Trump: Sell the Post Office

January/14/2018 10:05AM
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This is from the Washington Post,  which is owned by Bezos, who owns Amazon.

“Spokesmen for the Postal Service and Amazon didn’t immediately respond to requests for comment Friday. In July, Amazon told Fortune magazine that the Postal Regulatory Commission, which oversees the Postal Service, “has consistently found that Amazon’s contracts with the USPS are profitable.”

Amazon defended its program in July after Josh Sandbulte, a hedge fund manager with a stake in FedEx, wrote a Wall Street Journal op-ed asserting that the Postal Service effectively subsidizes Amazon, losing an average of $1.46 for each shipment it delivers. The op-ed cut against a view that rising volumes of e-commerce shipping might lift the Postal Service’s long-struggling finances.

Sandbulte largely based his op-ed on an April report from analysts at Citigroup arguing that the Postal Service’s employee benefits were acting as a drag on the USPS’s profitability.

“We contend that the USPS does not act as a rational price-setter in the parcel market,” the report said. “Remedying this could be the key to the organization regaining operating solvency. . . . To this day, price still does not cover all-in costs.”

The Postal Service recorded a net loss of $5.6 billion in 2016, which it blamed on employee health-care costs.

Although Amazon is the biggest user of the parcel delivery service, the Citigroup analysts warned that Amazon would also be best positioned to absorb any increase in shipping costs, because of its size and extensive leverage in the shipping market. Other major users of delivery services, such as Best Buy and Staples, would be more exposed.

James O’Rourke, a management professor at the University of Notre Dame who studies the Postal Service, said the USPS’s essential problem is that it faces costs few other carriers do. Unlike UPS or FedEx, much of whose business revolves around moving parcels from one hub to another, the Postal Service is far more involved in delivering parcels over the “last mile” of a trip. This can be costly, especially in rural and suburban areas.”

Basically, this says, the USPS is shipping Amazon packages on a one-day basis for $3.14 a pop.

My wife wants her junk mail forwarded from Illinois to Arizona for 17  weeks.  It’s called Premium Forwarding Service. The local post office holds the mail for a week. puts it in a box, and ships it to the forwarding address. The cost; $400 for 17 weeks.

Here’s how the first week went in 2018. Box was shipped to Arizona from the Illinois post office , per the person at the Illinois  post office on 1-9-18. I know this lady at the post office. She’s the only one at a large suburban Chicago post office who can do anything that’s not routine. She said she had been getting a lot of calls from the Florida people wondering where their first week shipment’s were.  At best,  it will be delivered 1-16-18. The day the second box is due to ship. That means the mail for January from January 1 to January 9 will show up on January 16. That’s called Premium Forwarding Service. The box will be smaller than the average Amazon package they ship in one day for $3.14 or less.

So, for the privilege of losing $5.6 billion, or more,(2016 USPS loss number, 2017 not in yet) we pay a ridiculous price for terrible service while the man who attacks the President daily in his rag paper gets a special deal. Then our tax dollars go to subsidize a business that is poorly run. Box businesses are minting money and UPS and FedEx will have record sales and profits due to Amazon. But, the USPS will undoubtably show a record loss and we taxpayers will cover that. Just like the year AMTRAK had record sales(gas prices were the highest) and record losses.

Enough Trump, pull the plug on this. The real estate alone is enough to build the wall. The USPS owns a post office on the main street of Park City, Utah. That property is worth several million. What business runs a warehouse out of a million dollar piece of real estate. Not, Trump, but what is now Trump’s organization.

Dump it Donald.

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Comments (3)

  1. Doug Gordon says:

    It’s especially costly when they go that last mile in rural Iowa and deliver it to the WRONG ADDRESS. Christmas of 2016 I ordered gifts from a Wisconsin company I’ve used for years to be sent to a bunch of relatives in Iowa. I wrote about it in my holiday card to one of my Aunts, and she found it strange that they never got the package. Finally in early January she called me to let me know they never got it. They were home all day it was supposedly delivered. I contacted the company, got them to send the gift again, and it was received a couple days later, which we again confirmed via phone.

    Now, for the really bizarre part, a week or so later the ORIGINAL package was delivered, seems it had been dropped off at a business several miles away from the stated address, and being good loading dock guys, they didn’t know what to do with it and let it sit around for weeks before getting it back in the delivery system by realizing it wasn’t for anybody that worked there.

    it is beyond aggravating to me how these FedEx/UPS folks move the package hundreds of miles in a day or two and then turn it over to the USPS for final delivery which takes another three or four days to go the last 10-50 miles.

    General Custer, don’t bring those gattling guns, they’ll just slow us down.

    There just isn’t any cure for stupid, or government (except less government).

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