The Post Office

One of the most eye-opening experiences that I had as a lawyer was when I worked on the postal rate administrative process.  Hundreds of hours spent by many organizations writing briefs to the Postal Rate Commission arguing why the price of stamps should go up two cents instead of three cents.  If you want to convert someone into a libertarian, this is excellent shock therapy.

As the Post Office is now on the brink of insolvency, it’s worth thinking about what should be done with the mail service. One approach involves slimming down its costs.  For example, we could close post offices, reduce the salaries of employees, and abolish Saturday delivery. (Raising stamp costs will probably just drive more business to FedEx and UPS, but maybe I’m wrong about that.) Another thought is that we should turn the Post Office into something that only delivers mail to rural or hard-to-reach places where private mail service would be costly for the poor. It would still lose money, but it would lose a lot less money.  Everyone else would have to rely on private firms for mail.  Folks involved in direct mail (catalogs, advertisements, etc.) would hate this change, but they are currently being subsidized for no good reason by taxpayers through cheap postage.

The problem, of course, is that the Post Office employs a lot of people, and thus a broad restructuring of the service would be very painful.  Unfortunately, I don’t think there is a way to make the service profitable.


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23 Responses

  1. Shag from Brookline says:


    There might be a book length paper on statutory changes – federal and state – that may have to be made; also some court rules. And consider Article I, Section 8, clause 7 of the Constitution particularly with respect to post roads. And what might be the financial impact on stamp collectors and their collections? What if at the end of the day of what you project, post office may be only a teenager game? And if the post office is eliminated because the service cannot be made profitable, then what’s next that the government provides that is not profitable?

  2. publicservice says:

    Here are two ideas.

    1. Stop paying people 50k to deliver mail.

    2. Stop providing pensions to people who get paid 50k to deliver mail.

    3. Make it easier to fire PO employees.

  3. publicservice says:

    Here are three ideas.

    1. Stop paying people 50k to deliver mail.

    2. Stop providing pensions to people who get paid 50k to deliver mail.

    3. Make it easier to fire PO employees.

  4. Brett Bellmore says:

    Yes, if you shut down the postal service, a lot of people would lose jobs. Some of them would find work with private companies doing the same job.

    But you have to look at the other side of it, the drag on the economy from paying people to deliver junk mail. That’s not inconsiderable. 95%, at a minimum, of the mail arriving in my mailbox goes straight to the garbage, and I’m paying taxes for that????

  5. Is the post office really on the brink of insolvency? Or is this due to its having to account for pension liabilities differently from private firms (by fully funding them)?

    I’ve been told that if the post office could keep its books like a private firm — or like how it used to before legislative changes some ten or so years ago, it would look very solvent. (I’ve even heard it claimed that the effort to make it look insolvent was an attempt to undermine the postal workers union, which is reliably Democratic.) Do you know if there is any truth to these claims?

  6. Shag from Brookline says:

    Speaking of “junk male,” Brett might consider recycling junk mail instead of tossing it in with the garbage. Isn’t there a tad of a connection between junk mail and the First Amendment? If not, then why not have Congress use its powers re: post office, post roads to treat junk mail somewhat in the manner of Email spam?

    By the way, during the glorious 8 years of Bush/Cheney, much of the junk mail I received was for credit card solicitations. Following the 2008 Bush/Cheney Great Recession, this seemed to stop – until just the other day when I heard from Chase. Did we have a credit card bubble that burst? Or is that yet to come? It may be one of the better profit centers for financial institutions.

    I wonder if Brett is as upset with paying taxes for Iraq, Afghanistan that may be even more of a drag on the economy than the post office, with or without junk mail.

  7. Brett Bellmore says:

    Why, yes, Shag, I am. People confuse my dismissing the “illegal war” meme with thinking such wars are really a good idea. Just because we do no wrong by taking a dictator down, or beating on somebody as evil as the Taliban, and break no law if Congress authorized it, (Unlike, say, our genuinely illegal military adventure in Libya.) doesn’t mean doing so is prudent.

    We’re suffering from an increasingly bad case of imperial over-reach, we need to scale back drastically.

  8. Adam says:

    Brett is right-having people carry trash from printers to widely distributed trash or recycle bins is highly inefficient. It leads to more carriers, walking shorter distances before “reloads” and delays and distracts from more useful mail.

    The bulk & presort rates are a result of regulatory collaboration in pre-internet days when catalogs and flyers seemed possibly useful.

    If my getting a catalog is so valuable to the sender, they should be willing to pay a few more cents for the privilege.

  9. Shag from Brookline says:

    Speaking of unwelcome catalogs, recall the Seinfeld episode when Kramer rebelled against Pottery Barn and its catalogs only to be brought before the Postmaster General to be chastized. Maybe the solution to the post office problem is to require all adults to have a computer capable for the delivery of messages – with of course a spam feature. We could call it the “Affordable Computer Act.” Failure to comply would result in mandatory COD deliveries of catalogs and other junk mail. But would Congress pass such a bill that might ascribe junk mail status to political mailings? Of course, there would have to be a special catalog exception for rural areas to stock outhouses.

    By the way, several years ago Nobel Laureate Joseph Stiglitz and an associate estimated the true costs of the Iraq and Afghanistan wars at $2 trillion. That’s quite a bit more than the post office shortfall. So perhaps a little perspective is appropriate.

  10. Jim Maloney says:

    I’m flabbergasted. All this junk mail we get and throw away because we never wanted it in the first place is not making the postal service solvent, yet (relatedly) taxpayers are subsidizing it?

    So why not raise the junk mail rates?

    If the postal service is not viable in the long run and scrapping it outright would put too many federal employees out of work too fast, merge it into a new logistics service that assists with disaster response and preparedness.

    USPS + FEMA – waste = a possible solution

  11. Jim the genius says:

    This may take a technological miracle on the part of the post office, but it is doable.
    I propose that the post office create an email address for everyone in the country based on physical address (e.g. 1234.ClevelandRoad.Columbus.Ohio). Then, if someone elects to receive mail electronically, the sender can transmit through the PO to him by email (both letters and “junk”). If the person elects to receive paper mail, he gets a delivery once a week.
    In a sense, the post office would compete with common email providers. But, the PO is uniquely authoritative – when something must be sent, you would have to pay the stamp fee to send it through the PO as the only truly official way of mailing it.

  12. anon says:

    “(Raising stamp costs will probably just drive more business to FedEx and UPS, but maybe I’m wrong about that.)”

    Unless you have no ability to assess the relative size of numbers (i.e. you have no ability to understand that $5 is more than $0.45) then yes, you are definitely wrong about this.

    This reminds me of a recent trip to the post office. The customers were in line and they insulted the postal workers and claimed they were “lazy” (the postal workers were working at a steady pace). Meanwhile, they were perfectly free to go to UPS or Fedex (which charge way more than USPS for most services) but they chose to stay, because the price was right.

    Is this cheap cost being subsidized by taxpayers and postal workers who are worked to death? Yes, but if you privatize the system costs will only go up.

  13. anon says:

    Here are three ideas.

    1. Stop paying people 50k to deliver mail.

    2. Stop providing pensions to people who get paid 50k to deliver mail.

    3. Make it easier to fire PO employees.


    Welcome to modern day America, where the proletariat post inexplicable messages disclaiming the right of other proletariat to get a meager wage. This reminds me of Joe the Plumber, the day laborer making (I think it was $30,000) who went on this Tea Party crusade to keep taxes down on the rich. What is wrong with this country?

  14. Brett Bellmore says:

    “Welcome to modern day America, where the proletariat post inexplicable messages disclaiming the right of other proletariat to get a meager wage” greater than what they make, doing something objectionable, (Delivering trash.) at their expense.

  15. Matt says:

    My understanding was essentially the same and Michael Froomkin’s above. If that’s right (and I’ve seen nothing to suggest it’s not) then this framing of the issue seems seriously distorted.

    I get some junk mail (don’t we all), but also quite a few things through it that I want, that would likely be more expensive if done commercially. (Netflix, other mail-order things, etc.) I also tend to find the post office to have as good or better service than the commercial carriers. But that’s beside the point if Michael’s account is right, since that’s really the issue that would need to be addressed.

  16. Joe says:

    We are going to rely on private firms to deliver SS checks and so forth? Are junk mail costs really what is causing the problems here? The mail officials already have to deliver mail — they aren’t just delivering junk mail. More junk mail means more funds to the post office, since the mail isn’t sent for free. And, some of the “junk mail” does have real 1A value to deliver information to the public.

    And, another tidbit: in one of these conversations, someone mentioned that private firms rely on the post office to deliver many types of packages, door to door costs just not worth it. If anything, said this person, the post office undercharges for this service of delivering packages from the local post office to the door.

  17. Shag from Brookline says:

    Article I, Section 8, Clause 7 of the Constitution grants authority to Congress “To establish Post Offices and post Roads.” Back in the 1780s there was of course no Internet. With the technology that exists today, how might originalists or non-originalists consider such technology under Clause 7 in what may constitute “Post Offices” and “post Roads” other than in the bricks and mortar we are accustomed to? Might my earlier suggested “Affordable Computer Act” be a modern version? Of course, this wouldn’t address packages delivered by the post office, an important feature that Joe points to. But if the goal is privatization where would it stop, as there are many government services that are not profitable but as with the post office do provide benefits to citizens/residents.

    Back in the 1840s, MA’s own Lysander Spooner set up a competition with the postal service, claiming that the Clause 7 did not provide the federal government with an exclusive right. Spooner’s competition was profitable at significantly lower rates than the government charged. Eventually, Spooner was challenged by the federal government and closed up his operation, but his competition brought down the prices that were charged by the government. That seemed to make a lot of people happy. (Spooner was not rewarded for bringing down such prices.) Just imagine if Clause 7 activities were to be privatized; would the “privateers (aka “pirateers”) charge what the market would bear? Would such privatization be subject to regulations, including regarding privacy, comparable to the current system ?

    Yes, it’s easy to trash the postal service by harping on junk mail, which is provided by corporations. But corporations are people, are they not, and don’t they provide jobs in the private sector?

  18. Joe says:

    The US Post Office has a website and you can do various things manually by downloading and printing out labels and stuff. And, after all, it is E “mail” and all.

    So, Shag’s references to computers make sense though that might also have interstate commerce implications too. The Spooner bit is interesting. Wikipedia talks about it as does this link:

  19. TS says:

    Here’s a thought.

    Rather than giving junk mailers special low rates for helping fill landfills and recycle bins, we should consider a “Do Not Mail” list (see for example: Of course, that would threaten still more the Post Office’s principal line of business but perhaps that simply suggests that the Post Office may have outlived its usefulness.

  20. Shag from Brookline says:

    Do the financial records of USPS indicate that junk mail is the Post Office’s “principal line of business” as TS indicates? What would prevent the Post Office from increasing junk mail low rates? Of course, capitalists (both libertarian and libertine) would squawk at rate increases. They might even claim such would be an abridgment of 1st Amendment rights. Imagine how Citizens United would come to the defense of junk mailers, including by means of political contributions. As for perspective, compare the post office finances with those for the Afghan and Iraq wars.

    By the way, the post office has been helpful to college and grad students over the years with temp jobs during the Xmas/New Year holiday season as well as during the summer, going back to the early 1950s when I was a student. Eliminating the post office of Article I, Section 8, Clause 7 of the Constitution just might get a reaction from 2nd Amendment defenders.

  21. Kent says:

    How about doubling the postage for all letters not completely addressed by hand.

    It is interesting to look back to the state of communication when the Post office was instituted and the state of communication now. If we had the kind of communication capabilities then as we do now would a gov’t run post office have been given a second thought?

  22. How about China’s method of saving both marriage and the post office at the same time be allowing spouses to send love letters in the future at traditional “divorce-itch” dates?!