The Postal Service Loses its Rationale for Protected GSE Status

Tuesday, April 17th, 2012 and is filed under Blog

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Earlier this month, I wrote an article in Human Events advocating that we privatize the Postal Service and let it fail or succeed on its own merits.  It has become clear that the USPS cannot generate enough revenue in this age of electronic communication to pay for its expensive pensions and day to day operations.  Moreover, in order to maintain its protected tax-exempt status and monopoly over first class mail, Congress has precluded the USPS from making the requisite cuts, reforms and restructuring to try to conform to the demands of the 21st century.

Supporters of the Postal Service status quo have contended that if we abolish the monopoly on first class mail along with the universal service guarantee, it will be hard for some seniors to get their Social Security checks.  Well, that argument will soon become obsolete.  Roll Call reports:

Beginning next year, the federal government will phase out paper checks for Social Security and other government benefits, the Associated Press reports.

Instead, recipients will either have the money deposited directly into their bank accounts or receive a debit card.

The Treasury Department says the new method is safer, quicker and more reliable. After all, Social Security checks have gotten lost or even been stolen in the mail, and similar measures for the now-misnamed “food stamps” have worked well.

Even the Treasury Department is getting with the times and moving to direct deposit.  This is just one more example of why there is no need for a government-sponsored entity to exclusively provide ground mail delivery.

Unfortunately, taxpayers are on the hook for another bailout of the Postal Service when they fail to make payroll this coming fall.  Democrats are planning a cloture motion once again to begin debate on S. 1789, a bill that will deffer more pension payments (they have already been differed for a year) without offering any reforms to the current failed system.

And they say that conservatives are stuck in the past!