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Comment by defertoreptar | Hacker News Reader

The military is paid by taxes. In general, no single citizen has much control over how much it costs. The USPS is different because if we eliminated stamps and paid it all out of taxes, individuals would abuse the system.

Because we pay out of pocket for postage, we expect the USPS to place no further burden on taxpayers. However, it keeps going going into debt. This signals that there is something wrong at an operational level, since its competitors don't go bankrupt despite not having the huge subsidies and advantages in the law that the USPS has.

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Nothing about that dictates it must be an operational level issue. No other carrier has government mandated delivery schedules to remote areas or laws requiring them to prefund pensions for 75 years. Of course no other carrier has tax breaks and government funding. It doesn't mean it's an operating issue though but maybe it is. The point being "government service isn't making money" assumes the goal for that service is purely to make money, which is not the sole purpose of the USPS.

It also does not follow that because stamps cost money we therefore expect the USPS to need no other funding. It's possible for something to be partially subsidized.

This isn't an argument about what should be done with the USPS one way or the other it's an argument against trying to shove everything into "because it's not A it shows it is therefore B" type arguments which don't consider there could be more to the story than A and B.

Prefunding medical pensions is not the reason for their cash flow problem:

> In addition, with respect to financial reporting, here are the key figures for 2019:

> Healthcare benefits paid out of the Benefit Fund: $3.7 billion.

> Normal costs scheduled to be paid into the Benefit Fund to cover current year’s current employees’ retiree healthcare cost accruals: $3.775 billion.

> Amortization payments scheduled to be made into the fund: $789 million.

> Overall net loss for the year: $8.8 billion.

> The math just doesn’t work to blame retiree healthcare contributions for the USPS’s losses. The amount they are recording on their P&L for retiree healthcare costs (which, again, they aren’t paying out in cash) — $4.564 billion — is only moderately more ($800 - $900 million, depending on rounding) than the amount that they would be paying out directly for pay-as-you-go benefits had the PAEA never been implemented. https://www.forbes.com/sites/ebauer/2020/04/14/post-office-p...

And I actually do see this as a "because it's not A it shows it is therefore B" type argument. When the USPS runs at a deficit, tax payers ultimately are the ones that have to bail it out. That goes against the principal necessitating stamps in the first place: individuals who don't place extra cost to the USPS end up paying more than their share and subsidize individuals who do cost the USPS extra.

I didn't say it was "the" reason it's just an example of something mandated that doesn't help their cash position. The postal service, having been mentioned even in the constitution, has a lot of such mandates that public companies don't have.

And again it's possible for something to be partially subsidized not just either income based or free. As you mentioned if it were 100% subsidized it'd lead to lots of abuse of the service. That does not mean the only alternative is it be 100% funded via shipping fees and 0% subsidized there is still 1%-99% subsidized which are valid options. Maybe you'd personally like it to not be partially subsidized but there is nothing strictly requiring it to be only one or the other.

Another example of partially subsidized services would be the roads the postal service and everyone else uses. They tend to be 30%-60% paid for by e.g. gas taxes or tolls and the rest subsidized via general taxes. That doesn't mean roads are failing to turn a profit they are also working as intended being somewhat use based and somewhat a public service.

The difference is that a postal service is rival + excludable. Most roads are (generally) non-rival and most people at least expect them to be non-excludable, but as you mentioned, some use tolls.

When you have rival + excludable, it is straight forward to charge on an individual basis. This efficiently allocates resources and punishes abuses.

It's not as easy to efficiently do that with non- (or perhaps less-) excludable goods. Also, when a good is non-rival, there is much less worry about abusing the system. That makes subsidies and "everybody pay the same" easier to be seen as a fair enough system.

The above is your reasoning (or part of) why you would not like the US postal service to be partially subsidized not why it must not be partially subsidized or why we must all consider it A or B. A+B is still a valid legal option and can also be a logical conclusion by others with different arguments.

It's a perfectly valid stance to hold though and certainly brings well thought points to the examples mentioned earlier.

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