The United States Postal Service’s anticipated default tonight shows that both Congress and Americans are on the mailman’s side.
USPS will default at midnight because it cannot pay $5.5 billion to retiree health benefits. Back in 2006, the Republican-dominated Congress passed the Postal Accountability and Enhancement Act, which mandated the USPS to “prefund all of its retirees’ health benefits” for the next 75 years. Naturally, they couldn’t afford to meet the requirement, and now find themselves in default six years later.
Despite the agency’s insistence that this default “will have no material effect on the operations of the Postal Service,” the impact won’t go unnoticed. A first-time default will crack a few bones of the service’s infrastructure, and a foreseeable second default in September could destroy it.
Yet both of these defaults hold good news: now that the skeleton of the postal service is broken, Americans will truly realize that change—on a radical level—needs to occur. Even if Congress passed a bill that was clearly unattainable, they did it with honorable intentions. This default needed to happen a decade ago. Now more than ever, it needs to happen so we can find a new pathway out.
Some call the postal service's foundation “old-fashioned,” but I think a more suitable term is archaic. The underpinning is based on a government-induced monopoly, a money-losing flat rate service, and a hope that Americans use snail mail instead of email. The simple reality? Delivering letters to rural places for the same 44-cent rate as delivering them to populated urban areas isn’t lucrative. Reforms have only lead to more junk mail. According to Bloomsberg, “the USPS needs three pieces of junk mail to replace the profit of a vanished stamp-bearing letter.” Additionally, the Internet has stolen the top money-makers from the USPS: Christmas cards and college acceptance/rejection letters. This spring, my mailman won’t get the satisfaction of delivering any rejection letters to my door! My Gmail account, however, will.
The only way out is to completely reconstruct the whole “one size fits all” plan. Privatization is inevitable.
Although many oppose privatizing because it could curtail unions, it has worked in socialist countries like Finland, Sweden, Germany, Switzerland, and Austria. The European Union “prodded members to give up their monopolies and compete with one another,” and the result has been glorious compared to our system.
Furthermore, the postal service would not be obliterated if we privatize it. More mail delivery services mean more job opportunities, more efficiency and more freedom. That little post office around the corner might be closed, but it doesn’t mean Americans will completely forget or demolish the legacy of the USPS. Privatizing will force the postal services to be rejuvenated, modernized, and ready to compete in the 21st century.
In a perfect world, Ben Franklin would have wanted us to keep the USPS alive. But this is far from a utopia. Our economy is already suffering, and privatizing mail is the only answer.