The future of the U.S. Postal Service

Structural, legal, and financial constraints have brought the US Postal Service to the brink of breakdown in the past decade. Faced by declining business brought about by the e-mail revolution and competition from private express companies, the Postal Service has repeatedly requested assistance from the federal government. This culminated in December 2006 with the passage of the Postal Accountability and Enhancement Act, which introduces modest revisions in the pricing and service policies of the Postal Service so as to make it a self-sustaining government corporation. This article discusses the nature and operation of the Postal Service and assesses the merits of its possible reforms. Postage rates vary widely, depending on the mail's content, weight, size, destination, and how it is prepared and presented by mailers to the Postal Service. As part of its public service mandate, the Postal Service is required to provide universal service to its customers. Privatization is likely to be much more effective than public enterprise in providing incentives for the Postal Service to succeed commercially.