Sell the Postal Service

There have been commercials lately that hype the US Postal Service.  One says that many small businesses count on the Postal Service to stay competitive.  Another declares that many people rely on the Postal Service to deliver prescription drugs.  And then there is talk of how many jobs would be lost if USPS is downsized.

The USPS has the great misfortune of being semi-private. It operates on the money it raises through stamps and postage but is subject to oversight by Congress. The Senate is strongly opposed to closing Post Offices to resolve the daily $25 million shortfall. Thus, it can't raise rates to cover the gap nor can it cut costs. This is what happens when government tries to run a business.

The market is speaking.  The US Postal Service is outdated.  If not for the fact that it is illegal to compete with the USPS, it would have gone bust years ago.  FedEx, UPS, and others would be glad to deliver the mail but federal law prevents them.  Though the Constitution does allow for the federal government to maintain a postal service, it doesn't require it to be a monopoly.  Competition will either make the USPS more efficient or drive it out of business, either of which will be good for the consumer.

Every private company seeks to get consumers to buy its goods but must compete for market share.  Hewlett Packard and Dell don't raise prices and lower quality to convince consumers to buy their computers.  No, they constantly seek ways to lower prices while improving quality.  Whichever one better achieves that goal will win more market share.  That's competition.  When there isn't competition, prices rise and quality suffers because the consumer has no other option.  Monopoly is bad and USPS is a monopoly.  Of course, so it public education but that's a blog for another day.

I would suggest that the government sell the USPS.  It would bring in some revenue that could go toward the ballooning debt.  Whomever takes over won't be getting the tax subsidies that currently exist, so tax receipts may rise.  Yes, privatization is the solution.