Post Office Gets Rate Increase Smack Down

April Peveteaux

post office rate increase deniedFor the first time in history, the Postal Regulatory Agency told the Post Office they could not raise rates as requested. So your first class stamp will hold steady at the current rate of 44 cents.

Which, honestly, I didn't even know since the rate hikes have been coming so fast and furious I can't keep up anymore.

I do remember getting up in arms about the succession of postal increases a few years ago. Mostly I was irritated that my roll of stamps were no longer valid without an extra 1 or 2 cent stamp. But now that I'm mostly digital, I couldn't even tell you the last time I bought a stamp.

Which is the problem. No one is buying stamps and the post office is hemorrhaging money. Combined with our national recession, the post office is claiming the hike is needed due to "exceptional or extraordinary circumstances."

The regulatory agency disagreed.

Instead of buying the argument that a rate increase can help solve the post office's billion-dollar losses, the agency blames the business model for the financial crisis. Which puts the post office in the same position as the publishing industry, the record industry, and the phone companies (the last of which is the only model that has truly adapted and thrived).

Technology has made many business models obsolete, yet they all have to adjust to the current reality, rather than holding on to the policies of the previous century. As a government agency, the post office is in the unique position of having to get the permission of Congress before they make any dramatic moves like ending Saturday delivery.

Can you imagine if you worked in a business that had to get Congressional approval? I feel for the post office -- it's in a very difficult spot. But as we all go digital, we don't need Saturday delivery, or even a post office within walking distance. Closing branches and cutting services makes sense, unless you're a post office employee, of course.

Ordinarily I'd side on the rate increase to save jobs and health benefits for the post office employees, but it seems like a temporary fix to a very serious, and permanent, problem.

Do you think the rate hike should have been approved?


Image via USPS


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