View Poll Results: Should government bail out / subsidize the post office?

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    11 47.83%
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    9 39.13%
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Thread: Should the government bail out the post office?

  1. #21
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    Re: Should the government bail out the post office?

    Quote Originally Posted by Alex Libman View Post
    The government mail monopoly actually costs quite a bit more, you're just not paying for it directly.
    I missed part of your post

    Is it a monopoly?

    USPS's revenue is $72 billion
    UPS's is $11.6 billion
    FedEx is $6.1 billion

    I'd agree it LOOKS like a monopoly from revenue numbers, but how about from profit numbers?

    Clearly, USPS is in the tanker.

    FedEx is around $500 mil in profits.
    FedEx reports higher earnings and revenue - Dec. 18, 2008

    $986 million for UPS
    UPS revenue, profit up, but miss Street expectations - Business First of Louisville:

    Last I could find for USPS profits was $1.4 bil for 2005
    USPS Ends Year with a Profit

    Now let's do net profit margins.

    USPS - 1.9%
    UPS - 8.5%
    FedEx - 8.1%

    I'm pretty sure no one is surprised that the government owned does the worst.

    In terms of market, USPS has 80% market share. So by at least that measure it is.

    But how do we define monopoly?

    [ame=http://en.wikipedia.org/wiki/Monopoly]Monopoly - Wikipedia, the free encyclopedia[/ame]

    In economics, a monopoly (from Greek monos , alone or single + polein , to sell) exists when a specific individual or enterprise has sufficient control over a particular product or service to determine significantly the terms on which other individuals shall have access to it.[1] Monopolies are thus characterized by a lack of economic competition for the good or service that they provide and a lack of viable substitute goods.[2]
    I don't think that the USPS has a monopoly. Especially when people are free to choose (and do choose) private firms all of the time.

    One aspect that I like how johnjoel brought up is how it facilitates business. It provides a low cost method of advertising, bill payments and communication for the business world. While that may be more relevant about a decade ago, it still holds true, abet to a lesser degree/
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  2. #22
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    Re: Should the government bail out the post office?

    Quote Originally Posted by obvious Child View Post
    I don't think that the USPS has a monopoly. Especially when people are free to choose (and do choose) private firms all of the time.
    They are a monopoly when it comes to standard mail delivery.

    It's illegal for someone to set up a standard mail delivery service.

    Quote Originally Posted by obvious Child View Post
    One aspect that I like how johnjoel brought up is how it facilitates business. It provides a low cost method of advertising, bill payments and communication for the business world. While that may be more relevant about a decade ago, it still holds true, abet to a lesser degree/
    You should read about how private firms where handling it prior to it finally being declared illegal.

    Privately owned mail delivery services were going to be apart of our country.
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    Re: Should the government bail out the post office?

    Quote Originally Posted by obvious Child View Post
    [...] I don't think that the USPS has a monopoly [...]
    "Monopoly" is a relative term - rarely do you truly have the only one possible way of doing something. In my opinion it only applies to situations where there are barriers to entry for new competition. A company having a large market share is not in of itself a monopoly - Microsoft isn't, for example, because anyone can switch to Linux / BSD / Solaris / etc if they so choose. There are, however, specific laws that prohibit private sector companies from competing with USPS in certain market segments.

    Notice the link to Anarcho-Capitalist hero Lysander Spooner's American Letter Mail Company in my previous post. He was able to provide postal service better and cheaper than the government, but Uncle Sam initiated aggression against him, as they would against UPS / FedEx if they ever start to offer delivery of standard (non-urgent) mail, or go below a certain price, etc.

  4. #24
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    Re: Should the government bail out the post office?

    Quote Originally Posted by RightinNYC View Post
    The postal service generally does quite alright for itself. It was turning profits of several billion dollars a year not too long ago.
    How are you calculating profits? Total revenue minus total expenses? Or total sales minus total expenses? Any government agency can show a "profit" if the government just gives them more money than they need. That doesn't mean they're actually profitable.

    For some reason it's difficult to find any information on how much revenue the USPS receives from its own sales, compared to how much it receives from the federal government. But I would doubt you could get 42-cent letters if not for the feds subsidizing your mail.
    Last edited by Kandahar; 06-16-09 at 03:34 PM.
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    Re: Should the government bail out the post office?

    The government owns the postal service, how is it a bailout. I mean, I know it's supposed to be revenue neutral, but I don't see it as a bailout. Plus the post office is a good thing, we can keep it going. We spend a lot more money on a lot worse things.
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    Re: Should the government bail out the post office?

    Quote Originally Posted by Shep Dawg View Post
    Newspapers will continue to struggle. Many will fold, and the ones that survive will have to radically change their ways of operating.
    Many newspapers will be folded, you mean....

  7. #27
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    Re: Should the government bail out the post office?

    Quote Originally Posted by Kandahar View Post
    The post office long ago outlived its usefulness. UPS, DHL, and FedEx can do everything it does better.
    DL went bankrupt.
    UPS and FedEx don't have daily service to every address.
    The post office has union issues and mass benefits while UPS and FedEx largely are part time employee sweat shops for handling. FedEx uses contractors and not employees with benefits. There as gobs of rules on the post office that carriers don't have.
    The post office must survive for many reasons including not losing benefits and retirement for hundreds of thousands of people. Dropping Saturdays and even going to 3 day a week delivery would work fine.

  8. #28
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    Re: Should the government bail out the post office?

    Quote Originally Posted by RightinNYC View Post
    Agreed.

    $.42 to send a physical piece of paper 3000 miles to someone elses door in 2 days time is a mind-boggling bargain.
    Yes it is! FedEx or UPS would charge about $10 to $15 even to deliver a letter across country to a specific address.

  9. #29
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    Re: Should the government bail out the post office?

    Quote Originally Posted by MrFungus420 View Post
    And there's the problem that you face. The postal service is Constitutional power of the Congress:

    Article 1, section 8 - The Powers of Congress:
    "...To establish Post Offices and Post Roads;"

    I'm also fairly certain that the Founding Fathers didn't envision that the post roads would become anything like the Interstate system. That doesn't change the fact that Congress is responsible for them.

    I'm also fairly certain that the Founding Fathers didn't envision the commerce clause being used to justify unconstitutional actions such as the the Drug War.
    Sharp observation. Do you think the government cares?

  10. #30
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    Re: Should the government bail out the post office?

    Quote Originally Posted by Harry Guerrilla View Post
    They are a monopoly when it comes to standard mail delivery.

    It's illegal for someone to set up a standard mail delivery service.
    Can you cite such a law that prohibits a private standard mail delivery service?

    You should read about how private firms where handling it prior to it finally being declared illegal.

    Privately owned mail delivery services were going to be apart of our country.
    And what law or case are you citing this position on?
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