Thursday, February 07, 2013

Why the USPS could be overruled...  

One test of whether Congress is even capable of reducing spending will be the unilateral action by the USPS. It is unusual - think about the USDA cutting its own budget all by itself. (Of course - the USDA is not independent like USPS, but stay with me.) If Congress reacts as I expect, you can narrow the already slender portion of the budget that is "cuttable" even more.
The fight between the Post Office and Congress is a very peculiar one. Normally, when the government owns some incredibly profligate business, it’s Congress which tries to impose efficiency gains and fiscal discipline, while the business insists that all of its spending is absolutely necessary and that it has already cut to the bone. In this case, however, the roles are reversed: the Post Office wants to change, and it’s Congress which is stopping it from doing so.
The latest move from the Post Office is a bold one: to abolish Saturday delivery unilaterally, starting August 1. This is a bit like Citicorp announcing that it was merging with Travelers: it’s illegal, but that’s not going to stop them, and the clear expectation is that somehow Congress will make it legal, before or shortly after it happens in reality.
As Jesse Lichtenstein details in his amazing 10,000-word Esquire story about the Post Office, the organization does actually have a detailed plan for becoming fully self-reliant over the next few years. Abolishing Saturday delivery is just one small part of that plan; all of it, by law, requires Congressional buy-in. The plan may or may not be successful, but, as they say, plan beats no plan. The big problem is simple, but huge: Congress isn’t playing along, and instead is just making matters worse, unhelpfully micromanaging everything from postage rates to delivery schedules to health-care contributions.
That’s why I love the idea of the Post Office doing something that’s clearly illegal, putting the ball squarely in Congress’s court. The idea is both delicious and dangerous: go ahead an implement the plan whether Congress likes it or not. And then dare them to bring down the hammer, or simply capitulate to the inevitable. They might not like the latter option, but the former would surely be worse for all concerned. [More]
This action could also attract some unwelcome attention to the rural/urban divide, both cuturally and economically. With less access to broadband, I expect strong arguments for continued mail delivery in the country will emerge from rural state Senators.
But the monopoly has become less lucrative and that's not going to change in the future. That's squeezed the budget, squeezed postal workers' compensation packages, and is now squeezing the quality of nationwide mail service. As a country, we need to ask ourselves whether providing subsidized mail delivery to low-density areas is really a key national priority. Without the monopoly/universal service obligation, it's not as if rural dwellers wouldn't be able to get mail, it's just that they might need to pay more in recognition of the fact that it's inconvenient to provide delivery services to low-density areas. Nostalgia-drenched Paul Harvey Super Bowl ads aside, it's not the case that rural Americans are unusually hard-pressed economically or are disproportionate contributors to the economy. They are, rather, the beneficiaries of numerous explicit and implicit subsidies, of which the Postal Service's universal service obligation is one. [More]
While everyone in farm country is thrilled by the now-famous commercial, frankly it makes me uncomfortable. Not only was it cloyingly flattering to farmers, it was based on a way of life that is much less common, and mostly on smaller farms.  Didn't see many pictures of CAFO's or 120' boom sprayers. Or my neighbors in Naples, FL on the golf course. The commercial looks like a lead-in to Big Ag subsidy pitch to me.

I'd rather earn respect for who I really am and what I really do.


Brian in Central IL said...

I wonder though where the basis comes from on the urban/rural divide you speak of? To me what is the difference of no Saturday mail as no mail comes on Sunday? Frankly if I got mail once a week that would be ok too. My Wife handles the bill pay duties and that happens once a week, so when the mail arrives is arbitrary.

Anonymous said...

I agree John on the superbowl ad. It is a piece of fantasy and I believe this myth of the yeoman farmer only brings on problems. It is why we have had a government dependent agriculture for so many decades. I guess it keeps the taxpayer coughing up money for agriculture. Lets get real about what farming is and who farmers are and quit living in this fantasy world.

Anonymous said...

So it is okay for "intelligent, progressive farmers" to understad this ploy of the yeoman farmer fantasy to further the "old ag" agenda and tell us that it's not real and it makes them uncomfortable.

But then we're okay when a car company or a deoderant brand wants to sensationalize their product and make it out to be more than it really is...we understand it's just selling something and somebody will fall for the sales pitch...right? What, the Chipotle ad on factory farming, is the right way to portray us??

This was a well done ad by RAM using an American icon and a nice story. I was proud of the ad and based on twitter trends, i would say it had the desired affect. If you had any other thoughts about this other than a small shiver and maybe a lump in your throat thinking of all that came before you and who Paul Harvey was talking about ( 1978!! for pete's sake) than you take yourselves and your profession way too seriously!

Have fun and enjoy the positive publicity for a change...nobody outside of Ag will be talking about that ad in another week anyway.

Anonymous said...

P.S. for you John --- you've earned respect for who you really are and what you really do. I don't need a commercial to know (most) of your writings!

Anonymous said...

Honesty used to be a virtue and way of life. I guess not so much anymore if deceit will keep the image intact and the cash flowing. It is a poor justification to say we are no worse than the other guy. Not much honor in that.

someguy said...

I agree with your comments on the RAM superbowl ad. I guess there's nothing too unusual about people who try to sell you something flattering you, but it seemed particularly ridiculous and over-the-top. This image we tend to embrace when we belly up at the subsidy trough, can indeed come back to haunt us when we bump up against payment limitations or try to deal with landowners switching to cash rent because they are overwhelmed by the complexity of all the government programs to help us poor farmers out.
At the same time, as someone who grew up in the 60's it was nice to see the ad as something that came pretty close to matching the experiences of my dad's farming life, with the exception of 'stopping the mower for an hour to splint a meadowlark's leg'. (I'm afraid alot of birds bit the dust without much ceremony or rescue procedures while we were mowing hay)

Daron said...

There is a HUGE difference in the Chipotle ad and farmers cultivating a (predominantly) false image for political gain. Chipotle is trying to build a brand image to increase the likelihood of people BUYING their product. The ag industry, on the other hand, is more concerned with building sympathy so that the government will keep handing out taxpayer money. Chipotle is trying to win in the free market. Ag is trying to subvert the free market.