Will Amazon Swallow the Postal Service?

For a while now, the Postal Service has been telling us that they'd like to end Saturday mail delivery as a way to cut costs and deal with their ongoing financial difficulties. Congress isn't about to let that happen, so now they've gone the other way: they're going to start delivering on Sunday. But only packages. And only from Amazon.

The natural response to this is, "Wait, what?" Since when does a single corporation get to commandeer an enormous government agency to use for its own profit-making purposes? What's next, are we going to just rename it the Lockheed Martin Department of Defense? Sell the naming rights to national parks? ("Welcome to the Doritos Locos Tacos Grand Canyon!")

OK, it isn't as bad as all that. In fact, as long as they do this in a fair way—essentially for any company that wants it—it could be good for everyone. According to news reports, they're exploring similar arrangements with other companies. And the Postal Service does sometimes negotiate special agreements with private companies to give a discount if they increase their mail volume for some period, but this is the first time anything as monumental as initiating Sunday delivery for the benefit of one company has been contemplated. So if they're going to do this on a wide scale, they have to open it up. They could say they'll only deliver certain types of packages, or require the companies that use it to meet some other kind of technical requirements or pay a fee. But you can't do it for Amazon and no one else, just because they're big.

In case you aren't familiar with the cause of the Postal Service's troubles, I explained them here, but in brief: First, Congress requires them to pre-pay retirement benefits, something no other government agency or private company has to do, which costs them billions of dollars a year. Congress also refuses to allow them to close far-flung, money-losing post offices (these are symptoms of the service's status as a quasi-government agency; they have to fund their own operations, but need Congress' permission to do all kinds of things). Second, the rise of email has led to a drastic reduction in the volume of letters being sent, which has cost them billions. Third, and perhaps most significant, we have some of the lowest postage rates in the industrialized world. All of us expect the Postal Service to come to your house, pick up your letter, carry it 3,000 miles across the country, and deliver it to someone else's house even if they live on top of a mountain or on a remote island, and to do it not for the $20 or so that Fed Ex would charge you (if they even delivered to those places, which they don't), but for 46 cents.

So even though the Postal Service has been trying mightily to cut costs everywhere they can (for instance, they've reduced their workforce by 30 percent in the last decade), it just isn't enough, and they're still losing money. But they make good profits on package delivery, which is why this deal with Amazon looks so attractive.

Contrary to the jokes conservatives still like to make about it, the service is a national treasure, and they've been trying incredibly hard to modernize and increase their efficiency despite the absurd requirements Congress puts on them. But again, if they're going to enter into these kind of partnerships, it has to be done in a fair way. Amazon can't be the only company that benefits, even if there are obvious logistical efficiencies that would come with all Sunday delivery coming from one company. But I'm all for (almost) anything that will help the Postal Service get on better footing.

You may also like