Sunday, January 7, 2007

Top Five Companies We’d Be Better Off Without, #1: The U.S. Postal Service

Author: Nick
Category: Money
Topics:

flyyy like an eagle... into a brick wall

Who would’ve guessed that the #1 company we’d be better off without is a government-owned corporation? (Okay, you can put your hands down now.)

Worse than any monopoly in United States history–yes, worse than Microsoft, Standard Oil, or even Major League Baseball–is this behemoth delivery service which will forever elude antitrust laws because it has the blessings of the federal government.

And why shouldn’t it? After all, think of everything the Postal Service does for us:

  • Delivers a letter anywhere in the country for under 40 cents. That figure will probably be out of date by the time I post this article, but USPS can do amazing things for dirt cheap.
  • Brings communication from the outside world to your door almost everyday. Heck, most people don’t want to see you even once a week, and these guys stop by six times that!
  • Puts up with your crappy handwriting. There are two people in the world who can read my handwriting: the first-grade teacher who taught it to me… and the United States Postal Service. It’s a miracle my hand-addressed envelopes make it to the right state, let alone street.
  • Provides employment for the mentally ill. Ha ha ha, just kidding on this one. Still, USPS is the third-largest employer in the country.

I must be out of my mind to nominate our beloved Postal Service as the top company we’d be better off without.

But don’t worry, I have my reasons. And now… let them be known to the world!

  • USPS has a total monopoly on non-urgent first-class mail. Wanna send a letter to your grandma in Some Town, Wisconsin, telling her how you aced your Differential Equations exam? It’s gotta go through the United States Postal Service. Absolutely nobody else is allowed to deliver standard first-class mail except those men (and women) in blue. Well, blue-gray.
  • Only USPS can touch your mailbox. Ever wonder why UPS will leave a tiny package on the ground even in a torrential downpour rather than stick in it the safety of your mailbox? That’s because the law says your mailbox is off-limits to all but the Postal Service. The penalty for breaking that law? Death by firing squad. Ha ha ha, just kidding again. I love postal worker jokes.
  • By law, potential competitors must charge at least $3 to send urgent letters. So even if FedEx wanted to charge you a buck to send your mail overnight, it couldn’t.
  • The reasons for the USPS monopoly are anti-capitalistic. All of us Americans pay 39 cents to deliver a letter from one point in the U.S. to another. But why should we pay the same to mail a letter to the other side of town as we do to send one to Middle of Nowhere, Montana? If the majority of your mail is paying local bills or sending letters within your state, and unless you live in some out-of-the-way area where your nearest neighbor is three miles away, it probably costs a few pennies for USPS to send each letter. You pay more to cover the cases when someone in Mountaintop, Colorado, wants to send a letter to his cousin Cletus in No Paved Roads, Alabama. An end to the Postal Service monopoly could cut the median American family’s yearly mailing costs in half or better.
  • USPS answers obsoletion with price increases instead of innovation. As e-mail quickly replaces first class mail as the standard form of written communication, and with other carriers doing a better job on urgent mail, USPS finds itself faced with eventual obsoletion. But rather than downsize its operations or look for ways to innovate and become competitive again, the Postal Service simply raises rates every so often to put a heavy tax on those letters you still need to send on occasion. If the business of sending mail were deregulated, competition would force companies to find new ways of doing business before passing on the extra costs to its customers. At this rate, you may only need to send one letter every year in 2030, but USPS will probably charge you $86 to do it!

Don’t forget to check out the other articles in the Top Companies We’d Be Better Off Without series:

Now it’s your turn! Comment here if you agree or disagree with any of these choices or their order. Alternately, you could send me a letter with your thoughts, but don’t be surprised if it “disappears” at your local monopoly–er, post office.

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