Posted on 10/21/2021 4:58:15 AM PDT by Kaslin
Postmaster General Louis DeJoy has entered the spotlight once again following a lawsuit filed earlier this month by 20 state attorneys general, who are aiming to stop his 10-year plan to reorganize the U.S. Postal Service.
It is fair to conclude these 20 attorneys general, all Democrats, are going after him in part because he was appointed by President Trump. But it’s also fair to say that DeJoy’s plan appears to exacerbate many of the problems it was supposed to address.
The Postal Service has two lines of products, basically – one that is monopoly protected and one that sells what it calls competitive products. Under the first umbrella is first-class mail and the right to put things in a US mailbox. Under the second comes its growing package delivery business.
The Postal Service loses $9 billion per year, and it can’t seem to turn this around because it refuses to honestly assess the costs of providing its competitive products. Packages generate nearly 40 percent of revenues for the Postal Service, but they are required to bear only 8.8 percent of institutional costs.
Moreover, the Postal Service pays no property taxes on its facilities and has access to loans no other vendor can receive. Congress approved $10 billion in financing this year, then canceled the Postal Service’s repayment requirement.
A new study shows the Postal Service has sold its competitive services – package delivery mainly – for less than what the services cost. So basically, our mail costs more and comes later so the Postal Service can afford to undersell FedEx and UPS and build its package business. According to the study, to ship a 2-pound overnight box from New York to Miami would cost $106.94 for FedEx and $114.74 for UPS but just $46.20 for the Postal Service.
The surprise then is not that its market share has climbed from 1.75 percent in 2010 to 15.6 percent in 2020, it’s that it hasn’t climbed more.
It’s certainly not productivity that allows the Postal Service to charge so much less than its competitors. The Postal Service’s annual productivity gains have averaged just a sixth of those of its commercial competitors over the last 30 years, labor costs have climbed at almost twice the rate of commercial competitors, and Postal Service on-time delivery rates have plummeted from 92 percent in 2019 to 73 percent in the first quarter of this year, even as mail volume has gone down another 14 percent.
The pandemic did not much affect mail service quality – there are no rises and dips that correspond with rising and falling caseloads. And the biggest decline in delivery times came after the 2020 election, meaning mail-in balloting can’t be blamed for the declines.
What has changed and brought deteriorating service is the increased emphasis on package delivery. Mail volume went down 10.7 percent in 2020 as Americans increasingly paid their bills online and sent fewer letters or Christmas cards. Package delivery went up 18.8 percent in 2020 – the Christmas rush essentially began in March when Americans found themselves with time on their hands to shop online and still has not abated.
Now, the Postal Service has decided to double down on this. It is purchasing a line of new trucks to accommodate its increasing foray into the package delivery business. It is retrenching on delivery times, adding a half-day to a full day of extra time for what it considers on-time delivery. It has raised rates twice already this year and has hinted more rate increases may be in store.
It’s not known how the new revenue will be spent, but it’s unlikely it will go to improve service. The Postal Service raised rates five times from 2011 to 2020 for a total increase from 44 cents to 55 cents for letters. But during that time, on-time performance suffered even as volume declined.
Resources were directed to enhanced package delivery because this has become the Postal Service’s priority. The question is: Given we have ample package delivery companies in the country and only one entity that can deliver first-class mail to all 155 million addresses in the US, should the Postal Service not focus on doing what we need it to do – efficiently, cost effectively – instead of the business it wants to be in?
If DeJoy wants to survive the onslaught of opposition that threatens his every move, that would be the question to get right.
That increase mostly comes from Amazon. Our mail carrier is now called the Amazon Lady after last Christmas.
All of the several pieces of “mail” we received yesterday...went straight to the trash.
I don't even bother going to the mailbox but once a week. All my bills are electronic. About the only actual mail I receive is an occasional communication from the SSA. Sucks being old. Where are those love letters that I received as a young man?
Another product that the Postal Service refuses to charge what it really costs.
Presorted business mail can cost as little as 19 cents a letter, where First Class postage is currently 58 cents.
Going to a 4 day a week delivery would be a good place to start
...and I’m sure everyone here has heard the story floated recently, that the USPS wants to get into the banking business.
Entities who do a large volume of mailing DO NOT PAY the full rate for stamps. I have seen envelopes with as little as 35 cents when I paid 55 cents. Hospitals-—States—Counties—all get a MASSIVE break.
Meanwhile-—MY car registration tags & records were ‘lost in the mail’...and in the same 60 day time period, so were my those of my neighbor across the street. Required a 70 mile round trip drive & 45 minutes at DMV to get a replacement set.
SOMEONE in the USPS is filching these tags.
I some rural areas, mail is delivered only 3 days a week. One lady does 2 routes in Wyoming.
MON-WED-FRI for one route
Tues-Thurs- Sat for the other.
Her routes are 98 & 101 miles .
When was the last time you sent one?
The Post Office illustrates how poorly big government manages large operations like big government, quite poorly.
Nonprofit? As low as 9.2 cents per piece in the US. That's for as much as 3.5 ounces delivered. Did USPS create that discount? Nope, Congress did. Oh, and guess who's qualified to send nonprofit rate mail? Yep, political action committees, registration fishing, etc.
But yeah, totally undercharging for packages (which isn't actually true when you look at the quarterlies, it's almost universally political mail where USPS is taking it in the shorts.)
As for ‘slowing mail’ - the DOJ has 85 active investigations where airline carriers are charging USPS for transporting mail on a timely basis - and just leaving it on the tarmac, sometimes for a week at a time. Translating to a truck distribution network (where admittedly, the bulk of it is nonprofit or other STD rate mail) is actually getting mail to destinations faster.
Who's the biggest objectors? Nonprofits, political action committees and bulk mailers. They liked the convenience of being able to print a mailing, dump it on their local distribution center and have USPS deal with distributing pallets of junk across the country, where things (as designed) could go from idea to in a person's mailbox in 3 days.
The Postal Service illustrates how much government can strangle an organization with oversight and regulation, especially controlling postage prices, most especially that prime 9.2 cent rate for the messages from the party congressional reelection committee.
I still want to know how much the Marines are in the red budget wise; should they start selling Marine Scout Cookies door to door? The most common vehicle used by USPS is old enough to be elected to congress, the average age of our sorting equipment is old enough to vote. Most likely the last time your local post office was updated was when Ronald Reagan was president.
When USPS reports they’re 9 billion in the hole, the majority of that is paper loss for a prefunding mandate to prefund retirement benefits 65 years into the future. (Thanks Biden for that.) Forestry service gets 19 billion from FEMA for PPE expenses and costs to arrange work from home for their employees, USPS gets a 10 billion dollar loan for 10 times the number of employees and 30 times the number of offices. (That loan was eventually forgiven..)
USPS would be in the black tomorrow if the nonprofit rate was removed (and you’d receive about 1/3rd less mail on a weekly basis.)
Fire all the union parasites! Clear the USPS facilities! Burn it all to the ground. Who needs it anymore.
Nuts.
Under the second comes its growing package delivery business.
I ship packages via UPS and FedEx it’s cheaper and a lot faster.
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