On behalf of infrastructure: Rethinking the postal environment


August 21, 2012

BY MARK JAMISON

It's been four years since the Great Recession began to take its toll on postal revenues, and we appear no closer to a resolution to the crisis than when it first arose.  Of course, if one looks at it from an historical perspective, the Postal Service has faced an existential crisis since 1968, when the Kappel Commission issued its report on the future structure of the Post Office Department.

The Kappel Commission was made up of ten members, six of whom were Republican businessmen representing some of the largest corporations in the country.  A seventh member was George P. Baker, the conservative Dean of the Harvard Business School.  The remaining members were George Meany, President of the AFL-CIO; David Ginsburg, a liberal attorney who had been executive director of the Kerner Commission; and David Bell, vice-president of the Ford Foundation.  The commission took its name from the chairman, Fred Kappel, the retired Chairman of the Board of Directors of AT&T.

According to Murray Comarow, the executive director of the commission, the commissioners, while differing on many points, came together on the following fundamental principles:

  1. The Post Office is a business and should be run like a business.  It should have a board of nine directors, six appointed by the president and three appointed by the board.
  2. It should be a self-supporting government corporation.
  3. Appointments and promotions should be nonpolitical.
  4. The board should set rates after due process hearings, under statutory guidelines.
  5. Wages and benefits should be established by collective bargaining; the parties may agree to binding arbitration.  An impasse would be referred to the president.
  6. The board should establish industry-competitive levels of compensation for top management.

Given that this was a time when the corporation had become the most revered of institutions, it is not surprising that the commission came up with these basic principles for transforming the national post. 

The idea of running government as a business — and perhaps for the benefit of business — was not necessarily a new one.  But in an era of extraordinary confidence in the ability of corporate America to use business methods to find technocratic solutions, there was a certain intellectual fait accompli in the idea that the new Postal Service ought to look and act more like a corporate entity.  Shouldn't everything?

 

The Holy Grail of corporatization

The Postal Reorganization Act that Congress passed met many of the conditions and recommendations of the Kappel Commission, but according to Mr. Comarow, it failed to completely embrace the vision of the commission.  Instead of leaving rate issues to the Board of Governors, Congress created a separate oversight body known as the Postal Rate Commission.  Instead of making the decision to move to arbitration up to the President, Congress mandated that labor disputes be subjected to binding arbitration.

In a paper titled “The Federalist Papers and Postal Reform” [pdf] sponsored by the EMA Foundation — an industry organization created by the Envelope Manufacturers Association to promote postal and communications related industries — Mr. Comarow discusses the history of postal reform.  

Mr. Comarow contends that had Congress followed the suggestion of the Kappel Commission and created a self-governing and self-sustaining corporate entity, many of the ensuing battles surrounding the Postal Service would have been avoided.  In fact, Mr. Comarow commends what has become the Holy Grail of postal reform — the creation of a corporate being, responsible to its Board of Governors and responsive to its industry patrons. 

Listen to the PMG today and you will hear echoes of Mr. Comarow’s corporate vision.  Listen to representatives of the mailing industry, like the 21ST Century Coalition of Mailers, and you will hear strident advocacy for a postal entity that competes in the marketplace.  Of course, if you listen a bit more closely, you’ll hear something a little different, a bit more nuanced.  They want the Postal Service to be an entity that competes, but not too much.  In any case, they are not content with seeing the Postal Service provide a sanguine and helpful environment to help them profit.  They want something more.

Mr. Comarow’s work and the intellectual framework it created for a corporatized Postal Service has been embraced by many, particular those in postal-related industries.  While there is much to disagree with in both this paper and Mr. Comarow’s work in general, he does provide an accounting of some of the ancillary budget battles that affected postal legislation, particularly accounting for prior retirement obligations.  He also provides an interesting discussion about the Revenue Forgone Act of 1993 and the issues surrounding mandated rates for non-profits.

The greatest value in Mr. Comarow’s paper is that it sets a clear, undistorted vision of what the mailing community sees as the preferential structure of postal services in the United States. In doing so, it also clearly and obviously leaves out the general interests of the American people and dismisses the idea of the postal network as infrastructure.

 

PAEA: Beyond the health care mandate

In many respects, the crisis confronting the United States Postal Service today originates in the provisions of the Postal Accountability and Enhancement Act (PAEA) that attempt to resolve the retirement accounting issue, particularly those that address retiree health benefits.  Certainly the burdensome payments mandated by PAEA are a significant part of the Postal Service’s fiscal woes, but the crisis that confronts us today is of a much larger magnitude and stems from other provisions of PAEA.

While some people didn’t think PAEA went far enough in making the Postal Service more of a corporate entity, it did move further toward that goal by dividing the products of the Postal Service into two categories: market dominant and competitive.  In the eyes of some, the concept of competitive products was a step in the right direction, but it created a cumbersome and opaque system of monitoring how those products contributed to the overall welfare of the organization.

In the view of many, particularly the leadership of the Postal Service, the preferable treatment would have been to remove the interference of Congress and its creation, the Postal Regulatory Commission.

The Postal Regulatory Commission was an updated version of the old Postal Rate Commission.  In PAEA it was given expanded oversight powers to determine the nature of postal services.  It was, at least nominally, supposed to be the guardian of universal service, while insuring that the actions of the Board of Governors and the management of the Postal Service remained transparent and in the interests of the American people generally.

By the most narrow of definitions, the PRC has fulfilled its statutory obligations admirably.  It has provided open forums for the discussion of postal services and products, although openness and transparency are sometimes given secondary consideration in favor of the “business interests” of the Postal Service and mailers in general.  

The fact is that many of the most important issues brought before the PRC are done so “under seal,” and consequently independent verification of the goals, objectives, and performance of the Postal Service is virtually impossible.  This, though, is a function of law, not a failure of the PRC itself.

Much of the opposition to the PAEA came from those who thought it did not go far enough in corporatizing the Postal Service.  They felt that PAEA allowed for too much meddling by Congress by requiring that facilities remain open, that services remain broadly rather than narrowly universal, and that labor continue to have a considerable amount of say in the operation of the postal network.

Many stakeholders viewed the capping of postal rates to increases no greater than the CPI as a welcome step, and they also favored creating specialized rates through negotiated service agreements (NSAs) as a felicitous opportunity.  But the old saws decrying the postal monopoly and the general inefficiency of a government-run agency could still be heard quite clearly.  

 

Post roads and post offices: Essential infrastructure

Those who saw the Postal Service as only a commercial entity that existed solely for the furtherance of their profit making were not going to be satisfied with merely the ability to engage in regulatory capture.  The industry and the ideologues wanted an entity that conformed to the paradigm of American business over the last forty years — the privatization of public goods, the desecration of labor, and the opportunity to define commerce and the economy without any of the restraints or obligations imposed by the New Deal.

While there is a case to be made that the provision of postal services is nothing more than a simple commercial activity that should be wholly subject to the vagaries of the marketplace, it is a weak and narrow argument.  There is no doubt that a capitalism defined by free and open markets is the most preferable of economic systems.  

But economic systems are not religions composed of rigid ideological rules or, for that matter, ideologies that require the absence of rules.  Markets are fluid and dynamic systems that require properly conceived environments composed of laws, restraints, and infrastructures that ensure both efficiency and yes, fairness.  Without sanguine environments, markets devolve into entropic chaos or inefficient consolidation.

The Founders conceived of the postal network as more than simply a commercial service.  They saw the network as infrastructure, a fundamental building block in our nation’s structure, a necessary element in the furtherance of the national welfare.  One can see this in the Article I Section 8 reference to post roads.  They understood that binding the nation together through a democratic and open form of intellectual infrastructure must be accompanied by the physical embodiment of a network.

Throughout our history, discussions of internal improvements revolved around the idea that it was a perfectly reasonable task for government to promote, build, and operate fundamental infrastructures.  The postal network we have built is the result of a reasonable and proper vision that ascribes tasks such as infrastructure to the promotion of the general welfare.  Alternative visions that deny this essential element of government may promote short-term profit or efficiency, but ultimately they result in consolidation and exclusion, which lead to inefficiency and reduced opportunity.

Despite forty-five years of postal reform that has tried to weaken the concept of universal service and binding the nation together, our postal network has continued to preserve our democratic ideals through the maintenance of open and accessible communications, while developing a system that is readily and fairly usable for the promotion of commercial activity.

 

The nature of postal monopolies

We are told that the postal monopolies constrain and limit opportunities for development, that they confer unfair advantage. That argument works if one views the postal network as merely a service entity, not infrastructure.  An environment where business entities can corner markets does stifle innovation and opportunity.  The supposed postal monopolies do not, however, work in that manner.

The letter monopoly requires that mail of a first class nature weighing less than twelve and one half ounces be charged a rate at least six time higher than the current first class postal rate.  There’s nothing onerous about this, and the fact is that private companies like UPS and FedEx have carved out exceedingly profitable business out of delivering first class material at rates, which far exceed the requirements of the statute.

Could someone create a profitable business out of delivering first class mail that didn’t meet the constraints of the monopoly provisions?  Libertarians will point to one of their heroes, Lysander Spooner, who did just that in the 1860’s.  Mr. Spooner developed mail companies that delivered in urban areas for less than the Post Office could.  The key, however, is that his model was not expandable across the broader landscape.

I suspect there are people today who imagine that they could create networks that could deliver first class mail cheaper than the current letter rate of forty-five cents.  Maybe they could do that for one small town or within a section of a wealthy and high volume urban area. But consider the broader question of whether they could reproduce that result throughout the country with the kind of consistency and standardization that the postal network provides.

It cannot be done, and the proof of that is that no one has developed a network that delivers all of the various classes of mail that are exempted under the private express statutes.  The supposed monopoly is actually a very thoughtful tradeoff off, granting a right — the delivery of mail — combined with a responsibility — universal service.  The two go hand in hand, and the financial value of the monopoly is greatly reduced by the responsibility embodied in universal service.  The value is in the combination of both right and responsibility and the subsequent network that arises from that combination.

The second monopoly is the mailbox monopoly, which states that only the United States Postal Service has access to the private mailbox.  Rand Paul, the Republican and confessed libertarian from Kentucky, has argued vociferously (to the point of obtuseness) that it is somehow unfair that the Federal government can tell me who can put mail in the mailbox I purchased.

His arguments sound valid, but are they?  I suppose there is a prima facie property rights argument for his position, but the Supreme Court declared in a 1981 case (USPS vs. Council of Greenburg Civic Associations) that the mailbox was an essential part of the national post.  Justice Rehnquist’s opinion argued that erecting a mailbox was a voluntary action and that one submitted to the rules of the Postal Service in accepting mail through their box.  Rehnquist wrote:

“Nothing in any of the legislation or regulations recited above requires any person to become a postal customer. Anyone is free to live in any part of the country without having letters or packages delivered or received by the Postal Service by simply failing to provide the receptacle for those letters and packages which the statutes and regulations require. Indeed, the provision for "General Delivery" in most post offices enables a person to take advantage of the facilities of the Postal Service without ever having provided a receptacle at or near his premises conforming to the regulations of the Postal Service. What the legislation and regulations do require is that those persons who do wish to receive and deposit their mail at their home or business do so under the direction and control of the Postal Service.”

A 2008 study by the ILO Institute commissioned on behalf of the USPS indicated that mailers and those receiving mail both valued the security of the mailbox.  For just about everyone other than those employed at think tanks, the mailbox monopoly is a non-issue.

A George Mason University study that examined the value of both monopolies concluded that in the context of six-day universal delivery where routes were not cherry picked and frequency was regular, the mailbox monopoly was worth about $160 million per year — hardly an amount worth dismantling the postal network for.

 

Monopoly double standard: Private yes, public no

When we’re talking about a government monopoly, we hear all about the costs and evils, but we seem to look the other way when it’s an industry.  The United States has some of the worst broadband service in the world.  Our service is slower and more expensive than most industrialized countries, and it certainly isn’t universal.  To cite one example, Taiwan has 60-megabit per second service available for $30 per month and soon expects over 100 Mbs for the same price.  In both price and performance, the U.S. lags behind Japan, South Korea, Europe, and even much of mainland China.

Broadband service and the cable and Internet industries in this country are controlled a by a very few companies, primarily AT&T and Verizon.  Somehow we permit this near monopolistic control by the private sector of an essential market, even though it is a sector that is critical for our economic development and even though it has resulted in a broadband network that costs more, runs more slowly, and fails to provide universal service.  

Yet when it comes to the mail — which is just as critical to the economy — there are many people who want to hamstring the Postal Service, even though it delivers the most mail in the world and at the cheapest rates.  Apparently it’s fine for private corporations to enjoy near-monopoly status, but not for a government entity like the Postal Service. (For more on this, see Charles Ferguson’s Predator Nation.)

The two monopolies accord the Postal Service very little economic advantage, but they do reinforce the idea of the Postal Service as infrastructure.  Again, it becomes a matter of perspective.  If the Postal Service, along with the network it has built and supports, is nothing more than a service business, then perhaps the effect of the monopolies is egregious.  If, on the other hand, the Postal Service and the postal network are seen as infrastructure, then the limited monopolies are a reasonably efficient way of promoting the growth of a national asset.

 

Market dominant and competitive

One of the more unfortunate consequences of postal reform in general and the PAEA specifically is that the discussion keeps moving away from the concept of the postal network as a national asset and towards the idea of the Postal Service as merely another competitor in the marketplace.  Nowhere is this clearer than in the provisions of PAEA that call for distinguishing between market dominant, i.e. monopoly products, and competitive products.

Mr. Comarow actually decries the provisions in PAEA that create this distinction.  He speculates that administering these provisions would create an expensive nightmare and that accounting for them would be arbitrary and less transparent.  He would prefer that the Postal Service be given a broad, unregulated mandate to compete in many product areas.  He bemoans the fact that Congress has decided to insert itself on a relatively micro level in determining what the Postal Service can or cannot do.

To a large extent I agree with Mr. Comarow, although the results of our agreement take us in completely different directions.  PAEA has created an incentive for the Postal Service to shift as many products as possible into the competitive products area.  This has the effect of undermining universal service, since the determination that some products are competitive and some are the results of the monopoly leads to some rather perverse behavior.

For years the Postal Service has been criticized for the scope and shape of workshare discounts.  Most of these discounts apply to market dominant products, but for the purpose of this discussion they provide an example of a clear motivation on the part of the Postal Service to jettison its internal labor in favor of outsourced labor.  Actually many of the constraints the Postal Service operates under work towards this end, although to hear the critics in the mailing industry tell it, the nefarious powers of labor lie at the heart of most postal problems.

 

The attack on the worker

This country has a long and schizophrenic history of how it views labor.  We celebrate the yeoman and the craftsman and the fellow that works with his hands, and yet the objective of some has been to ensure that labor receives the narrowest of rewards for its efforts.  This has certainly been true in the last forty years, as we have used the excuse of free trade to place our laboring classes in direct competition with those in underdeveloped economies while offering extreme protections to those in the professional classes.  We claim that free trade in the manufacture of goods is a benefit yielding cheaper prices, but we put limits on the types of competition our capital and professional classes face.

The fifty years prior to the Great Depression was a story of labor struggling to find an equitable voice in the economy it helped create. The vagaries of the Depression brought reforms in labor markets that helped ensure a generation of prosperity.  Over the last forty years there have been many who have tried to undo those gains. Certainly that is no more obvious than in the postal labor market, where the ascendance of unions has led to cries of unfairness and predictions of disaster.

At its height the Postal Service employed nearly a million workers, and they earned wages and benefits that allowed them to fully participate in our consumer economy.  In an economy based on consumption, the well-paid and secure worker — not government or the wealthy — is really “the job creator.”  The workers spend their wages on goods and services, thereby driving both profits and employment.  Henry Ford understood this idea when he insisted on paying his workers a living wage so that they might be able to buy the automobiles they produced.

While the Kappel Commission agreed to the premise of collective bargaining, the prevailing view has remained that postal labor must be reined in and essentially destroyed.  Rather than being recognized as a valuable infrastructure that provides broad employment opportunities for veterans, people of color, and those seeking upward economic mobility, the post office is criticized by big mailers for being a “jobs program.”  They think that because the Postal Service is sustained by their revenues, the infrastructure exists only for their benefit, and they certainly don’t want to pay rates that are inflated by the high costs of overpaid workers.

On face this is a self-serving argument that elevates the needs and wants of the ratepayers above those of the nation as a whole.  It narrows the class of “stakeholders” to the big industry ratepayers and excludes the general public.  It says ratepayers should be the ones to dictate costs, and cheaper labor leads to cheaper costs.  Hence the justification for workshare discounts.

Quite simply, these discounts have not paid their way.  They do not justify the revenues sacrificed at their altar.  But workshare discounts do move the institution further from a basis of infrastructure.  They create the impression that the Postal Service is merely a mailing vendor that ought to be in constant negotiation with a narrow class of customers, the mailing industry that designates itself as the premier stakeholder.

The Postal Service has generally maintained the lowest mailing rates in the world while providing substantial and economical employment that creates benefits throughout the economy.  Yet somehow that isn’t enough.  Hence workshare discounts that don’t pay for themselves and now the rush to move various postal products into competitive classes.  Merely succumbing to the idea that the mails are simple products leads one further away from the true mission of the institution.

 

Classification cases at the PRC

The current PRC docket is littered with cases that seek to move classes of mail out of the category that supports the idea of the postal network as a universal infrastructure.  These include parcel post, first class domestic and international parcels, and post office boxes.

These PRC cases are generally docketed under the category of mail classification combined with competitive products.  They contain the aforementioned classes as well as requests for NSAs and various discounts like those awarded to mailers who insert a mobile barcode on mail that sends recipients to a company website.

One of the most salient characteristics is that the information in the dockets is most often filed under seal.  This means that all the details of the particular contract, including rates and other processing information, are redacted from public inspection.  In these cases the Postal Service will file an attachment entitled “Application of the United States Postal Service for Non-Public Treatment of Materials.”   (An example is here.)

The above file contains a request for approval of a first-class package requirement.  As one reads through it, one finds that any meaningful details have been redacted.  You’ll find paragraphs like this:  

A paragraph like this is actually included in every one of these cases.  It is a statement that assures us that the contract involved covers certain institutional costs, but of course you can’t tell which ones.

Attachment F in this particular document is the application for non-public treatment.  It assures us that revealing information like whom the contract is with might cause “proprietary damage” to the Postal Service.  We’re also assured that we could learn everything we needed to know about this contract without seeing the redacted stuff, although I have a hard time understanding a contract without numbers, names, or any specific information.

 

Calculating the costs of reclassification

If we look at other documents in the docket, we’ll find a statement from the PRC’s public representative that assures us that he or she looked things over and found everything to be hunky dory.

The PRC has some wonderful folks working for it, and by all estimates they do a thorough job, but the fact that they are the only ones who know what’s in these various dockets creates a bit of a tautology: it’s ok because its ok. There really isn’t any independent confirmation, and there is absolutely no transparency.

Transferring a product from the market-dominant to the competitive list gives the Postal Service greater pricing flexibility, since the only constraint is that prices must be set to recover a defined percentage of institutional costs.  Institutional costs are defined as a figure that apportions all of the various overhead costs that go into the postal network to each product.  It involves a daunting series of calculation with arguable accuracy since the assumptions and methodology mean everything in terms of the eventual answer.

Transferring a product to the competitive list allows the Postal Service to raise prices at its own discretion and to be more flexible in adding and subtracting various enhancements and services to the particular product.  From a broader perspective, every product transferred to the competitive products list goes a little more towards undermining the defining characteristic of the Postal Service as infrastructure. Every transfer makes the Postal Service look more like a generic delivery company and has the potential for undermining revenue just a little bit more.

In last year’s docket MC 2011-25, the Postal Service requested permission to transfer post office box service at several locations to the Competitive Products list.  The justification for this move was that the areas in which the post office boxes were located were served by CMRAs (Commercial Mail Receiving Agencies) companies like Mail Boxes Etc. The Postal Service argued that by transferring PO box services to the competitive category, it could price the boxes better, i.e. higher, and offer enhanced services, like sending an e-mail telling the customer they have mail.

One would think that those in the private sector might applaud this move.  First, it satisfies the fundamental principle of moving postal services towards a privatized model, and second, if the Postal Service charged higher prices, the private vendors would be more competitive on price.

What actually happened, however, was that the private vendors filed a complaint arguing that the new service was too good and had too many features. That resulted in a docket, MC2012-26, that’s based on the vendors’ complaint.  It all gets very costly and contentious, which speaks directly to the futility of PAEA.

An interesting detail that has surfaced from the above docket is that the Postal Service has lost 66,000 boxholders since implementing the transfer.  In other words, the change has likely cost the Postal Service revenue. That may not be so unusual.  There have been intimations that some of the other transfers from market dominant to competitive products, especially some of the NSAs, have not added anything to the bottom line and may be costing revenue.

There’s supposed to be an accounting of these agreements each year but much of that takes place in the netherworld that is bureaucratically known as “under seal.”  And of course there’s always the issue of complexity in the accounting methodologies that sorts all these things out.

Another result of these agreements is that elements of the mailing industry end up getting pitted against each other.  It’s often hard to feel much sympathy for members of the mailing industry that claim distress from the very policies they’ve advocated, but there is one docket that bears watching because it speaks to another element embodied in a postal network designed as an infrastructure to enhance the public good.

 

Newspaper story

Throughout the history of the Postal Service and its predecessors, newspapers have received special treatment in mailing rates.  One of the goals of maintaining a robust postal network is to enhance the transfer and circulation of opinion, news, and information.  This fundamental public good has served our democratic ideals well.  The Postal Service has provided an open and accessible network for the distribution of opinion and educational materials, and it has done so very effectively.

I suppose that some will argue that newspapers are a dying business and that print generally is a losing technology.  The advertising mail industry would try to convince you otherwise, claiming that many studies show that people view printed material with a more serious eye then advertising on the web.  Beyond that, printed journalism may be suffering from an economic shift, but it is not dead and more important it is still an essential component to our public discourse.

Many books have been written on the subject but one of the most important is, The Death and Life of American Journalism by Robert McChesney and John Nichols.  If I understand it correctly, one of their arguments is that we shouldn’t be too quick to consign the newspaper to the dustbin of history and that there are shifts in the economic models that would preserve this essential component of the American intellectual and political landscape.

I live in a rural area that relies heavily on its local newspaper.  While there’s a version on the Internet, the vast majority of the local paper’s readership prefers the print version.  More important, the local paper is the only good source of local political news, often the only thing that keeps some of our local politicians honest. It’s an essential institution, and it relies heavily on the Postal Service for its survival.

There is currently a fashionable argument that government shouldn’t pick winners and losers. I don’t buy that.  Government helps define the society we live in by making choices.  Politics, at its very heart, is about making choices and selecting priorities, and the Postal Service has an important role in protecting some of the political choices we make.

Universal service is a political choice. The idea of promoting and protecting the free exchange of information and discussion is a political choice.

Over the course of our country’s history we have decided, for important and valid reasons, that newspapers and journalism are important.  We’ve also decided that supporting a strong non-profit sector is important.  In both of those instances and in others, such as free matter for the blind, we’ve used the Postal Service to help enhance and further our priorities, our political choices.  We’ve done this by mandating preferential rates for certain classes of mail, another consequence that arises from treating postal services and the postal network as infrastructure.

In docket R2012-8, Valassis, a very large sale paper mailer, is being offered a special contract rate based on certain increased volumes.  The newspaper industry, primarily represented by NAA, the Newspaper Association of America, opposes the NSA because the newspapers feel it will hurt their revenues.

Sale papers are the bundle of ads, come-ons, grocery coupons and the like that get stuffed in your box once a week or so.  Newspapers tend to make a good bit of revenue by including these things in their editions, especially Sunday editions. The contention is that if Valassis is given special, preferential rates, especially rates based on increased volumes, then it may cause advertisers to take this business away from newspapers.

Many might think this is much ado about nothing since the first thing a lot of folks do is remove the sale paper from their box or the inside fold of the newspaper and deposit it in the recycling.  I once did an informal study at my post office and for a year I counted what happened to the circulars.  I found that about 90% of the circulars never made it out the door.  

 

Discounting the public good

Regardless of personal experience these sale papers must get responses because the industry is a multi-billion dollar concern.

Several questions come to mind.  Will the Valassis NSA actually benefit the Postal Service? Will the decreased pricing drive enough increased volume to actually increase overall revenue?  How do you determine what Valassis’ intent really was?  Did they ask for cheaper prices knowing they were going to mail more anyway?  Is your cost structure well enough defined to allow you complete certainty that the very cheap prices being offered actually recover the basic costs of delivering the pieces?

Then there are a whole series of questions regarding how this impacts the newspaper industry.  Will the Valassis deal hurt the newspaper industry such that its mail volumes may decrease, thereby negating any additional revenue impact from the deal?  Will the Valassis deal somehow harm the newspaper generally in a way that has a negative public or social impact on a critical industry?

It’s likely that after deducting the possible drop in newspaper mailing revenues, the Valassis deal would have such a minimal positive impact on long-term USPS revenues that it isn’t worth the effort.  Still, we shouldn’t take the question of reduced public or social good lightly.

From workshare discounts to the complicated accounting for market dominant versus competitive products, from the inherent problems embodied in some of the discounts that are being offered to the increasing complexity and buried advantage that lies within the postal rate system, PAEA made a mess of things. The underlying impetus of PAEA — turning the Postal Service into a more competitive and supposedly healthier organization — has actually weakened an essential national resource and diverted our attention away from some fairly basic and fundamental questions.

If we’re going to give into our lesser, menial selves then we can probably agree that the discussion is over right now.  If we continue down the road begun with the Kappel Commission, a road that has brought us to the bastardized postal market of PAEA, then we should probably agree to throw in the towel and simply privatize the Postal Service.  Even progressives would likely agree that under those circumstances of intellectual cowardice and surrender that continuing down the current road will lead to a costly dissolution of the postal network.  Rudely put, if we’re going to screw ourselves anyway, then let’s get some value for whatever the current network will bring.  Let’s make the same calculations that any venture or vulture capitalist would make and move on to the next problem.

I’m hoping that we haven’t become so cynical and devolved that we’ve reached that point.  I’d like to think that we could recognize that there’s a valid and important discussion to be had about the value of the postal network and what’s left of the Postal Service.  I would like to think that we could move off the terms so erroneously set by Kappel in 1968 and lay down the banner that Pat Donahoe has carried with such mediocrity and move to a serious discussion about our national values.

Starting from a fairly narrow view we can see that the current delivery market is basically an oligopoly consisting of FedEx and UPS.  In a recent video to postal employees, the PMG described how volumes in the parcel and shipping market are expanding. “We are riding the e-commerce wave,” said the PMG, recognizing, perhaps a bit belatedly, that the postal network has a unique and penetrating last-mile presence.

 

In defense of public jobs

Perhaps our first question has to be whether we are willing to view this last-mile presence as a form of infrastructure or if, as we have done with broadband delivery, we are going to allow the market to consolidate to a point that causes us real national pain.

Next, maybe we could have an enlightened discussion about the value of employment in these United States.  The people who have fraudulently usurped the title of Job Creators haven’t done much with their charge. These are the same people who have berated and undermined public employment, thereby eroding any job gains made during the last four years. The simple fact of the matter is that unemployment is stagnant because for every job the private sector adds we’re losing public jobs.

Public employment for its own sake isn’t a very smart way to go, but we’re undermining, actually destroying, our intellectual and human infrastructure by letting teachers, police officers, and yes, postal workers go.  The Postal Service once employed 825,000 people and it did so both productively and responsibly, offering wages and benefits that were a model and also sustained local economies.  And those jobs were not only useful but they were fully paid for.

Abandoning those jobs and the potential they offered only makes sense if we are going to accept the stilted and stunted logic of the ratepayers who co-opted a national infrastructure and turned it into their pet delivery service.

So yes, let’s have that important and thoughtful discussion about the value of public employment and the way it sustains and promotes infrastructure while adding to the potential of our consumer economy.  For those who think the discussion is one-sided, let’s make sure we include a discussion about the limits and constraints of public employment because, yes, those do exist.

Let us then move on to a discussion that examines our national priorities in a clearheaded and honest way.  If open communications and the free and broad dissemination of information are important, then let us find ways to support both the underlying ideals and the infrastructure that sustains those ideals.

Let us talk about how we treat non-profit entities.  That’s a long overdue discussion.  Mr. Comarow resents paying for charities and non-profits he doesn’t support.  I do too, but I also recognize that the non-profit sector of our economy provides some very valuable additions to both our economy and society.  Like many aspects of our current world, the non-profit sector has become self-interested and self-referential, so perhaps we can begin to address the ills of a me-first society in the context of the sector that isn’t supposed to be that way but often is.

How we treat and resolve the issues surrounding postal services in this country can be a very clear indicator of how we define ourselves as a nation and a people.  I cannot think of a much greater goal to aspire to than binding the nation together.  “E Pluribus Unum” — from the many one — is an ideal that has allowed this country to become the wealthiest and at times the fairest mankind has known.  Over two and a half centuries we have confronted many horrendous national demons.  Perhaps none is more challenging than the fear of decline that leads to unbridled self-interest and the cynical destruction and debasement of our national institutions.

[Mr. Jamison recently retired as a postmaster for the US Postal Service.  He can be reached at Mij455@gmail.com.]

(Image credits: Fred Kappel on Time; Murray Comarow; "Boston Post Road" by Carl Rakeman; "Mailbox Soldiers" by Neil Burrell; US broadband map; Valassis RedPlum ads)

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Also: Sarah Ryan's "Understanding Postal Privatization: Corporations, Unions, and the "Public Interest"


 

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