December 20, 2009

THE FOUNDERS RECOGNIZED IT TO BE A CORE FUNCTION OF GOVERNMENT...:

Time to privatize the Postal Service? (David Lazarus, December 20, 2009, LA Times)

I called FedEx and asked if they wanted to take over the postal service.

"That's not something we would comment on," a company spokeswoman, Ann Saccomano, cagily replied. "It's speculative."

A UPS spokesman, Norman Black, was more forthcoming when I put the same question to him.

"We believe that the government plays a role in terms of ensuring that every mailbox is reached every day," he said. "That is not a responsibility that UPS would want."

That makes sense. The big private shippers probably would be happy to cherry-pick profitable urban routes but would want nothing to do with having to schlep mail up and down unprofitable rural roads.

It seems to me that the only privatization scheme that stands even a remote chance of working would be to break the postal service network into hundreds of regions and territories, and then have local companies compete for mail-delivery rights in each area.

But you'd still have to wonder how any such private-sector players would be more successful at the game than a long-established heavyweight like the postal service.

"If the system was privatized, it might cost 44 cents to get a letter across Los Angeles but $5 to get it to Connecticut," said Maher, the postal service spokesman.

"When you think about a network that delivers to all homes every day -- it's huge," he said. "Would a private company be able to do that? I don't think so. I think we would lose universal service."

I tend to agree. For-profit, market-driven companies tend to put bottom-line issues ahead of all other considerations -- and why wouldn't they? That's the nature of the beast.


...but why not keep it universal and public with rate increases that reflect the actual costs of the service?

Posted by Orrin Judd at December 20, 2009 9:00 AM
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