mail delivery in return for a commitment to deliver to every address -- the private companies only want the easy work, delivering in towns and cities. Once the former monopolist goes broke, mail delivery in rural areas will stop forever. To prevent this from happening, the Dutch government will eventually have to legislate -- tinkering with the business models of the competitors -- or accept that if you live in a village or on a farm, you have to drive to the nearest town to pick up your mail.

    3. Re:Remove the artificial monopoly by damn_registrars · · Score: 3, Interesting

      And then remove their union contract that states that they can never decrease their workforce, even if they don't need as many workers due to reduced volume.

      I don't know where you got that notion from but it simply doesn't match reality as I have seen. Post Offices in small towns have closed recently due to decreased volume and the employees from those offices have been let go. Existing offices are not hiring, even to replace retiring workers.

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    4. Re:Remove the artificial monopoly by PrimaryConsult · · Score: 5, Interesting

      A lot of that "inefficiency" is that mailing a letter from a rural village in the south to a similar village in Alaska costs the same (and has roughly the same quality of service) as mailing a letter from one side of a major city to the other. If you break up the monopoly and allow USPS to exit markets it finds unprofitable, a whole lot of places will stop getting mail. If you break up the monopoly but do not allow USPS to exit markets, then their revenue will reduce even further as the popular ones are taken by competitors.

      Also as far as USPS is concerned, a county made up mostly of farms that sees 15 pieces of legitimate mail a month is not worth their time. But when those 15 pieces of legitimate mail are vital to our food supply...

    5. Re:Remove the artificial monopoly by Kojiro+Ganryu+Sasaki · · Score: 5, Informative

      Exactly this happened in Sweden.

      The postal service had a monopoly on delivering mail across all of Sweden. The postal service was regulated by law to cover as much of the country as possible.

      Then the monopoly law was removed, opening up for City Mail. City Mail took over the profitable city areas while completely ignoring the unprofitable countryside. The postal service is now having extreme difficulties to maintain itself, because it is suffering from competition within the only profitable districts. This leads to lack of efficiency and inhumane policies at the postal service workplaces thanks to regulations from management. (I should know, I have worked there)

      Competition doesn't lead to efficiency if the competition isn't equal, and the competition isn't equal because the postal office still has to serve the countryside. You could say that the regulation is the fault of the government, but the fucking POINT of the postal service is to serve mail everywhere. If that regulation is removed then the countryside will no longer get any mail as the postal service and city mail will both compete within the profitable areas.

      The only other possibility is that prices in the countryside explode to ridiculous levels to compensate for the lack of profit in these areas.

    6. Re:Remove the artificial monopoly by Anonymous Coward · · Score: 4, Interesting

      Responding to your strawman:

      Even if the 'Political Left' says the government can be the perfect master of fairness, this doesn't mean that unions are useless. It is only because you don't understand unions that you would say this. Unions have started strikes and opposed policies of their employers when it was needed. But this isn't the only thing that unions do. Unions provide a forum for workers of similar skills, set rules of seniority and advancement, and negotiate their contracts from the point of view of the worker. They also handle discipline issues and take care of people in trouble (illnesses, deaths, etc.). As such, they are often very useful to an employer. I work in a nuclear plant and we are almost completely unionized. I work in management (non-union) and I find the unions to be incredibly helpful, not the least of which is because unions do not tolerate safety issues. The fact that unions will go out of their way to protect their workers from safety issues is more useful to me than I can describe. It is my opinion that if there would have been an effective union on the Deepwater Horizon rig, the management shortcuts wouldn't have been tolerated.

    7. Re:Remove the artificial monopoly by Bing+Tsher+E · · Score: 3, Insightful

      Why should city dwellers have to pay more for their mail delivery in order to subsidize the rural dwellers?

      As the GP posted:

      Also as far as USPS is concerned, a county made up mostly of farms that sees 15 pieces of legitimate mail a month is not worth their time. But when those 15 pieces of legitimate mail are vital to our food supply..

      Maybe you can grow enough food for the people living in your highrise apartment building up on the roof. Good luck. Send us a postcard telling us how it went. Ooops...

    8. Re:Remove the artificial monopoly by spasm · · Score: 5, Informative

      The contract between USPS and the APWU doesn't say they can "never decrease their workforce" at all.

      You may be thinking of the part of the contract which says that employees hired before September 15, 1978 have "lifetime protection against layoff" (Article 6(1)), and that employees who have more than six years service have a more limited set of protections against layoff (Article 6(2)). Everyone else gets sixty days notice (Article 6(B) and 6(C)).

      The Joint Contract Interpretation Manual is here, and took me a whole five seconds to find via google.

    9. Re:Remove the artificial monopoly by Wyatt+Earp · · Score: 3, Insightful

      Because you live in a nation-state where everyone gets access to government services equally.

      Lets take your argument to services other than mail

      Why should people from states not attacked on 9/11 fight in Afghanistan? Why should states without military bases get defended by the United States military?

      Why should tax money from the wealthy go to the poor?

    10. Re:Remove the artificial monopoly by PopeRatzo · · Score: 5, Insightful

      And then remove their union contract that states that they can never decrease their workforce

      Why do you care what contract postal workers have? You don't pay for it. The USPS has been self-sufficient since 1972 and have a much higher customer satisfaction rating than either UPS or FedEx. They have higher public favorability ratings than the National Park Service, the US Forest Service or NASA. Apparently most Americans don't agree with your criticisms of the USPS

      And what makes you think you know what staffing levels they need or don't need?

      Here's what I don't get about the Political Right: They claim to believe in "free markets" but don't want workers to be able to collectively bargain for their own best contracts. The only reason the US had a healthy middle class for so many years is because of labor unions. It's not accidental that the attacks on Labor that started under Ronald Reagan and the subsequent decline of unions has coincided with the decline of the middle class and the decline of the US manufacturing sector. Manufacturing in the US was healthiest when labor unions were healthiest. Germany, which is arguably the most successful free manufacturing/exporting economy on Earth happens to be the country with the most favorable laws regarding labor unions.

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    11. Re:Remove the artificial monopoly by SagSaw · · Score: 3, Insightful

      Do you really want pig farms to move in next to you? How about a slaughterhouse?

      Farming isn't all beautiful waves of grain and rolling meadows with horses frolicking. Some things need to be out in the middle of nowhere. But those places also need to be connected to the rest of the country.


      Since a pig farm or a slaughterhouse needs to be in the middle of nowhere, why not make the pig farm or slaughter house pay the increased cost of providing mail delivery? Since nearly all pig farms and slaughterhouses need to be in the middle of nowhere, no one pig farm or slaughterhouse is put at a disadvantage by paying higher postage. The higher costs are simply passed on to the consumer in the form of higher prices instead of higher postage.

      Note that I'm not suggesting that the USPS stop providing mail service to isolated areas (which would almost certainly be the effect of removing the USPS's limited monopoly), but charging most customers in rural areas the true cost of providing mail delivery. To the extent that some customers might not be able to afford the true cost of their mail delivery, it might be better to subsidize their relocation to other areas rather than continuing to subsidize services.

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  2. Trying to destroy one of their best traits... by damn_registrars · · Score: 4, Interesting

    The post office is again talking about canceling Saturday delivery. To me, that is one of the best things they have going for them. Sure, UPS and FedEx will delivery on Saturdays, but for an additional cost. USPS delivers Saturday for the same cost as any other day of the week. Take no-extra-charge Saturday delivery and better rates for many pertinent deliveries than UPS or FedEx and frankly I'm not sure why more people don't ship through them.

    But if they cancel Saturdays then they aren't as advantageous.

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    1. Re:Trying to destroy one of their best traits... by nlawalker · · Score: 3, Insightful

      That would be... a lot of people.

  3. City dwellers and suburbanites might not... by Nutria · · Score: 4, Interesting

    realize this, but there's still a whole lot of people who live out in the country and small rural towns where the population density isn't high enough for UPS, FedEx and broadband to be profitable enough to serve these citizens.

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    1. Re:City dwellers and suburbanites might not... by ColdWetDog · · Score: 4, Interesting

      realize this, but there's still a whole lot of people who live out in the country and small rural towns where the population density isn't high enough for UPS, FedEx and broadband to be profitable enough to serve these citizens.

      True enough, but then you have to frame the argument as a social issue. Is it a desirable social end for people in rural areas to have services that cannot be developed economically by the 'regular' market? Traditionally (pretty much since the inception of the US) it was felt that subsidizing mail to everyone was worth the cost as it help expand the country and thus the market. In the 1930's the rural electrification expanded AC power to the hinterlands, again as an effort to improve the economy of these areas (and as part of the New Deal).

      So the argument really boils down to whether or not it is worth it in a societal sense to subsidize postal service for rural populations. Of course, then you get to the literally hundreds of cross subsidies that the US (and likely every other government) gives for everything from peanuts to gasoline.

      Then my eyes glaze over and my head asplode.

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    2. Re:City dwellers and suburbanites might not... by SvnLyrBrto · · Score: 3, Insightful

      To my mind, that's just the trade-off you get in exchange for the advantages of living out in the middle of nowhere...

      You get things like a larger house on a much larger lot, easy access to lakes, forests or whatever, peace and quiet, a lower crime rate, cleaner air, less traffic, and so on. I get broadband, culture, good restaurants, a nightlife, public transit, and other such services.

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  4. not actually a monopoly by damn_registrars · · Score: 4, Informative

    the artificial monopoly congress created for the USPS making it so they are the only ones that can deliver first-class mail

    The post office doesn't actually have such a monopoly. The post office is the only company that can deliver to your mailbox, but you are free to put up a mailbox outside your house for UPS, FedEx, or any other service you want. Other companies can deliver as much mail as they want, they just can't use the USPS mail boxes. Other companies are also free to deliver any amount of mail or packages to your door in any way they want, any time they want.

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    1. Re:not actually a monopoly by Peach+Rings · · Score: 3, Informative

      That's not true, it's illegal for UPS and FedEx to deliver first class mail (normal priority letters in an envelope). The Postal Inspection Service investigates and aggressively prosecutes companies for sending normal mail through other carriers. I remember some story from awhile back where a big corporation was fined a large sum when the postal service found out that the "high priority mail" they were sending through a carrier was just normal priority.

    2. Re:not actually a monopoly by crmarvin42 · · Score: 3, Informative

      I'd like a citation for that. I send mail via FedEx all the time for work. I don't send personal correspondence that way, but that's because the USPS is cheaper for a simple letter than FedEx is (even with the recent stamp hikes) and I'm not usually worried about delivery time. If FedEx became the cheaper way to mail photo's of my daughter to her grandparents, then I'd probaby take that route. Are you saying that it is illegal for FedEx to deliver mail that isn't next day delivery somehow?

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    3. Re:not actually a monopoly by XanC · · Score: 3, Informative

      According to Wikipedia:

      Article I, section 8, Clause 7 of the United States Constitution grants U.S. Congress the power to establish post offices and post roads. The Federal Government has interpreted this clause as granting a de facto Congressional monopoly over the delivery of mail. According to the government, no other system for delivering mail - public or private - can be established absent Congress's consent. Congress has delegated to the Postal Service the power to decide whether others may compete with it, and the Postal Service has carved out an exception to its monopoly for extremely urgent letters.

    4. Re:not actually a monopoly by Main+Gauche · · Score: 3, Insightful

      Last edited by: "GP, over on Slashdot. Nah-nah, told ya so!".

    5. Re:not actually a monopoly by XanC · · Score: 3, Informative
  5. radical changes by nurb432 · · Score: 3, Insightful

    I translate that into 'internet email tax' or 'online bill pay tax'.

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  6. Don't kill the USPS! by countertrolling · · Score: 5, Insightful

    Some of us need an alternative to PayPal... Online only works for those who carry the mark of the beast (have a bank, or PayPal account, or a credit card)

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  7. Pricing cuts both ways by davmoo · · Score: 3, Insightful

    A lot of people here are whining that the post office charges too much. So why don't you call UPS or Fed Ex and see if they'll ship a 1 pound package from Supai, Arizona 86435 to Pago Pago, American Samoa 96799 for the same $4.95 that the USPS will charge for flat rate Priority Mail.

    And don't even get me started on first class mail. Even if they were allowed to carry it, I'd be willing to bet money that UPS or Fed Ex would laugh in my face if I expected them to deliver a letter just from one side of town to the other for 44 cents.

    For some mail and packages, yes, UPS and Fed Ex can do it cheaper. But for *many* places and types of mail, USPS is a freaking bargain (and that's why it doesn't make money).

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  8. Re:USPS does a very poor job by Third+Position · · Score: 3, Interesting

    Yeah, but all of that goes out of the window for international shipping. I sent a laptop to China with UPS, and the damn thing sat in a depot in Shenzhen for six weeks due to one bureaucratic snafu after another, not to mention the cost of shipping was something like $300. The next time I shipped something there, I used USPS International Shipping and it was there in 2 days, and it cost me less than half of what UPS charged.

    But yeah, for domestic shipping, I'd go with UPS.

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  9. Why profitable? by sohp · · Score: 5, Insightful

    The article starts from a false assumption: that the postal service must be profitable, or at least break even.

    Framing the issue this way has nothing to do with what the USPS should or should not carry, or how much they should charge.

    Why is that so for the postal service but not for the military, department of transportation, or most any other government agency that provides a service? Universal free mail delivery is something that the citizens of the US want -- or at least did at one time. As a government service, it's something taxpayers agree to pay for.

    Now clearly the two authors of this article, management consultants, have a different view of that need. Perhaps they are ideologically inclined to expect that government services should break even or better, in which case, they ought to take on a real challenge and explain to the Pentagon how they can "save" the armed forces. Or perhaps they have a financial interest in private delivery services like FedEX and UPS, who knows? It's clear from early in the article, "Should the federal government continue to compete against the private sector?" that the authors have a sense that somehow there's money to made for UPS, FedEx, and other private delivery services if the postal service was forced to compete on the same level as them. I'm sure they wouldn't advocate for reforming USPS if they thought it would take money away from the private sector.

    In any case, before people go trying to reform USPS, let's first decide if we want to continue to support the current expectation of free (for the recipient) door-to-door mail service for everyone in the country everywhere. If citizens clearly want that, then budget (and tax) for it, and shut up about billion dollar "losses" that pale compared to the "losses" racked up by other services we expect as a modern nation. On the other hand, if the country decides that hey, we don't need to deliver everywhere any more, then go ahead, revamp the postal service to be just another profit-motivated competitor.

  10. Re:In other words, everything better by Jedi+Alec · · Score: 4, Insightful

    Well honestly, why should you expect to live way out in the countryside and expect to have mail delivered to your doorstep, any time, for hardly any money? That doesn't seem realistic or efficient long term.

    Indeed, which is why we've been doing it that way for a couple of centuries...oh, wait.

    There's 2 options, either we consider mail to be a vital part of the infrastructure of the nation and treat it as such, or we keep following the path Reagan and Thatcher have laid out for us and eventually abandon it altogether except where it pertains to junk mail, which we'll collectively block through a sticker on the front door.

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  11. Re:yes it's not fair by PopeRatzo · · Score: 4, Insightful

    But I don't give a shit because it's only 40 cents and don't use it a lot. Why complain about stupid shit? USPS works fine.

    The problem is that any government agency or quasi-government agency that works well, that is popular with Americans and has a much higher customer satisfaction rate than any of its private competitors, is a stone in the shoe of the Anti-US Government Right Wing.

    Thus, it cannot be allowed to exist because it endangers their world view.

    Like evolution. Or global warming.

    Basically, if Ronald Reagan, a third-rate actor with Alzheimers, didn't like it, it cannot be allowed to exist.

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  12. Re:yes it's not fair by zogger · · Score: 3, Insightful

    Well, I live in the heart of what could be considered fairly right wing territory, and I have yet to hear anyone dis the post office or call for its removal. I think you are classifying "blue" area urban rich people millionaires who are globalists anyway, not nationalists, in with the normal regular folks.

    There's really a wide range of opinion here, it isn't all conservative or liberal, and globalists are neither, they are monetarists and fascists, they just latch on to whatever support they can get..like Hollywood "blue" liberal millionaires who still want all their profits private, but want government to protect them as well, ie, xxAA type folks. All for liberal causes, like you mention global warming, but it doesn't stop them running Ferrari, private jets, having huge energy hog mansions, etc. Are they the same "liberal" as some college student eating ramen living in a dorm and walking everywhere?

    So you can't really generalize all that much. Heck, I am a rural person, socially liberal, and old time civil rights worker back in the day, but economically conservative, enough so that I think bailing out the banks and GM was a horrid idea, it made no sense from either a right nor a left wing view, but again, wanting some control on mega corporations so they don't usurp government. So, mostly hands off..but let them fail when their biz model fails. What does that make me, liberal or conservative? I like green power a *lot*, I think solar power is our only practical fusion power and should be widely adopted, all the way to 100% tax credits, am one of the few people here who bought solar panels instead of some gaming rig or three, but I also think carbon credits and cap and trade "to fight global warming"!! is not only wrong, but insanely wrong and won't do jack squat to save the environment any, just make wall street skunks like goldman sachs richer, like they really need it. To think they have so many greens faked out on this... Am I liberal or conservative?

    I could go on with a lot of other examples, but this left/right deal the uber goons keep trying to force people into, like it is carved in stone you must be one "wing" or the other, is quite destructive and is playing into their hands and is part of their "keep the people divided and conquered" routine.

    Left and right have no bearing in today's world if you really think about it, it is globalist billionaires who co-opted government versus their prey animals, which is everyone else. *That* is the real political divide, the one worth noting and working against, because it is so inherently unfair and outright criminal how much they control so called "elected" governments. That other crap is what they want to keep most people trapped in, because that means all the victims point fingers at each other constantly, instead of looking just one more step upstream where the real problems occur, and at that level, there is no "left versus right" that exists very much, they all look and act the same at that level, they are the new aristocrats, or what I call the technofeudalists. Back to the casino bank bailouts, when the shrubbery did it, it was a "right wing" gift to some "right wing" billionaires..but then later on mr. party animal did the same thing....see how it doesn't matter, those labels? All part of the big fake out, along with that ludicrous "don't waste your vote"! and only vote for some hand picked for you candidate from the short list of approved and compromised millionaire globalist candidates. Remember when our big fat choice was between skull and bones frat boy millionaire and skull and bones frat boy millionaire?

    Anyway, the post office..most real old fashioned "paleo" conservatives (as opposed to neocons) I know support the Constitution and as such, are in favor of the post office and public roads, the "post roads". It's the globalist already billionaires who want privatized everything, and that notion flows downstream from the mega "blue" areas, like NYC and wall street (for the most part and I am really just generally speaking)