Back in the day, when various people were writing a new Constitution for the United States of America, they included a key bit of infrastructure that has been sadly neglected in modern times. Not that they were envisioning air mail, but they had the foresight to give Congress the power:
To establish Post Offices and post Roads
[Article I, Section 8, Paragraph 7]
From this slender clause, the federal government created a system that will whisk a letter from your desk to another’s. “Whisk”, perhaps, is too strong a term for a physical letter, especially in the shadow of e-mail. But the postal service does some pretty amazing things, including delivering that letter to any person in the U.S. at a standard rate, a rate that does not depend on their location.
But jealous voices (and there are always jealous voices in such tales, I’m assured by Rock & Roll Hall of Fame inductee, Todd Rungren) have long clamored to privatize this service. They got a partial success fifty years ago when the United States Postal Service was transformed by the Postal Reorganization Act of 1970 into an independent agency.
This is why, for example, the service is run by a board of governors, which installed Louis DeJoy (postal service nemesis) as postmaster general, and why most federal subsidies for the postal service were terminated. The service took another hit in 2006 with the Postal Accountability and Enhancement Act, which mandated the USPS fund the present value of earned retirement obligations within a ten-year time span.
It’s time for a full-on reorganization of the postal service that would restore it as an integral part of the federal government, put it under a secretary of postal services, and give it the ability to make changes it needs. As a critical part of the country’s infrastructure, it should also be given a mandate—and the funding—to provide modern and ongoing infrastructure to meet the communications needs of our present life.
I’m only going to briefly summarize the changes I propose in this article. I’m just laying out the intent. The resources and processes need to follow from that. If you agree it is high time we revitalized our postal service, I ask you to join me in developing this idea and promoting it to the pundits and politicians of the nation. The postal service of the future should serve our modern needs. Let’s define that future.
This article covers five essential changes:
- Reorganization
- Basic Financial Services
- The Postal Service as a Communications Artery
- The New Public Square
- The Presidential Mandate
Reorganization
Congress should start by dismissing the postmaster general and the board of governors. Instead, it should create a cabinet-level post, Secretary of Postal Services, reporting directly to the President, with the mandate to run the postal service for the benefit of the country.
Congress also needs to guarantee the retirement payments for all postal workers, taking over the fund set up in 2006 and freeing the service from putting aside its own money for this obligation. These have always been government employees. It is dysfunctional to demand their retirement funding come entirely from postal fees, which are not progressive. And the postal service is a public service; it serves the nation.
There are some things we need to retain. We should retain universal delivery at standard rates. That means retaining universal letter and small package delivery to points easily accessible by all citizens. This includes climate-controlled delivery of packages of medicines and other items essential for the health and safety of the public. This implies the continued monopoly on access to letter boxes.
The cost of delivery should be subsidized by the general fund. We should set the price for first class letter delivery to the per-ounce actual average cost divided by half, with the funding for the other half made up from the general fund of the Treasury. We provide letter delivery on a national scale for the betterment of the nation. It’s entirely appropriate the taxpayers subsidize this cost.
As a pure government agency, we need to set clear limits between what the USPS does and what private companies can do. My suggestion is to allow third-party (UPS, FedEx, etc.) delivery of letters, provided such letters are hand-delivered (or machine delivered) to an individual (human or human-equivalent) by that service. To qualify, the person receiving must see the person (or machine) deliver the letter. In other words, the letter or package must be delivered to a person, not a letter box or other receptacle. This is for “urgent” letters, outside the scope of the USPS.
Conversely, we should allow USPS to deliver packages on behalf of other services (the USPS on behalf of UPS, FedEx, etc.) at a cost equal to the actual average delivery cost of these packages plus 10%. This eliminates the Trump-inspired whine about Amazon (and other companies) exploiting the postal service. It sets a clear standard, allowing third parties to make use of the universal delivery system, but paying a reasonable price to do so.
One more thing. Let’s expand postal locations. Instead of shutting down post offices in under-served areas, we should expand them as the federal government’s point of presence in all communities. They should not just be a place to drop off the occasional post card. They should have more space for added services, including a place where we could set up delivery of vaccines or critical supplies in future emergencies.
This is especially important for under-served areas of cities. Building up the offices there increases the money flow and the safety for these areas. We should think of this as an opportunity to serve the under-served. And it is critical for rural areas. Other services are wont to deliver there because it isn’t profitable. Government is not like a business. It should not seek to make profits, it should seek to serve the people.
Basic Financial Services
From the early twentieth century to the mid-Sixties, the postal service operated the United States Postal Savings System. This was not a full banking service, but it allowed the public a convenient place to set up savings accounts. Then, changes to banking and other factors made deposits at regular banks more attractive, so in the 1960s the government terminated this program.
But as it’s become harder and more expensive for people to access banks, and as many people need both checking accounts and credit cards to operate in the modern economy, it makes sense to create a basic banking service open to every resident in the country. This is especially important in times of national disasters, such as the recent pandemic. If the national government needs to send money to individuals, it is critical for every individual to have at least a bank account, where they can receive those funds.
My suggestion is to provide to any person a free bank account with at least these services:
- Free checking.
- Free bill pay.
- Free savings accounts with an interest rate equal to the official inflation rate plus 0.5%.
- A debit card, which can be used on the same terms as the most popular credit card.
- A pass-through credit card issued by any state bank.
Free checking would mean no transaction or yearly fees. Depositors would be able to buy and use, at their own expense, paper checks. However, the USPS bank would provide an online service where the account holder could pay money to creditors from their checking account, and the bank would either transfer money electronically or by printing and sending a physical check for the recipient.
Depositor savings would be aggregated and turned into Treasurys (United States Treasury securities). This would provide some income to the postal service from the deposits. The remainder of the yield to the consumer, if any, would be made up out of the general fund, so that the depositor would get a half-percent plus inflation return. This would provide stable savings for the public.
This bank would issue debit cards, allowing the user to access their funds from any point of payment system that takes standard credit cards. The USPS locations could install ATMs, if they wanted, where customers could access their accounts with the debit card.
The legislation should also authorize this bank to enter into agreements with any state-owned banks to issue credit cards to account holders. This would be a separate agreement between the state-owned bank and the account holder. As far as I know, there’s only one state-owned bank in the U.S., the Bank of North Dakota. But this would encourage other states to set up their own banks.
(Parenthetically, I think California should set up its own state-owned bank and issue credit cards through that bank. This would be a huge service to the public because it would cut the costs of the whole credit card system and would provide citizens with a way of accessing short-term credit without being exploited as they currently are. Take the hint, Sacramento.)
We are guaranteed to have more natural or at least regional disasters. Providing free basic banking would facilitate delivery of cash to individuals and small businesses, allowing them to survive these calamities without the unfairness and delays of the current system.
The Postal Service as a Communications Artery
The USPS should be one of the nation’s most important communications arteries. We should invest in state-of-the-art electronic networking to connect the nearly 31,000 post offices and locations of the USPS. We should then allow interconnection with local Internet Service Providers (ISPs).
Any local service provider, either a local government agency, community owned ISP, or a not-for-profit ISP operating in a local area, should be able to plug into this communications network to get access to the rest of the Internet. By “local”, I want practical and objective criteria, such as the congressional district where the postal location is located and directly adjacent districts. It should have state-of-the-art technology from the physical layer on up. The USPS network should be a Tier 1 peer.
By pushing the physical infrastructure out to thousands of postal locations in the U.S., we make it much easier for rural and other under-served communities to get access to high-speed Internet. The nation’s basic physical packet switching network is inappropriate for private ownership, because it facilitates monopolies that create unfairness in our modern communication system.
All currently pending infrastructure proposals have some component for improving the “pipes” of the Internet. A key part of those proposals is (or ought to be) providing appropriate access to rural and other under-served areas. The post office already has a network that provides physical transport of messages. Its distribution of locations is generally appropriate for delivering this service fairly because of its mandate to serve every person in the country. It is a natural enhancement to add on the electronic infrastructure.
The New Public Square
Electronics created problems. As the speed of electronic communication and electronic computation increased over the last several decades, we’ve created a society dominated by intensely powerful private corporations that dominate society’s private and public communications. Everyone in the political world feels like they are treated unfairly by Facebook, Twitter, Google, and other services. The demands to regulate this industry grow every day. Should we break them up? Should we regulate them more heavily? Should we take away some of their immunities?
How about a little public competition?
The postal service should provide free online services to the public. That should include at least a free e-mail account, free online storage, free access to some kind of SMS service, free access to set up their own web pages and post content, and generally everything the public can do now on the Internet, including basic forms of social media.
The USPS should be authorized and funded to provide the core services we now associate with Internet access.
Right now, users make a Faustian bargain, where they allow companies to examine everything they post or send on the Internet in exchange for free access. When you go shopping in the physical world, you don’t give some company the right to see which locations you visit or what you buy, in exchange for them providing the roads for you to get there. The community collects taxes and provides those roads for you. In doing so, it gives you freedom. It gives you freedom from snooping.
(I realize that even our governments are now snooping with cameras that keep track of license plates and CCTV that records our movements. But that’s just government acting badly, not an intrinsic part of the system.)
The USPS should set up an electronic public square that provides the basics for all residents of the country.
To do that safely, Congress should provide for an Internet bill of rights, to protect the public from unwanted and unnecessary surveillance and intrusions of privacy. And Congress should take control of terms of agreement for all online entities, setting standards that preclude abuses like force arbitration clauses. The European Union has the General Data Protection Regulation (GDPR), which gives individuals control over their personal data and simplifies the regulatory environment. If our competitors on the international stage can have data protections, why can’t we?
The Presidential Mandate
I am not naive enough to think Congress will act anytime soon to reform the postal service. But I think it could be goaded into action by an active President.
The Constitution makes the post office a federal institution. As such, the President has control of it. I think that means the President should consider simply reorganizing the postal service, if Congress refuses to act.
As the postal service is a part of the Executive Branch, the President has constitutional authority to decide how it should be run. The President could, in theory, elevate the postmaster general to cabinet level and dismiss the board of governors. Or, simply supersede their authority. The President has constitutional authority to run the Executive Branch, and any laws to the contrary may not be constitutional.
It’s doubtful our current President would act that strongly, but I think this option should be on the table as an incentive for Congress to act.
The last guy in the Oval Office tried to destroy the postal service. He and his Republican cronies have used all the power at their disposal to kill off this government service. They hate government so much that they would rip the heart out of America, if they could, for their own ill-conceived political purposes.
A strong response is called for.
Summary
Let’s look at how we can enhance the postal service, this cornerstone of the country’s infrastructure, for our time. Our time is the mid-twenty-first century. Gone are the pony express and the telegraph wires across the lonely plains. Bring fiber. Bring satellite transmission. Bring video chat. Bring the modern world to the post office. Make it our future.
Note: A number of these proposals previously have been made by others, and I don’t take credit for inventing them. What I’ve done is to aggregate them here. I think these changes fall under the broad heading of “infrastructure”. While we are fixing infrastructure, it would be a massive fail to ignore the postal service, which is a key part of the nation’s infrastructure.