Brookings Keeps Banging USPS Privatization Drum

Here comes another proposal to privatize the U.S. Postal Service. Only this one comes from the supposedly liberal Brookings Institution which essentially argues that the USPS should be broken in half.

USPS should be divided into two parts: a public entity that would just deliver the mail and another private one that would deliver packages and supposedly compete with all the for-profit companies in the field.

Brookings senior fellow, Elaine Kamarck argues that the USPS, not really a governmental entity, is hobbled with an outdated structure and cannot effectively compete in the marketplace with corporations

True enough. But Kamarck’s arguments sound like tired corporate rhetoric that’s been around for at last 20 years much of which is easily disprovable.

If these ideas become law the profit-making types will never leave this arena but will seek to expand their foothold.

For any liberal pretensions Brookings might have Kamarck’s proposal sounds extremely pro-corporate.

Yeah, let’s put the money-making part of the postal service into private hands and let the government or some as-yet undefined public entity perform its basic functions.

Kamarck also seems to ignore the more than $5.8 billion a year the USPS must pay to cover the healthcare costs of future retirees for the next 70-plus years.

This provision, stuck into the 2006 postal reform law, accounts for quite a chunk of the USPS’s deficit. For the quarter ended June 30, the postal service reported a net loss of $586 million for the third quarter of fiscal 2015 (April 1, 2015 — June 30, 2015), a reduction of $1.4 billion from the net loss of $2 billion for same period last year.

Without this millstone the postal service might even be in the black again.

There’s no question electronic communications have cut into first class mail which has been declining steadily for years.

But the USPS still uses first class to deliver bills and not all people are online. Also not everybody wants to relinquish control over their own money as often happens with electronic bill-paying.

Kamarck believes postal service privatization is inevitable.

Not necessarily.

Brookings’ current report is it second in recent memory that castigates the USPS. Earlier this year, the think tank basically questioned if we still need the postal service or first class mail, according to
Kamarck’s proposals look disingenuous and short-sighted at best. They’re also uncaring and out-of-touch with the needs of ordinary people

Why does the USPS have to make a profit anyway? What about the idea of providing a necessary service to everybody?

With these reports, Brookings, looks more and more like those who call for the privatization of Social Security which is not likely to happen.

But they keep banging the drum.

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