2017-12-29 — cnbc.com
"We contend that this floor for competitive (parcel) products has been maintained at artificially low levels, creating large-scale systemic economic inefficiencies engendered by what is effectively a government-enforced taxpayer subsidization of the USPS' irrational pricing," wrote analysts at Citi in April.
The package pricing, argued Citi, hurts USPS' competitors, who have to match similar pricing. It may also be hurting USPS itself.
The question thus arises as to why the mailing service appears to be undercutting itself. As letter mailing increasingly becomes a smaller piece of the business in the future, the service may not want to mess with the growth it sees in packages.
Ironically the USPS's regulations were meant to keep it from steamrolling the private sector (which in theory Trump should be a fan of) -- has it gone to far in the other direction? Seems like, at minimum, the amount the USPS can charge for packages should be proportional to volume. The other interesting point is, since Amazon doesn't actually make much money (net income), one could argue the subsidized package delivery is actually passing through quite well to consumers... generally, however we are against market distortions induced by inflexible regulations...
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