Written by: will rippey
Lately, the United States Postal Service (USPS) has been getting a lot of attention. The USPS has been under attack from the Trump administration, which has been defunding it and removing mailboxes in major cities.
This sparked conversations of what the future of the agency will be. In the wake of the COVID-19 pandemic and the agency’s financial losses, many have advocated for the privatization of the USPS.
I would like to propose an alternative plan for the future of mailing in the United States. Rather than privatizing the USPS, I believe it would be much more beneficial to nationalize the privately-owned shipping companies that already exist.
This may seem like harmful government overreach, but there are two major effects of nationalization which would greatly benefit our mail infrastructure.
In 2018, Stanford conducted a study of various Chinese firms. The study found that state owned enterprises exhibited productivity rates 68% higher than that of their private counterparts. Furthermore, a study by Greenwich University in London found that nationalizing utility companies would save the UK approximately 7.8 billion GBP per year.
If the USPS were privatized, our mail infrastructure would become less efficient and more expensive. Conversely, if UPS and FedEx were nationalized, both companies would become more efficient.
This would obviously be a costly measure as the fifth amendment requires the owners of any seized property to be compensated for their losses. However, the University of Greenwich also highlights the fact that the cost of compensation would be paid off in under 10 years if the nationalizations were to occur.
Nationalization of postal companies would greatly benefit sellers and consumers as well. Compared to its private competitors, the USPS is much cheaper for individuals and corporations.
Individual shipping costs with USPS are anywhere from $8 to $70 cheaper than private companies. Additionally, major retailers such as Amazon still rely on USPS for deliveries to rural areas. USPS also delivers far more packages than UPS or Fedex each year, at 143 billion compared to UPS’s 4.7 billion and Fedex’s 3 million.
Privatizing the USPS would increase costs of shipping, thereby leading to less revenue for retailers and more expenses for individuals.
While nationalization seems scary to us as Americans who are already conditioned to vomit at the thought of the government intervening in the free market, UPS and FedEx are actually exceptions to the wide range of essential services already publicly owned in the United States.
Eighty-seven percent of water suppliers in the United States are municipally owned as of 2019 according to the University of Greenwich study. Greenwich also found that municipally owned electricity agencies provide power to approximately 49 million people even in major urban centers such as Los Angeles.
There have been 70 cases of water re-municipalization since 2003, and research in the city of San Francisco found that public ownership of its power grid will have long term financial benefits for the city.
Many would argue that these services are far more important than mail and that they should not be compared. I, however, would argue that mail, water and electricity are equally important to our infrastructure.
As electronic commerce continues to dominate the domestic and global market, shipping is becoming a vital utility for both consumers and businesses. Online sellers and, by extension thier customers, rely just as much on shipping as they do on electricity.
Nationalizing shipping would guarantee stable service, lower prices for businesses and individuals and secure jobs for USPS workers whose livelihoods are directly threatened by right-wing attempts to dismantle it and privatize the industry entirely.