Wail Mail
link Will Five-Day Delivery Save the Postal Service? – Newsweek.com.
If this article is leading to what it implies, that is the closing down of many postal offices, it will have a signficant impact upon American culture. Where are people supposed to go to get really angry? Who will dogs chase around? What will lonely housewives do to pass the day? Where do you mount wanted posters?
Something’s illogical here. Not the usual diatribe about the inefficient post office, but just big picture logic. With the onset of the computer age, the world has moved towards sending messages, greetings, advertisements and yes, even bill paying on to electronic media. If this is the case, there MUST have been a coincidental decline in regular mail over the past decade and a half. Wouldn’t this have been obvious from the revenue statements from year to year? Yet in the article, it states that it was only in 2008 that red ink began to show at the U.S. Post Office.
How can it be possible that the Post Office is projected to lose 23 billion dollars a year for the next decade? The obvious answer is fixed costs, in particular labor costs. While the rate for a letter has gone up from $0.32 in 1995 to just south of $0.50 cents today according to the UPS website, this apparently hasn’t been enough to cover salary and pension benefits for all the hard working posties. Heck, the Postmaster General John Potter is forced to scrape by on only $845,000 a year, a pittance compared to what he could be making if he ran UPS or Fedex.
As mentioned, not only has electronic communications cut off one stream of revenue for the Post Office, private carriers like UPS and Fedex are also formidable competitors for delivery service. The downside is, the Post Office still tries to maintain the offices and staffing levels as if they were still the monopoly. We know some cutbacks will happen, but before then, there will be an enormous hand extended to the government for money to support an old, inefficient business model. The article states that much of the business is from catalogs and magazines and which still contributes substantial revenue. Do people really need to spend over 230 billion dollars over the next 10 years to get catalogs? It seems more reasonable to let those companies find an alternate way to send their junk mail and stop having the public subsidize their business model. At the very least, we’ll likely receive less junk mail.
As heart wrenching as the ultimate demise of the Post Office will be, modern times have eclipsed the business model. They are still selling allegorical blocks of ice to consumers who now all own refrigerators. It still appears that there will be room for a federal postal service, but on a significantly reduced scale. Not to worry, there’s another big government industry being created now to absorb some of the displaced workers creating something else for them to deliver. Healthcare. Hopefully, it won’t be just 5 day delivery.