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brettdoyle said:   lillazyfats81 said:   @zgori

While you're thinking is fair, you must remember that it WILL kill a lot of jobs.

I'm all for closing up abundance, and getting rid of the lazy postal workers (and self entitled), but axing the complete postal system will not benefit the economy.

Don't get me wrong - I personally hate my local post office.... I have to drive to the next town to drop off my packages.

Axing the postal system all together as you propose will kill a lot of jobs, not beneficial for the economy, and in the end out tax dollars might be feeding their unemployment checks


Jobs only add value to society when they produce goods and services of value. Everyone in the Soviet Union had a job, but everyone was dirty poor and their economy was terrible.

The best thing that could happen is the postal workers get laid off and their labor (a valuable resource) is freed up for more productive purposes.


Right, because dumping a half million workers into a labor market with nearly 8% unemployment is such a great idea.

The post office provides an incredibly valuable service. Just because you personally don't use it doesn't mean that others do not.

JTausTX said:   brettdoyle said:   lillazyfats81 said:   @zgori

While you're thinking is fair, you must remember that it WILL kill a lot of jobs.

I'm all for closing up abundance, and getting rid of the lazy postal workers (and self entitled), but axing the complete postal system will not benefit the economy.

Don't get me wrong - I personally hate my local post office.... I have to drive to the next town to drop off my packages.

Axing the postal system all together as you propose will kill a lot of jobs, not beneficial for the economy, and in the end out tax dollars might be feeding their unemployment checks


Jobs only add value to society when they produce goods and services of value. Everyone in the Soviet Union had a job, but everyone was dirty poor and their economy was terrible.

The best thing that could happen is the postal workers get laid off and their labor (a valuable resource) is freed up for more productive purposes.


Right, because dumping a half million workers into a labor market with nearly 8% unemployment is such a great idea.

The post office provides an incredibly valuable service. Just because you personally don't use it doesn't mean that others do not.



Exactly

wordgirl said:   zgori said:   So hire them all to do something more important than delivering direct-marketing campaigns six days a week. I'm all for government employment, and there are plenty of worthwhile investments we can be making. Infrastructure, R&D, health care, whatever. The point is that maybe in an age of electronic data we need to reevaluate the costs of daily delivery and give people choices about what they need from their mail. (This, of course, ignores political realities, but it seems like the conversation was taking that direction anyway.)

Bulk commercial mail, as previously pointed out, is a highly profitable enterprise for USPS. (In fact, it's a good deal for pretty much everyone involved, except the consumers that have to deal with the deluge of crap.) Eliminating it would make everything else the postal service does MORE expensive.

And remember that all the things you listed off as alternative uses are government functions. The USPS is not government; any cost savings are plowed back into the USPS, which performs none of the functions you've outlined (unless you're talking about R&D into having unmanned drones delivering mail. Which would be kinda cool, and kinda scary. )


That's what's so genius about my plan! (If I must so say myself.) Bulk commercial mail continues, but on whatever schedule the customer selects. The point was that most of that mail is not so pressing it needs be delivered on a daily basis, unless recipient wants to pay for that privilege.

zgori said:   wordgirl said:   zgori said:   So hire them all to do something more important than delivering direct-marketing campaigns six days a week. I'm all for government employment, and there are plenty of worthwhile investments we can be making. Infrastructure, R&D, health care, whatever. The point is that maybe in an age of electronic data we need to reevaluate the costs of daily delivery and give people choices about what they need from their mail. (This, of course, ignores political realities, but it seems like the conversation was taking that direction anyway.)

Bulk commercial mail, as previously pointed out, is a highly profitable enterprise for USPS. (In fact, it's a good deal for pretty much everyone involved, except the consumers that have to deal with the deluge of crap.) Eliminating it would make everything else the postal service does MORE expensive.

And remember that all the things you listed off as alternative uses are government functions. The USPS is not government; any cost savings are plowed back into the USPS, which performs none of the functions you've outlined (unless you're talking about R&D into having unmanned drones delivering mail. Which would be kinda cool, and kinda scary. )


That's what's so genius about my plan! (If I must so say myself.) Bulk commercial mail continues, but on whatever schedule the customer selects. The point was that most of that mail is not so pressing it needs be delivered on a daily basis, unless recipient wants to pay for that privilege.


The problem is that you then have add an additional sorting layer to the post office, which requires either a heavy investment in equipment or added labor costs. They'd have to sort by address and also by who prefers what mail on which days. It'd be costly.

JTausTX said:   zgori said:   wordgirl said:   zgori said:   So hire them all to do something more important than delivering direct-marketing campaigns six days a week. I'm all for government employment, and there are plenty of worthwhile investments we can be making. Infrastructure, R&D, health care, whatever. The point is that maybe in an age of electronic data we need to reevaluate the costs of daily delivery and give people choices about what they need from their mail. (This, of course, ignores political realities, but it seems like the conversation was taking that direction anyway.)

Bulk commercial mail, as previously pointed out, is a highly profitable enterprise for USPS. (In fact, it's a good deal for pretty much everyone involved, except the consumers that have to deal with the deluge of crap.) Eliminating it would make everything else the postal service does MORE expensive.

And remember that all the things you listed off as alternative uses are government functions. The USPS is not government; any cost savings are plowed back into the USPS, which performs none of the functions you've outlined (unless you're talking about R&D into having unmanned drones delivering mail. Which would be kinda cool, and kinda scary. )


That's what's so genius about my plan! (If I must so say myself.) Bulk commercial mail continues, but on whatever schedule the customer selects. The point was that most of that mail is not so pressing it needs be delivered on a daily basis, unless recipient wants to pay for that privilege.


The problem is that you then have add an additional sorting layer to the post office, which requires either a heavy investment in equipment or added labor costs. They'd have to sort by address and also by who prefers what mail on which days. It'd be costly.


Of course, but would that really be more work than the millions of daily deliveries you wouldn't have to do anymore? I'm not an expert on mail distribution systems, but I doubt it.

JTausTX said:   zgori said:   wordgirl said:   zgori said:   So hire them all to do something more important than delivering direct-marketing campaigns six days a week. I'm all for government employment, and there are plenty of worthwhile investments we can be making. Infrastructure, R&D, health care, whatever. The point is that maybe in an age of electronic data we need to reevaluate the costs of daily delivery and give people choices about what they need from their mail. (This, of course, ignores political realities, but it seems like the conversation was taking that direction anyway.)

Bulk commercial mail, as previously pointed out, is a highly profitable enterprise for USPS. (In fact, it's a good deal for pretty much everyone involved, except the consumers that have to deal with the deluge of crap.) Eliminating it would make everything else the postal service does MORE expensive.

And remember that all the things you listed off as alternative uses are government functions. The USPS is not government; any cost savings are plowed back into the USPS, which performs none of the functions you've outlined (unless you're talking about R&D into having unmanned drones delivering mail. Which would be kinda cool, and kinda scary. )


That's what's so genius about my plan! (If I must so say myself.) Bulk commercial mail continues, but on whatever schedule the customer selects. The point was that most of that mail is not so pressing it needs be delivered on a daily basis, unless recipient wants to pay for that privilege.


The problem is that you then have add an additional sorting layer to the post office, which requires either a heavy investment in equipment or added labor costs. They'd have to sort by address and also by who prefers what mail on which days. It'd be costly.
not necessarily. Giving people choices doesnt mean opening the door wide open to their whim. Give people the option of 2x/week delivery, or paying a fee for daily delivery. Sorting is the same, but someone would then have to pluck the daily deliveries from the pile - but that's what the fee is being paid for...

I'm assuming there's alot more to be saved on the delivery side - having 1 mailman cover 3 existing routes (delivering each 2x/week rather than 6x/week) - than on the processing side if you were to only run processing centers every-other-day.

(not my idea)

Have Google pay to install Google Earth cameras on all USPS vehicles = constantly updating Google Earth/Maps for us all.


(cue people saying it's not fair, they don't use Google, black helicopter free Alta Vista only for them)

JTausTX said:   magika said:   I am very familiar with their healthcare funding problems. Analyzing how state governments are failing to pre-fund their retirement and healthcare obligations actually funded the first year of my PhD in Public Administration (thanks, taxpayers!). The USPS is in a most peculiar situation because its considered an autonomous independent business by the government yet it still is subject to government oversight. When congress ordered USPS to pre-fund its obligations, it was actually doing the smart thing. Like most states, USPS previously funded retirement healthcare on a "pay as you go" method where the expected bill for the upcoming budget year was paid for and future unfunded obligations were ignored and not truly accounted for on the books. Thats due to the magic of public sector accounting - these unfunded liabilities (all the money they will owe their retirees in the future in healthcare expenses) is not something the USPS had to pay attention to. Congress forced their hand, which on the surface seems like a bad idea but its actually quite smart for the following reasons:

The problem with "pay as you go" is that those healthcare (and pension) obligations are near their lowest point right now in terms of yearly cost, and will only explode in the future. In the case of USPS, those liabilites had a potential to grow to become such a large portion of their budget that the cost would cripple them. It would be impossible to still run the USPS and pay off the retirees. Prepaying those liabilities saves them money in the long run, because those funds are invested and the growth and compounding of those funds will eventually be enough to sustain the ever growing amount demanded by the healthcare liabilities - but doing this requires huge upfront payments to prepay those obligations...they have been ignored for so long.

What I find most interesting about the discussion of this in the media is that this is a harbinger of whats going to happen to state governments across the country very soon. Most states use pay go, and most of them face the same problem of basically ignoring their unfunded liability of retiree healthcare. The unfunded liabilities owed by most states are enormous and dwarf the USPS. And when it comes to states, they will have to be paid - lawyers for most state retirement systems already seem to agree that any cut in promised benefits would be an entitlement cut that would get slapped down by the courts. States who use pay as you go are trapped with a ticking time bomb that will go off in the next 10-15 years - and the majority of state governments have done nothing to stop it. In many ways the USPS is more fortunate, if they can prepay now they will be in much better shape in the future, which presumably will be good as use of normal mail continues to decline.


While I agree that prefunding is a good plan in general, please explain to me why it's necessary to fund it to this extreme. Once we have a satisfactory explanation for that, we'll move on to why this already onerous requirement needs to be done in ten years. Slice it however you want, it's a ridiculous requirement. As someone said, they are pre-funding the retirements of people who aren't even born.

novocane said:   Solvency of USPS is a fairly easy problem to solve:
1) Cut unprofitable services
2) Raise postage rates until the service becomes at least break even.
3) Raise taxes to pay for the shortfall.
(Or some combination of the 3)

US has some of the lowest postage rates in the world (lettermail in Canada is $0.64USD; in UK its around $0.95USD). I don't think lettermail should be subsidized. So why haven't postage rates increased? Because congress won't let them. USPS management has tried to increase rates, but Congress has limited rate increases [[L=http://iret.org/pub/ADVS-284.PDF].]http://iret.org/pub/ADVS-284.PDF].[/L] And then they wonder why USPS isn't profitable. The math is not all that complicated.

I've seen a lot of complaining about the work ethic of post office employees. I've seen some pretty hard working people at my post office, who are more efficient than the UPS people I've dealt with. And they are likely getting paid much less.


Sorry, number 3 is totally wrong. The USPS receives no contributions from the Treasury. It is entirely self-funded.


It's not totally wrong. I'm listing *options* that could make USPS solvent. USPS could receive contributions from taxes, it's an option, just up to Congress to decide.

novocane said:   Solvency of USPS is a fairly easy problem to solve:
1) Cut unprofitable services
2) Raise postage rates until the service becomes at least break even.
3) Raise taxes to pay for the shortfall.
(Or some combination of the 3)

US has some of the lowest postage rates in the world (lettermail in Canada is $0.64USD; in UK its around $0.95USD). I don't think lettermail should be subsidized. So why haven't postage rates increased? Because congress won't let them. USPS management has tried to increase rates, but Congress has limited rate increases [[L=http://iret.org/pub/ADVS-284.PDF].]http://iret.org/pub/ADVS-284.PDF].[/L] And then they wonder why USPS isn't profitable. The math is not all that complicated.

I've seen a lot of complaining about the work ethic of post office employees. I've seen some pretty hard working people at my post office, who are more efficient than the UPS people I've dealt with. And they are likely getting paid much less.


The only beef I have with the work ethic of post office employees is that they are too eager to help people. I am one of those types who comes in with the proper postage on my package and all proper labels filled out. Then you get these WalMart okies who dump a pile of garbage on the counter and expect the post office employee to locate a box, tape everything up, and fill out the address label. Its called Target, people. Hell, they got all the supplies there for sale. But its pretty upsetting when the clerk at the counter wants to go the extra mile by accommodating these fools that don't know how to pack a box for petes sake. The whole "customer service" process can take 15-20 minutes when the person is a real seasoned okie. Its not fair to those who come prepared.

I actually feel that it's a good thing the USPS doesn't get funding from the Federal government. However, I believe the balance of controls that the Federal government has over the USPS needs to be adjusted. The demands should be reasonable and not put the USPS at a competitive disadvantage against other agencies or private companies. USPS has gone through a lot of cuts recently directly due to the pressures it has felt. Yet service quality has largely remained the same during this time. This indicates to me that there was definitely room for improvement, improvement that might have not taken place were it not for the pressures currently felt. Read the postal forums - hours are down, overtime availability is down, performance requirements are up - all this indicates that people are having to work more while earning less. This is the very definition of increased productivity.

So maybe the congressional overlords of the USPS are smarter than we give them credit for. They are using inaction as an excuse to squeeze the USPS for all the efficiency it can get out of this round, before providing any relief.

FSBox said:   I actually feel that it's a good thing the USPS doesn't get funding from the Federal government.

The USPS already gets tons of funding from the Federal government... they owe the US treasury 15 billion in loans that will never be repaid.

The post office was solvent before 2006. On 2006, the Koch Brothers lobbied/funded a Bill that required Post Office to "pre-fund" the retirement/pension 75 years in the future (for employees not even born). Their idea was to break the back of the strong post office union workers so that they get laid-off after insolvency. That is the fact!

I'd be happy if we just let the USPS decide which post offices to open and close. This nonsense of Congress having to authorize every closure has to stop.

brettdoyle said:   FSBox said:   I actually feel that it's a good thing the USPS doesn't get funding from the Federal government.

The USPS already gets tons of funding from the Federal government... they owe the US treasury 15 billion in loans that will never be repaid.
What twisted logic is this? How do you suppose with any reasonable amount of certainty that the USPS will default on its loan obligations?

FSBox said:   brettdoyle said:   FSBox said:   I actually feel that it's a good thing the USPS doesn't get funding from the Federal government.

The USPS already gets tons of funding from the Federal government... they owe the US treasury 15 billion in loans that will never be repaid.
What twisted logic is this? How do you suppose with any reasonable amount of certainty that the USPS will default on its loan obligations?


Several reasons

1) They lost 16 billion last year, and over the next 5 years losses could exceed $50 billion
2) They are poorly managed by Congress, costs are rising much faster than average inflation due to fuel and crazy labor costs but they can't increase their price more than the CPI
3) Mail volumes are declining, they have high fixed costs
4) Their retirees pension plans and health care benefits will consume more and more of their overall budget while their revenues are declining.
5) The declining headcount of workers paying won't be able to support the growing number of retirees.
6) They already defaulted on their obligation to fund their health care plan and have reached their borrowing limit several times

Soooooo, the post office didn't deliver mail this Sat thx to the blizzard here on the east coast.

The mail, which usually comes in the am here came in the evening. Don't know if this meant overtime for her, but hey. It was late. Let's pretend. They used an extra truck for her to swap out (too much mail to fit in the single truck which is only large enough to accom 1 day's mail, said postal worker), hence extra carrier and gas and that, on our route as well.

Seeing it in action, gotta say I'm a bit perplexed how this is saving us substantial $$$$. But then again, maybe our town's exp was a complete anomaly and asking one person to do two day's work in one shift without overtime in a truck only large enough to fit one day's worth of mail was only an issue here. *shrug*

Might be a far fetched idea here, but in many other countries, the post office also runs deposit banks. They use the profits from the banks to subsidize the postal operations.

We in fact did have such a system in the US a while ago

http://en.wikipedia.org/wiki/United_States_Postal_Savings_System

 
WSJ said: WASHINGTON—The U.S. Postal Service, scrounging to stem a tide of deep losses, said Friday that it may pursue higher stamp prices later this year if Congress doesn't pass legislation that helps the agency cut costs.

After learning the Postal Service recorded a $1.9 billion loss in its most recent fiscal quarter, the agency's board directed management to consider higher prices for delivery of first-class letters, periodicals and bulk mail. The agency has been trying to reverse quarter after quarter or record losses by focusing on labor concessions and worker retirements. But it has repeatedly said it needs help from Congress to fix its financial woes.

The Postal Service projects it will have as little as three days of operating cash in October. "If legislation doesn't pass, we have issues to face in terms of cash flow," Postmaster General Patrick Donahoe said. "Everything has to be on the table."

That could include raising stamp prices by more than just a penny or two. The Postal Service must seek special permission from a commission that oversees the agency to raise prices by more than the rate of inflation.

Mr. Donahoe says raising postage rates is an unwelcome option because it may drive away more customers.

In recent years the agency has unsuccessfully sought as much as a 23% increase for some services, such as advertising mail, magazines and catalogs that are currently lose money. First-class mail, which is profitable, has seen 30% dropoff in volume since a 2001 peak, due largely to increased electronic communication. Stamp prices have increased 12 cents during that time.

A threatened increase in stamp prices is the latest plea to Congress for help. The Postal Service has previously asked lawmakers for permission to break away from government health-care plans and eliminate Saturday letter delivery as part of a plan to cut $20 billion in costs.

Better lock in today's low prices with Forever stamps if you can afford it.

Forever stamps are essentially forward contracts with no price premium to compensate the USPS for the risk of future price increases. I suspect as more people realize what's going on there will be a shortage of Forever stamps, especially if a large price increase gets passed (many individuals will buy up everything on the shelves looking to arbitrage the pricing differential between today's price and future price).

If the USPS continues to raise their prices at the rate of the CPI then their losses will continue to get larger and larger because the CPI does not accurately reflect the cost of delivering mail... something will have to give eventually.

From a purely FWF perspective, I have the following observations:

I don't believe the Congress of the United States of America is gonna allow the USPS to go OOB any time soon.

I do believe circumstances mitigate in favor of higher postal rates.

Therefore:

With interest rates low as they are, this appears to be a good time to load up on "forever" stamps. I plan to do so at my earliest opportunity.

Personal anecdote:

It's funny. A while back I loaded up with certainty I was "over-buying". So many stamps. I thought they would last . . well . . forever!!

Didn't happen. I ended up using the stupid stamps. And I do most everything on-line. Still used 'em. Crazy.

jerosen said:   neophyte said:   Well, I have only one word to say to a bashing crowd: "Netflix"

One word to say to that : streaming.
Oh come on - are you 10 years old? Because if you're older you know that Netflix had started way before streaming was practical.

My point is still fully valid: without PO such "new economy" as Netflix, eBay, Amazon would not exist, so by subsidizing PO the society had subsidized the web retailers.

I can't judge whether it's good or bad, but it must be recognized

brettdoyle said:   the agency has unsuccessfully sought as much as a 23% increase for some services, such as advertising mail, magazines and catalogs that are currently lose money.
Why don't they just eliminate the Standard Mail rate?
More $$$ and and smaller carbon footprint---another Nobel Prize for the big O.

p.s. "That are currently lose money"??? Reminds me why I don't read the WSJ.

I have not read most of this thread, but I thought I'd chime in with a thought. I personally think that the USPS is a wonderful business, and if prices were not controlled by the government, I'd love to have an opportunity to take it private and buy stock. They have a business built upon network effects and the scale makes it tough to replicate - they should be able to raise prices and solve many issues. That doesn't mean they shouldn't get expenses under control, but I think that despite the issues, it would print money for the owners if they are allowed to change pricing of mail service at their own desire.

Laker312 said:   The average salary for a mailman in my zip code is $95,346. I wonder if that is part of the problem???

The biggest problem for the post office is Congress is requiring them to prefund retirement and retiree medical benefits. No other agency has to prefund retiree medical benefits. Add to that the preference hiring for vets ( I have no problem with this per se) and giving them credit toward postal retirement for years they did not work for the post office. That should be coming out of the regular DOD budget as it does for regular government employees even those in the judicial branch. The postal retirement system has been an actuarial nightmare for the at least the last 15 years. Gingrich's budget cutting slights of hand.

nsdp said:   Laker312 said:   The average salary for a mailman in my zip code is $95,346. I wonder if that is part of the problem???

The biggest problem for the post office is Congress is requiring them to prefund retirement and retiree medical benefits. No other agency has to prefund retiree medical benefits. Add to that the preference hiring for vets ( I have no problem with this per se) and giving them credit toward postal retirement for years they did not work for the post office. That should be coming out of the regular DOD budget as it does for regular government employees even those in the judicial branch. The postal retirement system has been an actuarial nightmare for the at least the last 15 years. Gingrich's budget cutting slights of hand.

I'm just joining in now - when you say that they have to prefund those benefits, are they prefunding it with the present value of the obligation in the future, or something else?

I am not sure how Congress came up with the formula. Right now it assumes what essentially is 0% rate of return which essentially sucks money out of the Postal Retirement system by giving them no earnings on contributions but imputing 3% inflation in costs. If the USPS were allowed to buy I Bonds in the name of the employees they would have a better deal. Two things the retirement benefits and construction of new post offices when USPS gets nothing for the old one have killed its balance sheet. Example the old Main Post Office no longer houses the USPS but is called the Hipolito Garcia US District Court House. It houses the bankruptcy, immigration, and tax courts and the Social Security hearings officers, the FBI, Federal Bureau of Prisons and other law enforcement agencies but not the Postal Inspectors. Post office got stuck with building a new one and paying in full. In the town where I grew up, they built a new one to replace one from the 1930's. A WPA building that had all of the high quality brass boxes granite floors and hard wood counters. It was included in the list to be added to the national historical register of Historical buildings because of the architect who designed it. Instead it was torn down and turned into a parking lot for the local bank. Local land owners and contractors who "contributed" to the local congress man got the money. Teh flat roof of the new building leaks big time. Congress continues to "request" new facilities that aren't needed for their district.

neophyte said:   jerosen said:   neophyte said:   Well, I have only one word to say to a bashing crowd: "Netflix"

One word to say to that : streaming.
Oh come on - are you 10 years old? Because if you're older you know that Netflix had started way before streaming was practical.

My point is still fully valid: without PO such "new economy" as Netflix, eBay, Amazon would not exist, so by subsidizing PO the society had subsidized the web retailers.

I can't judge whether it's good or bad, but it must be recognized


Yes, because the whole world would just sit on their asses and parcels would pile up if government employees were on a permanent donut break.

lars23 said:   Might be a far fetched idea here, but in many other countries, the post office also runs deposit banks. They use the profits from the banks to subsidize the postal operations.

We in fact did have such a system in the US a while ago

http://en.wikipedia.org/wiki/United_States_Postal_Savings_System


Yeah, the government's done a heck of a job running FHA and making loans to businesses like Solyndra.

JTausTX said:   mistadeal said:   I honestly don't know why they don't just cut back to twice a week for residential delivery. Monday and Thursday, or Tuesday/Friday. At most, your important bills will arrive 2 business days later, and then 2 extra days before they can be mailed back out.

You honestly don't see a problem with that? A lot of people finesse the timing of their bills and paychecks. Sometimes people forget things. This would cause a lot of problems for your everyday user.


We live in the era of electronic banking. You don't see a problem with resources being needlessly squandered on paper bill payments and payroll mailings?

The dopers will be really upset at not being able to rifle mail boxes for checks to steal. Everyone else will adapt.

LawDawgAtl said:   HSimpson101 said:   scrouds said:   Now I have a question for you guys. Why do we expect the post office to cover its costs? We build roads without any expectation that the roads will cover their cost. Gas taxes pay for 1/2 of road costs. Where's the other half coming from? Why do roads deserve to be subsidized and the mail not?

None of it deserves to be subsidized. This is the problem across our economy. Everybody expects everything to be available below cost. This is how we get massive government debt at all levels of government. USPS needs to get its cost structure in line with its revenue structure.
If you don't subsidize essential infrastructure, then the entire economy suffers and all of us suffer a lot more as a result. If you don't subsidize the roads, gas prices skyrocket, which dampens the rate of economic growth, which leads to lower wages, more unemployment and less tax revenue. Here is a report showing that traffic congestion in Orlando cost nearly $1 billion in 2011. In Denver, it is $1.6 billion. The total financial cost of congestion in 2011 was $121 billion, up one billion dollars from the year before and translating to $818 per U.S. commuter. Of that total, about $27 billion worth was wasted time and Diesel fuel from trucks moving goods on the system (link).

I agree that there's plenty of waste and inefficiency out there but you can't evaluate these things the way that a frog evaluates the world from the bottom of a well. The relationship between many of these costs and benefits just cannot be evaluated the way that you are doing it.


When you subsidize infrastructure you obscure the true costs of maintaining that infrastructure, thus obscuring the price signals which help determine the optimum level of infrastructure and its relative benefit to society.

Is society more efficient as a whole if a container of goods at point A moves to point B by rail or truck? There's no way of knowing when violating the user pays principle

If roads are subsidized then goods which should have moved by rail will move by road.

And so on.

Xnarg1 said:   Maybe if the USPS wasn't mandated to pay >$5 billion per year to fund retirement/healthcare for its employees, 75 years into the future, its financial outlook would be better.Please don't bother us with the facts while we are trying to promote the false meme that the post office is broke. In fact we should ignore the fact that if the post office ran their retirement commitments the same as any other branch of the federal government they would be profitable.

boards5503 said:   Xnarg1 said:   Maybe if the USPS wasn't mandated to pay >$5 billion per year to fund retirement/healthcare for its employees, 75 years into the future, its financial outlook would be better.Please don't bother us with the facts while we are trying to promote the false meme that the post office is broke. In fact we should ignore the fact that if the post office ran their retirement commitments the same as any other branch of the federal government they would be profitable.

As pointed out earlier in the topic, here is why they are required to do what they are doing.

tomjef said:   neophyte said:   jerosen said:   neophyte said:   Well, I have only one word to say to a bashing crowd: "Netflix"

One word to say to that : streaming.
Oh come on - are you 10 years old? Because if you're older you know that Netflix had started way before streaming was practical.

My point is still fully valid: without PO such "new economy" as Netflix, eBay, Amazon would not exist, so by subsidizing PO the society had subsidized the web retailers.

I can't judge whether it's good or bad, but it must be recognized


Yes, because the whole world would just sit on their asses and parcels would pile up if government employees were on a permanent donut break.
Nice one-liner - no need to think or type

The fact is post-based Netflix (which millions enjoyed during the last 15 years) would've never existed without media postal rates; the fact is small seller's eBay would've never existed without PO

Invest 5 minutes of your time in quoting on UPS and FedEx site that package you mailed to your mom; pass your judgement thereafter...

neophyte said:   tomjef said:   neophyte said:   jerosen said:   neophyte said:   Well, I have only one word to say to a bashing crowd: "Netflix"

One word to say to that : streaming.
Oh come on - are you 10 years old? Because if you're older you know that Netflix had started way before streaming was practical.

My point is still fully valid: without PO such "new economy" as Netflix, eBay, Amazon would not exist, so by subsidizing PO the society had subsidized the web retailers.

I can't judge whether it's good or bad, but it must be recognized


Yes, because the whole world would just sit on their asses and parcels would pile up if government employees were on a permanent donut break.
Nice one-liner - no need to think or type

The fact is post-based Netflix (which millions enjoyed during the last 15 years) would've never existed without media postal rates; the fact is small seller's eBay would've never existed without PO

Invest 5 minutes of your time in quoting on UPS and FedEx site that package you mailed to your mom; pass your judgement thereafter...



Actually I thought you were saying that Netflix would save the USPS. 10 year olds like me are easily confused.

MarsdenFubar said:   boards5503 said:   Xnarg1 said:   Maybe if the USPS wasn't mandated to pay >$5 billion per year to fund retirement/healthcare for its employees, 75 years into the future, its financial outlook would be better.Please don't bother us with the facts while we are trying to promote the false meme that the post office is broke. In fact we should ignore the fact that if the post office ran their retirement commitments the same as any other branch of the federal government they would be profitable.

As pointed out earlier in the topic, here is why they are required to do what they are doing.


It makes perfect sense for the USPS to have to prefund its retiree health care liabilities.

The problem is that as far as I know only the USPS is being required to do that. I don't believe the government has passed any laws requiring any private companies or other government agencies to similarly prefund their retiree healthcare liabilities.

I mean just look at the medicare / medicaid liabilities...those are not even close to prefunded.

magika said:   The thing is you can't just make radical reforms to the union. They have a collective bargaining agreement, and its rock solid. I am pretty familiar with the version from about two years ago because I was on a regional USPS arbitration panel, so I had to become very familiar with parts of the contract that come up most often with grievances.

Those agreements are locked in for 4-5 year periods at a time, and from a management perspective, you just aren't going to be able to do much while its in effect. Love or hate the postal union, one thing they are very good at is filing unfair labor practice charges with the National Labor Board.


The Postal Workers Union is the biggest bunch of laziest folks on this planet. And they sure act like they are entitled to their entitlements.

Good luck when USPS goes bankrupt.

nsdp said:   Laker312 said:   The average salary for a mailman in my zip code is $95,346. I wonder if that is part of the problem???

The biggest problem for the post office is Congress is requiring them to prefund retirement and retiree medical benefits. No other agency has to prefund retiree medical benefits. Add to that the preference hiring for vets ( I have no problem with this per se) and giving them credit toward postal retirement for years they did not work for the post office. That should be coming out of the regular DOD budget as it does for regular government employees even those in the judicial branch. The postal retirement system has been an actuarial nightmare for the at least the last 15 years. Gingrich's budget cutting slights of hand.


But that argument (no other agency has to prefund) is irrelevant. The law is the law. Don't like it? Change it?

Until changed, USPS has to go what it has to do.

Read this: http://www.gao.gov/products/GAO-13-112

The big problem with USPS, unlike other government agencies are two-fold:

1. USPS can not levy taxes,
2. USPS is in a dying business. In an ideal world, the revenue generated by USPS would go down to zero in 20-30 years. So as a business, USPS needs to be wound down. If you have $95B in pension liabilities, you can not "pay-as-you-go" if you are going to be bringing in ZERO revenue in 20-30 years.

In fact, I could argue, that the current law, as applied to USPS is quite generous.

I would demand that USPS pre-fund its entire future pension liability in the next 5 years, or just be wound down.

Some people here don't realize that at the margin, USPS does not add value. It is net losing business, and it is probably net negative at the societal utility level.

lars23 said:   Might be a far fetched idea here, but in many other countries, the post office also runs deposit banks. They use the profits from the banks to subsidize the postal operations.

We in fact did have such a system in the US a while ago

http://en.wikipedia.org/wiki/United_States_Postal_Savings_System


It's just replacing one subsidy with another.

I am OK with Post Office running a bank, but as long as that bank gets to compete with all the other banks.

Heck, we can just have Post Office buy some Apple stock with their funded pension liabilities. Even that would be more profitable. Apple pays decent dividend, and it is only going to increase.

ankitgu said:   I have not read most of this thread, but I thought I'd chime in with a thought. I personally think that the USPS is a wonderful business, and if prices were not controlled by the government, I'd love to have an opportunity to take it private and buy stock. They have a business built upon network effects and the scale makes it tough to replicate - they should be able to raise prices and solve many issues. That doesn't mean they shouldn't get expenses under control, but I think that despite the issues, it would print money for the owners if they are allowed to change pricing of mail service at their own desire.

I am HIGHLY skeptical of this idea. Your argument seems to assume that demand for postal services is fixed, regardless of prices.

Somewhere in the range between doubling and tripling postal rates, the demand for Postal Services will be ZERO.

neophyte said:   Nice one-liner - no need to think or type

The fact is post-based Netflix (which millions enjoyed during the last 15 years) would've never existed without media postal rates; the fact is small seller's eBay would've never existed without PO

Invest 5 minutes of your time in quoting on UPS and FedEx site that package you mailed to your mom; pass your judgement thereafter...


You seem to be under the mistaken impression that delivery rates would still be the same if private carriers specializing only in parcels/express were filling the every-address routes of the USPS.

Society has been subsidizing Netflix's artificially cheap mail rates. Sounds like a wise investment of public money.

We still pay to deliver it, we just don't pay it with stamps. Pull up your past year's tax returns.



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