December 1, 2013
The arrangement between the Postal Service and Amazon to deliver packages to members of Amazon Prime on Sundays continues to make news, but details about the deal remain scant. In a post a few days ago, we speculated about how much the Postal Service might be making, and we took a look at a PRC docket that might have been about the Negotiated Service Agreement (NSA) on the deal. We were wrong on both counts, but not by much.
It looked like the deal was covered in Docket Number CP2014-3, which was about an NSA that was approved on November 7, just a few days before the Amazon deal was announced. This NSA involved Priority Mail, which one assumed was how Amazon would be able to ensure that orders made on Friday would be delivered on Sunday.
As it turns out, however, Amazon will be mailing its parcels using the much less expensive Parcel Select, as we learned from a reader who also pointed us to the correct docket, CP2014-1. Not that the docket reveals very much. The language in the filings is very vague, and the USPS-Amazon contract included in the docket is almost entirely blacked out (as you can see at the bottom of this post). The PRC approved the Amazon NSA on October 29 in Order No. 1863.
Retired postmaster Mark Jamison, who has contributed to a number of PRC dockets and who writes regularly for Save the Post Office, has requested permission to see the non-public materials in CP2014-1. Amazon and the Postal Service have filed comments opposing his request, and it's not certain what the PRC will do. Even if he's granted access, Mr. Jamison will not be permitted to share what he learns, so all we can do is continue speculating.
Parcel Select gets priority
Parcel Select is a workshare program that provides the Postal Service’s lowest-cost ground shipping option. It’s the means by which FedEx and UPS use the Postal Service for “last mile” delivery of their packages. The big mailers, consolidators, and private shippers presort the parcels and deliver them to the Destination Delivery Unit (DDU) or another entry unit from where they are often delivered in a surprisingly speedy way.
Parcel Select generally takes two to nine days, but if the shippers get the parcels to the DDU by a certain time — Early Bird DDU — the Postal Service can often provide same-day delivery. Regular DDU — dropping off the parcels after the carriers have left — usually means next working day delivery.
For orders placed on Friday, then, Amazon just has to get the parcel to the DDU on Saturday to be reasonably certain of Sunday delivery. That’s about as fast as Priority Mail, the service available to average customers who want speedy delivery. It’s also much less expensive than Priority, since under the workshare system, Amazon can do the presorting in its giant warehouses, where non-union workers are paid far less than USPS employees. (For more about Amazon’s anti-union policies, low-wage jobs, and the conditions in its warehouses, check out this piece on Huffington Post and this Salon article about Brad Stone's new book on Amazon.)
Apparently Sunday delivery for Parcel Select has been in the testing stage for many months. In early February 2013, when the Postmaster General was on TV explaining why he wanted to eliminate Saturday delivery, he also revealed that the Postal Service had plans to start delivering parcel on Sundays. That same month, some communities in Missouri and Kansas got Sunday delivery. It has also been going on a while in other locations, like Delaware and northern New Jersey, perhaps because they are near Amazon warehouses.
The minutes of a meeting of some focus groups of the Mailers Technical Advisory Council (MTAC), also held back in February 2013, explain some of the details of the program. They indicate that the Sunday delivery service requires regular postage plus a special fee; it applies to Parcel Select initially, with the hope of expanding to other products later; parcels can be dropped at the DDU on Saturday or Sunday; and an NSA is required.
According to an internal USPS memo dated October 8, the Postal Service is also testing Sunday delivery for Parcel Select in more than 900 ZIP code areas working out of 250 hubs, using low-wage city carrier assistants and rural leave replacements. It’s not clear from the S.O.P. instructions if the test is limited to Amazon, but for now at least, Sunday delivery is strictly for commercial shippers using Parcel Select.
November 27, 2013
The new Harry Potter stamps were released last week, but you can’t get them at just any old post office. You’ll need to travel to one of the 3,100 post offices that the Postal Service has designated as a Premier Post Office. A list of them, along with a map, can be found on Google Docs here. (The original source is here.)
The new issue has been greeted with controversy because the Citizens’ Stamp Advisory Committee, which evaluates the merits of stamp proposals, did not approve Harry Potter. The CSAC was not even consulted on the selection. The decision appears to have been made by Nagisa Manabe, the Postal Service's marketing director, who has moved the stamp program into her department. CSAC’s role has subsequently been reduced, and the subjects for stamps have tended to become more commercial, like the Beatles and Rudolph the Red-Nosed Reindeer.
The CSAC is not happy with its new role in selecting stamp subjects, and in September all thirteen members walked out of their meeting. In a letter to Postmaster General Donahoe, CSAC complained that the committee no longer represented "the very citizens it was designed to serve."
The problem with the Harry Potter series was summed up by John Hotchner, a former president of the American Philatelic Society, who served on the CSAC for twelve years until 2010.
“Harry Potter is not American. It’s foreign, and it’s so blatantly commercial it’s off the charts,” said Hotchner. “The Postal Service knows what will sell, but that’s not what stamps ought to be about. Things that don’t sell so well are part of the American story.”
There's another problem with the Harry Potter stamps, but this one hasn't gotten much attention. The Postal Service is not making them available everywhere at the same time.
The stamps are for sale at usps.com/stamps, at the Postal Store on eBay at ebay.com/stamps, and by calling 800-STAMP24. But if you want to buy the stamps at a post office, you have to go to one of the 3,100 Premier Post Offices.
The Premier Post Office program, which was announced in May 2011, consists of about 10 percent of the country’s 32,000 post offices — those that generate a significant amount of revenue. Together they account for 44 percent of all walk-in and self-service kiosk revenue.
The purpose of the program is to improve the customer experience and maximize revenues at these offices. Retail associates at Premier Post Offices are given guidelines to standardize how they deal with customers, they are taught telephone courtesy, and they participate in the “It Begins With a Smile” initiative. Premier Post Offices also get extra maintenance, inside and out, and there’s a certification program in which successful post offices are awarded Bronze, Silver, and Gold.
The Harry Potter series appears to be the first time that Premier Post Offices have been given the opportunity to sell a new issue before other post offices. That should be a matter of some concern.
November 26, 2013
INTRODUCTION BY MARK JAMISON
For the past couple of weeks, the media have focused, almost obsessively, on the assassination of President John F. Kennedy, November 22 being the fiftieth anniversary of his death. I found myself wandering through some of JFK’s speeches and came across his commencement address at Yale University, delivered on June 11, 1962.
In this speech President Kennedy focuses on three questions — the size and shape of government’s responsibilities, public fiscal policy, and confidence in America. In all three areas, he says, “there is a danger that illusion may prevent effective action,” and his speech seeks to distinguish myth from reality and to “separate false problems from real ones.”
As I read the president’s words, I saw obvious parallels to the situation we find ourselves in today, particularly with respect to our approach to solving the problems of the Postal Service. While we choke a great national institution and an essential piece of our infrastructure, trying to force it into a mold it can never fit, we also eliminate hundreds of thousands of jobs, dismiss opportunity for future generations, and, worst of all, abandon the basic principles of our country’s founding.
The populist demagoguery of the Tea Party enflames Republicans to rhetoric that portrays government as bad. The result is predictable — bad government. Most Democrats are not much better, seeing government as the handmaiden of corporate America, forgetting that this country is more, much more than a series of stakeholders and special interests. We may be a melting pot of people and interests, but the whole has always been greater than the sum of those parts — something we seem to have forgotten.
In this speech President Kennedy talks about the myths that obscure reality. He questions the myth of big government and, by implication, the related myth that government ought to be more like business. He takes on myths of budget and fiscal deficits, the very ones that drive our thinking today, like the myth that taxpayers would rather see government operations privatized than pay for them, which is used to excuse the expropriation of public services and goods. He also speaks passionately of employment, full employment, as the engine that drives our economy.
The problems of the 1960’s are not the problems of today. In many ways, we have regressed to 1929, or perhaps to an even earlier time, the Gilded Age of the 1890s. Though our problems may be different today than the one’s President Kennedy discusses, they are not all that dissimilar. I have argued in many posts here on Save the Post Office that the problems facing the Postal Service and the proposals to solve them are a reflection of our greater economic problems and the way we have approached them. Millions are without employment, yet we cut hundreds of thousands of jobs. Our infrastructure crumbles, and our approach is to privatize it. Our safety net is shredded leaving millions more vulnerable, and our answer is demand even further cuts. Wages and opportunity are stagnant, yet an increasingly small number of us are doing quite well, demanding and taking an ever-greater slice of the economic pie.
President Kennedy ends his speech with a call to arms. I don’t believe it is the same cynical and nihilistic call that drives much of our political discourse today — the call of “I’ve got mine so cut everything and everyone that is not of direct benefit to me." In his inaugural address President Kennedy asked us to remember country and community. It is past time that we began rebuilding this country, our economy, our infrastructure, our confidence, and yes, our Postal Service, in ways that benefit the great mass of Americans and the communities they live in — that should be our call to arms.
We would do well to listen and reflect upon these words of President Kennedy. Here’s what he told the graduating class that June day. (Some introductory and miscellaneous remarks have been edited out. The full text can be found here, and an audio version of the speech can be found here.)
November 20, 2013
Last week the Postal Service announced that it would be delivering packages for Amazon on Sundays, but only to Amazon Prime members (or those willing to pay extra), and only to customers living in New York and Los Angeles. The premium service will eventually be extended to some other big cities, but it’s not likely that those living in medium-sized cities, suburbs, small towns, and remote areas will ever see Sunday delivery.
The practice of providing a product or a service to only the most profitable markets is called cream skimming. It’s one of the main concerns about privatization. If Amtrak, for example, were to be privatized, the country would end up with a train system in the Northeast Corridor, running lines between Boston and DC, and not much else.
If the Postal Service were privatized, there are similar concerns that rural and low-income urban areas would get less service than upscale urban areas. One of the purposes of the Universal Service Obligation is to prevent just that. The USO is supposed to ensure that the Postal Service doesn’t cherry-pick the most profitable markets, products, and services. Everyone gets the same service at uniform prices, and the profitable areas subsidize the others.
The Postal Service hasn’t been officially privatized, but it’s getting there. It has become liberalized, marketized, and commercialized, and along the way, the meaning of the USO keeps getting reinterpreted. It becomes less "universal," the scope of “service” gets narrower and narrower, and instead of fulfilling an obligation when it delivers on Saturday or maintains rural post offices, the Postal Service acts as if it’s doing people a favor.
The signs of commercialization are everywhere. Just this week, the Postal Service put contract post offices in Staples and Harry Potter on a postage stamp. With the Amazon deal, the Postal Service is skimming the cream, just as if it had already been privatized.
A win-win but weird
Even though the Amazon deal seems to fly in the face of the USO, no one is complaining — at least so far — and it looks to be a win-win for everyone.
Amazon will sell more Prime memberships (at $79 each), and these members will buy more of its products. The deal may also help the company maintain a competitive edge against Google, E-Bay, and Wal-Mart, which are experimenting with same-day delivery (as Amazon does in a few cities).
It’s also a win for the Postal Service, which says it will make a good profit on the deal, though it refuses to say how much. The unions have endorsed the deal too because it means more work for letter carriers — even though most of them will be non-career carrier assistants.
Everyone seems to think the deal is just a great idea. Politicians like Senator Tom Carper are applauding it as a sign that the Postal Service can be “innovative," and the news media are filled with articles about how Amazon will "rescue the Postal Service” and “save the post office.”
But is the Amazon deal really a win-win for everyone? Is it truly a good idea for the Postal Service to deliver packages for just one company to just one particular geographic segment of the country, and only to those affluent enough to be members of Amazon Prime? Even the business magazine Fortune was led to ask rhetorically if it wasn't a little “weird” and “unsettling” for a private corporation to be “hiring out a government agency as a contractor.”