CONTEXT

October 19, 2016

‘Neither Snow nor Sleet, nor Aging of the Fleet…’

I am a huge fan of the US Postal Service, so their recent years on the Republicans’ Ten Most Wanted list of government agencies has been painful to watch.

truck Joshua Reading at Foreign Policy magazine summed it up nicely: “The biggest obstacle to a more efficient post office may be the U.S. Congress, which has failed to approve reform efforts such as setting up retail outlets in post offices, raising prices, shuttering less-used offices, and ending six-day delivery. (As part of its new cost-saving measures, the USPS has managed to circumvent Congress by keeping only parcel service on Saturdays so that, technically, there’s still some service six days a week.)”

But things are finally improving for the venerable USPS – someone had the bright idea of playing to their strengths. They do after all go everywhere and now they do it for Amazon, Fed Ex and even UPS.  That last mile has turned out to be very profitable for them.truck

And that means they can finally replace their geriatric truck fleet – the Northrup Grumman trucks that were new in 1987 were set to be retired after 24 years, but were declared usable – by necessity -for another six years. Now the deadline is upon us and so the USPS is taking bids.

This is a $6 billion contract which does not seem like small beer to me, but maybe it is, because Ford, Nissan and GM, who were all automatically short-listed, failed to make the cut;  I suspect they weren’t interested. (For more, go to Motley Fool.)

Here are your finalists:

  • AM General
  • Karsan Motors
  • Mahindra
  • Oshkosh
  • Spartan Motors
  • VT Hackney

AM General evolved from Jeep via American Motors and gave us the Humvee. Karsan is a Turkish company, Mahindra is Indian and VT Hackney is a subsidiary of VT Systems, which is a subsidiary of a company mostly owned by the government of Singapore.truck

Apparently the old rules no longer apply, because I thought federal contracts had to go to American companies, preferably with union workers.  So call me old-fashioned or ultra-nationalist or whatever you like, but I think American tax dollars should support American workers. Oshkosh is one of the top 100 federal contractors already, so I vote for Spartan, which was started by  four engineers from Diamond Reo when that company closed down years ago. I think six billion will matter to them and be a good thing for the state of Michigan.

In any event, all six finalists have gotten $37 million to build a prototype, which should be available for testing next year. The USPS is looking for fuel efficiency of course and any other green breakthroughs the companies can come up with.  Pretty soon the little truck on the corner wil be brand spanking new and we may have not just the largest (six thousand pieces of mail go through the USPS every second) but the most efficient postal service in the world.

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February 20, 2013

It’s in the mail. . .

It mattered to the Continental Congress and so it became one of a handful of government tasks specified by the Constitution – right in Article I, it says the Congress is required ‘to establish Post Offices and Post Roads.’871950399_a8b6924e6b_m

And a postal service, the Founding Fathers thought – oh the irony – would be an excellent source of revenue for the young country. (Although Thomas Jefferson  disagreed, seeing it as just a source of patronage and expense.)

The United States Post Office became official on this date in 1792.

Mailing a letter 221 years ago cost six cents, more than a dollar today;  the price has only gone down because of inflation. When the first stamps were printed in 1847, five cents was the going rate – still more than a dollar today. We should be paying about $1.35 for a stamp, just to be on par with the 19th century.

499007672_0d81a8dd0d_nFor 175 years, the US Postal Service trundled along without making much news, except when stamp prices went up.  Than in 1970, carriers in New York City went on strike for more money and better working conditions.

Eventually, they got what they wanted, as well as the right to form a union, but in 1971 we all got the Postal Reorganization Act, which abolished the Post Office as a cabinet position and created the kind of weird quasi-independent monopoly that we have with Amtrak.  I haven’t quite ever figured out the purpose of these things, except in Amtrak’s case, it’s a given we will always be making up its deficits.

And btw, was abolishing the post office without a constitutional amendment legal? Seems a little high-handed.

Then, in 2006, Congress took  another shot at the USPS and since then we’ve all been asking  “Who’s killing the post office – and why?’

The fact that the 2006 Postal Accountability and Enhancement Act  has a notorious  requirement that the PO fund its retirement accounts far into the future – to the tune of billions of dollars over ten years – to provide benefits for workers that haven’t even been hired yet is pretty generally known.  What articles on the subject fail to ask and answer is: Why?499087051_9f1270252d_m

Without going into detail about the various Congressional players responsible for the Act, let’s just follow the money – who profits from the demise of the USPS?

The answer seems to be – not surprisingly – the banks.  Take a moment and read this article – ‘Banks find opportunity in Postal Service woes’ – at Reuters.

And here is a reminder of why mailing a letter is a good option to have – it’s not likely to be hacked.

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