« BACK  |  PRINT

RS

MEMBER DIARY

Ending checks in Saturday mail hurts economy

By: Mike gamecock DeVine (Diary)  |  February 7th, 2013 at 10:20 AM  | 

RESIZE: AAA

The only business that President Obama insists make a profit is not a business. The Post Office is a constitutional department meant to unify the nation and empower the overall economy.

The financially struggling U.S. Postal Service said Wednesday it will stop delivering mail on Saturdays but continue to disburse packages six days a week, an apparent end-run around an unaccommodating Congress:

The service expects the Saturday mail cutback to begin the week of Aug. 5 and to save about $2 billion annually, said Postmaster General and CEO Patrick R. Donahoe.

“Our financial condition is urgent,” Donahoe told a press conference.

The move accentuates one of the agency’s strong points — package delivery has increased by 14 percent since 2010, officials say, while the delivery of letters and other mail has declined with the increasing use of email and other Internet services.

Under the new plan, mail would be delivered to homes and businesses only from Monday through Friday, but would still be delivered to post office boxes on Saturdays. Post offices now open on Saturdays would remain open on Saturdays.

Ending Saturday delivery of checks in mere envelopes to homes and businesses, essentially shrinks the economy for those sending and receiving checks not in more expensive “packages” and/or delivered to Post Office boxes rented at an extra expense, by 1/7 days or 14%. This shrinkage will harm the overall economy by slowing the turnover of money from buyers and sellers and will hit lower-income earners and small businesses hardest.

You can’t cash and spend a check until it arrives in the mail and 14-17% of them arrive on Saturday, with a large portion spent on that Saturday, Sunday and Monday before the next mail delivery. That money will no longer be available for spending until after mail delivery on Monday.

The Constitution of the United States was framed by the stanchest believers in free enterprise. Private delivery services existed in 1789 but the Founders, in their wisdom, considered a government subsidized postal service as essential to Liberty-fueled pursuits of happiness as the establishment of a Treasury:

That document [U.S. Constitution] also empowers Congress to raise taxes, establish Post Offices and post Roads (pictured, referencing Benjamin Franklin as first Postmaster General), raise and support Armies and provide and maintain a Navy. Just as we should not require the Department of Defense to take weekends off unless it raises funds to turn on the heat on Saturdays and Sundays via bake sales, neither should we shut off Americans from the unifying force of affordable mail communication due to poor management.

The Founders, and those that followed in the Daniel Webster/Andrew Jackson Era, deemed post offices and its roads essential to bind the nation; and history has born out their wisdom. Moreover, affordable postal services for all has proven and still is essential to a vibrant economy that allows any American to run a business from their home.

My fellow conservatives need to discover their inner originalist and eschew their penny-wise and pound foolishness. Save the Post Office, keep stamps under 50 cents and deliver mail Six days per week. Listen to Alexis De Tocqueville, the Frenchman who twice toured the United States in the early Nineteenth Century before penning his seminal Democracy in America (1835,1840):

The patriotic feeling that attached each of the Americans to his own state has become less exclusive, and different parts of the Union have become more amicable as they have become better acquainted with each other. The post, that great instrument of intercourse, now reaches into the backwoods…

America needs the wisdom of and unity with the backwoods and the inner city. Make Benjamin Franklin, our first Postmaster General, proud and support a vibrant USPS. Yes, the health benefits and pensions of the USPS are a problem that needs to be addressed, but this is true of all federal employees. Only at the Post Office, which sells products, are they held to an unrealistic “profit” standard to which no other government department is subject. Would that we scrutinized the EPA this closely for its job-killing regulations.

No government program or department, including the Post Office, should serve only as a jobs program for those it employs. But neither should its worth be judged by a standard unrelated to its mission. The most important function of the USPS is to bind the nation together in commerce and for that commerce to be fully realized it must continue to empower small business and lower-income patrons who live in a world that operates for at least six days per week, with one day of rest on Sunday. Two billion in savings is a rounding error not worthy of removing the post for so many.

Mike DeVine

Tags:

COMMENTS

POSTING RULES  |  LOGIN TO COMMENT  |  REGISTER TODAY
  • Sir Aaron

    Good post. I’m not sure I buy in…but I’ll chew on it a while.

  • obviously

    Agree that the USPS should be saved by some restructuring of benefits, but I also think some very slowly phased in cutbacks in service are justified. Whether this should include cancelling Saturday mail I cant say, but I don’t think your economic argument holds much water. Sure there might be some occasional hardships. But people are going to spend the money that they spend whether they get it on Saturday or Monday or Wednesday. Some small percentage of folks might have to fiddle with the chronology of their househould budgets, but they are still going to be putting the same amount of money back into the economy over the long haul.

  • metrication

    Apologies to Mike, but I don’t buy this at all. What you’re fingering is considered the ‘velocity of money’, which will have little effect upon the growth of the economy if all we are doing is moving in-the-mail check day back two days. If it’s even at all a problem, employers will probably just move payday up to Thursday or back to Monday. That’s on top of the whole fact that we live in a time where direct deposits are FAR, FAR more common than snail mail.

    In addition USPS, by all means, is profitable. What has brought them into dire financial states is a 2006 Congressional requirement to pre-fund their pension and health benefit schemes. Every other business in the country has to run on accrual accounting standards and thus recognize their future liabilities — it is only the US government and related organizations that run on a cash basis and have large, unfunded liabilities floating above them.

    We can argue about USPS’ pre-funding time frame and payment structuring to its pension/health benefit funds, but that largely ignores just how fiscally irresponsible the US government has become.

  • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

    Then why not go to mail delivery for one day per week and really save? Because it does matter when and how frequent we collect income.

  • obviously

    Because it’s nice to get things other than money (letters, packages, coupons, etc.) on a regular basis? The USPS exists for purposes other than just distribution of checks, and it does a pretty darn good job of it. I don’t think we should kill off that function. Lopping off one day per week won’t interfere with that, nor will it interfere with the economic value of being able to deliver checks with speed and reliability.

  • metrication

    That’s a bit of the ‘slippery slope’ fallacy. Removing one, two, three days, etc. days from mail delivery is exponentially more limiting of Postal services and would ultimately affect revenue generation. Removing one delivery day is not comparable to axing the entire service. Pointedly, this is a delivery day where most people are busing doing others things, banking hours are limited (and closed the following day) and the vast majority of employees’ checks are direct deposit or ETFs.

  • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

    Sunday is already a day of rest and if the importance of the Post Office were only about what “most” people “need” in a narrow sense, then why have one at all.

  • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

    No need to kill off either, but of course checks/money are the medium of exchange that funds all packages and time is money. Some people would have to wait from Friday until late Monday between possible pay days. The “fix” for the “construct” of the USPS as a business (which I reject, but since so many insist upon it) is the same as needs to be for ALL federal employees. Reform the pension and health ins systems. For many, it is no hardship to wait an extra day on top of Sunday, to receive owed compensation. For others it is a hardship, and this is just another example of a slowly pitched softball for the GOP to endear themselves to the poor and lower income voters by treating another issue as an accounting exercise.

  • metrication

    What are you trying to argue? You seem to believe either delivery on Mon-Sat, or that we should burn down the whole institution. There’s nothing coherent in that to which I can respond.

  • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

    One of the best ways to illustrate supply side economics and tax revenues and the velocity of money is by the comparison of extremes. Sorry it didn’t help. Obviously, money not collected for 48 hours can’t be spent and turned over as often. This is fundamental. But my argument for continued Saturday service is broader than that, as I explained in the column proper. I do admit that strong arguments exist for those that disagree but those most of those same arguments could also be applied to consider UPS and FedEx sufficient for all postal needs. I see the mission as more important than that and that reducing deliveries by 14% as anathema to that mission. Respectfully submitted, Gamecock. Now feel free to deliver insults, unanswered. Hope this was “coherent” enough for you.

  • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

    Also, one of THE main things the USPS does cheaper than UPS and FedEx is deliver regular mail, the very thing the “reform” will cut back on.

  • norris

    If the day off was Wednesday ,they wouldn’t have to wait two days to cash it.
    Most business transactions are going electronic so checks in the mail will be less of a problem as time goes on .

  • obviously

    I just think you are overestimating the effects. People will adjust their behavior some, but the money will be churning through the economy at about the same rate. Some people will buy things late in the week and some might wait till Monday or Tuesday. Some folks will still shop on Saturday but will use other funds. The velocity of money issue is more concerning over longer periods of time, like if people wait an extra year or two to buy a home or a new car because of interest rates (or economic uncertainty). I doubt anyone will wait an extra 6 months to buy groceries because their check arrived on Monday instead of Saturday.

  • eltuba

    UPS and FedEx don’t deliver regular mail. They probably wouldn’t want to if the opportunity was offered to them on a silver platter.

  • commonsenseobserver

    We cannot afford to just throw money at the Postal Service. It must modernize, and if it fails to reform, it must be exposed to competition.

  • eltuba

    You shouldn’t mix the Postal Service with any other Federal Agencies. The Post Office hasn’t received any taxpayer money since around 1983. The only revenue it gets is from stamps, the boxes and shipping it sells, etc. I’m not trying to bust your chops, but I think it’s important that people understand this.

    I agree with you that the Service must survive. If it disappears, a Postal Service like the one we’ve all grown up with can never be recreated. I think that a lot of conservatives let a reflexive dislike of labor unions color their opinions regarding the Postal Service. If anything, I think the Postal Service should serve as a textbook example of how excessive governmental oversight can ruin a business. The USPS is the only institution is the country that is expected to make a profit while the Congress has final say on it’s business decisions. If Wal-Mart decides to close an underperforming store, that’s just a natural part of business. If the Post office try’s to close redundant or unprofitable branches, you can bet that every Congressman affected is going to fight tooth and claw to keep his constituents happy by saving their little Post Office regardless of how it affects the Services profitability.

  • ww2nd95

    The Postal Accountability and Enhancement Act of 2006 has definitely crushed the USPS with debt. Honestly, I thought that bill was absurd given the USPS makes money solely on stamps, boxes, and other services. So you can say it needs to modernize (which I completely agree with), but what needs to happen is the repeal of that ludicrous requirement the 2006 Congress laid on them.

  • Notre Droite

    We already have postal delivery companies in our private sector. Just because the constitution empowers Congress “To establish Post Offices and post Roads” does not mean they are REQUIRED to do.

    The USPS is just one of many government programs that should be completely abolished. Pension requirements or not, the USPS is just sucking money that should rightly be going to companies like UPS and Fedex so they can continue to innovate and optimize for their customers. As with all things, if Adam Smith’s invisible hand were free to operate on postal services, then I’m sure we’d have a much stronger postal system and the private-sector competition would only benefit the consumer.

  • SoFiMil

    Fascinating argument/perspective. Thanks for the diary!

  • rosenstern

    Budgets (operating and otherwise) have to be balanced. This entity (and all other government entities) have to cut back. This is a good start. If this creates a gap in service that is profitable, the private sector will figure out how to address it. If not, people have to deal with less service.

  • http://www.examiner.com/x-1597-Charlotte-Law--Politics-Examiner Mike gamecock DeVine

    Good points ‘tuba and most others made in this thread. I have weighed the various factors and still favor maintaining regular Saturday service, but many of the points against it are certainly defensible.