News about the post office is circulating rapidly (which is ironic, given that the news is about cuts that will slow service). Over the weekend, the New York Times ran an analysis of the finances of the U.S. Postal Service, concluding that it could not survive without junk mail. And then this morning, the USPS itself announced anticipated service cuts that will close more than half of the 500 processing centers around the country, slowing mail delivery and eliminating (for practical purposes) next-day delivery of first-class mail.
As I’ve argued in other spaces, and as J.L. Bell commented on my post last Friday, Congress has asked the Postal Service to do the impossible: act as a monopoly universal provider and make a profit. It’s taken a while, but postal officials are finally starting to put things in those terms:
“We are in a deep financial crisis today because we have a business model that is tied to the past,” Postmaster General Patrick R. Donahoe said during a speech last month. “We are expected to operate like a business, but we do not have the flexibility to do so. Our business model is fundamentally inflexible. It prevents the Postal Service from solving problems and being effective in the way a business would.”
This is an unsustainable model for the long term. I would also stipulate that a major problem for the postal service is the massive obligations it is under for its pension system, though the problem runs far deeper (and therefore I won’t discuss it). Most importantly, I think the Postmaster General is underselling the issue. The key question is whether, as I noted on Friday, the government has a vested interest (i.e., a reason to fund) in providing a means to communicate by paper and packages throughout the country. The problem is and has been that Congress hasn’t asked that question. People want to privatize it or “rescue” it, but with little examination of the underlying question of whether society’s interest in the circulation of information in this manner is worth an expenditure.
The question is deeply vexed and has a long history. The 1710 Post Office Act of Parliament established the Post Office in North America (with headquarters in New York) for the purpose of facilitating communication but also with the explicit assumption that it would produce revenue that could accrue to the Treasury. (The revenue was initially to go for the support of the royal family.) It didn’t make money until the 1760s, when Benjamin Franklin as Deputy Postmaster General for North America instituted a series of reforms that streamlined and improved service. As I noted previously, the post office was important enough that it was one of the first actions of the Second Continental Congress, and it is also one of the few government agencies that Congress is explicitly authorized to regulate in the enumerated powers clause of the Constitution. Questions of revenue generation continued into the nineteenth century, when the Post Office made an enormous profit. And of course the Postal Reorganization Act of 1970, which converted the Post Office Department into an independent government agency as the U.S. Postal Service, focused on ways to make the Post Office profitable again.
It’s also important to consider that the communication that flows through the postal system has changed dramatically. At its inception, the Post Office was a means to circulate political information (through newspapers and other publications), official mail, and commercial information, and rates were set accordingly. Alexis de Tocqueville, on his tour of the United States in 1831, noted with wonder how thorough information circulated in the nation:
I travelled along a portion of the frontier of the United States in a sort of cart, which was termed the mail. We passed, day and night, with great rapidity, along the roads, which were scarcely marked out through immense forests. When the gloom of the woods became impenetrable, the driver lighted branches of pine, and we journeyed along the light they cast. From time to time, we came to a hut in the midst of the forest; this was a post-office. The mail dropped an enormous bundle of letters at the door of this isolated dwelling, and we pursued our way at full gallop, leaving the inhabitants of the neighboring log-houses to send for their share of the treasure.
The post office was, as Richard John has demonstrated, the branch of the federal government most present in the lives of Americans, and served as an outlet for encouraging informed political debate (or at least that was the ideal). Not until the 1840s and 1850s did Congress lower the price of sending a letter to a level that encouraged mass use of the genre, which led to the development of new forms of mail, including the valentine and advertising circulars. Now, as the New York Times piece cites, junk mail–that is, unsolicited advertising–constitutes a major component of the Post Office’s revenue stream. We no longer get our newspapers, as Tocqueville once noted, through the post office. We no longer send personal letters.
At some point, therefore, the ideal of government-sponsored communications channels fell by the wayside. What I hope Congress and the media will pick up on is the question of whether society and government have an interest in guaranteeing this sort of service, and if so, how. Whether that leads to the demise of the Post Office is up to Congress.
UPDATE (12/6, 9:31am): Just found that Richard R. John did a study for the Postal Regulatory Commission in 2008 entitled, History of Universal Service and the Postal Monopoly. Provides a good background with quite a bit more detail than I’ve provided here.