
Americans Are Receiving Unordered Parcels from Chinese E-Criminals - colinprince
https://www.forbes.com/sites/wadeshepard/2017/11/27/americans-are-receiving-unordered-parcels-from-chinese-e-criminals-and-cant-do-anything-about-it/#3c9f763c73da
======
LV-426
This article appears in the second top post of this (currently front page)
thread, made 9 hours ago:

[https://news.ycombinator.com/item?id=15940318](https://news.ycombinator.com/item?id=15940318)

It was also submitted seven hours ago, here:

[https://news.ycombinator.com/item?id=15944653](https://news.ycombinator.com/item?id=15944653)

The original submission 19 days ago is here, with 90 comments:

[https://news.ycombinator.com/item?id=15803725](https://news.ycombinator.com/item?id=15803725)

~~~
dang
Ah thanks! With that last link this is unambiguously a dupe.

------
crispyambulance
I have ordered stuff from aliexpress and got "ePackets." It always seemed
strange and now it is even stranger because, apparently, the shipping costs
are subsidized NOT by China but by the USPS itself
([https://www.forbes.com/sites/wadeshepard/2017/11/05/how-
the-...](https://www.forbes.com/sites/wadeshepard/2017/11/05/how-the-usps-
epacket-gives-postal-subsidies-to-chinese-e-commerce-merchants-to-ship-to-the-
usa-cheap/#1078f4dd40ca)).

How did this "deal" happen? Who is getting paid, and what benefit does the USA
get from this?

I mean this is just consumer shipping we're talking about, small potatoes
compared to commercial B2B shipping. But still it must add up to something
significant as well as being demonstrably hurtful to US-based small business.

~~~
snowpanda
>How did this "deal" happen?

Although no expert, I do know enough to possibly answer your question. This
has been going on since the 60's and to some extend the Universal Postal Union
goes back to 1863[1]. At the time, when you wanted to mail a letter, it was
fairly complex. You had to arrange for the details of your shipping for every
route your letter took. Meaning you had to calculate for every leg of the
shipment ahead of time. So they came up with these 3 points (From Wikipedia):

    
    
        There should be a uniform flat rate to mail a letter anywhere in the world
        Postal authorities should give equal treatment to foreign and domestic mail
        Each country should retain all money it has collected for international postage. [2]
    

The problem is that this system hasn't really been updated that often. So
rates do not make sense anymore, especially not since ecommerce took off.

Along came USPS and signed a special deal with China in 2010 to increase their
presence in China (well, that's the official statement anyway[3]).

That statement however leaves out a very important part. Which is that USPS
lost so much money under UNU, that although they had a net loss of $29.4
million in 2012[4]. They would have "lost another $1 million or so in 2012 had
Chinese shippers opted for regular mail instead of ePacket."[4].

So basically the USPS was already losing a ton of money, and this is a way of
minimizing the damage.

The real issue is that the broader picture isn't really taken into
consideration. Which is, that China is literally sending things for rates
cheaper than Amazon which is estimated to pay USPS $2 per package[5]. Take the
fact that most items are manufactured in China for cheap anyway, and you have
just signed away a lot of domestic business opportunities.

[1][http://www.slate.com/articles/news_and_politics/explainer/20...](http://www.slate.com/articles/news_and_politics/explainer/2007/01/i_mailed_a_letter_to_paris_.html)

[2][https://en.wikipedia.org/wiki/Universal_Postal_Union](https://en.wikipedia.org/wiki/Universal_Postal_Union)

[3][https://about.usps.com/news/national-
releases/2011/pr11_037....](https://about.usps.com/news/national-
releases/2011/pr11_037.pdf)

[4][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/)

[5][https://www.bloomberg.com/news/articles/2015-07-30/it-s-
amaz...](https://www.bloomberg.com/news/articles/2015-07-30/it-s-amazon-s-
world-the-usps-just-delivers-in-it)

Anyone feel free to correct or add information, it's an interesting topic.

~~~
tasty_freeze
> So basically the USPS was already losing a ton of money

The USPS isn't losing a ton of money. It is profitable.

The "loss" is that congress mandated that the USPS accumulate 75 years worth
of employee retirement funds and gave them 10 years to do it. So they "lose"
$5B a year because they are not able to pay that amount into a retirement
fund.

~~~
mikeash
Don’t knee jerk this as a political thing. They’re saying that the USPS loses
money _on this service_. It has nothing to do with their overall profitability
or Congressional action or whatever.

------
cardamomo
The USPS Inspector General did an audit [0] of the ePacket program in 2014,
finding that the cost of the program could not be effectively calculated,
though the USPS certainly lost money on this service in the preceding two
fiscal years:

> ePacket volume and revenue have increased, but the Postal Service still lost
> at least $39 million during FYs 2011 and 2012. Until accurate costs for
> ePackets can be identified and used as a basis for pricing, the risk of
> revenue loss for ePackets remains high.

Wade Shepard first wrote about this [1] for Forbes in 2011, following the
USPS's announcement of the program [2]. His commentary sets the program
against a backdrop of a global shipping war and plummeting postal service
revenues. He writes, "Essentially, U.S. shippers are partially paying higher
shipping rates to make up for the hit the USPS takes giving subsidies to the
Chinese."

[0]: [https://www.uspsoig.gov/document/inbound-china-epacket-
costi...](https://www.uspsoig.gov/document/inbound-china-epacket-costing-
methodology)

[1]: [https://www.forbes.com/sites/wadeshepard/2017/11/05/how-
the-...](https://www.forbes.com/sites/wadeshepard/2017/11/05/how-the-usps-
epacket-gives-postal-subsidies-to-chinese-e-commerce-merchants-to-ship-to-the-
usa-cheap/#6e70553f40ca)

[2]: [https://about.usps.com/news/national-
releases/2011/pr11_037....](https://about.usps.com/news/national-
releases/2011/pr11_037.pdf)

~~~
crispyambulance

        > He writes, "Essentially, U.S. shippers are partially paying higher shipping rates to make up for the hit the USPS takes giving subsidies to the Chinese."
    

Yeah, but why?? What is the intent of this program? Is it some kind of global
trade "kick-back" in exchange for something else or is it just a dumb idea?
Even the audit doesn't address the reason for this bilateral agreement made in
2011.

Moreover, even if the program "makes money" for the postal service it comes at
the expense of hurting competitiveness of domestic mail-order. There must be
some other side to the story, right? Protectionism is harmful in itself, but
this seems like the exact opposite: active harm to domestic business in favor
of Chinese business.

~~~
AnssiH
From the linked Forbes article:

> They came up with the ePacket, which is actually meant to be an improvement
> over the rates set by the UPU. In exchange for providing tracking and faster
> delivery times, ePacket partner countries agree to pay slightly higher
> rates.

So the Chinese pay more for ePackets than they would for standard mail by UPU
rates.

------
notacoward
Title is clickbait. "E-criminal" implies that the contents of the packages are
bugged or something, but it's just a specific form of growth hacking.

~~~
soneil
The act is criminal. It's just that the recipient isn't the victim, but merely
incidental.

------
tomohawk
Reminds me of Bill the Galactic Hero
([https://en.wikipedia.org/wiki/Bill,_the_Galactic_Hero](https://en.wikipedia.org/wiki/Bill,_the_Galactic_Hero)).

He solves an important waste management problem by using the free postal
service.

------
userbinator
[https://www.consumer.ftc.gov/articles/0181-unordered-
merchan...](https://www.consumer.ftc.gov/articles/0181-unordered-merchandise)

Fortunately, it seems unordered merchandise is yours to keep. If I was
targeted by this, I'd probably find a local store to take them rather than
just throwing it all away.

------
dwagnerkc
Our great mail mystery has finally been solved!

~50 hair tie packets, ~5 beanies, a scarf, and some makeup.

My wife sometimes wears the light blue beanie they sent and the scarf. I still
hear her say "I need a hair tie. Can't find one anywhere" every couple of
days. Keep 'em coming guys.

~~~
pault
I laughed so hard when I saw this article; a few months ago a got a package
that contained another package that contained another package that contained a
single scrap of Chinese newspaper. It was so bewildering I took pictures of it
and sent them to my friends to see if anyone could make sense of it. This is
the second mystery HN has solved for me this week. :)

~~~
mavelikara
Whats the other mystery?

~~~
pault
A mystery truck with radioactive material warnings on it:
[https://news.ycombinator.com/item?id=15897238](https://news.ycombinator.com/item?id=15897238)

------
Invictus0
I believe I got one of these. It was a book I didn't order, "Getting Things
Done" by David Allen. The people at the Post Office said it was mine to keep
and there was nothing I could do about it.

~~~
the-dude
Did you get stuff done?

~~~
asah
Post on HN, nuff said.

------
ufo
Why do they send the packages to random people instead of sending them to
accomplices or just faking everything and not even sending the package? Is it
to avoid fraud detection by the marketplace?

------
msie
Ha! After reading the article...this is not a huge problem folks. If people
were shipped drugs to be picked up by criminals then i would be more alarmed.

------
hollander
Is there a risc for the receiver of the packages?

~~~
beamatronic
Yes, there's only a very small set of things you can do. But you can do them
very quickly.

------
zeep
I only got 1 unordered package from china so it probably was not part of that
scam... it was worth $10 too...

------
bcoates
Of course they do, a three way handshake at that distance takes way too long.

------
_red
>Due to the unbalanced pricing policies of the United Postal Union and
subsidies from the U.S. Postal Service, it costs people in China virtually
nothing to ship small packages to the U.S.

I'm so happy my tax dollars are going to subsidize this.

~~~
gruez
USPS receives no taxpayer money, so no.

~~~
sbuttgereit
You're technically correct when thinking of only the transfer of money, though
that's not the whole story. Many here would call tax breaks to regular
businesses a tax subsidy to those businesses... after all, there are services
those tax advantaged businesses are using that are being paid for by others.
In this sense, there is a transfer of "something" from taxpayers to the
business, it's just not hard "taxpayer dollars".

However, we see that the USPS does get a lot of advantages that are
effectively subsidized by others:

[http://fortune.com/2015/03/27/us-postal-
service/](http://fortune.com/2015/03/27/us-postal-service/)

There are real subsidies that the USPS gets that are funded by taxpayers, it
simply that those are not paid in cash. So I think the person you were
responding to has a completely valid point. They are not competing and doing
business on the same terms as other businesses and squandering their cash is
enabled because of the subsidies of other expenses that they don't have to
bear directly.

~~~
kasey_junk
They also have to put up with all manner of political interference from
Congress with regard to rates they can charge, what they can pay employees &
what business plans they can implement.

The Post Office has been a political battleground for 40 years and it shows.

The “they are subsidized & squander their money” angle seems unfair given
that. Personally I think they do a fairly good job.

That said I think it’s fair to say they are tax subsidized, it’s just not much
of one.

