Re: [NTLK] [OT] USPS

Hello,

--- On Tue, 7/21/09, Bob Carls Dudney <kosmicdollop@saber.net> wrote:

> Re: USPS I just want to add couple comments:
>
> The reason first class mail costs less than a real market
> price is bulk mail covers the bulk of USPS costs. Delivering all
> that paper spam advertising subsidizes other postal services.

Well, I was led to understand the opposite: that the DMA (which uses Standard Mail [the old "Bulk Mail"]) has lobbied so that First Class Mail users have the "privilege" of picking up the tab for them. :)

Whatever the case may be, there is definitely cost-shifting taking place here.

>And that's undoubtedly why, at least in lawmakers' minds, USPS must
> have a sanctioned monopoly. I wonder if there's less spam mail in
> Europe making first class higher there.

Put it this way: even if, as you say, Standard Mail users subsidize First Class Mail users, if the cost of First Class Mail were to go up $0.20, but your mailbox was relatively junk mail free, would you consider this to be a fair trade off? :)

It's an interesing question.

> Also, while it's not at all a fair comparison, it costs
> many times more to send a letter size manilla envelope via UPS ground
> than First Class (cross-country UPS delivery time slightly longer in
> my experience). Not only does that give an indication how bulk
> mail subsidizes first class,

I don't know if that's really a fair comparison or not (as you did warn us at the beginning). I say this because a letter-sized envelope takes up many times more space, and weighs more, than a regular business-sized envelope. And so costs more to move around.

>the fact one can blatantly violate USPS's monopoly

Well, if UPS is forced to charge more money for the service because they are unable to use standard business-sized envelopes, but must use envelopes that are much larger in size, I'm not sure it's fair to say that UPS is "violating" the monopoly the USPS enjoys. Also, the higher rates that UPS must charge are doubtless reflective of the fact that, under current market conditions, UPS cannot hope to enjoy the same economies of scale that the USPS can.

That is, the more mail I move, the less I can charge for it.

Supposedly, the USPS is getting its act together as far as its accounting practices go, and (again, supposedly) their ability to lean on the taxpayers to help make up any shortfalls is being further reduced. We'll see if this results in USPS rates continuing the same sharp upward trend that they've been following the past few years. :)

>and send first class via UPS demonstrates it's not the first class >monopoly that matters, but the bulk mail one.

Well, Standard Mail certainly has an impact on First Class Mail rates, that's for sure. :)

For myself, I would like to see people bear the costs they actually incur, as opposed to being forced to subsidize the costs that *other* people incur. That, to me, is the fairest way of doing things, but I can certainly understand why other people might not share that same view. ;)

Best,

James Fraser

====================================================================
The NewtonTalk Mailing List - http://www.newtontalk.net/
The Official Newton FAQ - http://www.splorp.com/newton/faq/
The Newton Glossary - http://www.splorp.com/newton/glossary/
WikiWikiNewt - http://tools.unna.org/wikiwikinewt/
====================================================================
Received on Wed Jul 22 03:41:40 2009