The Postal Service’s Dereliction of Duties

Image: 

Earlier this year, after the United States Postal Service (USPS) announced its eighth straight year of multi-billion-dollar losses, we wrote about the agency’s dire financial situation and the extreme lengths to which USPS officials are going in order to salvage their failing business model. This has included venturing into same-day package and grocery delivery, banking services, and the establishment of special deals with retailers to prioritize their packages over regular mail among other things. All subsidized by the American taxpayer. Adding insult to injury, these programs appear to be losing money and increasing financial risk.

Now, a report released last week by Copenhagen Economics confirms that the USPS is not only losing money for itself, but it is losing money for other agencies and potentially putting our country’s national security at risk in the process.

According to this report, private express carriers like UPS and FedEx routinely collect duties and taxes on international packages as required by law, making appropriate customs declarations 98 percent of the time and paying applicable fees to U.S. Customs. In contrast, international government-sponsored postal carriers were unable to verify any customs declarations and no applicable duties were collected. This has resulted in an estimated loss in customs fees totaling more than $1 billion annually.

This government-sponsored “discount” of sorts is in addition to the already substantially subsidized international postage rates, which are estimated to have cost Americans $79 million in 2013 alone – and almost $308 million since 2010.

The USPS’s lack of reporting also prevents other agencies – like Customs and Border Protection, the FDA, and the Department of Agriculture – from ensuring the safety of packages and products coming into this country from foreign sources and bypassing Air Cargo Advance Screening (ACAS), a measure that was deemed necessary in 2010 after two U.S.-bound packages from Yemen were discovered to have contained viable bombs capable of bringing down aircraft.

This is simply unacceptable.  Continuing to subsidize unfair competition with the private sector and international postage rates, failing to collect duties, and bypassing important security screenings only does harm to the economy, while favoring special government and union interests.