U.N. postal union clinches deal to keep U.S. in
reuters.com
reuters.com
It was more expensive to ship within the US and Canada than from China. Pretty much crushed the small retailers (I know I refused to spend $7 shipping for a $12 item). Now that that’s improved the rates should more normalize, because they won’t have to subsidize the loss on China shipping.
Months ago I bought replacement shelves for my fridge. Together about the size of two phone books stacked. Shelves were $40 and shipping was $40 from Illinois to Ontario.
Life itself feels so frustrating when it's wildly cheaper just to buy more crap from China than to recycle stuff from within North America.
What's interesting about it is that there are some users who order 50x of whatever the item is and then just sell them out of their garage, but there are others who have an arrangement with their contract manufacturer in China to actually do drop-shipping through eBay storefronts and similar. This latter group are obviously the more professionalized ones, but it's funny just to see a tiny microcosm of this issue, where the guys who are sending stuff within North America and Europe struggle to compete against dirt-cheap overseas shipping.
$16ea + $5 shipping to Canada from China: https://www.ebay.com/itm/302678192585
Compare this to Metroboard, an established e-commerce storefront, who currently has their similar pulley marked down to $15 from a regular $30, but when I emailed to asked about shipping to Canada I was told it would be a $55 flat rate box: https://metro-board.com/e-skate-shop/pulley-insert-for-abec-...
You can send that for $10.50 from USA to Canada as an International Small Package [1].
They just don't care enough about you as a customer to bother.
Thank god for China! You are not at the mercy of the douchebags.
International shipping does require a bit of a knack for risk assessment. There are countries that most think are fine, but with terrible postal systems. Or annoying customs. Or people that flip out when a package takes more than 3 days to arrive.
Shipping to Sweden is fine. Shipping to Italy isn’t. German Customs will inspect a lot and send a bill, Canadian customs often doesn’t bother with American packages.
And I was happy to make some Super Nintendo collector in Sweden happy.
It's really an astonishing situation, but I guess the purpose was to subsidize China and other countries in order to help them develop economically, and to increase imports. It seems to have worked, so we can probably end the program now for China at least.
What's interesting is that there doesn't seem to have been a lot of debate or media coverage before now.
or you can say the purpose of the subsidy was to make goods cheaper for American consumers?
Though I'm not sure the funds will not just be redirected elsewhere, and how wasteful this is, given that it helps give access to more affordable and efficient direct shopping from producers, and puts pressure on the government to lower spending because of the tax breaks that are given to people buying directly from China.
If you drive from Bend to, say, Winnemucca, you go from Pacific to Mountain and back to Pacific.
It takes a minute to explain that Portland is to remote parts of Oregon like...New York City is to Morgantown, West Virginia in both distance and everything else.
Someone can land at Newark Airport, and have to figure out the difference between going to Newark Penn Station or New York Penn Station, which are in opposite directions from the airport.
Of course the PRR hasn't existed in 50 years so maybe it's time to change the name...
They're in the same direction from the airport, and the train will stop in Newark Penn on the way to New York Penn. Some people will be confused and try to get off in Newark, although the conductors normally try to announce this really clearly.
Found that out the hard way when I went to meet a fried at the general store in Strawberry, and wound up a few hours away from him.
However, it'd be fascinating to see some mapping showing in detail where most place names are from in a region.
https://en.wikipedia.org/wiki/List_of_state_and_territory_na... has the states, but it'd be more fun to dive into towns, rivers, mountains, etc...
Also note that where USPS has a monopoly it's often where it is required by law to sell below costs. For example, delivering mail to Alaska and Hawaii is quite expensive, but US law requires uniform postage costs.
The USPS is hampered by law in other ways. The UPU decision is one example; they also have fairly strict pension laws and they cannot raise prices without agreement from overseers (a price increase to 55¢ was just struck down in court). It's not totally clear that it's possible for USPS to run in the black while also being the mailer of last resort that it is today. (That said, perhaps mail is a government service worth subsidizing, though we can debate how much, and running in the black would be preferable.)
The issue for the postal service is that the law was changed so that the USPS would start funding their retirement health care costs since they are promised to the workers and the projected costs had exploded. This was supported by a bipartisan commission, the GAO, and the Postal Service itself:
>...Although retiree health benefits are often unfunded or poorly funded, two considerations suggested the Service’s retiree health care obligations should be funded: they are as firm a commitment as the Service’s pensions, and they had become enormous (about $75 billion by 2006). In 2003, the presidential commission suggested establishing a reserve fund for these obligations, and the Postal Service itself sent Congress a proposal for creating such a fund.
>Prior to 2006, the Service simply paid retirees’ health benefit premiums when they came due. The Service put aside no money when it promised the future benefits. Paying benefits when they come due rather than funding them in advance is known as the pay-as-you-go or unfunded approach.
>Early this century, Congress, the Administration, the U.S. General Accounting Office (GAO), and a bipartisan presidential commission expressed concern about the lack of funding. Although retiree health benefits are often unfunded or poorly funded, two considerations suggested the Service’s retiree health care obligations should be funded: they are as firm a commitment as the Service’s pensions, and they had become enormous (about $75 billion by 2006). In 2003, the presidential commission suggested establishing a reserve fund for these obligations, and the Postal Service itself sent Congress a proposal for creating such a fund.
>In 2002-2003, it was discovered that the Service was contributing far more than necessary to fully fund its pensions, and Congress allowed the Service to contribute less. Congress decided the pension “savings” could help patch the retiree health benefit underfunding. In 2006, as part of the Postal Accountability and Enhancement Act (PAEA), the Postal Service Retirement Health Benefits Fund (RHBF) was established. Most of the Service’s contributions to the new fund could be paid using the pension “savings.” PAEA was bipartisan legislation with broad support.
https://taxfoundation.org/primer-postal-service-retiree-heal...
(BTW I agree with the other responders - this was an excellent summary for those of us not in the US)
It's also possible to run local fire departments, etc in the black as well. Whether that is preferable or not is a subject of debate :D
Fedex and UPS, in unison: am I a joke to you?
The short answer is yes, they are.
The USPS can't increase their domestic prices but there is good indication that they are charging more to offset this. There are complaints in this thread even about the cost of shipping abroad, as international shipping is not regulated like domestic postage rates if I remember right. So the USPS uses outbound international shipments as a cost center to make up for the subsidy to China.
The article states there is a ~$500M subsidy to China through UPU rates.
They won’t. The rates for shipments from China will go up and some executives will get higher bonuses
That's normalization. Instead of shipping a cog from 1 state over for $5 or China for $.05, it will now cost China closer to the same rates everyone else pays.
The argument want never that shipping domestically was too expensive, it's that shipping from China to domestic was cheaper.
I countered with the assumption that while the former will happen for sure, the latter won't, but instead the additional revenue coming from the increased shipping costs from China will subsidize higher bonuses for executives rather than be used to lower the costs for non-china packages.
(it's the sort of thing I personalize & sell myself, need to charge more than that for material costs + profit, and ship as well)
https://www.ebay.com/itm/Acrylic-Transparent-Photo-Frame-6in...
Your example in the other comment was 4 oz. The commercial rate for pre-sorted flats is $1.249. There's even lower rates if you can do higher levels of sorting and injection, cheapest is $0.936.
See https://pe.usps.com/text/dmm300/Notice123.htm#_c104 "First-Class Mail Commercial Flats (Large Envelopes)"
And even then you're wrong: Paying any amount for shipping of items, even if the items cost the same amount as the Chinese version it's still more expensive. It doesn't matter if the shipping cost is $10 or $3.50 or $1: It's still more expensive.
>And even then you're wrong: Paying any amount for shipping of items, even if the items cost the same amount as the Chinese version it's still more expensive. It doesn't matter if the shipping cost is $10 or $3.50 or $1: It's still more expensive.
Care to elaborate? If your cost was the same as the Chinese and your shipping cost the same as well then your overall cost would be the same. What are you trying to say here?
And you ignore that point that even at the high volume flats rate, it's still more expensive. Maybe your needs are an edge case, I don't know. But you asked for examples where shipping within the US is more expensive, and you have those examples in spades. Once given, you want to move the goal posts, and can't even move them to where you're actually right. You're being deliberately obtuse and intellectually dishonest. I'm done trying to have a conversation.
Regardless, you're not trying to honestly assess the examples given. But I guess I was incorrect when I said I was done with the conversation-- I couldn't help pointing out for other readers how you persist in being wrong.
No, it doesn't imply that. For other configurations there are different programs that reduce the cost; elsewhere in this thread I pointed out that using parcel select lightweight would reduce the claimed shipping cost by a factor of 3.
My claim is that the specific examples people give tend to be wrong. I'm sure there's some exotic configurations where China ends up paying less. It's just that virtually none of the articles about the topic point to correct examples.
>And even if it did, once again, it would still be more expensive.
You keep saying this, but so far have not identified what the comparable option you're showing that's cheaper.
In my initial comment I asked for locations, dimensions, and weight. You only provided weight, so I had to guess the others based on the product page.
Small packages, generally about 6" x 6" and weighing under 4oz, trickled in over the following few months. They came from China, Estonia, and Slovenia.
We got one really nice panda hand puppet, several charming small stuffed animals, a bunch of bookmarks, and some magnets.
Now that you mention it, it would be interesting to try the experiment again and see what is the cheapest price I could get to remail each package back to my friend elsewhere in the US.
Do any of the items fit in a regular envelope? Is it possible to ship for the price of a stamp? If not, most likely you can ship with flats for $1-1.50 range.
There's a great Planet Money episode explaining the brokenness of the existing system (https://www.npr.org/sections/money/2018/08/01/634737852/epis...). NPR ends up substantiating the claim of an entrepreneur who says that it costs him more to send a package across the street than it costs someone in China to send a package to that same address.
If you look up the cheapest US shipping rates you'll find they're roughly the same range, and that almost all the comparisons purporting to show otherwise are cheating, typically by using retail pricing on a more expensive shipping option.
>So he turns to his shipping guy. And he asks, how much would it cost for us just to ship this mug, like, not across the ocean, just across the street?
>SMALDONE: He told me it's going to cost us about $6.30 to ship this item.
Amazon page for mighty mug says it's 12.6 oz shipping weight. https://www.amazon.com/Might-Mug-1525-Mighty-Black/dp/B00FZD...
Round up to 13 oz, then look up rates for the cheapest shipping option for packages under a pound "parcel select lightweight". See https://pe.usps.com/text/dmm300/Notice123.htm#_c139
The cheapest rate is $2.02 for 13 oz. This rate applies when mail is injected at the closest mailing point (DDU), which "mailing across the street" corresponds to.
"Parcel select" is a service for large mailers who deliver packages, in bulk, to multiple post facilities in the US, near to the destination of the package and have the USPS do the "last mile delivery". Does China Post have a fleet of trucks, in the US which moves Chinese packages to a closer US postal delivery facility. I believe not.
Moreover, if China did have such a service, someone, China or the US is subsidizing it since individual shippers in China, not doing any aggregating themselves get a rate equivalent to large shippers in the US who aggregate and must pay the costs of this themselves.
"“Parcel Select” is the registered trademark name for the Postal Service’s economical ground delivery service for packages entered in bulk, including those entered at destination facilities. It is designed for and generally used by large- and medium-sized parcel shippers. Parcel Select mailers pay postage that reflects the degree of work-sharing they do in presorting their parcels and/or drop shipping their pieces at a destination facility located closer to the delivery point. Mailers are responsible for transporting their Parcel Select pieces to a destination bulk mail center (DBMC), destination sectional center facility (DSCF), or a destination delivery unit (DDU) for business and residential delivery."
https://about.usps.com/postal-bulletin/2007/html/pb22219/kit...
They explicitly claim that the prices quoted are just for last mile delivery.
The cost for an individual shipper in the US versus the cost for an individual shipper in China is clearly the correct point of comparison and it seems NPR was in making that comparison.
Edit: removed comment about other thread.
International mail is aggregated by China post, and they pay the USPS for the last mile. To evaluate to what extent USPS is subsidizing them, you need to compare to what someone else who aggregates and pays for last mile delivery would pay. This is very different from what an individual shipper would pay.
The aggregation that USPS gives domestic shippers a discount for involves actually doing all but the last mile of the shipping process - taking a large group of packages to the appropriate shipping area. This is a process that would require a shipper to have a fleet of long distance trucks (something large and medium sized US shippers have).
If you're claiming China Post does this in the US, I think you need serious references. And, as I mention above, it ultimately doesn't matter. If China Post is doing this, they would be doing it for free because the total cost we're talking about individual shippers paying, in shipping things from China, is close to the last mile cost that USPS charges domestic shippers.
Labor costs in China are much cheaper than in the US, it stands to reason their cost of sorting there will be less than what the USPS implicitly charges for sorting here.
This is the key point in your claim that was not clear in your top-level comment, which is the source of the confusion/dispute. (I have no idea who is right.) Consider editing your top-level comment to clarify this claim (with an edit flag) and, ideally, link to somewhere that backs it up.
For instance, even if you're right it probably means that China is subsidizing the shipping to the distribution point, which would be an important thing to understand.
But I suppose part of the difference is not due to the subsidy but because the China post has lower labor costs for the aggregation work?
That's end to end, although you do need to pay to ship it to Amazon's warehouse, but that can be done in bulk cheaply.
Under the UPU, the USPS is required to charge Chinese shippers a "terminal fee" for packages shipped from China. However, due to China being classified as a "transitional country" it had extremely low terminal fee rates.
Combined with China subsidizing shipping for export-based businesses, it was generally cheaper for a business in Shenzen to ship small/light products by post than for an American business to ship an equivalent product by USPS across the street.
The deal secured by the US allows the USPS to begin charging new terminal fee rates beginning next summer. Presumably the new rates will change the economics of this situation, but in the meantime Chinese shippers still have at least a year to continue these subsidized shenanigans.
Um...the beneficiary of these "subsidized shenanigans" is the American people!
Bad for the middleman, bad for the parasites, bad for the FBA goofballs, but good for the American people.
So by itself that's a wash, no benefit nor loss.
But also people that could have bought a local product send their money out of the country, which means less money circulating in the economy.
And more labor is spent on shipping than necessary, which means less value per dollar spent.
Both of those hurt the American people.
In vague hand wavy tickle down from a government that isn't going to lower taxes nor reduce total expenditure there might be a benefit in increased funding available for other things but the visible net effect is less money in individual Americans' pockets.
Maybe they'll save more to that pension fund, but I can't in good conscience say "The USPS should keep that policy where I can get $3 cheaper shipping from china and the money to pay for it comes out of the USPS pension fund."
If most of the money stays inside the realm of shipping, the average cost for local businesses will go down. (The first order effect just shuffles money around. More to buy from china, less to send to customers, on average the same. A second order effect is that more purchases from china will shift to being bulk, dropping the average cost.)
I agree with you that the right deal was made. But the cheap shipping from China has pretty much proved a market for subsidized small parcel shipping as an economic multiplier that ought to be made available to everyone in the US and abroad.
I'm not sure I agree that there's a big difference between $4 small parcel shipping and $.50 small parcel shipping to the economy, especially when it involves waiting a month for the product.
And that is the primary reason that China subsidizes shipping costs for Chinese manufacturers: to drive foreign competitors out of business until only China is left.
Alternative is getting the same or maybe at best rebranded chinese OEM products, that went through a local distributor that adds his own markup, taxes, and other stuff, because he's operating in bulk quantities.
Changing the current scheme will be bad for plenty of consumers around the world.
It will also make it more expensive to get replacenemnt parts, for typical electronics, and will make self-made repairs more expensive. Because normal (unatuhorized) people can only get many of those spare parts from China.
Making it more expensive to ship from China will have many negative effects. It may have some positive ones, but that's to be seen.
If a middleman ends up cheaper because of bulk shipping, that's because they're actually providing value! They are reducing the total cost of shipping.
If the total shipping cost you pay, including your share of hidden subsidies, goes up? That means you were an above-average china-buyer, and the average citizen was paying part of your bill and getting nothing. That's not fair, and you're not entitled to offload shipping costs onto everyone else.
And I'm also paying quite a bit of taxes that go to someone else's needs, and I have nothing from. Just a nature of taxation and government subsidies.
This just shifts the balance of what's comming back to me, to where I don't care as much, perhaps.
Especially when you're looking internal to the post office.
How are retail stores supposed to compete when Amazon will ship for free! Eventually, there will just be Amazon, and then watch prices skyrocket!
>Combined with China subsidizing shipping for export-based businesses, it was generally cheaper for a business in Shenzen to ship small/light products by post than for an American business to ship an equivalent product by USPS across the street.
Please back this up with examples.
You linked to a price sheet for US shippers. Chinese shippers don't pay those rates. They pay Chinese shipping rates (which I can't provide an authoritative example of because they're negotiated on a vendor basis), and the terminal fee. In many cases, China Post covers the terminal fee and/or all shipping costs for strategic regions, such as for vendors located in Special Economic Zones.
The important thing though is that the terminal fee for Chinese shippers is lower than the lowest postal fee for US shippers.
Yes, Chinese shippers pay different rates. NPR claimed to ship a mighty mug across the street for a US shipper would cost $6.30, when the actual cost would be about a third of that.
The claim seems to be true. Yes, he seems to have overstated his shipping cost and could have done better. Yes, with the combination of all 3 of A) volume pricing, B) presorting, and C) taking it to the specific delivery unit, you can get pretty close to the cost to mail a parcel from China. To somehow take these facts and get to "lolol it's a false claim" is absurd.
If you set up an apples to apples comparison, I think China would end up slightly cheaper much of the time, but nowhere near the hyperbolic numbers that get thrown around. Maybe they pay $2 for something that costs $2.25 or something. It's difficult to point to specific comparable shipments where they're actually cheaper, though.
>The claim was that someone (and, actually, this includes low volume mailers) could mail something from China for a total cost less than his cost to mail it across the street.
Actually, the claim made there was that someone could sell something including shipping from China for less than the shipping cost across the street. This claim is laughably absurd, and the comment I was replying to said that NPR had substantiated that, which is also absurd. If they'd fact checked that podcast the $6.30 figure would have never made it in.
I can't use Amazon's FBA to ship one package cheaper than I could myself.
End, low-volume customers in China can get packages shipped to the US cheaper than I can myself as an end, moderate-volume shipper in the US.
I think using published rates for presorted mail is fair. It's not the cheapest the USPS charges - they give further, unpublished, discounts to Amazon, and they still make a profit there.
If NPR was looking to ask the "average" business what it would take to fulfill a single order, they likely got a good answer. And the shipper may have been overestimating final shipping weight if done on the fly.
Bulk freight of nonperishable things is cheap.
Ask why Australia ships iron ore and coal to China to be made into steel.
Let alone how moving up one step in granularity to the more realistic DSCF pricing, where you go to the closest of 350 facilities instead of the closest of 30000, is already $2.52 for 13oz...
This shows the rate for 12 oz under Parcel Select—Lightweight. Depending how closely you're injecting the product (how many miles the "last mile" is), rates range from $1.83 to $4.34. Not seeing $4.76 anywhere.
I think that's what the NPR report was getting at, with their colorful tales.
"The 1874 treaty provided for the originating country to keep all of the postage revenue, without compensating the destination country for delivery. The idea was that each letter would generate a reply, so the postal flows would be in balance. However, other classes of mail had imbalanced flows. In 1906, the Italian postal service was delivering 325,000 periodicals mailed from other countries to Italy, while Italian publishers were mailing no periodicals to other countries. [...]
In 1969, the UPU introduced a system of terminal dues. When two countries had imbalanced mail flows, the country that sent more mail would have to pay a fee to the country that received more mail. The amount was based on the difference in the weight of mail sent and received."
https://en.wikipedia.org/wiki/Universal_Postal_Union#Termina...
It blows my mind that Aliexpress was willing to take my money and act as an intermediary between me and the retailer/factory as I cannot imagine they made a profit on this transaction given the fixed cost of accepting credit card payments (i.e. the "$0.30" part of 2.9% + "$0.30"). It further blows my mind that a retailer/factory can profitably send me the case at all, even if they were to receive the entire $0.46.
The UPU classifies countries by level of development, and there's a price break for underdeveloped countries.[2] China is currently in group 3, along with Chile and Lebanon, and was probably going to move up to group 2 in the 2021 round anyway.
So all this was mostly hype.
[1] http://www.upu.int/en/activities/terminal-dues-and-transit-c...
[2] https://www.uspsoig.gov/sites/default/files/document-library...
Good news on this issue; although I'd feel more comfortable if there were fewer geopolitical games of chicken going on; it just takes one crash to wipe away the wins.
I hope European countries follow suit and stop subsidizing foreign mail.
It's absurd that we can order something on AliExpress, have it shipped halfway around the world, and pay 1 Dollar.
It will also get terminated immediately in UK if they leave without a deal, at least according to current UK government VAT guidance.
You don't see that many sites offering this anymore, but the rare wish.com competitor will have the option.
What's the difference between "strong-arm" and "negotiating?"
Especially if you care about the environment.
Well, maybe in a Telsa.
And it's not because they're poor, it's that culturally, they don't seem to give a shit. The higher their standard of living becomes, the more they pollute.
Maybe, someday, they'll change. I hope so. For now, though, the only countries that care about the environment enough to pass laws preventing its destruction are in the West. People who care about the environment should spend their money accordingly.
>the only countries that care about the environment enough to pass laws preventing its destruction are in the West.
Environmentalism at the cost of economic growth is one of the few things Chinese public made CPC concede on. See the rapid improvement in air quality in major urban centres and the variety of green initiatives China is actually meeting prematurely. Westerners dog whistles that they care about the environment, they might genuinely believe it, but that's certainly not reflected en-mass in individual actions or massive infrastructure responses.
>People who care about the environment should spend their money accordingly.
Yet people who are good for the environment are the ones who spend less, aka people with less money, or if we're bringing in culture, the propensity to save. China savings rate is among the highest in the world, it's substantially higher than western countries. Compared to a western vendor who has a higher profit margin and lower saving rate = more consumption -> worse for the environment. The only thing keeping consumption down in the west is wage and purchase power stagnation due to increased inequity. And that's the hard pill, the best way to reduce consumption in absence of behavior change is to make people broke or redistribute wealth in a manner that reduces consumption.
Also, the Chinese might argue that the West outsources their industrial pollution to China.
For example Australia post operates a service when you can buy US goods, have them shipped to a US address, and then have the parcels shipped in aggregate to Australia for arbitrage on shipping and licensing costs: https://shopmate.auspost.com.au
To be clear, I'm not saying one way or another whether this is a good thing. It's just, I felt the title somewhat implied that the USG had given up on its intentions. Whereas actually what happened was the opposite. I meant only to point this out for others who might be likewise confused.
I get the history behind it but the world has changed since then.
I just wish he could get the USPS to stop seeing outbound international mail as a profit centre.
Plenty of Americans could be exporting a lot more internationally, but the USPS has chosen high prices and low volumes.
As a Canadian that sometimes talks Americans into selling to me on Ebay, they find it a painful and costly experience compared to US sales.
Indeed, buying from small U.S. suppliers into Canada is awful. The customs clearance fees are immense, and between those and CBSA, it seems that packages often arrive hastily repacked after a deep inspection, with permanent damage to the goods.
Just say "Trump was right". You will not be condemned by bien-pensants as a thought-criminal. At least, not immediately.
>I just wish he could get the USPS to stop seeing outbound international mail as a profit centre.
In other words, you'd like to pay less when buying from the US.
(There's nothing wrong with such a wish, but let's be clear about what you mean.)
>Plenty of Americans could be exporting a lot more internationally, but the USPS has chosen high prices and low volumes.
I know of no evidence that the USPS charges more to ship internationally than Canada Post, notorious among Canadians for high prices. On the contrary, it's sometimes cheaper for Canadians to ship to elsewhere in Canada by mailing from the US. (Discussion: https://www.reddit.com/r/canada/comments/6rcn0v/canada_post_... )
>As a Canadian that sometimes talks Americans into selling to me on Ebay, they find it a painful and costly experience compared to US sales.
That's because it is, compared to mailing domestically. It'd be surprising otherwise, for any country.
I've sold on eBay and Amazon for years and have shipped often to Canada and elsewhere; the procedure isn't that much more cumbersome. The vast, vast, vast majority of sales are within the US, however.
It's quite possible for an American seller (whether on eBay or Amazon or with their own online sites) to make money solely from the US market. Canada is one ninth of the US and a smaller portion of potential sales for American sellers. A Canadian seller, on the other hand, knows that the American market is nine times larger than the domestic one, so has much more incentive to a) learn how to handle international orders, and b) be willing to pay the higher postage rates.
Naw, I want USians to have better chances of getting my money. When I buy niche things that are available from the US and Asia, Asia keeps winning out. I'm willing to pay more for faster shipping, but I have my limits.
> I've sold on eBay and Amazon for years and have shipped often to Canada and elsewhere; the procedure isn't that much more cumbersome. The vast, vast, vast majority of sales are within the US, however.
Doesn't explain why most others don't bother. Is it still too cumbersome? Or is it just cultural where the rest-of-world is thought of as a scary and dangerous place?
> It's quite possible for an American seller (whether on eBay or Amazon or with their own online sites) to make money solely from the US market. Canada is one ninth of the US and a smaller portion of potential sales for American sellers. A Canadian seller, on the other hand, knows that the American market is nine times larger than the domestic one, so has much more incentive to a) learn how to handle international orders, and b) be willing to pay the higher postage rates.
> It's quite possible for an American seller (whether on eBay or Amazon or with their own online sites) to make money solely from the US market. Canada is one ninth of the US and a smaller portion of potential sales for American sellers.
Dunno why a business would throw away an extra 11% in sales, or being able to sell their same inventory for higher prices. Depends on your product. Obviously a lot of Canadians really benefit from FBA because postal prices are high enough to discourage a lot of non-FBA online ordering.
> A Canadian seller, on the other hand, knows that the American market is nine times larger than the domestic one
My own experience was that selling to the world made me more money than just N. America, largely selling video games, DVDs and other small electronics.
Although I comment from the perspective of a Canadian, there's a whole world out there that USians could profitably benefit from selling to, IMO.
Ah yes, you're one of those who think that not calling the only country in the world with the word "America" in its name, "America", somehow strikes a mighty blow against American imperialism. You'll pardon me if I am skeptical of your claim of primarily wanting to help American businesses, as opposed to wanting to pay less (which, as I said, there is nothing wrong with wanting, in and of itself).
>Doesn't explain why most others don't bother. Is it still too cumbersome? Or is it just cultural where the rest-of-world is thought of as a scary and dangerous place?
Yes, indeed, one of those.
>Dunno why a business would throw away an extra 11% in sales
First, it's not "11% of sales"; the actual share is less because of natural friction, just as you didn't have nine times as many sales to Americans as Canadians.
Second, unless the item is very small, international shipping by USPS requires a larger-than-usual mailing label, in triplicate, and a special plastic pouch to put the extra forms in on the box's surface. Then there are the risks of complaints by customers who have to pay duty, and the much greater difficulty of accepting returns from international customers. I was willing to ship internationally despite these factors, but I cannot criticize others who decided that the additional revenue isn't worth the trouble.
>My own experience was that selling to the world made me more money than just N. America, largely selling video games, DVDs and other small electronics.
That's a given. But, again, as a Canadian you would have left much, much, much more on the table by only selling to the domestic market than your American counterparts. I assure you that if American sellers could quintuple sales by selling to Canadians, they would do so even if the mailing process were three times as complicated. But they wouldn't, so they don't.
>My own experience was that selling to the world made me more money than just N. America, largely selling video games, DVDs and other small electronics.
Spare us the false veneer of kindly advice. You can't stand how the country next door to yours constantly has for sale items you want to buy at attractive prices but can't, at least not directly, despite sharing the same language and culture. Instead of trying to change things in your country to make it easier for such things to be sold there, you demand that the neighboring country seek to earn less money when transporting the items to you. Congratulations.
Does anybody have any idea what this means? Who is considered a "high-volume importer" and how do they set "self-declared rates"?
Backbone internet companies trade traffic with each other, but the trades aren't always equal so it makes sense for there to be money flowing more in one direction.
The US is saying that the current relationship has costs that exceed the benefits, so the US is going to be declaring their own interpretation of a "fair market rate" to import mail from other countries that aren't receiving the same volume of US mail in return.
Problem for China as we see in their capital controls is maintaining wealth in Yaun. Any subsidy which requires using foreign dollars, as paying the US postal tarrif would, weakens the states stability.
And for decades before this moment it never occurred to any of the demagogues in chief to look into such mundane matters as trade imbalance, or subsidizing everybody in the world at the expense of our own businesses and manufacturing base, hollowing out large chunks of the country to make a quick buck.
This shows the downsides of electing lawyers who never did anything of material consequence in the real world, and don't understand or care how the business side of things works.
Incidentally, every Chinese person I know absolutely adores Donald Trump because he plays hard ball, whereas they didn't quite know what to think about Obama, who was totally inscrutable from the Chinese perspective. Trump lays out what he wants, and then he fights for it, and he usually gets it. As far as I can tell, people who grew up in China view that as the natural, normal, and proper way of conducting affairs.
I have read countless well-written articles arguing exactly the opposite, so I find this interesting.
Or maybe they prefer to keep the US in the UPU so they can continue sending packages there, even if it is at a higher cost.
Less state subsidy for electronic crap exports.
I get the idea that international incoming shipments were subsidized but it's not clear what self declared rates really .. does?
It almost sounded like the sending were and of course they'd be all "oh yeah this is like a penny...".
1. Use international institutions like the WTO and UN to affect a change or enact a legal, narrow set of tarifs on bad actors without putting the wider, generally beneficial system at risk.
2. Start subsidizing our own postal service. China does it because it's an economic multiplier that benefits a wide segment of society. Why not copy it.
3. Burn the postal union treaty to the ground.
Trump picked 3 and has now pivoted to 1. I personally would have picked 2 but I don't think any of these options are crazy. 3 sucked but wasn't outrageous IMO.
I'm not universally in favor of subsidies, just in certain specific instances where the economic multiplier is high and a large fraction of the public benefits directly (usually infrastructure).
Someone who doesn't actually take advantage of the cheap shipping directly is 100% benefiting from the businesses they frequent that do.
An argument that might be more familiar in our industry: Why do we spend 10M on advertising when we could use that money to make our product cheaper? Because that 10M spent brings in 12M in revenue.
Or that would have been my reaction until I read the article:
"Countries with more than 75,000 tonnes in post imported annually - mainly the United States - may apply their self-declared new rates from July 2020, UPU officials said."
So does 'mainly the US' mean 'only the US'? I don't want an exception just for the US because they are too powerful to ignore, I want the same rule to hold for every EU country. Replacing a rule where rich countries subsidize long distance mail from (former) poor countries with a rule where only small rich countries have to pay for that subsidy is really not an improvement.
That you begin with a snarky remark about Trump, and then go on to say that he is at fault for not helping Belgium or Austria win the kind of changes that the US needed to seriously threaten to leave the UPU for, says more about you than about the US or Trump.
So I have no idea why you choose to read my complaint about the UPU negotiations as a complaint about Trump. I even started out by saying he is right in this one case. But this is an issue that's not unique to the US, but to all wealthy countries, and therefore should be handled evenly for all countries. That's what I pointed out in my comment. You're a bit too eager to read attacks where there are none.
Had the UPU made just a single exception for the US because of the US's power, that would have been inconsistent and a mistake by the UPU. But as others have explained elsewhere, that's not what happened. The rule is for everybody, it just starts 6 months early for the US, which I guess is a minor gesture to appease Trump. I'm fine with that. Starting in 2021, the situation will be fixed for everybody.
>Good. This might actually be the one good thing that Trump has accomplished.
>Or that would have been my reaction until I read the article:
>"Countries with more than 75,000 tonnes in post imported annually - mainly the United States - may apply their self-declared new rates from July 2020, UPU officials said."
>So does 'mainly the US' mean 'only the US'? I don't want an exception just for the US because they are too powerful to ignore, I want the same rule to hold for every EU country. Replacing a rule where rich countries subsidize long distance mail from (former) poor countries with a rule where only small rich countries have to pay for that subsidy is really not an improvement.
In other words:
* Requisite snarky remark about Trump
* Complaint that the rule change is only for the US (written before you read the rest of the thread and realize that this refers to the US getting the rule change slightly earlier than other countries, as we can see by ...)
* Stating that "this is not an improvement" because other rich countries won't benefit from the rule change, again because you hadn't yet read the read of the thread. (Even were you correct, this would be an improvement for the US, which is Trump's concern. As I said, he is not the president of the EU.)
> "then go on to say that he is at fault for not helping Belgium or Austria"
That is not something I wrote. I never said Trump is at fault for these results. That is something you're trying to put in my mouth, and I'm telling you not to do that, because it's a dishonest way of arguing.
If you're looking for bad things to blame on Trump, there's tons of that around. This is one of those very rare things where he actually did the right thing. And had the UPU only made this an exception for the US, and not changed the rules for everybody, that would have been on the UPU as a whole and presumably the EU members who failed to negotiate this properly. Fortunately that's not what happened; it was a misunderstanding on my part (based on a cursory reading of the article, so I was already hoping it was the article or my reading of it that was wrong).
No, but you blamed Trump for not getting the results for other countries. Let me repeat again what you wrote:
>Replacing a rule where rich countries subsidize long distance mail from (former) poor countries with a rule where only small rich countries have to pay for that subsidy is really not an improvement.
That you wrote the above without understanding the full ramifications of the change is immaterial, because you
* Take a swipe at Trump ("This might actually be the one good thing that Trump has accomplished")
* Then say, based on your misunderstanding, that this "is really not an improvement".
The implication is clear: Trump is at fault for not obtaining the same improvement he gained for the US for other, "small rich countries" as well. I reiterate my original reply to you:
>Trump is president of the United States, not of the EU. It is the EU and its member states' onus to obtain similar changes, should they believe them desirable.
>That you begin with a snarky remark about Trump, and then go on to say that he is at fault for not helping Belgium or Austria win the kind of changes that the US needed to seriously threaten to leave the UPU for, says more about you than about the US or Trump.
As you can see from your own quote out of my comment, that is simply not the case:
> ">Replacing a rule where rich countries subsidize long distance mail from (former) poor countries with a rule where only small rich countries have to pay for that subsidy is really not an improvement."
Nowhere do I mention Trump. I'm not blaming this on Trump.
> "Take a swipe at Trump ("This might actually be the one good thing that Trump has accomplished")"
Well, it is. There's not a lot of good he's accomplished in other areas, has he? He's mostly a disaster. This is the one truly good thing I can see that he has accomplished.
> "Then say, based on your misunderstanding, that this "is really not an improvement"."
And indeed it wouldn't have been an improvement if it had only created an exception for the US. I'm glad that's not the result of these negotiations. I will absolutely credit Trump for this one good thing he has accomplished.
But if it hadn't been this good result, and it had only resulted in an exception for the US, he would not have accomplished this one good result. Surely that's clear, right? You can't claim credit for something that didn't happen (though I'm aware that Trump sees that differently).
However, had the result been not as good, that doesn't mean that Trump is automatically to blame. I understand the assumption, but he's not doing these negotiations on his own. It would be the whole of the UPU, and particularly the EU negotiators, that would have failed to replace the previous rule with a better universal rule, opting for an exception instead. That exception would probably have been good enough for Trump, so he'd still have gotten what he wanted, but this is an issue that's bigger than just the US, and I'm glad the UPU recognised that. I'm also glad Trump addressed this issue. Credit where it's due.
However I was kind of looking forward to the insanity that would follow from leaving this long term and fairly sensible pact! Change isn't always bad, sometimes change leads to new solutions.
I personally enjoy the ability to buy NEW parts for my 1914 sewing machine and have them sent directly from some mom and pop family stall in a Chinese village for $0.15 with free shipping.
But I also see the importance of encouraging American manufacturing, even though I also realize the long tail products I love so dearly and greatly appreciate the life support China's extended to them is valuable.
I also benefit from the ability to manufacture prototype PCB boards in China for new products just by sending off a webform request and for around 1/50 the cost stateside. Losing that ability might be damaging to domestic productivity since we really can't meet those prices, which makes doing frequent bugfix revs, or a small production product, untenable. For those with access to those highly superior Chinese facilities at low cost and quick turnaround, they might have the long term advantage. On the other hand why can't we locally have very modern robotic pick and place machines that don't cost hardly anything and have Joe Bob's fabrication of Arkansas pivot from custom tractor parts to producing clean room spec proto boards. These shops in China doing this stuff a lot are in rural areas and are small outfits run by a few people. We can do the same and would be more interesting for a lot of americans than meth and opioid despair. And yes we can do it.
Who knows though. What happens in the global economy and balance of tech is a delicate balancing game and difficult to predict long term outcomes past next year.
I do think our present administration is quite good at this game of take it or leave it hardball. The present outcome is a reasonable compromise. And is the new solution we may or may not have gotten from actually leaving.
I do, too, but this just means that we're externalizing the cost of shipping and ignoring the fact that shipping things over such long distances is damaging to the environment, and damaging to the US's ability to have an independent, self-sustaining economy. (We'll never actually 100% get there in our globally-connected world, but getting closer when it makes sense for our interests is IMO a good thing.)
> I do think our present administration is quite good at this game of take it or leave it hardball.
I agree they're good at reaching for hardball at the slightest provocation, but I would not agree that they're good at it. This is one of the very very scant few situations where it's worked. It's the exception, not the norm.
1. Maybe maybe not.
2. I guess we should just give up then. Manufacturing will never return to America! It's hopeless.
Choose your own adventure.
As to "degenerate", that's the label you use when you've lost the rational argument. All I see is a talented businessman with a bit of Aspergers, strong Twitter game, and a profound lack of public speaking skills. None of that disqualifies him from the job he was elected to do.
http://nymag.com/intelligencer/2016/05/ronald-reagan-was-onc...
https://www.youtube.com/watch?v=UXA--dj2-CY
Or are your morals selective enough to remain blind to this? Because it seems that the mainstream press is trying their hardest to not cover the story, and if it wasn't for Trump's "whistleblowing" (which I believe he orchestrated himself), nobody would know.
I'm not impressed with the timeline associated with this deal.
I'm also not impressed by how the US seems to have only solved the problem for the US. It seems like Canada and most of Europe are in a nearly identical situation.
Also it applies to every country from 2021, i.e. Canada and EU will be able to set their own rates as well.
> Also it applies to every country from 2021, i.e. Canada and EU will be able to set their own rates as well.
Oh, I must have misread the article, that's good to hear.
Regardless, I don't think it's fair to include the preceding 12 months; there was nothing actionable for any country to do to prepare for the changes until now. I would actually consider seven months to be impressively fast.
Also, this change does apply to other countries. It's right in the article: Every country has the same terms, they can set prices when they import more than 75,000 tons annually.
The article also calls out that 75,000 tons as a criteria made up to include the US and basically no one else.