Home » National Blog » Lysander Spooner’s Revenge

Lysander Spooner’s Revenge

 

Lysander Spooner’s Revenge

The U.S. Postal Service is broke.

I know, I know, this isn't news.

In the age of the internet, it seems the only thing keeping the USPS in operation is Netflix, direct mail fundraising, and bills (even though online bill paying is becoming popular at a rapid pace).

Without a way to close a $5.5 billion gap by September 30, the Post Office will "default."

In total this year, the post office is running a $9.2 billion deficit.  The USPS is learning the fatal flaw of forced monopolies in a free market… people will find a way around them.

In 1844, the USPS was acting as a monopoly, though at the time there was no legal protection except for the Constitution's clause allowing for the Congress to establish post offices.  Prices were exorbitant. For a single letter, it would cost 25 cents to deliver from Boston to Washington, D.C.

A man named Lysander Spooner challenged the postal services monopoly by introducing the 5 cent stamp through his "American Letter Mail Company."  The venture was such a success it almost ran the USPS completely out of business.  

In order to stop Spooner, Congress eventually passed a law in 1851 establishing the USPS monopoly over distribution of first class mail.

Today, the USPS monopoly has grown so large and unwieldy it is completely unresponsive to the changes in mail use.  

The New York Times reports that parcel delivery is down 22% over the last 5 years.  Another factor involved is labor costs.  80% of the postal services operating costs go to labor.  That's compared to just 32% for Fed Ex.

Congress is about to begin debating "fixes" for the USPS.  These include ideas such as eliminating home delivery (a feature adopted from Spooner's company) and only delivering 5 days a week (further making the postal service obsolete – email doesn't take two days off).

What is needed most to fix the post office problem is competition.  Remove the USPS monopoly on carrying mail and allow private citizens and companies to compete for what's left of the postal industry.


Subscribe

Subscribe to our e-mail newsletter to receive updates.