The postal service’s junk mail scandal
By Charles Lane,
I haven’t heard much talk about it from the 2012 candidates, but there’s a scandal brewing in this country.
Monday through Saturday, uninvited messengers show up at households all across America and drop off unsolicited catalogues, credit card come-ons and other paper equivalents of spam e-mail. Americans get 84 billion pieces of this stuff every year — the vast majority of which they dump, unread, in the nearest trash can or recycling bin.
If homeowners are merely annoyed, local governments are furious; it costs them $1 billion per year to collect and dispose of the waste, according to a recent New York Times report.
Yet the federal government stands by and does nothing to stop this nuisance. Arguably, Washington is encouraging it.
I refer, of course, to the U.S. Postal Service. The digital age has rendered paper obsolescent and the postal service’s business model unsustainable. Buffeted by a 26 percent drop in first-class mail volume since 2006, it lost $15 billion in the fiscal year that ended Sept. 30.
And the postal service has exhausted its line of credit with the U.S. Treasury for the first time ever, which means that henceforth it must fund current operations out of current revenue, to the extent that’s possible.
It has asked Congress for the authority to make necessary cost-cutting reforms, such as suspending Saturday delivery and closing unneeded facilities. But lawmakers are dithering, lest they offend any of the “stakeholders” — direct-mail advertisers, postal unions, rural politicians — that feed off the postal gravy train (or what’s left of it).
It’s not that different from the stalemated politics of entitlement reform — only this time the unaffordable promises at issue include “universal” six-day-a-week delivery and health benefits for 600,000 mostly unionized postal employees.
Meanwhile, the postal service must cast around for money-making ideas. It is especially interested in ads, which now account for about half of its dwindling business. The wasteful flow of paper from mailman to mailbox to municipal dump is not about to end.
In August, the Postal Regulatory Commission approved a “negotiated service agreement” under which the postal service will give deep rate discounts to Valassis, a direct-mail firm that grossed $2.2 billion last year by sending about 3 billion pieces to 60 million homes. USPS estimates the deal will bring in $107 million over three years.
To be sure, even if it increases junk mail, the deal won’t necessarily add to the total national pile of paper. The particular ads USPS would deliver — pitches for durable goods sold by brick-and-mortar retail stores — already reach consumers via newspaper inserts.
What the deal would do is alter the national flow of advertising, to the financial detriment of newspapers like the one you may be holding. Struggling print media need this like a hole in the head. Small wonder that the Newspaper Association of America — of which The Post is a member — has sued to block the deal in federal court.
This gives me a conflict of interest, of course. Still, even people who don’t draw a newspaper paycheck should be able to appreciate what’s wrong here.
The rationale for a postal service is that the U.S. government should facilitate national integration and economic expansion. That’s why the Constitution gave Congress the power “to establish Post Offices” and why Congress used that power to give the postal service a monopoly on first-class mail delivery, preferential access to federal credit and other advantages. It was envisioned as a utility, providing a delivery network to all companies and individuals on more or less equal terms.
Now, in its technological obsolescence and financial decrepitude, and with the encouragement of both Congress and its regulator, the postal service has been reduced to helping one private-sector entity outcompete another. The fact that all parties concerned — USPS, newspapers and junk mailers — are scrapping over the same shrinking paper pie only heightens the poignancy.
Many proposals for reviving the postal service would compound the error by letting this federally advantaged entity compete with the private sector in businesses such as check-cashing or beer and wine shipment.
Without serious cost-cutting, such gimmicks would probably fail anyway.
Our far-flung postal system used to epitomize American democratic efficacy. Today, however, Congress’s failure to deal with mail’s inevitable decline is a case study in democratic dysfunction.
Read more on this issue: The Post’s View: The time for real postal reform is now The Post’s View: Congressional foot-dragging with the Postal Service