Saturday, November 12, 2005

How to End the Postal Monopoly

In my lifetime, the price of a first-class postage stamp
Began at           .03
Then increased to .05 on Jan. 7, 1963
Then increased to .06 on Jan. 7, 1968
Then increased to .08 on May 16, 1971
Then increased to .10 on March 2, 1974
Then increased to .13 on Dec. 31,1975
Then increased to .15 on May 29, 1978
Then increased to .18 on March 22, 1981
Then increased to .20 on Nov. 1, 1981
Then increased to .22 on Feb. 17, 1985
Then increased to .25 on April 3, 1988
Then increased to .29 on Feb. 3, 1991
Then increased to .32 on Jan. 1, 1995
Then increased to .33 on Jan. 10, 1999
Then increased to .34 on Jan. 7, 2001
Then increased to .37 on June 30, 2002
The price will increase to 39 cents in 2006.

Are we getting our money's worth? Of course not. The U.S. Postal Service (formerly known as the U.S. Post Office) enjoys a legal monopoly on the delivery of letters, bills, catalogs, and junk mail to your mailbox. Well, its not your mailbox, even though you bought it. It's there for the exclusive use of USPS, and its use by any other party invites a stiff penalty.

The best evidence that we don't get our money's worth from the post office is the flight to online banking, online billpaying, online shopping, and the rise of UPS, FedEx, and similar carriers. USPS boasts of an operating surplus in 2004, but that surplus is down from the one recorded in 2003, and it is probably due to the continuing contraction of USPS employment. USPS is in a death spiral, and its management knows it.

In recognition of that, USPS contrived a partnership with FedEx. Perhaps, in the long run, that partnership will evolve into the absorption of USPS by FedEx. That would be a good thing, except that it might enable FedEx to acquire a taxpayer-funded asset cheaply -- or even for nothing.

The best solution would be to dissolve USPS and auction its assets. The proceeds should be spread among taxpayers in the form of a tax credit proportional to each taxpayer's income tax liability for the year in which the proceeds are realized.

I, for one (among many), would not miss the surly presence of a USPS carrier or clerk in my life. It is pleasant to do business with UPS and FedEx drivers and other employees. They may be pleasant only because they make good money and want to keep it that way, but that doesn't matter. They are pleasant and they do deliver the goods, literally and figuratively.