Not the part of the government that’s already gone postal, it turns out.
According to Monday’s Wall Street Journal:
Postal Service Eyes Closing Thousands of Post Offices
Now, with the red ink showing no sign of stopping, the postal service is hoping to ramp up a cost-cutting program that is already eliciting yelps of pain around the country. Beginning in March, the agency will start the process of closing as many as 2,000 post offices, on top of the 491 it said it would close starting at the end of last year. In addition, it is reviewing another 16,000—half of the nation’s existing post offices—that are operating at a deficit, and lobbying Congress to allow it to change the law so it can close the most unprofitable among them. The law currently allows the postal service to close post offices only for maintenance problems, lease expirations or other reasons that don’t include profitability.
This was inevitable. The government has been running a flailing public system for years while private businesses have stepped up to fill the void, delivering mail faster and better than the pony express.
The only advantage the postal service has over private mail delivery companies is its ability to crowd out. Because this public function is not sensitive to demand or market forces, nothing deters government workers from pouring countless dollars and man hours into this outdated system.
If public functions that are not valuable are limping along only by their ability to crowd out the private market, what’s happening with health care?
Health care is out of sync with the post office, but the same forces — and same inevitabilities — apply.
USPS has long attempted to substitute for demand by raising prices on those who have not yet switched to smarter, newer package delivery methods (like “gifting” through Amazon.com). Aren’t you surprised every year when stamps cost more than they did the last time you bought them?
With such an inelastic good, two cents won’t deter you from purchasing those stamps. In fact, who even knows what stamps cost nowadays? Seventeen cents? Thirty-two cents? Perpetual “first class”?
Mailing a letter costs a whopping $0.44/ounce nowadays. The explanation for yet another increase in stamp prices is here:
The U.S. Postal Service Governors recommended the increase in postage stamp prices to help reduce a projected budget shortfall of $7 billion in fiscal year 2011. Any recommended price increase must first be approved by the Postal Regulatory Commission (PRC). In the 18 October, 2010 issue of Linn’s Stamp News it was reported that the PRC, for the first time in its history, rejected the requested price increase. The USPS may appeal the decision to the U.S. Court of Appeals.
Seven billion dollars. That’s just the budget gap,not the full operating budget. This huge public boon is failing. If only the president could have found some forum to disseminate that information, the state of our nation, to the curious public.
For years the post office has relied on tax subsidies and incremental price hikes to make up for ever-waning demand. If we knew what the post office cost us, we’d never use it.
In fact, we don’t. USPS keeps hiking prices to make up for what they’re losing in volume. But business doesn’t work that way. That’s why the post office is closing such an enormous number of offices. Do they think we’ll be more likely to use their services instead of the internets if we enjoy even fewer post office visuals along our commute?
This is the future of health care. Medicine has long rested in private hands, with public assistance only at the margins. If there were no private market, there’s no way the public sector could handle the demand for all that health. Who would spend the best years of their lives, accumulating crushing student debt, just to graduate into a world controlled entirely by the government?
Anyone who’s ever had to rely on the government to provide information knows what it means to chase Big G. Imagine having to perform delicate surgery and chase faceless, nameless government unions for your paycheck?
You wouldn’t do it. That’s the problem. California had to pay public employees in IOU vouchers this year. The post office is shuttering thousands of offices. The government is not too big to fail, because even when it tries to crowd out private entrepreneurship, the market exists.
Hold on to your pensions, retiring postal workers — we independent thinkers will turn to you before long, when we move to tap the future of all of this “investment” that did find its way into the president’s speech.