Wednesday, September 21, 2011

Only 5 more weekdays to go.

The U.S. Postal Service lost $8.5 billion last year. It's on pace to do even worse this year, losing $3 billion last quarter alone. The Obama administration has proposed ending Saturday delivery as a way to close the financial gap. Notably, his plan does not consider any layoffs. Why? If we reduce the delivery schedule nearly 20%, won't labor needs decrease as well? If Wal-Mart was closed every Sunday, it wouldn't need as many employees, right? Then again, Wal-Mart is not a unionized bureaucracy with a federally guaranteed monopoly on the service it provides.

This plan won't fix the Postal Service any more than when Regan "fixed" Social Security in the early 1980s, although they're based on the same principle - charging more while delivering less. In fairness to Obama's propsal, we don't have a mandate that at least 15% of everyone's email must be sent through the Postal Service. Yet.

I understand that delivering mail on Saturdays is inefficient. Delivering the mail any day is inefficient. And don't forget, the delivery schedule has already been chopped in half - the mail used to come twice daily. Even if the Postal Service somehow overcame those inefficiencies, it is still doomed to failure. Federal law requires the Postal Service to deliver mail to everyone regardless of origin or destination. Sending mail from Middle of Nowhere Alaska to Florida obviously costs more than sending it across town. But the Postal Service is prohibited by law from charging a different price to do so. That doesn't make sense and guarantees inefficiency. It has the same flaw as requiring medical insurance providers to provide coverage to everyone for the same rate regardless of age or medical condition.

And what about the fuel? The Postal Service has the largest passenger vehicle fleet on the world. Liberals should be fuming over the carbon footprint. Conservatives should be furious about the gas.

The U.S. Postal Service should be abolished. The vast majority of mail I personally receive is unsolicited advertising. I'm not alone. Almost everything else could and would be delivered differently if the Postal Service disappeared. FedEx and UPS could still ship packages and vital documents more efficiently. They already do. Much of the non-vital paper mail would shift to online delivery. The junk would either shift online or cease completely.

- Posted using BlogPress from my iPhone

Location:No mail delivery on Saturdays? Well, it's a start.

Sunday, September 11, 2011

Conservatives can usually see the unintended, negative consequences that come from government meddling in the economy.  Some of them also see the negative, unintended consequences that come from bombing and laying siege to foreign nations most people think can't fight back.

Friday, September 09, 2011

The Educational-Industrial Complex

This AP article should make people rethink college and how it's funded.  For example:

 - A human development and family services major in his junior year at Colorado State realizes he will owe about $125,000 when he graduates.  In order to pay of the debt, he's joining the military so he has a guaranteed job to pay off his loans.

Who would pay over $125,000 for a human development and family services degree from Colorado State? Well, this guy did, and he's not alone.  And that's just the portion for which taxpayers are responsible if he defaults.  It doesn't include the federal subsidies, his out of pocket costs, his work study, etc.  He doesn't need that degree to get a job in the military, and probably won't be using a human development degree while he's there.  Why not quit college now and enlist, instead of racking up two more years of out of state tuition?

- Two years ago, 30% of California's higher education cost was paid for by federal stimulus funds, and now they are facing huge shortfalls.

Despite the fact that these funds were temporary, California (and many other states) refused to make the necessary adjustments to deal with reality.  Were they counting on federal bailouts forever?

- Dan Hurley, an executive for the American Association of State Colleges and Universities claims it will be the hardest year on record for cash-strapped colleges.

Mind-boggling.  Colleges are selling a product - education.  

Think about this:

1)   This product has never been in higher demand
2)   The price of this product has increased dramatically and consistently for decades
3)   This product receives enormous government subsidies at the local, state, and federal levels
4)   Many colleges pay few, if any, taxes on their operations
5)   Colleges are supported by charitable donations
6)   The federal government co-signs a blank check for any potential customers for their products

There is not a single private industry with such favorable conditions.  The medical industry, military industry, and housing industry are the closest.  But even they pay taxes and aren't supported by charity. 

Yet colleges claim they've never had it harder. We need to ask why.