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Comment by ip26 | Hacker News Reader

The common argument is if USPS did not have that monopoly, then other providers would enter only the profitable regions.

The result would be the USPS would not have the revenue to serve the unprofitable regions, and would either be forced to end service in the unprofitable regions or simply collapse.

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Indeed, FedEx and UPS already do this where their services overlap with those of the Postal Service.

The problem is that the USPS monopoly is not as valuable as it used to be as less and less business is conducted by mail. In the long term the government is going to have to subsidize its necessary services, because those services are not and cannot be competitive advantages.

Right, and that exposes the reality that the USPS is at best, a state run subsidization scheme for rural mail delivery. But if that's the case, why subsidize it indirectly through selectively inflated prices, which regressively hurt poor people in urban markets)?

Sounds like if the problem is that rural mail is socially important, we ought to subsidize it directly.

The USPS is entirely self-funded and they're still trying to kill it. Good luck getting appropriations for it.

Right. The problem with the USPS is that it's both been exposed to "market competition" and also has legal obligations that its competitors do not have. The cost of those legal obligations now far outstrips the value of their statutory monopolies.

Which legal obligations that it's competitors don't have? If you're talking about the requirement to pre-fund their pension fund, my understanding is that UPS and FedEx (and all private corporations) were already required to do so. I think it's more accurate to say that PAEA removed an artificial advantage that USPS had.

OTOH, FedEx responded to MAP-21 and similar pension funding laws by getting rid of their pension fund which I suppose isn't something USPS can do as easily. On the third hand, UPS is still able to afford pensions for union employees.

USPS is required to serve every one every where. FedEx/UPS punt their shit to the USPS when it comes to rural america.

It's not particularly rural, but it's the opposite case where my parents live. UPS, FedEx, and various courier services will typically deliver right to their house. However USPS doesn't deliver mail to their address. They have to pick it up themselves from the nearest post office

> If you're talking about the requirement to pre-fund their pension fund, my understanding is that UPS and FedEx (and all private corporations) were already required to do so.

It seems that most observers agree that this is not the case, so it is unclear how you came to the exact opposite understanding. E.g. https://www.bloomberg.com/opinion/articles/2018-04-04/congre... mentions

> The law requires the Postal Service, which receives no taxpayer subsidies, to prefund its retirees' health benefits up to the year 2056. This is a $5 billion per year cost; it is a requirement that no other entity, private or public, has to make.

To be clear, the pre-funding obligation doesn't mean USPS must gradually fund the pension obligations for an employee as that employee works for them, as would be common in private enterprise. Instead the USPS is basically required to set aside the entire pension obligation, at the date of hire. No one else has to set aside millions of dollars the same day they hire someone.

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