The U.S. Postal Service has a long and storied tradition. It was first authorized by the Continental Congress, and the first Postmaster General — Benjamin Franklin — was in the line of presidential succession.
In the early years, the U.S. Postal Service had no competition, resulting in a monopoly. It was one of the largest employers in the nation, and is now only behind the Pentagon and Wal-Mart. Let’s just say it was powerful.
According to the Cato Institute, the Post Office of the early years was designed to take profits off of mail delivery and distribute them to special interests. The prices were exorbitant, which led to competition from private companies. These private mail carriers introduced the postage stamp and other important innovations.
The tricky thing about being a private mail carrier is that you’re trying to turn a profit while going up against a competitor that gets to make the rules.
When private companies made enough of a dent in the USPS’s profit margins, the government set up a series of laws codifying a post office monopoly over mail delivery, then closing each and every loophole they could find. With that, the government “saved” us from a private postal system.
Fast forward about 200 years, and we are starting to see similar trends. There is competition from e-mail and private corporations, causing trouble for the profit margins. We’ve seen innovations coming from FedEx and UPS when it comes to non-letter mailings, and yet there are still two groups of laws preventing true competition.
These are the Private Express Statutes and the mailbox access rules. No private party is allowed to deliver letters, and mailboxes are for use only by the USPS.
It is just as difficult to justify a monopoly now as it was in the 1800s when theUSPS squeezed competitors out of the market through fiat. The government is hardly the only able body when it comes to delivering letters. FedEx and UPS already have the infrastructure built for parcel delivery; they could almost immediately expand into first-class letters — and likely with greater efficiency than shown by the government.
This begs the question, “Why is the government even in the postal business anyway?” At this point, several corporations are already built up with the ability to directly challenge the monopoly, if only the 1845 Express Statutes were repealed. There would be very little disruption in the marketplace.
Thankfully, the USPS has gotten out of the business of channeling profits toward political allies. The basic reason behind the Post Office’s continued position as not simply a governmental business, but a legal monopoly, is simply that it has been in that position all these years.
Fostering competition would inspire greater innovations in mail delivery, more timely arrival of mail and lower costs. When competition was allowed, this was true, and it can be again. The UPS online tracking service, for example, might be expanded to include post. There really isn’t a downside to allowing private companies to compete directly with the USPS, as long as your name isn’t Uncle Sam.
However, the likelihood of the government actually removing the legal monopoly in the near future is practically zero. Governments just aren’t known for giving up powers that they have granted themselves, especially after enjoying 100-plus year monopolies. The 20th Century, in particular, largely had consisted of governmental roles expanding in myriad ways and shrinking in few.
There’s the sentimental value of a government entity began by one of the nation’s founding fathers. Also, there are approximately 800,000 employees of the USPS, many of them unionized. These employees are liberally sprinkled throughout the United States, in every single county. The union is just about as likely to allow private competition as it is to shoot itself in the foot with a large caliber rifle, because the results would be much the same.
And so here we are, saddled with a government system that is largely a historic anachronism. It isn’t that the USPS can’t compete with private companies: It already does in parcel delivery. The government simply won’t allow people to deliver their own mail.
Imagine a world wherein you can become a criminal simply by taking an invitation and putting it in your neighbor’s mailbox. That is the world we live in.
U.S. Postal Service monopoly is outdated
Published: Friday, November 14, 2008
Updated: Friday, November 14, 2008
You really need to do more research, and get your facts straight. While every large organization and/or employer has it's faults I can honestly say that I don't know of any company in the WORLD, who could handle the sheer volume of mail that the USPS does on a daily basis, and for the price that's charged. Also as stated above the USPS is the only delivery company in the USA that delivers to every address in our country, can FEDEX and UPS say that? By the way, anyone other than a USPS Letter Carrier who inserts something into my mailbox (i.e. flier, invitation,etc.), is committing a crime.