New PDF release: Mail at the Millennium: Will the Postal Service Go Private?

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Extra info for Mail at the Millennium: Will the Postal Service Go Private?

Sample text

We owe nothing less to the American people. 23 3. The Postal Service’s Market Grab Michael A. S. Postal Service (USPS) as a replacement for the old Post Office Department. Although the aim of the reorganization was to place mail delivery on a more businesslike footing, the Postal Service is a wholly government-owned enterprise that is located, officially, within the federal government’s executive branch. 2 Further, federal legislation in 1934 awarded to the Postal Service exclusive access to home and business mailboxes, giving it a mailbox monopoly.

Spulber, Protecting Competition from the Postal Monopoly (Washington: The AEI Press, 1996), Chapter 2. 25 MAIL @ THE MILLENNIUM: WILL THE POSTAL SERVICE GO PRIVATE? Beyond its monopoly core, the Postal Service also operates in competitive markets, facing private-sector businesses offering similar products and services. Generally the private firms—not the Postal Service—either have offered such products and services first or have made them into commercial successes first. The USPS, nevertheless, is seeking to expand into more competitive market sectors.

In any case, it can be objected that the premise of the argument is wrong: Volume and revenues in the Postal Service’s monopoly market are rising, not falling. 34 Whereas private businesses constantly fear that their sales will be hurt by aggressive competitors introducing similar but slightly better products, the Postal Service has the security of an immense core market with products that other suppliers are barred from offering. Of course, there are substitutes, such as e-mail instead of a firstclass letter, direct deposit instead of a check in the mail, and newspaper inserts instead of a mailed advertisement.

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