
Trump orders Postal Service review after blasting Amazon deal - Mimino123
https://www.theverge.com/2018/4/13/17233024/trump-executive-order-post-office-amazon
======
ilamont
What they should do is review the subsidization of Chinese companies shipping
to U.S. customers, often at the expense of makers and merchants in the U.S.:

 _According to the terms set out in Universal Postal Union treaty, the USPS in
2014 gets paid no more than about $1.50 for delivering a one-pound package
from a foreign carrier, which makes it hard to cover costs. [1] The USPS
inspector general’s office estimated that the USPS lost $79 million in fiscal
year 2013 delivering this foreign treaty mail. (The Postal Service itself
declined to provide specific figures.)

In an effort to ride the e-commerce boom, the Postal Service signed a deal in
2010 with China’s state carrier to sell a special service for small packages
entering the U.S. For a small premium, the USPS offered tracking and delivery
confirmation, an essential feature for online retailers, as well as expedited
shipping.

... In 2012, USPS was paid only 94 cents on average for each piece of Chinese
ePacket mail, according to a February report from the Postal Service’s
inspector general’s office. That report estimated that the Postal Service was
losing about a dollar on each incoming item, adding up to a $29.4 million net
loss in 2012.

Forums on eBay are filled with angry notes about ePacket. “I must say that it
is simply an economic disaster for US Sellers,” one person wrote. “One product
that we sell for 2.00 with 2.50 shipping a chinese company is selling for .99
with free shipping,” another complained. _

Washington Post: USPS loses millions each year on local delivery of mail from
abroad (2014)
[https://www.washingtonpost.com/news/storyline/wp/2014/09/12/...](https://www.washingtonpost.com/news/storyline/wp/2014/09/12/the-
postal-service-is-losing-millions-a-year-to-help-you-buy-cheap-stuff-from-
china/)

Discussion:
[https://news.ycombinator.com/item?id=14651884](https://news.ycombinator.com/item?id=14651884)

~~~
mcbits
I'm curious what you mean by "makers" here. To me the term means end users who
tinker and build their own gadgets for fun, education, or because nobody
produces the thing they want. Cheap parts from China are a benefit to that
group, not an expense, although shipping should be priced sustainably.

~~~
ilamont
I'm thinking of the type of person who makes small-batch products and sells
them, which kind of was the model for Etsy before cheap imported goods took
over right around the same time the post office began subsidizing overseas
carriers.

Wired uses the term "maker" interchangeably with "crafter" in the following
article, which gives some of the history:

 _That Etsy began allowing manufacturing partners in 2013 underscored the
reseller issue that has plagued the site for years. The Marketplace Integrity,
Trust & Safety team—which has the unenviable task of policing sellers for
adherence to Etsy rules—is unable or unwilling to weed out sellers of mass-
manufactured goods._

[https://www.wired.com/2015/02/etsy-not-good-for-
crafters/](https://www.wired.com/2015/02/etsy-not-good-for-crafters/)

------
dsparkman
The package delivery business side of the USPS is a profitable venture. The
USPS is in the state it is in not because of Amazon or last mile delivery that
is doing for other businesses. The core problem is Congress and the
requirement they put is the USPS that they prefund 75 years of pensions. A
requirement placed on no other institutions in the US.

~~~
mieseratte
> The core problem is Congress and the requirement they put is the USPS that
> they prefund 75 years of pensions. A requirement placed on no other
> institutions in the US.

Why is this? Did the USPS have some kind of retirement funding scandal, or was
someone trying to smother it?

~~~
Spooky23
Two reasons... it’s tranfers postal revenues to federal cash flow via bonds,
and key GOP lawmakers want to make the service unsustainable to enable
privatization.

~~~
coldcode
Privatization is a key goal here. By making USPS appear to struggle to make
money it improves the argument that UPS, Fedex and anyone else who could make
more money would be "better" at delivery. But the requirement that all
Americans have access to daily (6) deliveries which is a core requirement for
the Post Office is in the way of privatization as no one can honor this
requirement for so little money as a stamp and make public company profits. So
this can be buried in this "review" by proposing doing away with daily or even
direct to home deliveries of mail.

Interestingly enough by eliminating the daily delivery of mail also kills the
DMA business, which while everyone hates spam mail, is still a vital business
tool for small and local businesses. Fedex will not deliver mail to your house
that costs a nickel.

~~~
Spooky23
Remember that saving money isn’t usually a privatization factor.

FedEx will deliver mail for a nickel when they get a dollar from the
government to do so.

------
smoyer
In the last week I've received packages shipped via DHL and via Fedex that
used SmartPost, where the USPS actually delivers the package. I don't remember
ever having a UPS-to-SmartPost shipment. If the USPS is cheaper than these
global shippers for the last-mile deliver, it might be a sign that they're not
charging enough. At least in my town, they also don't seem to be very
efficient - two Saturdays ago I was working in the yard and the post office
went by four times during a six hour period. I can understand that the package
delivery might be a different than their normal service route but shouldn't
the three package deliveries have been one vehicle on our street one time? UPS
is a master of route efficiency.

~~~
IAmEveryone
If what the USPS charges for packages is "enough" depends entirely on your
definition of "enough":

Does package delivery lower the USPS' losses? Absolutely!

Do they charge enough for package delivery to spin it out into a separate,
viable business? Probably not.

This unusual situation stems from the fact that the USPS is mandated by law to
pass by every house in the country at least once a day, six days per week.

~~~
smoyer
Yes ... and the best way to make money delivering packages is to include them
with the regular mail so that you're passing each house exactly once. I might
also agree that the package delivery is stemming the USPS' losses but you'd
have to show that it's not actually causing more losses - our little village
now has three USPS trucks (there used to be one). I'm also assuming additional
personnel are needed for all those extra runs and we now see USPS trucks on
Sundays.

------
snarfy
It's a government service, not a business. It's not supposed to be profitable.
It's supposed to provide a service.

~~~
briandear
As a voter and taxpayer, then I demand an end to this service. The last time I
received an actual piece of valid mail was probably years ago. The USPS has
become an ad-delivery network subsidized by my tax dollars. Perhaps charging
bulk-mailers full price could end the problem of junk mail or create financial
solvency. Why should junk mail literally nobody wants be subsidized? For
official notices, the government could contract with a commercial carrier for
far less than paying billions to operate a fleet of trucks that mostly carry
junk.

~~~
mikeash
They don’t get any of your tax money.

~~~
theandrewbailey
Who is "they" here? USPS? Commercial carriers? Junk mailers?

~~~
mikeash
USPS. I’m responding to “The USPS has become an ad-delivery network subsidized
by my tax dollars.”

I should mention that USPS does get tax money when other agencies use their
services, but they’re paying for it just like anyone else does. It’s not
_subsidized_ , other than indirectly by their monopoly on letters.

------
aneutron
It'd be fun to see Amazon US spinning off their own delivery service if they
are backstabbed by UPS/FedEx/Postal service

~~~
axaxs
Oddly, I disagree. Package delivery is one of the few remaining 'low skill'
professions that pay well. UPS pays their drivers exceptionally, and has very
strict rules and safety standards. USPS also pays relatively well. In
exchange, we consumers get service from generally trusted, uniformed
individuals. I'm afraid Amazon would create a race to the bottom, which would
leave us accepting subpar service like we have in other industries(retail,
fast food, etc). The employees are paid less, and the service as a whole gets
worse, all in the name of 'cost-savings.' I know that's the free market for
us, but it'd be nice to not lose every segment in a race to the bottom.

~~~
reformedjuju
I’m a Fedex Express courier in a rust belt city. Fedex pays well enough that,
even when I started part-time, I was able to afford a mortgage payment on a
three-bedroom in a quiet neighborhood.

That’s a big deal for low-income folk who usually have limited options.

~~~
axaxs
That's awesome. Similar story...location in profile. Parents had a house, 2
cars, and raised 3 children on UPS salaries. Until one retired, both still
worked there, and doing quite well for themselves.

------
nsx147
Short term bump in the road for Amazon. They will not need USPS in the long
run anyway:

\- Build out own network (AMZL, Amazon Flex)

\- Buy UPS/Fedex/etc

\- Drone delivery

It is unfortunate that AMZN is taking the fall for whatever this executive
order is actually trying to accomplish.

~~~
chiefalchemist
Politics always needs a enemy.

So is the next question: should USPS be merged with AMZN? What happens if a
high volumn of packages disappears from the USPS revenue stream?

If AMZN delivers it can also pick up. Feels like a new Prime add-on, doesn't
it?

------
dawnerd
Guessing they’ll find some unrelated things to complain about instead of
admitting amazon makes Usps a lot of money.

------
bhouston
Amazon is going to rush in with its own delivery service, Amazon Flex:
[https://flex.amazon.com/](https://flex.amazon.com/)

------
makecheck
This is one of those things where, even if it were an issue, shouldn’t there
be about 4,321 better ways for the federal government (much less the
president) to choose their focus?

And it’s not like he has to go far to find bigger problems. How about
“ordering a review” on poverty and homelessness for instance?

------
JudasGoat
The Postal service seems to be a stepping stone for Amazon. It appears that
before human delivery people are replaced with drones, Jeff Bezos plans to
replace postal employees with people at least contracted to Amazon.

------
lcooper
Looking at the bigger picture here, US has always been the closest thing to
the Free Market idea, but lately, the government has been taking some measures
that go against this idea, this is one of them.

------
maxerickson
Dupe of
[https://news.ycombinator.com/item?id=16826446](https://news.ycombinator.com/item?id=16826446)

------
RickJWagner
Slimy hit piece at Trump. But it does raise some interesting points for
discussion.

As a consumer, I love Amazon. The convenience and selection are incredible.

But jobs have clearly suffered. (This is a point often raised by those on the
left side of the political aisle).

What's the right thing to do, regardless of who's president?

~~~
jrsmith1279
Amazon isn't the only company using USPS this way. It might be worthy of
investigation, but Trump's motive here is to get back at Bezos for things that
The Washington Post publishes. The president using the power of the executive
branch to fight personal political enemies is never the right thing to do.

------
kgc
They may find that Amazon is keeping USPS alive.

------
crdoconnor
The whole "USPS is a in a fiscal hole" thing is part of the privatization
playbook. It _is_ in a hole, but it's a deliberately created hole:

[https://www.nakedcapitalism.com/2015/10/the-right-wings-
assa...](https://www.nakedcapitalism.com/2015/10/the-right-wings-assault-on-
the-post-office-smashing-the-myth-that-its-in-financial-trouble.html)

Note who owns the newspaper cheerleading for privatization:

[https://www.washingtonpost.com/news/federal-
eye/wp/2015/09/2...](https://www.washingtonpost.com/news/federal-
eye/wp/2015/09/28/should-the-postal-service-be-sold-to-save-it/)

I wonder if they have any ideas about potential buyers?

------
spodek
I wonder if he's trying to distract people from other news that makes him look
bad.

Can anyone think of any news or investigations he'd want to distract people
from?

If this attack doesn't work, he may start a war, which is guaranteed to
distract.

~~~
chiefalchemist
Um. We're engaged in 5-7 foreign conflicts at the moment. No one I know is
distracted.

Tweets are cheaper and far more effective. That said, Stormy Daniels was one
of the best distractions yet. Sex sells...and it distracts? :)

