Why the USPS SHOULD Lose Money

The whole fracas over the USPS losing money has been overwhelming lately with the predictable arguments from the Right citing it as another example of Government Failure and a system that is better served by fully private corporations — not this funky implicitly government backed entity.

Let’s forget all of the other details for now like the decline in mail volume and the odd requirement that the USPS fully fund its pension plan.  Forget the odd restrictions that Congress has placed around the USPS and how it runs its ship.

Forget all of that for a moment.  It occurred to me a while back when sifting through the tons of junk mail that I get, the USPS is a business subsidy.

Yes.  Those credit card offers?  Those coupon mailers?  Flyers and ads?  Brochures?  Would it be possible for small businesses (and big businesses) to afford these services if the USPS charged a fee that actually covered the costs of running a profit at the USPS?  In that sense, the USPS is important as a small business subsidy as physical addresses are easily enumerated whereas email addresses are much more “ethereal”.  Not everyone watches TV.  Not everyone listens to radio.  Not everyone has Internet access.  But every person has a physical address that can be targeted for advertising.

I mean, of the volume of mail that I receive, I would guess that over 80% of it would be what we consider “spam” in this digital age.  But it’s different from “spam” in that the coupons and ads are typically much more relevant.  I’ve used many local service providers (plumbers, gutter cleaners, driveway sealers, landscapers), visited local merchants, and patronized local restaurants based on coupons and promotions I’ve received in the mail.

I conclude that proposing that the USPS curtail services or charge higher rates is tantamount to proposing placing a tax on businesses which will especially impact small/local businesses.