Post office loses 15.9 billion for FY 2012

Yeah, but Norway has like 5 million people.

Also Norway covers ~150,000 square miles. The USPS has to cover 3,800,000 square miles including service to Alaska and Hawaii. I would not trust my local supermarket employees to handle my mail any more than I'd do my banking with the bagboy. It may also come as a shock, but there are a number of places in the US that have post offices and do not have supermarkets - hard to get Piggly Wiggly to open up a store to service at most 200 people.

It might be relevant that working in a supermarket in the US and one in Norway probably mean different things, especially in terms of the quality of the work environment, and that in general transferring responsibilities to well regulated private sectors within a country that has made its peace with the welfare state (albeit in a petroleum rich way) is a very different proposition from what typically happens in these transfers to the private sector in the United States, which is a brand new front in the Norquistian Crusades Vol XVIXVIXVVXIX.

Ok well that was fun imaginationland for a day, you may now return to your ritual clubbing of brett.

Will say there were lots of "noo can't do that it'd be hard" re: SMS billpay/banking. Read up on the bullshit M-Pesa went through, for a long time people thought that shit was literal unpossible.

People do kind of need a public utility to store small sums of money safely if banks aren't getting a giant transfer. If not them, splitting the central bank from the monetary authority and allowing people to open risk free accounts at the central bank would probably work (with the physical office hosted at the post office because that and the DMV is everywhere). Or you could even let any retail facility open a depository/withdraw facility for the central bank. I do my USAA deposits through Fedex (USAA pays) and my withdrawls through CVS or random banks (USAA covers the atm fee). I imagine a public utility bank would function in a similar manner.

It's an extension of my loathing for private monopolies over public goods with public subsidies to keep them afloat. Nefarious system that virtually guarantees regulatory capture, with all the 'flowers and kittens' that ensures. Difficult to point to a local natural monopoly in this case, but given all the time and money spent on creating onerous regulatory barriers to disruptive new entrants and the unholy relationship between finance and government I'm inclined to believe there must be a currency level one.

I guess the idea I'm getting at is that financial innovation and creative destruction are good things, but the public needs a near money alternative for convenient paying of bills and changing funds. Given stable macroeconomic climate (necessitating expectations oriented non-discretionary monetary policy) private banks should fail at random, and should pay out interest on deposits above the prime rate (as depositors would be explicitly creditors rather than an unusal mix of utility service purchaser and creditor).

It'd be neat to see how a system like that would play out. I'm guessing net neutral or slightly positive relative to today's climate.

LLCs had a bigger impact on ratios, but I think the massive subsidy counts for more.

More musings from imaginationland, feel free to ignore.

Out of curiosity I did some back of the envelope math on those numbers, and it seems to me that operating a postal service, or any form of infrastructure, in Norway ought to be a lot more expensive per capita than in the USA, which probably explains why Norwegain Post is closing most post offices to save money, and farming postal services out to local stores instead; supermarket is clearly a wrong label for most shops in rural parts of Norway. And compared to supermarkets I have visited in the USA, our stores in Oslo probably wouldn't qualify as such either. So I don't really see the numbers above as strong arguments against outsourcing postal services when comparing Norway and the USA.

Population density Norway is 35/sq mi, in the USA 87/sq mi. Distances also matter of course, the continental USA measures about 2500 miles, giving you 120000 people per mile if you stand in line, Norway is about a 1000 miles, giving us only 5000 people per mile. (The practical difference in cost due to this is probably a lot less though, due to the different shapes of the countries). If we include Hawaii we should include Svalbard for Norway; for the USA that doubles the maximum distance, for Norway it increases by 50 %, so the above calculation gives 65000 people/mile for the USA and 3500 people/mile for Norway. And Norway is not really centralized like most other European countries. People live all over the place here, some of them in very small communities. If I have made some grave logical or logistical errors influencing the running of a postal service here, I would actually really like to be corrected.

This has been a serious problem in Norway. You really do not want retail staff to handle your registered letters, or any mail actually. But it seems, to my surprise, that Norwegian Post has been working on this, and that they have actually managed to get it under some semblance of control.

This is probably a very good argument against outsourcing postal services in general in the USA. It is hard for me to evaluate. But I am not convinced the idea should be dismissed out of hand on practical grounds. It has worked better than I would have expected here. And does apparently save quite a lot of money.

I am not advocating closing your post offices though. I don't think we should have done so in Norway either. But it does actually appear to work quite well here.

We have the same setup as the norwegians in Sweden, but without the petro dollars. For the most part it seems to be working out ok.

Edit: Sweden is more sparesly populated than Norway, but I guess the remote areas in Sweden are not quite as remote as the remotest areas in Norway.

I'll double check this later if someone hasn't done so already (about to duck out and finish up my Christmas shopping) but I think if you exclude the east and west coast states the US population density would drop quite dramatically. There is a shitload of space here in flyover country without a lot of population.

Also, while I'm not willing to trust the local Price Chopper or whatever grocery store employees with my mail, IME they both sell stamps and generally have USPS mailboxes for letters out front.

There's a decent amount of outsourcing in the US Postal System currently: ground bulk transport of mail between mail depots and some rural delivery are contracted out currently that I'm aware of, probably some other stuff as well.

I'm for closing them where it makes sense to do so just on general efficiency principles. As posted above though, it's a drop in the bucket compared to total USPS costs.

binglebeep, I think the biggest thing you're making a huge assumption about is that the cost and logistics of such services scales linearly. That you are comparing the costs of servicing Svalbard and Hawaii as a matter of proportional scale should tell you something about how off-the-wall your envelope math is behaving. Hawaii is 2,000 miles from the US and has a population of 1.4 million. Svalbard is 400 miles from Norway and has a population of 2,400. Do you think "100% vs. 50%" might be a bit... oversimplifying the matter?

Food for thought - any time you transform an area density into a linear density you by definition are working with exponential factors. For example, say I have a post office that can cover folks living within 10 miles. If I have 90 square miles:

xxx
xXx - I'm covering everybody with 1 office
xxx

But if I convert this to a line:

xXxxXxxXx - I now can only cover everybody with 3 offices.

This does not scale linearly. Say I now have 250 square miles.

xxxxx
xXxXx
xxxxx - Boom! Everybody covered with just 4 offices.
xXxXx
xxxxx

However, as a line...

xXxxXxxXxxXxxXxxXxxXxxXxX - Now it's 9 offices

Look, I'm glad your Norwegian mail system works for you, but I do not think it would scale and meet the needs of what the USPS does today.

Absolutely. I'm just not convinced that a federal savings&loan institution should be under the umbrella of the post office as it currently stands (being a pseudo-GSE, in serious debt to the Fed, very concerned about pension solvency, etc). Something operated more like Western Union money orders (but government run, not private) where it doesn't have locations per se but is available in most supermarkets, convenience stores, and online is one of my very superficially developed ideas. Or think of it like buying stamps; you don't have to go to the post office, they're available everywhere.

Maybe even state-run institutions would be successful as an alternative to federal? Don't know. But I have been thinking alot about non-profit banking and money management lately so this is an area of current mild interest to me.

It might in net terms, but the liability protection was the opening volley. It gave bank owners free reign to throw away all the fucks because hey, not liable. FDIC is more about operators and even depositors than equity holders.

The current bank chiefs are incredibly liable in the case of a bank failure (much wealth tied up in company stock for long periods, potential for criminal suits, clawbacks, etc) yet they still played fast and loose with the assumption the Fed would ride to the rescue (they were roughly right) in the event of a negative shock, and depositors allowed it because they knew they were safe thanks to the FDIC guarantee.

So I'd agree that the LLC had an impact on how banks were run, but it wasn't necessarily a bad impact, in large part because I believe that a lot of the post LLC financial innovations were hugely beneficial to society. Lowering the risk of innovation to bankers who were focused on the market (as opposed to government) is a good thing, just as it's a good thing to lower the risk of innovation to entrepreneurs. We should and do (generally) reward that sort of thing.

The later envelopment of banking within the warm cocoon of government support shifted incentives and make that reduction in risk a bad thing. And the inability of the often incompetent Fed to do its fucking job (macroeconomic stabilization) means that the risk seeking behavior of bankers can sometimes have macroeconomic effects. It shouldn't, and if the Fed was competent it wouldn't, but under the current circumstances it does.

Current theory sort of acknowledges these points, but doesn't want to remove the subsidy from banks (they probably lobbied like a motherfucker to kill THAT idea in utero), so instead they're, uh, forcing the subsidized sections into a separate chunk of the bank and doing huge amounts of damage to the financial system in the process. It's ugly.

Oh, minor addendum. If the only risk free deposit available was a 100k (inflation tracking) deposit at the central bank, I wonder how that'd impact long term wealth development trends. I have a feeling there'd be significantly less wealth transferred from generation to generation over the long run what with the risk of random bank failures in the absence of FDIC insurance.

Again, just to retain focus: while it is certainly possible that the way the Postal Service handles the mail can be improved, and that alternative proposals for mail distribution might have some merit, it is clear that the current crisis was entirely manufactured by a recklessly stupid Congress that is incapable of fixing its mistakes because we are stuck with a Republican majority that regards every failure of a government agency as a blessing no matter the cause.
Fix the problem, then come to me with proposals about improving the fundamentals. Otherwise, I'm just going to assume that it's the latest approach to artificial crisis in order to allow for the common good to be auctioned off to jackal companies, and I'll end up getting my mail on the same sort of ludicrous superficial efficiencies as my goddamned cell phone. And I'll be right, most of the time (ask me about privatization of education sometime!) (or better yet don't).

Oh yeah no dispute whatsoever, the whole thing is a bunch of Congressional circlejerking. I'm having fun playing "WE CAN DO IT BETTER" using it as a launching point, but that's totally different from accepting the farcical interjections of the current Republican House as legitimate.

There is some real convincing research on how risk-taking increased when limited liability was introduced to banking in the late 1800s and I, naturally, can't recall anything about the papers except the broad strokes. However there are some highlights in this essay if you have a few minutes highlighting how this change in liability directly flowed through to bank balance sheets and therefore to the industry, and how this essentially laid the foundation for everything involving the failure of effective risk management in banking these days.

True and I think most people would acknowledge that the Fed has focused almost solely on price stability with everything else a distant second over the past 20+ years. It allows private banks to not keep a capital stock of fucks because all the fucks are kept by the Fed by means of insurance/solvency lending and by means of interbank lending where a bunch of high-risk no-fuck-havers attempt to smooth volatility by covering each others' lows with their own highs. Believe me, I'm not in favor of giving banks a further "depository subsidy" (is that a thing? 'tis now.) with effectively twice insured zero-risk deposits for the very people who most need actual financial assistance.

Large chunks of wealth would probably move into offshore accounts and non-currency assets like real estate and yachts and sexual favors. Hell you could pay someone $100K per year to manage a continually laddering portfolio of zero-coupons, Treasurys, CDs, and other instruments that effectively have zero risk; it simply wouldn't be as concentrated in demand accounts as it is now.

... glancing back through thread...

Yeah. So, the post office. ;)

Can we please get this thread back on topic? The Postman was a really good book and a decent movie.

Good point.

I saw the first part of a documentary over the weekend about a failing post office that was successfully revived. A lot of how they were able to do it was situation-specific of course, but I think some of it could work here.

Here's another specific example of why it would suck if the Post Office went away. I just had to ship a package overseas. Using the online calculators at the FedEx, UPS and USPS sites, these are the lowest shipping quotes I got:

FedEx: $173
UPS: $178
USPS: $47

Note that the USPS one is for Priority Mail (package was too large and heavy for First Class, or it would have been even cheaper), so it will be there in about a week.

Yeah, Priority Mail is fantastic. I use FedEx for overnight deliveries and stuff but for ordinary things that should just get there reasonably fast and aren't especially time-sensitive, it's tough to beat Priority.

Yeah, it's a pretty sweet service that is well worth our tax dollars. Not that it would even need them, if we could get rid of PAEA-HR 6407. Without that, the USPS would still be a profitable operation that doesn't cost the US taxpayers a single dime.

OUR TAX DOLLARS DON'T GO TO THE USPS CURRENTLY

(sorry, that's a peeve of mine)

Except for Congressional bailouts, which is about 1/3 of the problem with GSEs. (Shared pet peeve though, FWIW.)

IIRC, we bailed them out this fiscal year, so some tax dollars did go to the USPS. As I (and several others) pointed out, though, it doesn't have to be that way. And wasn't prior to the passage of the above-mentioned bill.

Well, it's (soon to be announced as) official:

Source

GODDAMNIT.

This pisses me off so much.

Why, this is such a tiny change to service, I bet you wouldn't have even noticed had you not seen it stated. Saturday delivery always struck me as strange in the US, my mind boggled when I had heard about it.

I for one do a lot of mailing on Saturday.

So you should be happy, since the post offices will still be open.

And the post offices will still be open on Saturdays (many here in Canada are open Saturdays but there is no weekend delivery) you just won't receive non-parcels on Saturdays, that's it.

This seems like a good idea. Letters are so retro, anyway, if the USPS can save ~$2 billion by only delivering them on weekdays, then I say: go for it! We pay all of our bills online, so I actually can't remember the last time I got something in the mailbox that wasn't junk, aside from birthday and Christmas cards.

They usually pick my mail up when they drop the new mail off. :P

For me it's pretty much just Netflix discs. And until their streaming movie library catches up to their DVD movie library it's likely to stay this way.

So you can put your outgoing mail in your box on Saturday and they'll pick it up on Monday, this isn't particularly onerous.

I do actually tend to agree that there are some real serious issues with the way we run the postal service, but I also tend to think that it's such a basic service that I'm very hesitant to cut back on it regardless of how much money it loses.

Then it won't be postmarked Saturday. Jesus, it's like you've never sent mail before. :P

This. So much this.

Really, you think cutting Saturday delivery is somehow going to break the service? How many other countries even offer weekend delivery service?

How many other countries are as sprawled out as the US? How many other countries have the rural population of the US? How many other countries have severely underserved areas when it comes to Internet access and libraries and other resources?

What the hell does any of that have to do with Saturday mail service anyway?

Then...go to a post office to mail it.

Ryan does live in bleak, war-torn Detroit. I can understand why he might not want to go out, else chance facing ravening hordes of biker mutants, radioactive sewer crabs or rogue robocops.

Don't forget the radscorpions.

Here's an interesting article on the crisis and whether or not there's any specific place to lay the blame. Surprisingly enough, it seems the blame can be laid with the GOP. It's from ThinkProgress, so take it with a slightly smaller grain of salt than you would if it were on DKos.

It all comes down to the Postal Accountability and Enhancement Act of 2006 which was passed by the Republican lead congress in 2006. It requires that the post office pre-pay all future health care benefits for the next 75 years over the next ten years. What we're saying is that part of the USPS's massive deficit? A big part? Is them paying health care bills for people who not only have not yet been hired, but who, in some cases, have not yet even been born.

Insanity.