Why the Postal Service Exists

The Postal Service faces significant problems that threaten its survival. The financial problems are well known but solvable. However, solving the financial problems in a way that ensures a vibrant postal market as long as the prevailing story line is that “we have a delivery service whose raison d’être is rapidly vanishing before our eyes.” as illustrated by a recent New York Times article. Until that view is reversed, neither Congress nor any President will look at any proposal ensuring the survival of the Postal Service beyond the impact on the budget or local jobs and services.

The Postal Service is a Business Service

For at least the past two decades mail has been a service for commercial and government entities. While expansion of Internet and broadband access to household is often thought as the driver as the decline in consumer use of mail, business/government/non-profit share of mail volume has remained close to 90% of mail volume.

  • 1987 – 88.8%
  • 2006 -90.6%
  • 2007 – 90.6%
  • 2008 – 90.2%
  • 2009 – 89.8%

If one adds mail sent by individuals to business, government, or non-profit, the share of mail that involves a business, government, or non-profit is

  • 1987 – 95.2%
  • 2006 – 97.0%
  • 2007 – 97.3%
  • 2008 – 97.1%
  • 2009 – 96.9%

The slight decline in the commercial share of mail reflects the impact of the recession on economically sensitive commercial mailers.

To the extent that consumers have abandoned mail because they don’t sent personal cards and letters that abandonment happened well over 20 years ago. One might argue that the decline in consumer use of mail had more to do with the universal access to land-line local and long-distance telephone service and the deregulation of long-distance telephone rates as the abandonment happened well before e-mail or other web-based services were accessible to every office worker and most homes.

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