
US Announces Withdraw From Postal Treaty - walterbell
https://www.bbc.com/news/business-45894346
======
godzillabrennus
A friend helped the Wall Street Journal expose the damage this treaty was
doing to his small business in the United States as it tried to fend off
counterfeiters.

[https://www.wsj.com/articles/this-subsidy-for-china-is-
dumb-...](https://www.wsj.com/articles/this-subsidy-for-china-is-dumb-as-a-
post-1517963275)

Seems like a win for American innovation if you care about that thing.

Seems like China is going to get hurt by this change which is bad for
globalization if you are into that thing.

~~~
paulsutter
Globalization is about an even playing field, not one-sided concessions and
subsidies

~~~
colechristensen
The idea of free trade/globalization is everyone benefiting from the
efficiency of each place doing the work it can do most efficiently. Iowa corn
and Swiss fine machinery and Arab oil and all sorts of things where one place
can do something better and cheaper because of the nature of the place.
Poverty (cheap labor) and treaties (cheap postage) shouldn't be the drivers of
this efficiency because they aren't caused by fundamental differences, just
political ones.

~~~
raquo
But the issue here is not the differential in efficiencies.

It's China receiving subsidies from the US because it was considered a
developing country in 1969. It's not anymore, it's a global superpower now, it
can pay its own postage.

~~~
baldfat
No it has no bearing on China. It is the same policy with Switzerland. You get
the international package to America we pay for the final delivery. Pay for a
package to Switzerland and Switzerland pays for the final delivery. It was
suppose to be a wash for both parties. China just got a much better deal. Cost
me more to mail a package the next state away then for me to get a package
delivered from China.

Now you have to pay for Switzerland delivery and then the domestic cost.

Wish and EBay from China is now bye bye.

~~~
nkurz
_EBay from China is now bye bye._

Why would this change the be end of direct shipping from China? Currently
(rounded off numbers) the cost of shipping a 2 lb (1 kg) package within the US
is about $7, and the cost of shipping such a package from China to a US
address is about $2. The obvious solution would be that the Chinese shipment
ends up costing $9 (current Chinese rate of $2 to the US border, plus $7
standard US shipping). The Chinese shipping would thus end up $2 more than the
US. Presumably there would be lots of cases where the $2 greater shipping is
offset by lower price of the item?

~~~
kbenson
Where are you getting those numbers from?

My understanding is that there's a nominal fee for last-mile delivery the USPS
charges mail from other countries, which is all (or the vast majority) that's
being charged for Chinese shipments, as the Chinese side is subsidized
completely (or almost so) for outgoing mail. I think the $2 you are quoting
might be the treaty fee for delivering mail from other countries, which is not
the true cost of delivery, but mostly works out as long as there's a fairly
even flow of mail between two countries. What we have here is that China is
subsidizing their side of the outgoing mail, so all that's being paid is the
treaty set delivery fee for external mail (which again, isn't the true cost of
last-mile delivery).

~~~
michaelt

      the treaty fee [...] is not the true cost of 
      delivery, but mostly works out as long as there's
      a fairly even flow of mail between two countries.
    

Isn't the core problem here that there _isn't_ an even flow of mail between
China and the US? Because there's far more ebay/aliexpress traffic coming out
of China than going in.

~~~
kbenson
I think it's not _just_ that, which would be problematic on it's own, it's
that China is also subsidizing local delivery, so the only (or almost only)
delivery fee for Chinese shippers is the portion they pay to USPS for local
delivery, which is artificially very low. So not only are they taking
advantage of the difference in trade flows, they are also encouraging it even
more.

I think this was covered in an Planet money podcast from NPR.[1] It's also
possible I'm not remembering portions of it correctly, but I think they did an
interesting treatment of the subject.

1:
[https://www.npr.org/sections/money/2018/08/01/634737852/epis...](https://www.npr.org/sections/money/2018/08/01/634737852/episode-857-the-
postal-illuminati)

------
derekmhewitt
Not weighing in on if this is a good or bad thing overall, but I did listen to
a pretty good NPR podcast a while back that explains a little more about this
treaty and how it was affecting businesses in the US.

[https://www.npr.org/sections/money/2018/08/01/634737852/epis...](https://www.npr.org/sections/money/2018/08/01/634737852/episode-857-the-
postal-illuminati)

~~~
rprenger
I really liked that podcast as well. If I remember correctly, one take away
from the podcast that is relevant to a lot of comments below was that the U.S.
used to get a net benefit from the weird international mail system. It was
more recently that the import/export by direct mail balance shifted to make it
a net loss to the U.S. Though it didn't sound like who the net winners and
losers would be was strongly considered when the system was designed.

~~~
mercutio2
Yeah, it was a great episode.

Generally speaking, I’m in favor of the US exiting this treaty, it really does
seem like a clear distortion of the retail shipping market.

But I think it’s going to worryingly contribute to the dynamic where other
nations, with quite a bit of justification in this case, see the US as playing
a “heads I win, tails you lose” game with the world.

I also think people are fooling themselves if they think high-wage, low-skill
manufacturing jobs are going to come back to the US because of this. Those
jobs are gone, and automation is going to keep them from coming back.

This will mainly help highly automated manufacturing shops in the US, and
online resellers with warehouses in the US.

Basically, I see this bringing more Amazon warehouse jobs, not many more much-
mythologized blue-collar manufacturing jobs.

------
nakedrobot2
This is absolutely a good idea. Whoever thought it would be advantageous for
packages from China to cost less to ship than equivalent packages within the
USA, is beyond me.

I hope there are positive economic and environmental results from this move.

What will be the unintended consequences I wonder?

~~~
onion2k
_What will be the unintended consequences I wonder?_

Small businesses who use dropshipping direct from Chinese companies will stop
being able to compete with big businesses who buy in bulk and ship from US
warehouses. This will benefit the likes of Amazon more than anyone else.

Not sure if that's an _unintended_ consequence though.

~~~
prolikewh0a
I'm low income for where I live and buy a lot of basic $1-$5 clothes from
China that would be $20-$30 equivalent in USA. This is going to hurt me
directly. It's not like I'm buying food, housing, electricity from China, but
having good quality fashionable clothes for very cheap when I can't afford
anything except Goodwill here is beneficial for professionalism at my job, and
overall satisfaction about myself.

Trump should focus on putting more money in our pockets rather than making
things more expensive and hoping the pipe dream of any manufacturing is coming
back to US is a reality.

~~~
malvosenior
Please don't take offense, but these subsidies are paid for by our taxes and I
have no interest in paying to help you dress nice.

Also, if you're really buying clothes from China for $1-$5 you're almost
certainly supporting child labor.

~~~
prolikewh0a
Subsidies? No, it's called free trade and efficient shipping. If I'm buying
clothes anywhere else and it says made in China (most), I'm probably
supporting child labor. I'm skipping the retailer charging $12 for the same
thing I get for $1.88. What kind of country do I live in where I'm not allowed
to dress cheap but well to go to work? What the absolute f __*?

I walk to work, so I don't want to subsidize your commute or travel by roads,
and I don't fly often so I'd rather not subsidize the FAA as well.

------
sschueller
We have the same issue in Switzerland with cheap packages from China which are
received as mail but do not fit through the automated sorting system. This
requires a lot of manual labor which increases the costs for the postal
service.

This is why sometime this year people who receive such mail will be billed
additional fees increasing slowly over the next few years.

The treaty allows under developed nations to ship at a much lower rate. China
and a few others should simply be reclassified.

This does not require having to leave the treaty.

~~~
adventured
It does require having to leave the treaty - if the UPU Congress refuses to
reclassify China. The threat to leave, is meant to apply enough pressure to
finally get that reclassification accomplished. They've been intentionally
dragging their feet on this matter over time and they only meet under normal
circumstances every four years (they can of course hold emergency sessions).

It's the exact same problem the US has had with the WTO, it has refused to do
anything about China's dramatic state sponsored dumping for more than a
decade. These are global bodies that are invalidating themselves by refusing
to normalize rules for China now that they're a massive economic power.

~~~
the_mitsuhiko
I heavily dislike that america just leaves treaties it does not like instead
of improving them. Most smaller countries cannot use the same method.

If my country for instance were to do thay nobody would ship there any more
because the billing system would be too complex and expensive and the market
is just too small.

~~~
traek
> Most smaller countries cannot use the same method.

Sure, but America can, so why shouldn’t it?

~~~
kmlx
there are a multitude of other ways, ways which are completely oblivious to
the current administration as well as its supporters.

~~~
djrogers
There have been efforts and negotiations to get the UPU to reclassify China
from developing nation status for quite a while now, to no avail. This is the
final gambit in those negotiations.

It’s best if you don’t let your hatred of an administration color your
perceptions such that you choose not to look at facts.

~~~
simplify
Can you cite those efforts and negotiations? I want to read more.

------
eigenvector
I used to use a US parcel forwarding service to shop online and have things
forwarded to me in Canada. One of the services they offered was first shipping
the US origin package to their warehouse in China (presumably via some kind of
discounted or chartered freight service) then forwarding it on from there to
the destination country via China Post. This could actually be cheaper than
mailing something directly from the US to, say, Switzerland due to the low UPU
rates out of China.

~~~
mistermann
That this level of physical inefficiency is a sound business model well
illustrates how unfair this shipping subsidy is.

------
ilamont
Not noted in the article: The U.S. attempted to revise the treaty last month
and was shot down (1). Hence the new announcement.

1\. [https://www.caixinglobal.com/2018-10-18/trump-to-withdraw-
us...](https://www.caixinglobal.com/2018-10-18/trump-to-withdraw-us-from-
postal-treaty-squeezing-china-101336196.html)

------
eksemplar
The headline made it sound sort of bad, but reading this and the WSJ article,
it makes you wonder why it wasn’t done sooner.

~~~
gnopgnip
Because it will make some goods much more expensive for everyone in the US.
This can have unintended consequences.

~~~
eksemplar
True, but that’s frankly still a net positive side effect if you add climate
change to your model.

------
gaff33
Sweeden had a much more interesting solution to this problem. Usually small
packages like this avoid VAT because it's not worth the administrative hassle
to deal with them. Sweeden decided that such packages should be liable for
tax, plus a $15 admin fee to cover the costs:
[https://www.thelocal.se/20180119/your-cheap-imports-from-
chi...](https://www.thelocal.se/20180119/your-cheap-imports-from-china-are-
about-to-get-more-expensive)

~~~
kwhitefoot
That's not a proper solution and I hope it isn't the one that my country of
residence, Norway, will choose. It is simple protectionism. And it is
extremely regressive. If they want to figure out a way to efficiently charge
the VAT that would be different (even though VAT is also a regressive tax).
Charging a USD 15 fee to apply the USD 1 VAT to the USD 4 cost of the goods I
have just received from China is absurd.

------
coliveira
The US is engaging in protectionist policies that will bring back inflation
and reduce the purchasing power of the population. The country should better
be prepared for the consequences of these policies, because it will be much
more costly than the $300 million spent in the postal service.

~~~
empath75
I agree with this in general but in this particular case we were actively
subsidizing shipping costs from China.

------
jayd16
Do people in this thread realize the USPS is almost entirely self funded? I
see a lot of talk about tax dollars etc. The USPS doesn't work that way.

~~~
qqqwww
If that is true, then American consumers subsidize Chinese shipping via higher
costs of domestic shipping rather than through higher taxes.

~~~
jayd16
Perhaps. However, that's not the same as taxes and its not a hidden cost like
a tax. It's not factored into the price of US goods as US companies would use
a private shipper if the this law significantly effected shipping costs.

At worst it hurts USPS revenue and increases the cost of first class mail as
market forces can't compete for first class mail. My point is a lot of the
comments are misleading about the scope of the costs involved here.

------
devoply
Say goodbye to AliExpress in the US. This will more or less kill the business
model that AliExpress relies on in the US for most cheap products.

~~~
adrr
Also ebay and etsy have significant China-based Merchants.

~~~
pishpash
Amazon won't be spared, either.

~~~
adventured
Amazon is a very big fan of this change. They've been arguing in favor of this
for years. The postage welfare program enabled Alibaba et al. to inexpensively
lob attacks into Amazon's primary shopping market, from China, where Amazon
can't go to compete. It's a big win for Amazon and most domestic US
manufacturers and retailers.

------
Animats
Oh, the terminal dues issue.[1] International mail is delivered in the
destination country but paid for in the sending country. The UPU has rates for
this, and they vary with the development category of the _sending_ country.
The problem is that China is still getting the rate for underdeveloped
countries. In 2021, that's scheduled to change. Every 10 years this gets
looked at.

[1] [https://www.lexingtoninstitute.org/terminal-dues-time-end-
dr...](https://www.lexingtoninstitute.org/terminal-dues-time-end-drain-u-s-
economy/)

------
fyfy18
if China loses its status as a developing country, all that's likely to happen
is the items will end up being shipped from a neighbouring country that still
has the status.

When you buy items from AliExpress often they have the option of being sent by
Singapore Post. I'm not exactly sure how that works (Singapore isn't that
close to China), but although the item comes from China, to the postal service
it doesn't.

~~~
sam_goody
I had a chat about this with one of the sellers on AliBaba.

He claimed that the items are still being shipped from China, and that he is
just witing Singapore / Czechoslovakia / any other developing country on the
package (he said it is part of the tracking code), and he gets the benefit of
the country whose code he used.

He said the main reason they do that is that the laws differ as to what can be
shipped from each country, especially vis a vis things that use radio
frequencies. By choosing even distant countries they can be caught breaking
minimum standards and are not prosecutable.

He said that the down side is that things can never be returned to sender,
since the sending address is fictitious. This last sentiment has been echoed
by many sellers.

Have no way to verify, but it is an interesting claim.

~~~
oblio
> and that he is just witing Singapore / Czechoslovakia / any other developing
> country on the package

That's impressive both because Czechoslovakia does not exist anymore, but also
because Czechia is developed these days, I'm pretty sure :)

~~~
sam_goody
The conversation started when I got a package "from Czechoslovakia", and I
couldn't figure it out.

He had given me his email address and a catalogue, so we took to talking.

~~~
oblio
Really? And the US Post fell for that? I'll try sending a package from
Austria-Hungary, now that you've told me :))))

------
mcantelon
Canada did the same last year, by the looks of it:

[https://www.theglobeandmail.com/report-on-business/canada-
po...](https://www.theglobeandmail.com/report-on-business/canada-post-phasing-
out-controversial-shipping-discount-for-chinese-goods/article36883687/)

~~~
dragonwriter
No, Canada negotiated changes within the treaty framework.

The US could do that (and some of the coverage have indicated that the
withdrawal is a negotiating tactic to provide more leverage for that, with the
plan being to leverage the time it takes to go into effect to negotiate
changes and then cancel the withdrawal before it is effective; Canada didn't
have to do that to negotiate changes, though.)

~~~
abricot
They could, they did[1], and it didn't work out. [1] "U.S. officials said the
administration sought to revise the treaty in September and was rebuffed by
other nations, prompting the decision to withdraw."

------
sparkpeasy
I always wondered how Chinese sellers on Ebay could sell small toys and
trinkets for less than a dollar with free shipping that took several weeks to
arrive. It would cost more than that to send a small empty box between two
addresses in the US.

------
megaremote
I bought a button from China for 3 cents once, after reading an article about
it. This is too Australia. The package was worth more than that here.

------
iask
Finally!!! Moves like this will help small and medium businesses
compete...finally we won’t have to pay 25.00 to mail a small book to China.

~~~
onion2k
You'll still have to pay that price, but now a Chinese company will have to
pay 25.00 to mail a small book to the US as well. This is just going to limit
the sale of small goods internationally.

~~~
XorNot
Also small volumes of the type small businesses deal in.

In every way this benefits mostly large stateside enterprises who source their
products in bulk.

------
the_mitsuhiko
Why does the US have to withdraw instead of negotiating? The US are not the
only country that is unhappy about the shipping rates with China.

The postal treaty however is hugely important for smaller countries. I don’t
want a world where the US destroy the entire postal system for the rest of us.

~~~
dgellow
The threat of withdrawal is part of the negotiation as far as I can tell.

~~~
dragonwriter
It's not a threat of withdrawal, it's an actual withdrawal, which takes time
to take effect (like Brexit), with the idea that if negotiation is
satisfactory, the withdrawal might be cancelled.

~~~
pluma
Either the Brexit example is a simple mistake or you're confused about the
mechanics behind it, so I'll elaborate to avoid people thinking it's a sound
analogy:

The Brexit referendum was non-binding, so at that point nothing legally
relevant had happened yet.

The UK government then decided to honour the will demonstrated by the 37.5% of
the population that cast a vote in favour of leaving the EU (51.9% of the
result at a 72.2% turnout). Again, this decision didn't mean anything legally
relevant but the government announced its commitment, setting expectations.

At that point the UK government could have negotiated with the EU and sought
alternative solutions (not that there was much left considering "do this or
we'll leave" had been the negotiation strategy for quite a while).

But then on 29 March 2017 the UK government decided to start an "actual
withdrawal" by triggering Article 50 of the Lisbon treaty. This set its
membership to auto-destruct within two years time and was legally binding.

The problem with Article 50 is that the UK now had a mere two years until all
existing treaties it was part of via the EU would simply end and nobody had
bothered to prepare for negotiating any replacements yet. As of today there
are still hundreds of incredibly complex treaties that haven't been sorted out
yet, the most obvious problem being how to deal with Northern Ireland's
chaotic land borders without upsetting the DUP (the political party that
enabled the Prime Minister to stay in office after her botched early re-
election).

However unlike the US and the Postal Treaty, the UK can't simply cancel its
withdrawal from the EU. If it wants to revoke its invocation of Article 50, it
has to get approval from every single of the EU's (other) 27 member states --
some of which don't particularly care much for the UK for various reasons.

It's like giving your boss the finger and handing in your signed three weeks
notice (after using the threat of quitting during salary renegotiations for
decades) and then coming back two weeks later asking them if they can please
let you stay. Except you don't have one boss but 27 of them and all of them
have veto powers and some of them really don't like you.

 _However_ Scotland (where a majority voted against leaving in the first
place) brought forth a case that will decide whether maybe the UK could still
unilaterally revoke its invocation after all. The only problem is that a
ruling might take months and may come a little too late.

Even if the court rules in favour of Scotland and the UK pulls off a full 180
at the last minute, the entire ordeal would leave the UK in a worse position
by having called its own bluff and shown that leaving is not actually an
option they're willing to follow through on.

tl;dr: the biggest difference is that (unless the ECJ rules differently)
Brexit "took effect" immediately when Article 50 was invoked, it just includes
a 2 year "migration" period during which the membership status remains in
effect.

~~~
dragonwriter
> Either the Brexit example is a simple mistake or you're confused

Or it is exactly what it was offered for, an example of an actual withdrawal
that, once triggered, takes time, which is why the “(like Brexit)”
parenthetical was placed precisely where it was but not (for instance) after
the reference to th negotiate-then-cancel strategy, which wouldn't
mechanically work with Brexit, as you note, and had never been suggested to be
the strategy of Brexit (though trying to effect a cancellation in the face of
failed exit negotiation send to be emerging as an idea in some significant
corners of British politics, but that's a different thing.)

Your essay was well-crafted, but entirely misplaced.

~~~
gamblor956
You still aren't getting what he's saying.

Brexit: the "exit" part takes place over two years, but is irreversible once
the process begins. Re-joining the EU requires unanimous approval from all
then-current members of the EU.

Postal treaty: the exit takes place over one year, and is reversible at any
point during the year. Re-joining the treaty is a simple matter of re-
ratifying it through your legislature (i.e., the US Congress) because all UN
members are automatically entitled to join the treaty and are not subject to
any sort of membership vote. (Non-UN members are subject to a vote by the
membership.)

------
exabrial
China _still_ has developing nation status? This seems more than reasonable to
renegotiate.

~~~
freddie_mercury
In Shanghai and Beijing the average household income is $7,000 a year.

If it isn't a developing economy, what would you call it?

~~~
collyw
I am curious how that translates.

Cost of living will be substantially lower, I am not sure by how much but 5
times wouldn't seem unfeasable. That would translate to $35k per year which
sounds similar to plenty of European countries, so might buy a reasonably
comfortable lifestyle there. Anyone with any more knowledge care to comment on
this?

~~~
z2
From my armchair--it could be somewhere in between what's considered
purchasing power parity and the actual exchange rate, because goods aren't
exactly comparable when the entire supply chain is less advanced. You may pay
less for a washing machine in a developing country, making your money go
farther, but that washing machine may also have a greater chance of
electrocuting you due to lower quality control. It's hard to measure quality
of life through qualitatively similar goods. Is a jar of tomato sauce from a
developed country that's vacuum sealed in a sterilized glass jar the same as a
tin can of tomato sauce made under questionable conditions?

Edit: For Shanghai, cost of living is closer to 1:1 to 1:3 from here:
[https://transferwise.com/gb/blog/cost-of-living-in-
china](https://transferwise.com/gb/blog/cost-of-living-in-china)

------
apexalpha
For anyone not up to speed with the Postal Treaties and its (dis)advantages,
this video is a good summary:

[https://www.youtube.com/watch?v=DkckYLBCNfI](https://www.youtube.com/watch?v=DkckYLBCNfI)

------
nil_pointer
This video does a good job explaining the bad position we were in prior to
leaving the treaty:
[https://youtu.be/DkckYLBCNfI](https://youtu.be/DkckYLBCNfI)

~~~
gmiller123456
Even if we assume the information in that video is correct, just charging the
extra $1 or so for delivery would not cause any significant number of jobs to
the US. Firstly, the movement of jobs from the US to China pre-dates consumers
wide availability of ordering packages straight from China. Secondly,
factories in China shipping a lot of products aren't going to be sending their
entire inventory in the small $2-$3 packages mentioned in the video, they'll
be making larger freight shipments not involving the USPS at all. Thirdly, the
cost of shipping is just one thing that's cheaper for China, their labor costs
are also so much lower, that just charging an extra $1 per package won't make
it cost more than it would to make in the US.

Lastly, the assumption the video makes is that the USPS loses $1 per shipment,
without backing it up with any evidence. The exact amount it costs the USPS to
deliver a package is competitive information and likely very closely guarded
against public disclosure. If you pause the video where they show the US vs
China price chart, you see the China cost is about $1 less for each. So it
seems they assumed the US cost was the exact cost with no margin. The other
way of assuming, is that the China cost is the exact cost, and the US cost is
just extra profit to the USPS because the market will bear it. And the $1 the
USPS "loses" is just extra profit they didn't make. Additionally, other
countries also benefit from the same price China does, but it has not
benefited them as much as China.

So there's a lot more to the economics than just $1 per package that the video
seems to lead to.

~~~
gamblor956
It seems you're misundestanding the problem entirely.

 _Secondly, factories in China shipping a lot of products aren 't going to be
sending their entire inventory in the small $2-$3 packages mentioned in the
video, they'll be making larger freight shipments not involving the USPS at
all. _

This was _precisely_ what Chinese factories were doing: dividing up shipments
to the US into smaller packages that qualified for the USPS treaty rates,
because it cost them pennies per item.

 _The other way of assuming, is that the China cost is the exact cost, and the
US cost is just extra profit to the USPS because the market will bear it._

It cost the USPS more to collect and move these packages within the US then
the Chinese sender paid in total shipping costs (China and US combined). These
aren't "lost profits," they're actually increased expenses that eat into
actual revenues resulting in actual financial losses on Chinese parcel
shipments.

~~~
gmiller123456
Those would be good points if you can back them up with a source. But even the
video I was responding to showed the prices as $1.63 for a 1oz package, not
"pennies" as you say. A 2oz package costs $1.96, and a 4lb package costs
$21.15 which is higher than the US cost of $7.15. So it would be far cheaper
for them to bundle the 1oz packages into a 4lb package and pay the higher
rate. So I think you'd be better off questioning the source of your
information.

------
forapurpose
> foreign packages cost the US about $300m (£228.5m) each year, according to
> administration estimates.

Is that even a rounding error? How much annual trade is there with China? How
much is done via the Postal Treaty?

------
lancewiggs
Postal Services have a large fixed cost component - reducing the flow of goods
coming into the country puts the entire USPS system at risk. That may be the
point.

------
swamp40
Although this is a good move, small US Postal shipments from China to US
households are a drop in the bucket compared to DHL deliveries from China to
US companies.

And that cost is being massively subsidized by the Chinese government. I think
the money goes directly from the Chinese government to the Chinese companies,
who then pay DHL - so I doubt there is much the US can do to stop that.

------
kimsk112
NPR Money has a good podcast about this couple months ago.
[https://www.npr.org/sections/money/2018/08/01/634737852/epis...](https://www.npr.org/sections/money/2018/08/01/634737852/episode-857-the-
postal-illuminati)

------
onemoresoop
I think Chinese shippers can send items in bulk to a us destination and resend
locally the individual items from there ...

------
AtlasBarfed
IF From what I've heard of the postal treaty is true, this is an unreasonable
subsidy for imports and offshoring.

And it's not without environmental consequences: it offloads the carbon
impacts of shipping and further enables arbitrage and cherrypicking of lax
environmental regulations for production undermining the global common good.

While I don't like most aspects of the Trump administration and it's pandering
policies, this one is probably good for the world, even if the people trying
to do it care nothing for our environmental future.

~~~
PeanutNore
"Even a broken clock..." and all that.

~~~
rc_mob
Still.. Wtf Obama, why couldn't you fix this?

------
ElBarto
Lest we forget that the USPS seems to have been quite OK with how things
worked:

[http://about.usps.com/news/national-
releases/2010/pr10_058.h...](http://about.usps.com/news/national-
releases/2010/pr10_058.htm)

------
forapurpose
Do I understand this correctly: The U.S. President claims to withdraw from the
Postal Treaty with the entire world because he objects to one provision with
China that he says costs the U.S. around 0.06% of its annual economic output?

------
joshe
At most the subsidy reduces prices by 0.1% for goods from China. If all
foreign packages only cost the US $300 million a year (from article), China's
portion has to be less than that. We buy $462 billion in goods from China.

It's also worth remembering that the subsidy goes to both the American
consumer and the Chinese supplier. Eliminating it helps the American supplier
and hurts the Chinese supplier and American consumer.

Probably no one bothered to fix it because it's such a minor issue. It's also
difficult to change treaty agreements, oddball stuff tends to stick around for
awhile just because the cat herding is so difficult.

It's reasonable to remove this subsidy, and probably good to do so before more
people take advantage of it.

This is a big emotion story but it's not that important.

------
nojvek
Credit where credit is due. This is very much a “America First” move and
deserves kudos. I no longer consider China a developing nation.

------
forapurpose
Imagine your CTO said this:

'I found a bug, therefore we should discard the entire system'; imagine it's a
mature, complex, functioning system. If your CTO did it, you'd seriously doubt
their leadership. The real question is, what are the outcomes we are choosing
from? What is the outcome if we keep the system, and what is the outcome if we
discard it? What would we replace it with - are we going to try to build a
complex system from nothing? Are there third or fourth better options, perhaps
improving the existing system?

The politicians have explicitly and repeatedly expressed their goals (see
Trump's UN speech, for example): Undo international cooperation and jointly
made rules, and create zero-sum geo-political competition based on power. It's
fundamentally undemocratic and against the belief in the fundamental equal
rights of all people ('all men are created equal') - i.e., that others should
have an equal say. It also has a long and proven track record of leading to
war, the experience of most of human history until the rules-based
international order was built amid the ashes of WWII.

In this case it's backed by typical political talking points, designed to give
people the impression that international treaties are generally bad and to
rationalize the step they are taking toward their strategy. But as I said,
it's should be transparent (and expected, though you never know which
agreement is next).

~~~
jchb
> complex

Complex is an understatement.

The Universal Postal Union constitution (1) from 1964 is some readable 11
pages, setting the scope to "... a single postal territory for the reciprocal
exchange of letter-post items" and international collaboration to improve
postal services including facilitating technical assistance.

Fast forward to 2018 and there is a a list of UPU activities (2) that really
stretch that constitution to its limits.

Then some two hundred pages of regulation (3), including a bunch of country
specific rules and exceptions. "Not withstanding article 17-107.5.2,
Azerbaijan, India, Indonesia, Lebanon, Nepal, Tajikistan, Turkmenistan,
Ukraine, Uzbekistan and Zimbabwe shall admit sound recordings as items for the
blind only if these are sent by, or addressed to, an officially recognized
institute for the blind"

That doesn't yet include the elaborate classification of countries into
different contribution groups. Those classification documents are hidden
behind a login screen on the UPU website - only accessible to "select
partners". Although with a bit of Google-fu you can find them from the US
Postal Regulatory Commission (4). There you can see that the US is classified
as group I, China as group III.

A complex world may need complex regulation, and the activities the UPU
undertakes are not necessarily bad. But just a brief look at this thing
reminds me of a quote from the "The CumEx-Files" article that is currently on
the HN front page: "the German tax law has grown so complex that those who
have written the laws no longer understand it themselves".

(1)[http://www.upu.int/uploads/tx_sbdownloader/actInForceIndefin...](http://www.upu.int/uploads/tx_sbdownloader/actInForceIndefinitelyConstitutionEn.pdf)
(2)[http://www.upu.int/en/activities.html](http://www.upu.int/en/activities.html)
(3)[http://www.upu.int/uploads/tx_sbdownloader/actRegulationsCon...](http://www.upu.int/uploads/tx_sbdownloader/actRegulationsConventionFinalProtocolEn.pdf)
(4)[https://www.prc.gov/docs/96/96632/Attachment%20B.pdf](https://www.prc.gov/docs/96/96632/Attachment%20B.pdf)

~~~
forapurpose
Large institutions, and interactions between large institutions, use complex
rules to manage their very many and varied activities, often called
'bureaucracy'. Nobody has found an alternative; you can't name any sizeable
institution that lacks it.

We're talking about the rules governing all mail sent between all countries in
the world. 200 pages seems very small to me.

And what better option do we have? If there's a simpler, equally effective
one, I'm all for it.

> stretch that constitution to its limits

How does it stretch the constitution to its limits? The ratio of pages isn't
high (look at any charter and then all the policies that organization makes)
and is no indicator of 'stretch'. Stretching it would be violating the rules
in the constitution.

~~~
jchb
What you are missing is this institution does not have direct accountability
to neither voters nor tax payers. But rather than focusing on its core
mission, it seems to have a life of its own (just like some other UN
organisations). Still it expects to continue get funded no matter what.

US and other western governments have being reviewing the UPU for years, for
the distortion these rules have been causing since the explosion of e-commerce
parcels. Still, the UPU has not been able to change itself fast enough, and we
have arrived at this situation.

International corporation is necessary, but I believe as such each
organisation should have a very well defined mission and scope. For example,
why is the Universal Postal Union concerned with income redistribution? There
are already other branches of UN that concern itself with foreign aid.

~~~
forapurpose
I'm still waiting to hear about a better option ... what will yield better
outcomes?

> What you are missing is this institution does not have direct accountability
> to neither voters nor tax payers.

I'm not sure what this means, though it's often repeated.

In most democracies, only one person who does anything (legislatures don't
act, they make rules) that is directly responsible is the chief executive,
e.g., the President in the United States. 99.9999% of what is done is by
people not directly responsible to voters, which includes every park ranger,
bank regulator, soldier, janitor, cabinet official, medicare payment
processor, security guard, CIA agent, NIH researcher, etc etc etc.

Furthermore, every international agreement is made by the executives, and
carried out by someone - Trump isn't going to be personally delivering the
mail to Mali (or to Minnesota) no matter what happens, so inevitably it's done
by an institution that "does not have direct accountability to neither voters
nor tax payers".

How do you propose we handle international mail with people directly
accountable to voters?

> why is the Universal Postal Union concerned with income redistribution

It's not redistribution, it's paying our share as the richest countries in the
world. Is it income redistribution when Bezos pays more taxes than the person
who served you your coffee? The principle is equal sacrifice. If Bezos and the
waiter paid the exact same taxes, it would be absurd. Bezos and the rich
countries can afford much more. We'd have to be amazing doctrinaire or miserly
to demand that poor people pay as much as we do. $300 million issues should
not reach the President's desk in the U.S. - it's laughable. There are many
corporations that could write off that amount without thinking twice.

~~~
jchb
> Is it income redistribution when Bezos pays more taxes than the person who
> served you your coffee

Yes, it is, taxation is a mean of income redistribution!

But I find your example flawed for the purpose of this discussion. More apt
would be to say that the coffee clerk (through his taxes) have to help
reimburse the Chinese post office when Bezos orders a package from Aliexpress.

But note, I didn’t say income redistribution is always bad! You seem to assume
that you are arguing with some tea-party republican with a MAGA cap. But I am
not, not even american.

But income distribution through UPU is incredible opaque. If we are going to
pay foreign aid, I think we tax payers at a minimum deserve to know exactly
how much we are paying and to whom!

>How do you propose we handle international mail with people directly
accountable to voters?

I don’t suggest that. What I am saying is that they since they are not
directly accountable to the tax payers, the people that are (eg US president)
have to hold them accountable. Also they better stick to their scope or they
will lose public support.

I doubt the US will leave UPU in the end, but this will be a huge wake up call
for the other member countries.

> miserly to demand that poor people pay as much as we do

But no one is upset with US or France paying more than Zimbabwe. They are
upset mostly with Chinas classification, which doesn’t match its new economic
powers.

Whether US president should be involved in a $300 million decision I don’t
know, but that is still is a lot of money, and the tax payers deserve that
every dollar of their money is spent judiciously. A corporation writing that
off is not an apt comparison because being a shareholder is a voluntarily
taken risk position. You can’t opt out of paying tax.

------
remote_phone
I hate to say it because a Trump is an embarrassing, non-presidential,
ignorant buffoon, but some of his policies are very good and are actually
helping small businesses. This is an example of it. He is willing, whether he
fully understands it or not, to touch the third rail and do things that wiser
politicians would never do, but is incredibly frustrating. This is a perfect
example of this. I have two friends who are impacted by this and have been
complaining about this for years.

------
basicplus2
"Under the treaty, a UN body sets lower international rates for packages from
certain countries, a move originally designed to support poorer nations."

i presume this is code for making it easier for rich players to exploit cheap
labour to make alot more money no matter the consequence for local
manufacturing and sovreign security.

------
c789a123
While it is very easy to buy stuff directly from China on websites like amazon
or even Chinese web sites, it is almost impossible for people in PR.China to
buy US products via WWW the same way. The Chinese CCP party intentionally
blocks outside products to sell easily in China and keep the profits they got
from US to the families of party leaders. Thanks Trump for acting on it!

------
noobermin
Will this affect the myriad of businesses that assemble products in the US?

~~~
adventured
No, generally speaking those businesses purchase their orders in large
quantities that don't arrive by individual small packages.

This would end an absurd international postage welfare program that China
benefits from, pretending to be as poor and developing as they were 30 or 40
years ago.

------
basicplus2
all i know is i have to pay an ENORMOUS amount of money to pay for freight
from US to Australia

So is this going to make it worse? Because this is an enormous incentive NOT
to buy any US goods

~~~
chippy
It's not going to make it any cheaper. This will mainly effect the cost of
others shipping goods to you.

------
m-p-3
I guess this will hurt businesses like Alibaba and etc?

------
morpheuskafka
Interesting, on October 15 the USPS OIG release a redacted copy of report SAT-
AR-18-002, "Use of Postal Service Network to Facilitate Illicit Drug
Distribution"[1], which commented on the Universal Postal Union requiring the
USPS to accept all international mail from UPU members[2] (basically everyone)
that don't want to comply with the US requirement of Advance Electronic Data
(basically Secure Flight for mail/packages, the idea is that CBP can identify
suspected drug packages just as they do passenger flights, as mail can only be
screened without a warrant by CBP at the mail port of entry). Footnote 25
notes that as recently as September 1 of this year, the US moved to require
AED on packages sent through UPU's EMS program[3], the partially redacted next
sentence appears to indicate that some countries pushed back or had plans not
to comply.

Sent in a FOIA for the report, so we'll see what exceptions they were
claiming, if they actually claim it as non-disclosable under FOIA law. Also
interesting that the WHPSEC statement[3] notes that Trump is willing to
abandon plans to leave if unspecified goals are met in negotiations.

Edit: A conservative think tank recently complained about the UPU and drugs as
well: [https://www.aei.org/multimedia/universal-postal-union-and-
ma...](https://www.aei.org/multimedia/universal-postal-union-and-mail-order-
opiates-viewpoint/)

[1] [https://www.uspsoig.gov/sites/default/files/document-
library...](https://www.uspsoig.gov/sites/default/files/document-library-
files/2018/SAT-AR-18-002.pdf) [2]
[https://en.wikipedia.org/wiki/File:Universal_Postal_Union_me...](https://en.wikipedia.org/wiki/File:Universal_Postal_Union_membership.png)
[3] [https://www.ems.post/en/about-us-contacts/about-
us](https://www.ems.post/en/about-us-contacts/about-us) [4]
[https://www.whitehouse.gov/briefings-statements/statement-
pr...](https://www.whitehouse.gov/briefings-statements/statement-press-
secretary-38/)

------
bovermyer
While you can count on me to be hostile to just about everything Trump does,
this seems to be a good idea.

Thanks to everyone posting links to further information.

------
dang
Url changed from [https://hackaday.com/2018/10/17/us-announces-withdraw-
from-p...](https://hackaday.com/2018/10/17/us-announces-withdraw-from-postal-
treaty-international-shipping-prices-expected-to-rise/), which points to this.

------
pknerd
Let's see how long Trump's economical orgasm last.

------
cableshaft
Considering pretty much all board and video games are manufactured in and
shipped from China, this probably means they're all going to become more
expensive. Yay.

It still might be a good thing overall to do away with this treaty, I don't
know, but this is probably not going to be great for those industries.

~~~
chrissnell
Manufactured goods are not being sent to distributors and dealers in bulk by
postal mail. That stuff comes in a shipping container. This is targeted at the
typical AliExpress shipment.

------
baybal2
Developed countries have a moral duty to support developing nations, that
includes China.

~~~
andun
I know your comment is in jest, but no, developed countries don't owe
developing countries shit.

~~~
rswail
Well actually, current developed countries owe developing countries for not
paying for the externalities (pollution primarily) now causing climate change
that were not paid for by the developed countries while they became developed.

That's a purely economic argument and leaves out the exploitation of
developing countries by government supported corporate entities over the
entire period of colonization.

So actually, you're right, they "don't owe [them] shit." What they owe them is
getting rid of the shit that was created in the first place.

------
a_imho
Off-Topic: Most stories about politics, or crime, or sports, unless they're
evidence of some interesting new phenomenon. Videos of pratfalls or disasters,
or cute animal pictures. If they'd cover it on TV news, it's probably off-
topic.

