Partially privatize the USPS?

Brookings Institute scholar Elaine Kamarck has called for a partial privatization of the USPS. The business, which is neither a public or private body, is making vast losses due to regulation. “Delaying the Inevitable: Political Stalemate and the US Postal Service” was published this week.

The paper calls for the profit making parcel delivery side of the business to be divested while the loss making mail side is kept in government hands. Together they lose around USD $5bn annually, requiring Federal subsidy to survive.

There are a number of issues to resolve should this be considered should this happen. Most pressing is that the parcel side should not have unfair subsidy to outcompete with its rivals in the private parcel delivery market.

Should this be done, the six day universal mail delivery mandate, in place since 1983, can be maintained for postal services where the parcel delivery side can go to the less lossmaking 5 day a week delivery schedule.


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