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U.S. Post Office Makes Stamps Cheaper for the First Time in 100 Years

• sbierwagen 11y ago
  Deflation.
  • jerf 11y ago
    Deflation would be if they wanted to lower it. They don't. They want to raise it more, but they can't, because they are one of the most bizarrely-regulated entities in the US.
• skywhopper 11y ago
  So long as Congress micromanages stamp prices, the postal service can never be fairly expected to meet its obligations without losing money. Personally I'd be happy to let the price of mailing a letter double or more. The service provided is incredible when you think about what's involved. Getting a letter from your _house_ to nearly any address in the entire country in a few days at most is worth a lot more than 47 cents.
  • dpark 11y ago
    I've never understood why congress does this. The USPS is undercharging. Deutsche Post charges 80 cents (USD) to deliver a letter within Germany. 70% higher rate to cover only about 4% of the land area.
    • justin66 11y ago
      At present, just about everything they do with regard to postage or the pension fund has to do with damaging the post office's bottom line in the interest of union busting.
      • SilasX 11y ago
        Yes, how dare they be required to fund their pensions rather than taking the risk-shifting approach of "oh, we'll have the money later", as employed by GM, Bethlehem Steel, ec.
        • zardgiv 11y ago
          You should try not being sarcastic, it just makes it look like you have a weak argument and are overcompensating. Factually, they're being required to overfund it, to the tune of 75 years in advance, which is money that they can't reinvest. No business should accept being run that way.
          • SilasX 11y ago
            Actually, they wouldn't have an arbitrary n-year cutoff for discounting obligations, and would probably be in jail if they hid liabilities this way.
            • zardgiv 11y ago
              I clearly struck a nerve, since you wouldn't just post a longer version of 'no' and not support your argument otherwise.
              • SilasX 11y ago
                I explained how, if you were correct, it would have a less probable implication. (That's how a lot of reasoning works: "if you were correct about oxygen absorption spectra, the sky shouldn't be blue.") Here, the improbable implication of your claim that I highlighted is that businesses are normally allowed n-year cutoffs (for some value of n) for discounted future liabilities. It was not simply a reassertion. If you need another reason your claim is implausible, it would suggest that, should a business issue a zero coupon bond with 76-year maturity, it should log that as an increase in book value (with corresponding tax liability). But obviously a loan should not itself increase tax liability!
    • zardgiv 11y ago
      Congress does this because Republicans in Congress want to privatize it. See also their bizarre retirement and healthcare prefunding requirement.
      • cperciva 11y ago
        What's so bizarre about paying for costs when they are accrued? I wish that approach was applied more widely; imagine the effect on the USA's willingness to go to war if the expected long term cost of disability pensions and other veterans' benefits had to be set aside up front.
        • koolba 11y ago
          Amen brother! Defined benefit plans without sinking funds are a time bomb across this entire country. What I really wish they'd do is abolish all defined benefit plans and instead switch to defined contribution plans. That way they'd be forced to pay them up front and couldn't defer the payment to the next generation. Otherwise whoever is in charge now gets to mortgage off the future by caving to demand after demand. If people want defined benefits then the private sector can meet in the middle and handle the conversion/risk transfer. It's a tough sell but long term it's better for the fiscal stability of the country.
          • jdeibele 11y ago
            My understanding is that many, if not most, local governments have split their pension plans into two levels: employees hired before date X get the defined benefit plan; employees hired after that day get a defined contribution plan instead. In Oregon, the state Supreme Court has held that once you're hired the state has no right to change the retirement plan to your detriment. A few years ago there was a Republican candidate (Ron Saxton) for Governor who said he would fire all the state employees and re-hire them. Sounded very bizarre but the idea was to move them from one plan to the other
        • dpark 11y ago
          My understanding is that the USPS is effectively overfunding its pension and healthcare and required to continue doing so. The USPS claims as much: https://www.uspsoig.gov/sites/default/files/document-library-files/2015/ESS-WP-09-001.pdf https://www.uspsoig.gov/sites/default/files/document-library... But it's hard to get neutral information on this because most of the people putting forth information seem extremely partisan. I will say it's pretty bizarre to regulate USPS revenues downward while simultaneously regulating their obligations upward.
• quanticle 11y ago
  How much does the USPS make from first class mail these days? I find it somewhat strange that people are bringing up the fact that e-mail has killed old-fashioned letters while ignoring the fact that online shopping has led to a dramatic increase in the number of parcels shipped. Is the profit margin on parcel delivery really that much lower than that of mail? If so, then how are FedEx and UPS able to make a go of it?
  • badlucklottery 11y ago
    I would guess that the spam mailers subsidize a lot of USPS's mail services. If they're already getting paid to ram advertising garbage in my mailbox, adding an actual letter in there is probably relatively cheap.
  • matthewowen 11y ago
    There are a number of reasons which I'm sure others will go into, but one point to mention is that FedEx and UPS can charge what they like and ship where they like. USPS must deliver to every address and, to my knowledge, isn't allowed to charge more to deliver to some addresses than to others. So FedEx and UPS can make money by doing a large volume of deliveries in cities, and not delivering to rural areas (or charging through the nose to do so). USPS doesn't have the same freedom. In practice, this means that shippers go with UPS or FedEx unless those places don't go to the address, in which case USPS gets saddled with the unprofitable business.
    • yuhong 11y ago
      This also reminds me of private vs public health care. For fun, look up the "American Letter Mail Company" too.
    • karthikb 11y ago
      First class is fixed, however other services are prices based on zones: http://pe.usps.com/text/dmm300/notice123.htm#1152653 http://pe.usps.com/text/dmm300/notice123.htm#1152653
      • 11y ago
• gragas 11y ago
  This headline completely passes over the reason why stamps got cheaper: there were price hikes after the recession so the Post Office could recoup some of the money it lost in the Great Recession. Given this information, the article isn't very noteworthy.
  • deleted 11y ago
    [deleted]
• dpark 11y ago
  > While the price cut will be a boon for many consumers, it’s bad news for collectors and investors in so-called “Forever stamps,” the generic stamps valued at whatever the current postage rate is no matter when they were purchased. Since Forever stamps were created in 2007, Americans have scooped them up as a way to hedge against future price hikes that seemed eternally inevitable. But that strategy has now backfired: As former Fortune columnist Allan Sloan put it in a 2014 column, “If stamp prices somehow were cut, millions of Forever holders, including me, would feel cheated.” Collectors don't care. They aren't buying for face value. "Investors" are idiots if they invested heavily in forever stamps. Stamps have generally tracked pace of inflation. You could put your money almost anywhere else and do as well or better. I buy forever stamps because it used to be so damned inconvenient to buy (and remember to add) 1 and 2 cent stamps every time they raised prices. The fact that they're lowering the price by 2 cents does not make me feel cheated.
  • mturmon 11y ago
    Those forever stamps are a good idea, and as you say, it's obviously about convenience. There seems to be a culture of complaining about everything the USPS does. Personally, I think it's something of a miracle that for about 50 cents, I can send a letter to anyone in the country.
  • michaelbuddy 11y ago
    yeah and one price drop, people who hoarded forever stamps from 2007, they send a letter, they still saved money from today. They just gained a little less for once. Still a gain if you think of it that way. I'm not in that space, of stamp collecting but investments have a short term gain / loss and a long term gain or loss. it's not that difficult to understand.
    • dhimes 11y ago
      And it's not like it's not going to go up again. Hang on to the forever stamps, and buy the cheaper stuff now as needed. I mean, people weren't buying US $10000 worth of the damn things, were they?
• ourmandave 11y ago
  From this chart, the total 2015 volume was 154.2 billion pieces. Of that, 80 billion was advertising pieces (51.8%). Every Wednesday I get a mailbox full of the equivalant of Sunday paper ad inserts. https://about.usps.com/who-we-are/postal-facts/decade-of-facts-and-figures.htm https://about.usps.com/who-we-are/postal-facts/decade-of-fac...