An interesting topic of discussion for today’s Public Policy debate:  the Post Office.  This power is conferred on Congress in Article I, Section 8:  “Congress shall have the power… to establish post offices and post roads.  If anyone knows me I am a stickler for the Constitution and the federal government only doing things that they are authorized to do under the U.S. Constitution.

The United States Postal Service is technically a government corporation.  This is a business that is run by the federal government to provide a specific service.  They are regulated and sometimes receive federal funds as part of their budget.  Unfortunately the mail service we have is not always the best.  I can speak from experience as I have several letters and packages “Lost in the mail,” via the USPS.  My main purpose of the public policy is for the free markets to decide the fate of this service.

I would through legislative means break up the USPS and break some of those parts from the federal government.  I would retain the USPS as a regulatory body for all post services throughout the United States.  They would set the regulations for delivery of mail.  This would mostly of establishing zip codes and standards for the delivery of post to anyone in the U.S.  They could also be called upon to help search and protect the citizens from the mailing of hazardous materials.

The business aspect of the post office, all the branch offices would be privatized.  They would be required to run the sweat of their brow and the services they provide.  But also the other private companies that handle post (UPS, FedEx, DHL, and others) would be given greater freedom to compete with the USPS on even ground.  They could send letters and other things through the mail following the same regulations established by the government regulatory agency.

That does mean, in the short term, prices for post would go up through the post office.  The price of mailing a letter might go up.  But if they are forced to compete against the other mail carriers in the U.S. their service and the service of other companies would go up.  Think of the freedom of choice you would have now.  You as a consumer could decide which service delivers your mail (for a nominal fee if you like).  Each company could provide different services and rates to fully compete against each other from your business.  Since the government will not have a monopoly on delivering mail this will drive prices down in the long term.

This idea may not work, but they do it in other countries.  In Australia, the Post Office is still part of the government but they must run based only on the money they bring in.  This makes them more efficient, offers better and faster service, and spawns more competition among the companies that handle post.

Thoughts?  Comments?  Questions?  Points I missed?  Let me know.

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