The Post Office is Sitting on a Gold Mine

Published August 4, 2013

The United States Postal Service is operating according to a paradigm set up 100 years ago.  In spite of protected monopolies and immunity from paying taxes or even parking tickets, the USPS is losing business and losing money.  The problem is that the paradigm is technologically obsolete and has lost its usefulness.

I gave up receiving bills in the mail years ago.  I pay all my bills by credit card or automatic bank withdrawal.  Most of my service providers don’t even send me bills in the mail.  So far this year I’ve written only 3 checks to providers of goods or services.  Almost everything can be paid on line or via bank bill pay services or credit cards.  About 95% of the mail I receive I never open or look at.  It either goes in the trash or is shredded and then goes in the trash.  I rarely mail a letter — maybe once a month.  I hate actually going to the post office.  Usually, in Chicago or Miami where I live, I have to wait in line for 30 minutes simply to be served.  That is not good service.

Granted, I’m a heavy user of electronic communications.  Much of the world hasn’t adopted such intensive post office avoidance.  They will over time.

The post office has a terrific advantage of being mentioned in the Constitution and being able to use federal authority to promote the common good.  I’ll leave aside the implementation questions and concentrate on the new services that the post office could provide. Obviously they would need to bring in subcontractors for implementation and support.

A secure email system  

This would be a system where you would pay to send an email, it would be encrypted and there would be signal that the email was opened by the recipient.  The post office could make vast amounts of money from this for a lot less than 44 cents per email.  Further, the users could specify what kinds of advertisements, or none, that they are willing to receive.  Advertisers could then get access to list of people who actually want their advertisements.  Obviously there would be little spam due to the cost of sending the email.  Working with the secure email system could be a way to send money to users of the system.  It could also be used to send printouts of the messages to people who are not subscribers and still using snail mail.  There could also be a subscription fee at various levels including a free level.

The advantage of the secure, fee-based, email is the elimination of spam, the safe communication of information, and integration with payment systems and package delivery.   If people on the average received 10 emails per day and the cost were 5 cents per email, that would be $54 billion per year revenue to the post office.  Compare that to the gross revenue of the post office of about $70 billion per year currently.  Google, UPS, or FedEx are all in the range of $40-$50 billion annual revenue.

Package delivery boxes protected by federal law

This would be a box that could be bolted down where the postman or the FedEx or UPS driver could leave a package.  The delivery man could open the box using an electronic device leaving an audit trail.  The homeowner would have a key of some sort.  A display would tell if something was in the box.  Theft from the box would be heavily investigated by postal inspectors.  The box might be alarmed and snap a photo of anyone opening the box.  Sharing the box with other delivery services, now prohibited, would be for the common good, save vast amounts of wasted labor, and inhibit theft. 

The USPS is experimenting with locker services for delivering packages. However this is only slightly less inconvenient than going to the post office since you will have to go to a mall or some location with lockers to collect your package.  It is also not shared with other services.  If these facilities are shared, the cost is shared, and it becomes more convenient for the customer.

A national directory of persons and business

It would be voluntary and people could place as much or as little information in it as they want.  Information from an optional section could be sold to advertisers by the USPS.  A novel idea might be that customers could specify how much an advertiser would have to pay, possibly split between the customer and the post office, to send an advertisement or unsolicited secure email.

There are questions of privacy and big brotherism.  But, at least these things would be out in the open.  The government is not very trustworthy and needs to be held in check.  Are Google and Facebook trustworthy?  Can they be trusted to stand up to the government to protect your privacy?

Since packages can’t be sent electronically, the option of physical delivery will remain for the foreseeable future.  So, it would also be possible for the post office to deliver physical mail or convert electronic mail to physical mail.

The economic value of the Postal Service is its potential to establish universal and to some extent compulsory, national standards and systems.  The real value is in the common framework and infrastructure.  First class mail is the most profitable part of the post office, but I’m proposing eliminating the need for that over time.  As a result, the post office would have to greatly downsize.  Currently only Walmart, among private companies, has more employees than the USPS.  Most likely the postal employees unions will oppose any modernization of the sort I’m proposing, preferring to prop up the old system as long as possible.

[First Published by The American Thinker]