Obama to Town Hall Gathering: The public health plan will be just like the US Postal Service

During Tuesday’s so-called “town hall” in New Hampshire (in which a schoolgirl warned the president that there were people outside holding signs that said “mean things” about his plan), the president gave the US Postal Service as an example to calm our fears about a new government program, the “public option,” destroying private health insurance.

The president said, “UPS and FedEx are doing just fine, right? No, they are. It’s the Post Office that’s always having problems.” (Laughter.)

He’s got that right. The Postal Service is going to need a taxpayer bailout of $7 billion this year. And despite the president’s claim, it doesn’t have competition in its core market of letter delivery. It’s illegal for FedEx or UPS to undercut the government’s price on letter mail. It’s also illegal for any other entity to send mail to a Post Office Box. And the Postal Service maintains that they – not you – are the real owners of your mailbox.

This monopoly is supposed to be what allows the Postal Service to deliver a letter for 44 cents anywhere in the USA. What is the social value of charging the same price to send a letter from Boston, MA to Cambridge, MA as one from Tampa, FL to Wasilla, AK? I have not the slightest idea, and I suspect that few others do either. But it does make for a well paid public-sector workforce.

Ironically, the Postal Service can’t even make a profit, despite all these monopoly protections.  And its victims are not FedEx and UPS, but small entrepreneurs whom the law forbids from launching inexpensive letter-delivery services in densely populated cities.

I have a proposal to redeem the Postal Service. Let’s put it out of its misery and use that $7 billion to cover the uninsured. Taxpayers spend about $42 billion of their federal dues to pay for uncompensated care for the uninsured. Eliminating the post office would cover one sixth of that!

Come on Postmaster-General: It’s time to step up and fall on your sword!

Comments (11)

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  1. Eric McKnight says:


  2. Devon Herrick says:

    What did Obama mean when he said the government-run health plan would be like the Post Office? Was he referring to bloated, money-losing operations? The lack of innovation? The customer service policies that allows its front office staff to take their lunch break precisely when many customers are trying to mail packages during their lunch break?

  3. RM says:

    Sure John, lets abolish the USPS and let everyone drive to their local FedEx or UPS store to mail a letter. I’m sure it’d only cost $5-10. And I’m sure that FedEx’ll be happy to deliver on Saturdays for no extra charge.

  4. George Danz says:

    To RM,

    Let’s compromise. Instead of blowing away the US Post Office, let’s just let FEDX and UPS fairly compete against the USPO by charging whatever will allow them to make a profit and provide services during lunch breaks too if they can schedule that.

    And last I looked I have to pay for a busted mailbox so I guess I own the friggin thing, eh?

    And BIG BROTHER HEALTH CARE will NOT be same as the BIG BROTHER POST OFFICE – It will be a LOT WORSE!!!

  5. Juan O. says:

    The Post Office and government-run health care have a lot in common. Both have:

    – long waiting times

    – outdated facilities named after people I’ve never heard of

    – one-size-fits-all prices that don’t cover costs, which require taxpayer subsidies to balance out

    – politically-appointed bureaucracies that are beholden to the government, not the customer

    – a failure-to-deliver rate that would be unacceptable in the private market

    The Post Office sends a government employee to your house almost every day to deliver bills. Will government-run health care do the same?

  6. Jack says:

    the post office is a government-protected monopoly; 19th century laws make it illegal for anyone else to deliver letters. It’s also exempt from state and federal taxes and free from most government regulations. That combination is a recipe for disaster

  7. Mo says:

    The USPS monopoly on ordinary letters was established in the 70s by what are collectively termed the “Private Express Statutes,” which provide for criminal and civil penalties to private letter carriers.

    UPS and FedEx operate in two areas – parcels, which are not covered by the Private Express Statutes at all and, so far as I can tell, not viewed by Congress as within the monopoly allegedly granted Congress to control the mails allegedly granted under U.S. Const. Art.I, Sec.8, cl.7; and “extremely urgent” letters, which must meet certain maximum delivery timing and minimum pricing requirements and must be marked as such, and are allowed to be carried by private carriers only because of a USPS-created exception which USPS may revoke at any time without Congressional, or likely even judicial, review.

  8. Joe S. says:

    I think Jack is more correct than Mo about the origin of these restrictions. They date from the 19 century.

  9. KME says:

    Ummm…. just a question for all of you that think the Postal Service should be eliminated. How much do you think the unemployment rate would spike if you put almost 700,000 (thats 700 THOUSAND)people out of a job? And good luck mailing that birthday card to Grandma for 44 cents. Oh, and mailing anything to our troups overseas- nope, not gonna happen. Just saying… think before you type.

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