The Postal Service Faces the Future

mailcarrier.jpgAstute readers will recall that I'm a fan of the Postal Service. That's right -- they perform a mind-blowingly enormous task every day, and the services they provide are absurdly inexpensive to consumers. As Business Week tells us in a cover story, the Postal Service is in crisis. But first:

The USPS is a wondrous American creation. Six days a week it delivers an average of 563 million pieces of mail—40 percent of the entire world's volume. For the price of a 44¢ stamp, you can mail a letter anywhere within the nation's borders. The service will carry it by pack mule to the Havasupai Indian reservation at the bottom of the Grand Canyon. Mailmen on snowmobiles take it to the wilds of Alaska. If your recipient can no longer be found, the USPS will return it at no extra charge. It may be the greatest bargain on earth.

But the USPS is losing lots of money, in part because mail volume is dropping even as they have to deliver to more and more addresses every year. They could end their economic difficulties pretty quickly if, like Federal Express or UPS, they just refused to service far-flung areas of the country and charged you $18 to send a letter. But they can't do that -- they have to serve every American, and for next to nothing, because that's what we've come to expect from them. One thing they can do, however, is to get out from under a statutory requirement that they prepay retiree health and pension benefits, which no other federal agency or private company has to do. This prepayment costs the USPS billions of dollars every year. Democrats in Congress are trying to eliminate the requirement; Republicans are balking, for no apparent reason other than it's something Democrats want and the postal workers unions support.

But the real question is whether they are going to fundamentally alter the way they do business, doing things like shutting down thousands of post offices, installing privately run stations in places like supermarkets, and finding new ways to take advantage of digital technology. In Europe, many of the postal systems have privatized part or all of their operations and undertaken a variety of experiments to keep up with technology and hold down costs:

Itella, the Finnish postal service, keeps a digital archive of its users' mail for seven years and helps them pay bills online securely. Swiss Post lets customers choose if they want their mail delivered at home in hard copy or scanned and sent to their preferred Internet-connected device. Customers can also tell Swiss Post if they would rather not receive items such as junk mail. Sweden's Posten has an app that lets customers turn digital photos on their mobile phones into postcards. It is unveiling a service that will allow cell-phone users to send letters without stamps. Posten will text them a numerical code that they can jot down on envelopes in place of a stamp for a yet-to-be-determined charge.

The big question for us isn't so much whether these kinds of things are possible here, but whether we're willing to pay the necessary price -- not in money, but in a change to the way our mail has always been. It would require abandoning the comforting knowledge that there's always a post office within a few blocks, you can rely on your friendly mail carrier coming to your door six days a week, and sending mail costs almost nothing. Can we give that up?

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