4 ms·

Whether that's a net subsidy or anti-subsidy is an interesting question. They have both a monopoly and a fairly stringent mandate: they are required to deliver

Whether that's a net subsidy or anti-subsidy is an interesting question. They have both a monopoly and a fairly stringent mandate: they are required to deliver first-class mail to every mailing address in the United States (including very remote areas), six days a week, at prices that they can't set. The estimates I've seen are that the first-class mail mandate is a net money-loser, with pre-sorted bulk mail and premium services like Priority Mail the more successful products. So the USPS might actually be financially better off without this "subsidy". But Alaska and Montana senators would have a fit if rural communities lost mail service.

derleth 13y ago
> they are required to deliver first-class mail to every mailing address in the United States (including very remote areas) Not even close. If you live out of town, you don't get a mailbox. You get a PO Box in the post office in the closest town.
jellicle 13y ago
Indeed. We see what the market price for delivering a letter quickly across the country is: about $20 from Fedex. USPS can only charge 46 cents by law, the cheapest first-class mail service in the world.
- ekianjo 13y ago
  You failed to mention Fedex does it much faster, has insurance and tracking. It's not apple-to-apple comparison.
  - tesseractive 13y ago
    The more than 40x price difference is not all about speed, insurance, and tracking. No private service would providing first class mail delivery without cutting off service to unprofitable rural areas or jacking up the price significantly. Or, more likely, both.
    - ekianjo 13y ago
      >No private service would providing first class mail delivery without cutting off service to unprofitable rural areas or jacking up the price significantly. Or, more likely, both. I don't know how you can prove that, postal services worldwide have been a government run business until very recently, and are still kept as a monopoly even after being privatized. Fedex cannot ship your normal mail, they are not even allowed to do it. As for your claim that private companies will not be going in unprofitable rural areas, well even the USPS does not go there anymore (or much less often) : http://m.wfpl.org/?utm_referrer=https%3A%2F%2Fwww.google.com%2F#mobile/3846 http://m.wfpl.org/?utm_referrer=https%3A%2F%2Fwww.google.com...
hnam 13y ago
I live in Montana and don't think I've ever seen a package from FedEx or UPS. Both companies use USPS to do the final legs of the delivery that would be unprofitable for them to do.

derleth 13y ago

> they are required to deliver first-class mail to every mailing address in the United States (including very remote areas) Not even close. If you live out of town, you don't get a mailbox. You get a PO Box in the post office in the closest town.

jellicle 13y ago

Indeed. We see what the market price for delivering a letter quickly across the country is: about $20 from Fedex. USPS can only charge 46 cents by law, the cheapest first-class mail service in the world.

ekianjo 13y ago
You failed to mention Fedex does it much faster, has insurance and tracking. It's not apple-to-apple comparison.
- tesseractive 13y ago
  The more than 40x price difference is not all about speed, insurance, and tracking. No private service would providing first class mail delivery without cutting off service to unprofitable rural areas or jacking up the price significantly. Or, more likely, both.
  - ekianjo 13y ago
    >No private service would providing first class mail delivery without cutting off service to unprofitable rural areas or jacking up the price significantly. Or, more likely, both. I don't know how you can prove that, postal services worldwide have been a government run business until very recently, and are still kept as a monopoly even after being privatized. Fedex cannot ship your normal mail, they are not even allowed to do it. As for your claim that private companies will not be going in unprofitable rural areas, well even the USPS does not go there anymore (or much less often) : http://m.wfpl.org/?utm_referrer=https%3A%2F%2Fwww.google.com%2F#mobile/3846 http://m.wfpl.org/?utm_referrer=https%3A%2F%2Fwww.google.com...

hnam 13y ago

I live in Montana and don't think I've ever seen a package from FedEx or UPS. Both companies use USPS to do the final legs of the delivery that would be unprofitable for them to do.