A 46 Cent Rip-off
The Post Office wants to raise its rates. From 44 cents to 46 cents, to mail a first class letter. Because, as we all know, it's a finely-tuned model of efficiency and service.
Of course, it lost about $3.5 billion last quarter, and is projected to lose almost $250 billion more in the next ten years. And they want to eliminate Saturday delivery. Call it Long's First Law of Public Sector Economics: If it's even remotely politically possible for a government-sponsored enterprise to increase its fees and reduce its service, it will do so annually.
(Long's Second Law of Public Sector Economics, by the way, is that any government-sponsored enterprise that is legally and explicitly not backstopped by the American taxpayer -- Freddie Mac and Fannie Mae, for instance -- will in fact be backstopped by the American taxpayer for losses in excess of 100x what anyone dreamed of.)
The real question with the Post Office, though, is where does all that money go? Speaking personally, my surly letter carrier appears only intermittently. And my local post office, where I keep a P. O. Box, has signs everywhere announcing that All Box Mail Will be Delivered by 11AM. Box mail is usually available around 3PM. When a helpful customer (me) points this out to the folks behind the counter, he is told that the signs are only there for when the local supervisor drops by. They'll try to get the mail in the boxes by four, five at the latest.
So where does the money go? Well, according to the Washington Times, a lot of it goes to things like this:
Even as the U.S. Postal Service began sliding into the worst financial crisis in its history, some postal executives in recent years found a way to earn more money by resigning from their jobs and returning as highly paid contractors while doing essentially the same work.
In three recent contracts awarded without competitive bidding, for instance, former Postal Service executives were hired to perform what contracting records described as "knowledge transfer," according to a review of the agency's multibillion-dollar contracting operation by thePostal Service's office of inspector general.
"These contracts were put in place, even though highly experienced postal executives filled the positions vacated by the former executives," the inspector general's office concluded in a report, which was ordered by two senators amid a procurement scandal involving the agency's former top marketing officer.
One former vice president retired in May and within two months received a $260,000 no-bid "knowledge transfer" contract for the postal executive who assumed his old job, the report found.
I like that phrase -- "knowledge transfer." But I wonder what that "knowledge" is? Aside, I guess, from knowing how to charge more for less and get away with it.
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Comments :
Re: A 46 Cent Rip-off
Mail service was good when I lived in Tulsa, OK; it is fine in Hillsdale, MI, where I now live. But when I lived in DC, it could take a week for a letter to make it across town; and when I lived in New Haven, CT, no one in my apartment building got any mail on Fridays. A funny thing, that.
Still, it could be worse. When I lived in Italy, the authorities at the Italian post office were found to be burning undelivered mail.
Edited on Sep 27, 2010 at 9:11amMay '10
Re: A 46 Cent Rip-off
When the private sector loses customers they lower the price on their goods and services to lure the customers back. When the public sector loses customers they raise rates and drive their remaining customers away.
That's why the USPS, Amtrack and public bus lines should all be shuttered.
May '10
Re: A 46 Cent Rip-off
The problem with "knowledge transfer" is that it is the wrong knowledge. If you are going to fix the USPS, you need to avpoid any knowledge of the way they've always done things and go in with an empty head.
And it saves all that contract money as well.
May '10
Re: A 46 Cent Rip-off
But I love this issue because this is one that everyone gets. Even the most firebrand liberal is hard-pressed to defend the continued existence of the post office for more than a few minutes in polite conversation. I think the post office could actually be shut down in our lifetime. And that once it gets shut down and the world doesn't end, that maybe others things could be shut down as well.
May '10
Re: A 46 Cent Rip-off
Sid, my neighbor, uses our efficient small-town post office. Sid is 84 and lives next door to me with his wife and his mom.
They have no notion of the internet. Please don't take their post office unless you have some means in mind to serve them.
Jul '10
Re: A 46 Cent Rip-off
You know things are bad here when even welfare states such as Sweden, Denmark, New Zealand, Finland managed to private their postal services.
Edited on Sep 27, 2010 at 12:26pmMay '10
Re: A 46 Cent Rip-off
Aside from the unfortunate fact that they are the business of moving paper when the world is moving away from that costly way of communication, the Postal Service was doomed by politically influenced hiring and personnel management policies. A similar problem besets public transportation and schools. These executives have found a loophole in these foolish rules, and are exploiting it.
But in the end it comes down to how you hire and manage your people. Public organizations cannot escape politics.
Jun '10
Re: A 46 Cent Rip-off
$260,000 versus $3.47 per month. Rob maybe the postal service knows something you guys at Ricochet missed?
Aug '10
Re: A 46 Cent Rip-off
Email, wire transfers, fedex, expedia, amazon.......who uses the US Post Office anymore ? privatise it !! fedex and ups would come up with some killer numbers to get pieces of the business. the only thing the mail is good for is the float on accts payable and receivable. if we changed the commerce laws to pull the pins from under the registered mail business, it's over. think about the forests saved !
the carbon footprint of all those jeeps and delivery vans. the miles of blue gabardine.... the ocean of frowns that would be swept away with the sight of brown truck....
May '10
Re: A 46 Cent Rip-off
I'm all for letting UPS and FedEx take over the market entirely, retaining USPS only where those private organizations don't deliver. If providing postal service to small towns in obscure areas cannot be profitable, private businesses shouldn't be forced to provide service to those citizens.
But that doesn't mean every small town must have its own post office either. It's reasonable to make some share and accept sacrifices when the public is paying. Excepting military and law enforcement (any government's primary responsibilities), government's proper role is to provide what is necessary (and the market cannot or should not provide), rather than what is optimal.
May '10
Re: A 46 Cent Rip-off
Trace Urdan: But I love this issue because this is one that everyone gets. Even the most firebrand liberal is hard-pressed to defend the continued existence of the post office for more than a few minutes in polite conversation. I think the post office could actually be shut down in our lifetime. And that once it gets shut down and the world doesn't end, that maybe others things could be shut down as well. · Sep 27 at 9:33am
No need to shut it down. Just spin it off with a nice runoff contract; there is more than enough meat there to operate a successful business and still provide what we need. You need one carrier who doesn't just skim the cream- but there is no reasons whatever for the union featherbedding and Congressional interference. First way to save money is to abrogate all the union agreements; give them a vote choice between layoffs and wage freezes.
Second, eliminate the Congressional franking privilege. Third, phase out the rate cap on 1st class postage, but open it up for competition.
Jul '10
Re: A 46 Cent Rip-off
All these comments and no mention of healthcare!
I've always used USPS as the example of why We should not have "universal healthcare."
That, and the DMV.
That, and.....
Jul '10
Re: A 46 Cent Rip-off
One of these things is not like the others. One of these things just doesn't belong.