The cause of postal privatization has attracted ideologues since James Hale and Lysander Spooner back in the mid-nineteenth century and has echoed periodically in the halls of the Capitol since. In the 1970s, Senator Jesse Helms, Republican of North Carolina, argued to end the postal monopoly on the grounds that it was just a matter of time until companies would turn to electronic billing, which would cut the revenue from first-class mail. Senator James Buckley, a Conservative/Republican from New York, proposed to “liberalize” the postal market by opening it to competition from independent carriers and granting them access to private mailboxes, which federal law prohibited. In 1979, the Private Express Statutes were suspended to allow rival companies to compete with the post for the delivery of “extremely urgent” letters.
The privatizers raise some good points, particularly regarding the post’s labor issues and what amounts to its encouragement of junk mail. They note that a number of European nations that have de-monopolized their posts have seen some improvements regarding innovation and cost. (Indeed, the USPS took some steps in that direction long ago by adopting the principle of work sharing and making concessions regarding urgent letters.) However, privatizers gloss over the major reason for the different bottom lines of businesses and public services, even a hybrid like the USPS: the latter do the difficult, unprofitable work that the former eschew, such as providing universal mail service to every American everywhere for the same low price.
If the post were privatized, or even turned into a regulated private industry like the airlines and railroads, management would naturally place revenue over the commonweal. Postage between big cities, such Boston and Los Angeles, might remain low, but a profit-oriented business would legitimately demand higher rates per mile in less cost-efficient areas that are off the beaten track. As of 2015, the USPS charged forty-nine cents to send a first-class letter from Deposit, New York, to American Falls, Idaho, but a private carrier, like an airline, would ask much more, thus effectively compromising universal service.
Then, too, many of those who blithely say “just privatize the post office” are unfamiliar with the way the nation’s delivery system actually operates in the twenty-first century. FedEx and UPS are most profitable in metropolitan areas and would risk bankruptcy in trying to handle the enormous volume of the entire nation’s mail. Moreover, during the past several decades, dealing with each other and practical realities on the ground has nudged the post and the independent carriers to become “co-opetitors” that are bound by the former’s last-mile service. Parcel delivery is not a significant added expense for the USPS, which carries the mail door-to-door six days a week anyway. Neither of the major independent carriers, however, could make those exhaustive rounds without subsidization. Just as FedEx and UPS pay the post for help with this final phase of their deliveries, the post pays the private firms for transportation services. In the latest iteration of the public-private collaboration that the post has engaged in since the days of the stagecoach, FedEx’s planes carry the U.S. mail by day and the company’s own freight by night.
The privatizers’ bold rhetoric lends itself to iconoclastic opinion pieces and letters to the editor in newspapers, but it has not won over the great majority of American households and businesses. The national delivery system has evolved over time, and though it might not be the Platonic ideal, it works pretty well. The independent carriers and the post both benefit from their symbiotic relationship, as do consumers, because the post’s lower rates keep the private companies’ prices in check. Moreover, surveys show that while most people accept that the post, like the rest of world, must change with the times, they don’t think that the Internet has made it obsolete, any more than planes eliminated boats or TV killed radio. They don’t see why they must choose between public and private services, digital and physical media, if they don’t have to.
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ADVOCATES OF THE second and third schools of thought on the post’s role in the twenty-first century agree on a number of important principles. Both the more liberal and conservative of these supporters value the post’s great reputation for security and privacy—the same old-fashioned virtues in which the Internet is seriously deficient—its tremendous infrastructure, and its state-of-the-art technology for processing traditional mail. They believe that Congress is arguably the USPS’s worst enemy and that the post must be freed from legislative oversight blight. (One provocative proposal for effecting that change is based on the fact that, unlike most huge businesses, the USPS has no shareholders. However, if it were to pay taxes on its revenue, as a normal company does, the Treasury would become a powerful vested interest with a strong incentive to push Congress for the reforms necessary to make the post solvent. Near the top of that list would be the elimination of the price caps imposed by the PAEA in 2006 that prevent the post from raising its low charges to cover its high costs.) These groups ask, “Why not keep a public asset that offers dependable, inexpensive services, receives no tax dollars for its operations, belongs to the citizens, and is important to many of them, some vitally so? Who would benefit from privatizing it?” Although the post’s left- and right-leaning supporters agree on some big things, they divide over others, particularly whether the USPS should emphasize its business or public-service nature and whether it should cut back its services or expand into new areas.
The post’s progressive supporters allow that its failure to go digital was a serious lapse but argue that it can still make up for the missed opportunity. They want to retrofit the meaning of “postal service” and the founders’ information-based postal commons for a world in which, as the saying goes, if it can be digital, it will be digital. They want the post to provide Americans with broadband access and a secure electronic “home base” that would unify their scattered online lives, link their digital and physical addresses, and provide hack-proof services, such as an electronic mailbox, a lockbox for important private data, and verification and authentication for legal and business transactions. They question why the government that gives financial support to Wall Street companies despite their baroque abuses can’t help a benign and popular public institution modernize its services, as it has in the past.
The nation’s growing problem of financial inequality could provide the post with an opportunity to run a digital experiment based on a century-old precedent. About a quarter of Americans are effectively barred from the private banking system by low income, which leaves them prey to overpriced, unscrupulous payday lenders, check cashers, and pawnshops. The duties of the USPS’s Office of Inspector General include investigating opportunities for generating revenue, and its research suggests that the post could respond to this unmet need with an electronic update of postal savings banking, which ended in 1966: the basic financial services provided by a “nonbank bank”—the awkward term for an institution that doesn’t handle both loans and deposits. Customers would receive a postal card that they could use for purchasing, withdrawing from an ATM, depositing and cashing checks, paying bills, and making international money transfers. The post would charge a fraction of what the predatory vendors do, while also producing substantial revenue for itself. The banking industry’s objections about the specter of unfair competition, first made a century ago, and Congress’s recent restrictions on new “nonpostal” services pose formidable obstacles, but the post’s long history of issuing money orders might enable the USPS to test the plan without congressional approval.
Going online is not the only way in which the post could modernize. Its huge workforce, which moves house-by-house through America’s neighborhoods nearly every day, could provide more services, such as checking on the elderly and infirm and contributing to “big data” on air pollution, traffic patterns, and other public concerns. Better use could be made of the nation’s nearly thirty-two thousand post offices by allowing them to handle state and local matters, such as processing traffic tickets, driver’s licenses, car registrations, and hunting and fishing l
icenses. As in many nations, they could become community information hubs that offer computers, Internet access, and even simple rooftop aerials that provide free or low-cost local “intranet” web and phone service. The local Starbucks or Dunkin’ Donuts could even move into the post office, space permitting. This type of public-private collaboration could attract more customers for both enterprises; help maintain a town’s identity, ZIP code, and gathering place; save on new construction; and preserve architectural landmarks, some of which the USPS has already sold to private developers amid significant controversy.
The first hurdle to expanding postal services in the twenty-first century would be convincing Americans and their elected representatives that such a thing is still possible. Congress would have to reassess fifty years of policy that has prioritized traditional mail and discouraged postal innovation and confront strenuous opposition from lobbyists deploying the same arguments that their predecessors used against the postal telegraph, RFD, the Postal Savings System, and Parcel Post. To make a major investment in America’s telecommunications infrastructure, the legislators would also have to bet on the equivalent of the tremendous return on bipartisan funding for interstate highways and rural electrification in the 1950s and ’60s. On one hand, the timing is currently favorable for such a step, because the government could borrow the money at low long-term interest rates; on the other, the nation’s current center-right politics constrains federal spending.
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THE POST’S MORE conservative supporters believe that, like the federal government in general, it is simply too big and ambitious. Like postmasters general Benjamin Franklin, Ebenezer Hazard, Albert Burleson, and Walter Brown before them, they narrow their eyes on the bottom line. Considering the decline in the first-class mail that has traditionally been its main source of revenue, they conclude that the post must bow to Congress’s directives, act more like a business, and offer only traditional services that are profitable or at least self-supporting, notably the delivery of parcels and advertisements. They maintain that by acknowledging the changed times and downsizing gracefully, the post can continue to deliver America’s hard copy and endure as a national resource.
The conservatives’ leaner, meaner post would scale back its workforce and facilities and become the general contractor for a public-private delivery system. The businesses that produce at least three-quarters of the nation’s mail would handle all the “upstream” activity that precedes delivery, such as sorting, bar-coding, and transporting it to large distribution stations, as many firms already do. From those facilities, the post’s carriers would depart on their routes with their bags mostly presorted—again, as many do now. In short, the USPS would become a public utility that, aside from doing some collection, was primarily a delivery system of carriers.
Most scenarios for such a stripped-down USPS emphasize the revenue to be reaped from a kind of gold-plated version of Parcel Post. The same Internet that reduced first-class mail’s volume also significantly increased that of packages, which rose by 50 percent between 2010 and 2015, making the post a cornerstone of America’s delivery-and-returns-dependent electronic marketplace. (With its reputation for security and connections with mail systems abroad, the post could also benefit from the international e-commerce boom, which is plagued with such difficulties as authenticating buyers and sellers across borders and deciphering foreign taxes and customs duties.) To make the most of the parcel boom, which helped account for the $1.1 billion increase in postal revenues between 2014 and 2015, however, the USPS must improve its retail services. It must also do more to cultivate the tech-empowered tough customers who are accustomed to online merchants’ cosseting and impatient with any friction that interferes with their purchasing pleasure. To win over more of these consumers, the post must provide more individualized treatment, almost-instant delivery, and round-the-clock, no-wait pickups and returns.
The conservatives’ no-frills model of the post comes at a price. The universal-service requirement could be modified if not eliminated. Mailing could become more expensive, especially in out-of-the-way places and for such amenities as quicker service. Local post offices would disappear, and the postal workforce would be significantly reduced. Buying stamps and sending letters and parcels would be handled in drug or convenience stores by retail workers who earn less than postal clerks. (Indeed, the USPS has already taken steps in this direction. Like the private employees who staff postal service counters in stores such as Staples, shop owners enrolled in the Village Post Office program sell stamps and ship flat-rate packages. Moreover, they can do so during hours when post offices are closed—practices critics condemn as further jeopardizing full-service post offices.) Such a pared-down USPS might be cost-effective, but it would not be the dynamic, evolving communications and information system envisioned by the founders and steadily amplified into the twentieth century.
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SHOULD THE POST OF the twenty-first century devolve into a private industry? Update its historical mandate, as it has in the past, and bind the nation with digital services? Become a bare-bones version of the current government-business hybrid that focuses on paying its way, especially by delivering parcels?
Any discussion of the post and its value takes place in the context of much larger issues and questions, starting with: What is the value of government itself? The United States and its post were creations of the Age of Enlightenment. More than two centuries later, reason no longer necessarily produces agreement, and the principles of universality and equality that are intrinsic to the post are questioned in practice if not theory. Since the 1960s, institutions in general have been reflexively seen as obstacles to progress rather than its potential agents. The idea that government should not do what private business could do instead, which has ebbed and flowed in American life since the early nineteenth century, is widely tolerated if not accepted.
The effort to assess a huge, complex institution that in its nearly two and a half centuries has been both advanced and backward, principled and corrupt, brilliant and dysfunctional, also requires what F. Scott Fitzgerald called “first-rate intelligence,” which he defined as “the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function.” Then, too, the post’s future is in the hands of citizens and their elected representatives who are mostly unaware of its history, which tells America’s story from creating the democracy’s educated electorate to expanding the small Atlantic nation to the Pacific to adding the skies to its transportation grid.
The post office is the least remarked and most misunderstood of the nation’s original great institutions, but it’s the one that did the most to create America’s expansive, forward-looking, information- and communications-oriented culture. In need of drastic reform, it almost went out of business in the 1840s, only to be resurrected and reach its zenith a few decades later. Before deciding its future, it behooves Americans and their leaders to reflect on what the post has accomplished over the centuries and what it could and should contribute in the years to come.
Paul Revere, a courier for the revolutionaries’ Constitutional Post
Mary Katherine Goddard, America’s first woman postmaster in her own right
Dr. Benjamin Rush, physician, philosopher, and champion of a distinctively American post
Vexed by the railroads’ charges for transporting mail, Postmaster General Amos Kendall chose the old-fashioned post rider, glimpsed here outracing the locomotive, for the Post Office Department’s insignia.
Andrew Jackson, here in his general’s regalia, satirized as founder of the corrupt “spoils system” by cartoonist Thomas Nast
Narcissa Whitman, an early eastern missionary to the Native Americans of the Oregon Territory, whose letters “back home” helped popularize the Northwest’s settlement
The mid-nineteenth century’s cheap postage turned women into active correspondents, but they were segregat
ed in large, urban, traditionally “male” post offices.
By the mid-nineteenth century, Star Route carriers like this later contractor transported the rural mail by the least expensive, most expeditious means available.
For many decades, the stagecoach ruled America’s roads and carried its mail, both in the East and the West.
Although short-lived, the Pony Express demonstrated America’s can-do spirit and helped keep California in the Union.
Brilliant Postmaster General Montgomery Blair, appointed by President Abraham Lincoln, used the exigencies of war to improve mail service.
Both the Union and the Confederacy used stamps and “patriotic stationery” as political propaganda.
The desire to afford privacy to recipients of bad news during the Civil War provided the final impetus for mail delivery to urban homes.
The U.S. mail steamboat Chesapeake
By the late nineteenth century, Americans regarded their efficient Railway Mail Service as a “wonder of the age.”
Owney, the well-traveled, much-beloved mascot of the Railway Mail Service
Well into the twentieth century, most of America’s intercity mail was efficiently sorted as well as transported aboard rapidly moving trains.
How the Post Office Created America Page 30