April 13, 2018
President Trump doesn’t need a new commission to figure out how to fix the US Postal Service, as he has called for. He could just read what prior analysts have found. Or better yet, ask the Postal Service itself.
Through no fault of its own, the Postal Service, which lost $2.7 billion in 2017, is a perennial basket case that is essentially built to hemorrhage money. It’s not a normal federal agency, funded by Congressional appropriation, but it’s not a normal corporation, either. Instead, it’s a hybrid operation that couldn’t possibly exist in the same form in the private sector. “Under existing laws and regulations,” the USPS itself says in its 2018 financial plan, “our business model is broken.”
Trump doesn’t seem particularly interested in the Postal Service, even though he recently issued an executive order establishing a task force to investigate the service’s finances. Trump’s real beef is with e-commerce giant Amazon, which, he claims, rips off the Postal Service by getting cheap rates for package delivery. Trump doesn’t really care about Amazon, either, except for its CEO, Jeff Bezos, who also happens to own the Washington Post, a frequent Trump critic. Stitch it all together, and Trump has ordered an investigation of the US Postal Service because he hates the Washington Post.
Anyway, Trump’s task force will no doubt discover many flaws in the postal business model that are already well known. First, the Postal Service is extremely limited in how it does business, because of laws that require it to operate in certain ways determined not by free-market principles, but by Congress. Postal carriers are required to visit virtually every address in America six days a week, with a price cap on first-class mail, the USPS’s main source of revenue. The number of addresses goes up every year. The amount of regular mail consumers buy postage for goes down every year. Kindergarten math explains the basic problem
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